Nov 9, 2017 10:02:00 AM
Can you believe Thanksgiving is almost upon us? With the end of 2017 coming up fast, we're looking ahead to the B2B payment landscape in the year to come. That landscape is more diverse than ever, for both suppliers and buyers. The internet is the common thread for many of the new and improved payments innovations: The push for faster, more secure B2B payments spurs new trends -- which is possible because of the nature of the web. There is every reason to believe that the following five B2B payments trends will continue to impact the accounts payable sphere in 2018 and beyond:
The days of businesses mailing check payments are close to extinct. Already, 30% of U.S. companies have gone fully electronic with their AP. One of the dominant B2B payments trends involves payment for services via the use of a virtual card.When a virtual card payment is authorized, the buyer’s bank issues the supplier a temporary card number that is good for one single purchase. The amount of this transaction is set by the purchasing organization in advance, so that the vendor cannot attempt to charge more than the previously agreed price. If the vendor tries to charge more or to turn it into a recurring payment, the system will automatically decline the transaction. As we look ahead to 2018, we can expect more and more organizations to adopt this form of payment.
A B2B payment form that is will continue to enjoy a major resurgence in 2018 is Automated Clearing House (ACH). The reason for this renewed dominance in the industry? ACH payments have recently become far more efficient. The removal of most payment functions to the internet means that financial institutions can promise their customers a series of major ACH perks, including same-day deposits. A small fee is involved, of course, which is why this payment form may not be as appealing for some organizations as virtual cards, which actually deliver a rebate to the buyer.
Trend #3: Electronic Checks Will Continue To Be a Staple
While paper checks still have a particular place, most business owners have transitioned to electronic checks. The advantage of using an e-check lies in the fact that, instead of having to hand over personal information to the recipient, you can process that data through a secure portal and let the check-handling company manage the entire transaction. This way, the payment is processed securely, and no one but the company that processes your e-check gets to see any of your private info. While companies will continue to adopt more advanced forms of electronic payment in 2018, we expect e-checks to hold their own for the time being.
As PayPal and its competitors have continued to thrive, peer-to-peer payments have become a force to be reckoned with in the B2B sphere. Being able to make your payments directly over the internet, in a matter of mere seconds, is an innovation that has reshaped purchasing. While the traditional Paypal-like platform for online payments remains hugely popular, peer-to-peer payments will soon be available on a new series of platforms, such as instant messengers and email.
One thing is certain: B2B payments will continue to develop quickly in 2018. New developments in this industry will soon enable business owners to conduct online transactions over a variety of platforms. In the process, more innovative B2B payments platforms are likely to give traditional banking a serious run for its money. Hopefully, the competition will inspire the banking industry to innovate as well.
Want to learn more about how your organization can capitalize on B2B payment developments in 2018? Contact us for more information on the latest.