Regulation and Compliance
January 16, 2025
Thanks to technological advances, making and receiving consumer payments has evolved beyond recognition. While the B2B space is lagging, research suggests progress is on the horizon as businesses look at ways to improve their cash flow and growth potential.
Ongoing challenges faced by finance leaders accelerate the digitisation of B2B payments. Research by American Express in 2023 reveals nearly one-third (29%) of senior UK finance professionals state late payments as one of the biggest pain points they face when it comes to business payments, followed by costly processes (27%) and human error (26%).
Finding and implementing the best payments infrastructure can be complex and challenging. However, getting the right processes and partners in place can help to boost growth and drive efficiencies. The research reveals three main drivers for digitising B2B payments.
Almost one-third (29%) of businesses spend 1-2 hours daily working on payments. That’s the equivalent of up to one working week every month when finance leaders could commit the time to higher-value responsibilities, such as engaging with suppliers and meeting customers.
This is why over two-fifths (42%) of respondents believe payments processes need to be more efficient, 40% think the time spent processing transactions needs to be speeded up, and 38% are looking to reduce costs and free up more time.
Businesses are widely considering automation—almost seven in 10 (69%) are using or considering automated payments to drive efficiency, reduce administration, and free up finance teams to be more strategic. Those who have automated their payments are already seeing the benefits—nearly half (46%) have saved time, while 39% have seen fewer errors.
However, UK finance leaders are rightly cautious when bringing in a new payment method. Almost three-quarters (71%) would onboard a new payment method in partnership with an existing or trusted partner, and two-thirds (66%) are more likely to implement a new payment method if they have tried and tested it as a consumer.
Maintaining healthy cash flow is a significant concern for survey respondents, with two-fifths (39%) of finance leaders saying late and slow payments are to blame for this. These cash flow challenges are holding firms back from investing in technology and systems that would ultimately boost their finances, according to the research.
Without ways to better manage cash flow, businesses will continue to face the same challenges.
Digitised payment systems can enable quick and secure business payments and reduce the time taken for accounts payable and accounts receivable processes, ultimately putting businesses in a stronger financial position.
Freeing up time, improving accuracy and boosting cash flow are vital. However, security tops the list of most important considerations for 60% of businesses when it comes to exploring new B2B payment methods.
The research found that over a quarter (29%) of surveyed UK businesses have seen increased payments fraud over the last 12 months, meaning security is a primary concern.
This explains why almost half (45%) of those who reported increased fraudulent activity have introduced new cybersecurity and anti-fraud measures, and one-third (34%) have taken steps to boost their current cybersecurity capability.
With the increasing adoption of modern payment solutions, the B2B landscape is undergoing a transformative shift that businesses looking to succeed would do well to stay ahead of. Those that do so can reap the benefits of saving time, boosting efficiency and building stronger relationships with suppliers.
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