B2B payments providers must meet complex and sometimes conflicting priorities for SMBs

B2B is the largest segment of overall US payment volume, holding roughly five times that of consumer payments. It has been slower to digitize than the consumer sector, but finally passed the tipping point during the pandemic. Even now, almost a third of the market is up for grabs.

The real growth opportunity lies within small and medium-sized businesses (SMBs). They make up almost half (44.9%) of B2B payment transaction value and have dragged their feet on digitization relative to larger firms given more limited resources. Providers can capture their payments volume by helping SMBs digitize.

To win over SMBs, providers must address two ongoing tensions in the B2B payments process:

• Balancing speed, convenience, and costs. Buyers want to defer payments and use the most convenient payment method. But suppliers want to receive funds quickly and minimize the cost of payment acceptance.
• Navigating complex accounts payable (AP) and accounts receivable (AR) processes. These laborious and time-consuming processes need to be automated. But first, businesses must transition to digital payments.