Top Emerging B2B Payment Trends

Oct 12, 2021
3 minutes of read


Top Emerging B2B Payment Trends

The past ten years have seen a gradual shift in the B2B payments sector – there has been a steady need to digitise this sphere, making it contactless and cashless. The year 2020 valued the B2B market size at $6.69 trillion in digital transactions and this was further expected to reach $20.9 trillion by 2027.

The COVID-19 situation has changed the way B2B cross-border payments and B2B trade portals function, acting as a catalyst for digitization. B2B portals for import-export have seen a surge in digital payments and in general digitization of all the business processes. Even before COVID-19 changed the course for many businesses, customer satisfaction and ease of check-out and final payments were coming into the limelight giving way to new digital trends. This requirement was further strengthened by the need for operational optimization and security in this sector.

Digital payments, automation of B2B payments, and exclusive B2B payment integration systems were a few innovations that had already been widely incorporated by many players. These offer tailor-made solutions and a seamless payment interface to ensure smooth cross-border trade and faster transactions. Apart from these modernizations, there are a few other trends that are taking the B2B payments space by storm.

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The emerging B2B payment trends:

Cross-border payments

B2B cross-border payments is a growing space with swelling opportunities leading to many new players emerging in this space. This space gained momentum due to the increased globalization and amplified cross-border trade, rendering B2B cross-border payments indispensable. There are many factors that need to be dealt with such as regulatory compliance adherence, exchange rate fluctuation, buyer & seller protection, risk and fraud reduction, bank transfer fees elimination, and eradication of the time-consuming and cumbersome processes associated with payment clearance. This increased the importance of exclusive financial B2B portals for import-export that streamline the payment process and provide security.

For instance, an Escrow service provider ensures that one can safely trade internationally while eliminating the chance of risk and fraud by acting as an intermediary that dispatches the funds once services are rendered. Digital payment players and cross-border payment providers have collaborated, leading to faster and cheaper digital payments.

Blockchain and Cryptocurrency

The blockchain revolution has swept the fintech and finance sector with B2B payments next in line. Though it is still in the testing stage, they have certain benefits of being incorporated in the B2B payments space.

Blockchain helps businesses with Know Your Customer and Anti-money Laundering compliance requirements. Other benefits of adopting cryptocurrency and blockchain in B2B payments are reducing fraud, streamlining the process, reducing paperwork, enhancing efficiency and providing transparency in the payment process, being able to have a decentralised cash reserve, and fast digital identity authentication amongst others.

It is believed that blockchain networks will enable over $60B in cross-border payments by 2023. The B2B payments space is constantly innovating owing to the market maturity and widespread adoption of blockchain-based solutions.

Artificial Intelligence and Machine Learning

Most businesses are focusing on reducing human error and increasing efficiency, making AI and Machine Learning inevitable to several businesses including the payments ecosystem. AI and Machine Learning eliminate the chance of error and redundant processes while providing analytics to make informed future decisions. The insights that come out of these ubiquitous technologies help streamline and optimise the way payments are processed. Apart from operational efficiency, it also helps in fraud detection and cybercrime reduction, providing security to the payment handlers.

The adoption of AI and Machine Learning has many benefits right from procurement efficiency leading to fast processing times with fewer errors to bringing down invoicing and pricing issues. They can act within a quick TAT by identifying alternative suppliers and providing critical information to the concerned parties. They can study the recurring orders and processes and optimise decision-making through smooth and error-free procedures. They can also be integrated with existing systems to optimise B2B payments.

B2B cross-border payments globally have shifted from paper checks to digital invoices and payments. This seemed like an obvious option given the volume of trade and the value of payment processing in the sector. Though it was more welcomed by the B2C sector to start with, now with new technology and innovation, this legacy sector is also making the digital switch with ease.

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