# Upgrade Your B2B Payment Systems: A Beginner’s Guide
Payment systems for business-to-business (B2B) transactions have been in need of a significant overhaul for some time, and the ongoing pandemic has only magnified the problem. In this article, we’ll explore the reasons why B2B payments require a makeover, how digital payment methods are becoming more global, the ascension of artificial intelligence, and the emerging trend of B2B BNPL (Buy Now, Pay Later) payments. We’ll also take a closer look at the role that cryptocurrency can play and provide some advice on how your business can stay ahead of the curve.
## Why B2B Payments Require a Makeover
Historically, businesses have been hesitant to change their payment methods, citing privacy and security concerns and a general lack of demand. Many businesses still use paper checks as a means of payment, despite the fact that paper payments are slower, less secure, and more prone to errors. Alternatives to paper payments that coexist alongside checks include the Automated Clearing House (ACH), wires, and cards, but each has its own set of problems.
The pandemic has wreaked havoc on businesses’ payments in ways our history has not seen in decades. Long-standing business practices have become outdated overnight, causing businesses to scramble. Employees must now work remotely when social distance regulations are fully implemented, and offices are shuttered. Organizations use digital technology in huge numbers (and at unprecedented rates) to adapt. Companies have cut three to four years off the time it takes to digitize their customer engagements, supply-chain connections, and internal activities. Consequently, their digital product deployments have sped up by an incredible seven years.
People still feel the ramifications of this massive transition inside enterprises. Consequently, the payments landscape is finally changing after a lengthy period of stagnation. Businesses increasingly want their payment systems to provide more payment alternatives and process transactions more quickly. Convenience is becoming a need. Modern B2B payments must be rapid, simple, and frictionless, like consumer purchases.
## Digital Payment Methods Are Becoming More Global
As the shift from conventional to online commerce gains traction, small business payment solutions must evolve to keep up. Consumers in the business world are clamoring for contactless transactions, which will increase by 41% by 2020. With such a linked world, contactless payment alternatives are internationally oriented. Yet, with antiquated and sluggish systems, this desire still falls flat.
Significant advances in internet security and privacy are assisting in alleviating many of the worries that companies previously had, particularly as they pertain to eCommerce and e-payments. Technology has started to close the gap through internet apps by allowing for more frictionless and instantaneous cash transfers. While costs for calculating exchange rates, digital wallets, and other eCommerce payment methods may still exist, these solutions are less expensive than credit cards.
Furthermore, other methods such as ACH and wire enable money to be sent considerably more quickly. Machine learning and artificial intelligence (AI) will continue to push the frontiers of banking, producing a far more fair playing field throughout the world.
## The Ascension of Artificial Intelligence
The pandemic has resulted in a substantially smaller workforce. Leaders must simplify tasks for more innovative work with fewer team members. AI provides for a smaller workforce while simultaneously lowering the margin of error.
More mundane duties, such as payment posting and remittance monitoring, may be done promptly and perfectly by technology, automating things that are prone to human mistakes. We may also train AI to do higher-level jobs like payment behavior analysis, which takes time and effort. Artificial intelligence (AI) for analysis gives immediate feedback on payment patterns and payer behavior.
The use of AI by accounts receivable teams to streamline the whole payment process, eliminate human error, and reduce cybersecurity concerns represents an incredibly useful tool for the industry.
## B2B BNPL (Buy Now, Pay Later)
BNPL has lately been seen in B2B sectors. The BNPL option reaches a far larger audience of customers, those people who would not have been able to buy in the past owing to a lack of cash or credit.
The controlled and regular installments typically with no extra costs also increase the amount spent on every transaction. The “loan” does come with a bit of a fee for the seller. However, with AI’s advancement, they may conduct a thorough risk assessment based on a customer’s previous transaction data to ensure payback. This is another example of artificial intelligence (AI) revolutionizing the payment industry.
## Cryptocurrency’s Function
Payment choices are multiplying due to the emergence of AI and the slingshot effect of the pandemic. Don’t overlook cryptocurrency when contemplating the future of contactless digital payments. Although there has been an increase in digital payment choices in the last year, we will require a greater emphasis on worldwide solutions.
While digital wallets and QR code payments are convenient, they can have drawbacks. These payment alternatives are related to specific financial institutions and operate in local currencies. Instead, Bitcoin employs decentralized finance (defi), eliminating the need for private institutions or third-party intermediaries. Furthermore, cryptocurrency’s single currency would remove the need for complicated currency conversion formulae.
Of course, like everything, there are hazards to consider. Cybersecurity is a significant problem because the whole procedure and currency are online. There is still a lot of progress before the world adopts cryptocurrency and defi, but it is the way of the future.
A crucial conclusion from the pandemic’s digital breakthroughs is that technology evolves at breakneck speed. To be relevant, businesses must stay ahead of the curve. As your business grows, look to technology for a more streamlined approach to payments and a lower margin of error.
By upgrading your B2B payment systems, you’re not only making your operations more efficient and cost-effective, but you’re also giving your business a competitive edge in an increasingly global and digital market. As a result, you’ll be able to process transactions more quickly, reduce costs and errors, and ultimately increase customer satisfaction and loyalty.
In conclusion, the technological innovations and advances discussed in this article are providing businesses with new opportunities to streamline and optimize their payment processes, and it’s up to you to take advantage of them. By embracing digital payment methods, AI, and other emerging technologies, you’ll be well on your way to achieving success in the fast-paced and ever-changing world of B2B commerce.