The effort required in obtaining and maintaining supplier information in a secure way is a major challenge in automating B2B payments in any business. Despite these challenges, powerful technology trends have hit the market to make B2B payment easier and more convenient for many businesses. With that in mind, here are some of the interesting trends you should keep an eye on:
- Fintech Banks
The United States Office of Currency Control is currently considering making it possible for Fintech Companies to partake in money lending, which has previously only been done by banks. Companies such as Facebook, Apple, Square, and others will have limited banking functions if they are approved by the rule of law. This will only be possible if the companies attain the standards for the charter. With this trend, there will be a new development in the Fintech solutions in B2B lending and payments.
In order to automate these B2B payments, some considerable time, investment and effort should be allocated to make these payments efficient. This is because consumer payments are always the first types of payments to be focused on. While new technology improvements have been implemented for consumers, B2B payments have often been overlooked in recent years by new payment technologies
Modernized Cross-Border B2B Payments
In our more globalized world, it is easy to make international payments over bank networks by establishing common relationships payment Application Program Interfaces. These are used to create simple experiences without any complexity when making B2B payments.
The use of distributed ledgers such as the blockchain ledgers make it possible to manage B2B payment networks. These ledgers synchronize, share and replicate payment data across various banks, computer systems and geographical areas. This method is extremely efficient for B2B payments as it enables you to expedite payment from one point to another without any middleman or bank involved in the transactions. This greatly simplifies the payment process.
- Procure-to-pay converts to Procure-to-paid (P2P)
P2P networks have existed since the 1990s in the processing of electronic business payments as well as for purchasing and payments by consumers. People have used it frequently, although the payments have since failed tremendously in many developing countries. This is because the P2P methods only involved invoice approval, and are generally not understood in cash-based countries. Lately however, payment companies have automated the payments using the latest technologies to achieve better payment solutions. If this method succeeds, the earlier mistakes will be done away with as businesses will only use cards to make payments. These cards will contain the payment history and the details of the supplier.
- Truly Computerized Payments
In the past, most businesses have been using electronic business payments by using cards to make payments through banks. Banks always automate payments quarterly, leaving the rest of the payment process to be done through paperwork. This method is extremely tedious as it involves manual payment methods by the accounts team.
Recently, technology has been adopted to start automating the payment processes. These computerized B2B payments are very visible and traceable with adequate efficiency in international and domestic business payments. These automated payments securely maintain the supplier information regardless of the geographical locations and size of the business.
- Faster Payments
In the past, consumer payments made by companies such as Venmo have been experiencing delayed payments of approximately 48 hours. This has affected how B2B payments are made, as most companies do not have the ability to control the way in which these payments move through the bank accounts of the involved business and consumers. NACHA, a non-profit entity which manages faster money movements, has stepped in to expedite this process by implementing 24-hour ACH processing. This process will greatly improve how B2B payments are made.
In conclusion, it is evident that B2B payments have attained some significant changes through the technological improvements. These new trends will nurture the operations and foster more clear and expedited B2B payments until efficiency and success are achieved in business payments.