B2B Payments Challenges You Didn’t Know Exist
While moving towards the end of 2019, it is hard to ignore how consumer payments have changed over the past few years.
More and more people are utilizing the services, like PayPal and Venmo to buy online things and send money to family members from the other end of the world. And revolution in consumer payment methods is not stopping here. Apple Pay and Google Pay have also entered the scene to take betterment in customer payment one step further – closer to convenience and ease.
But this inspiring story of revolutionized payments is only constraint to the customer’s world. We don’t witness the same pace of improvement in the B2B landscape where businesses are still sticking with the centuries-old traditional payment methods. Thank God, there are some instant money transfer methods like if you want to transfer money to India, you can take services of online money transfer platforms. But things are not as inspiring as they should be. Businesses are still facing issues in their payment methods that hinder the smooth flow of payments.
Here are some challenges associated with B2B payment methods that you need to know about:
Clash in Payment Methods
Many times businesses feel difficulty in payment because of the clash in payment methods with the clients. You might want to pay with a credit card, but your client isn’t okay with it. Or you want to go with online banking payment methods, but the other party is still sticking to checks and getting high-tech isn’t in their bracket yet. That’s where B2B payment challenges start kicking in!
Even if better payment methods are entering the scene, clash in payment methods remains there. It might be because the increase in payment solutions is also increasing the complexity in transferring payment because every client is not ready to embrace them.
The Threat of Fraud
Businesses are always wary of the frauds they might encounter during transactions. Obviously, business payments are a matter of thousands and millions of dollars, not a few dollars that they wouldn’t mind their loss. That’s why a jungle of complex payment methods force businesses to never come out of the world of checks – a world they know for many years and are accustomed to handling.
The worst thing is that the fear of fraud is not some sort of hypothetical assumption of business. According to the stats, 22 percent of businesses have actually faced fraud in payments over the past few years, and such examples are the reason why threat of fraud is thriving among businesses despite the emergence of new payment methods.
Time Factor Matters
As your business grows, your involvement with vendors, suppliers and other services providers also increases. It means that your B2B payment also gets extensive and more complicated. You might have to deal with more than 100 suppliers every day as you embrace the global market.
Coordinating transactions with so many suppliers takes a lot of time – significantly if you are dealing with companies with different payment methods. So, the time factor involved in B2B payments is another challenge that businesses have to deal with as they grow.
Cost of Transaction
Swapping credit card, or riding on wire transfers is not free at all. You have to pay from your pocket for each transaction. Higher the transacted amount, the more you would have to pay for the transaction fee. And it is an extra burden for businesses, especially if you are a startup which is hardly managing to breathe and maintain its cash flow.
These are a few of the reasons due to which B2B payments solutions are not maturing at the desired pace. As technology is bringing changes at a rapid pace, there is a hope that one-day things will change for good in B2B payments’ realm as well!