While everyone in the business-to-business (B2B) space would like to see transactions become as simple as they experience in their lives as consumers, companies have their own hurdles to overcome when creating fully digitized experiences. and transparent for buyers and sellers.

During PYMNTS’ B2B Fireside Chats, a month-long series focused on efforts to reinvent business payments in the digital economy, experts acknowledged challenges and offered solutions. Overall, there was a sense of inevitability as the benefits for buyers and sellers will drive continued adoption of digital tools in the B2B space.

The goal is to “consumerize” B2B payments

The trend of “consumerizing” corporate finance dates back to at least the 1990s, but the pandemic is forcing major players to reinvent processes that have been in place for decades, said Darren Parslow, global head of Visa Business Solutions.

“B2B payments just aren’t where they need to be,” he said. There is fragmentation between payables and receivables systems, a lack of data standards, and poor overall interoperability between buyers and suppliers.

Consumer/retail payments are the North Star indicating what B2B payments could be. Payments are immediate, efficient, convenient and secure no matter where they occur on online or physical channels.

Read more: Visa’s New Head of Global Commerce Solutions Considers “Network of Networks” Strategy for B2B Payments

B2B payments go digital

With increasing accounts payable (AP) automation and online experiences and expectations, the tide may be shifting away from the paper check that is commonly used for ad-hoc B2B payments, said Drew Edwards, CEO of Ingo. Money. Engaging with suppliers on a one-to-one basis – and on a transaction-by-transaction basis – costs time and money.

With companies like Ingo, Edwards said, “There’s actually technology in place with a one-to-many payment solution, where a company can choose to say, ‘Hey, let’s be more efficient here. Let’s be more modern here. Let’s digitally engage with our suppliers and find out how they want to be paid and pay them. »

Read more: Inefficient and often late one-time payments account for 38% of SMB sales

As more information is digitized and sent with vendor payment requests, and automated clearing house transactions and virtual cards become more common, the shift to real-time payments (RTP) will accelerate, said JP Jolly, head of payments at JPMorgan. This will be more intuitive and less of a cultural leap than going directly from paper checks to RTP.

“One of the reasons businesses are still using checks in this market is the payee details that surround the information that accompanies the check. And that’s why customers are still using this form of payment.

Read more: JPMorgan: Real-Time Payments Will Accelerate B2B Payments, But ACH Stays In Place

These real-time payments serve a noble cause: helping customers and large enterprises change their business models and create products and solutions that “speak better” to a digital economy, said Manish Kohli, head of global management. cash and cash at HSBC. Real-time payments enable instant redemption and a range of other value-added experiences.

“Enhanced real-time payments information, converted into an integrated interactive experience with” application programming interfaces [APIs]can fuel new business models that monetize payment speed and choice, Kohli noted, adding that “the greatest form of monetization is customer delight.”

Read more: Banks must relentlessly focus on the cost, speed, convenience and transparency of commercial payments

Automation Accelerates AR

On the Accounts Receivable (AR) side, the marriage between automation and invoicing has accelerated significantly, where companies are realizing the need to “chase the long tail of accounts” in ways that avoid processes ineffective textbooks, said Steve Pinado, president of Billtrust.

The recent tie-up between Billtrust and iController, Pinado said, is part of a broader automation of AR in the offering to “apply money correctly, whether it’s fast and efficient billing, it’s about raising money quickly and efficiently by turning “almost” cash – things you’ve successfully sold, customers you’ve acquired – into real revenue that’s recognized.

Read more: Billtrust/iController deal to eliminate B2B’s “almost cash” problem

Buyers and suppliers negotiate terms

Besides the actual payments, there is the issue of terms in the B2B space. Ideally, to navigate the ebbs and flows of B2B commerce, there should be a built-in “slider” feature in financing programs that allows buyers and suppliers to match terms, discounts and payments that work on a case-by-case basis, said Rob Rosenblatt, CEO of Behalf. A million different transactions could possibly have a million different term sets, aided by a robust flow of data points, analytical technologies and platforms.

“In theory, there should be a financing vehicle for every transaction,” Rosenblatt said.

Read more: Data key for vendor-driven payment terms, working capital control

Companies can also cooperate with B2B partners by offering payment options. As more CFOs start to think about the customer experience, much-needed change is coming, driven by the pandemic-induced digital shift in business processes, said Craig O’Neill, CEO of Versapay. Versapay and other expert solutions are available to help businesses take business payments digital and move away from checks altogether.

“If you can find a way to connect with your customer, make it easy and flexible for them, and deploy technology that supports that, you can really get outsized results,” O’Neill said.

Read more: Going digital is ‘harder than checks’, but essential for CFOs

Businesses are seizing new opportunities

While brands that were purely B2B began selling direct to consumers during the pandemic-driven shift to e-commerce, some saw the longer-term opportunity and explored using their products as platforms for lifestyle-based markets, said Shahrokh Moinian, chief executive of JPMorgan. Hunt.

“Companies were like, ‘What else can I add?’ Not necessarily my competitors’ products, but what else do I need if I’m buying shoes? I may also need socks, t-shirts or shorts,” Moinian said. “And if I am not a producer and manufacturer of [a] product, can I bring in other merchants and sell them in my marketplace so I can have a captive market, rather than just selling my own [single product]?”

Read more: The Shift to a More Digital, Ecosystem-Driven Model Is Here – Companies and Their Bankers Must Adapt

Another opportunity is the application of cryptocurrency to B2B and other transactions. Proponents of cryptocurrency believe it is a safe and efficient modern form of payment, but regulators are concerned about potential risks to financial stability. If nothing else, Congress’ increased focus on regulating cryptocurrencies and big tech is a clear reflection of how entrenched and important these assets are.

U.S. Representative Patrick McHenry, Republican head of the House Financial Services Committee, told PYMNTS: A new regime built around the nature of digital assets – current law and existing regulatory structures do not match the unique nature of these assets.

Read more: U.S. Rep. Patrick McHenry: Rushed Crypto & Big Tech Regulations From Congress “Will Be Horrible”

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NEW PYMNTS DATA: 70% OF BNPL USERS USE BANK PAYMENT OPTIONS, IF AVAILABLE

On: Seventy percent of BNPL users say they would prefer to use the installment plans offered by their banks – if only they were made available. PYMNTS’ Banking On Buy Now, Pay Later: Installment Payments and the Untapped Opportunity of FIssurveyed over 2,200 US consumers to better understand how consumers view banks as BNPL providers in a sea of ​​BNPL pure-players.