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Know your Business and the Important Process of it!
by Account Mein Fintech Solutions We are India’s largest B2B Channel Payments PartneBusiness-to-business payments, or B2B payment processes, are the exchange of currency-denominated value between a buyer and a supplier in exchange for goods or services. Considering the buyer and supplier terms, B2B payments may be one-time or ongoing. Business-to-business or B2B payments are more complicated than business-to-consumer or B2C payments because B2B payment processing can take more time to approve and settle the transaction, which can take days or weeks. The transaction is typically settled immediately in B2C payment processing.
Different forms of B2B payment methods
Paper checks, ACH payments, wire transfers, credit cards, and cash are the most popular B2B payment types. Here is how the various kinds of B2B payment methods vary. Each B2B payment method has its advantages over the others.
Checks: According to PYMNTS.com, reviews still account for 80% of all business-to-business payments in 2020, despite technological advancements in this area.
Automated clearing house payments, also known as ACH payments, are electronic payments that have grown in popularity recently. The ACH Network processed an astounding 24.7 billion payments in 2019—more than three for every person on the planet. According to a 2019 survey, 93 percent of employees receive payment via direct deposit, and they have also become popular for B2B transactions. Additionally, ACH payments are anticipated to soon make up about half of all B2B payments, according to NACHA.
Wire transfers: According to Glenbrook, wire transfers account for less than one percent of all B2B payments but account for 93 percent of the total amount because they are frequently high-value payment transactions. In a recent Federal Reserve study, wire transfers still made up 95 million payments, which noted that if only 2% of corporate check volume were switched to wire transfers, the book would increase by 47%. Fedwire, CHIPS, and RTP are the three most common methods for making these payments.
Credit cards: In B2B payments, credit cards aren't all that common because some vendors prefer to avoid the 3–4% processing fees that credit card companies frequently impose. Despite this, many companies occasionally accept plastic as a form of payment. As of 2019, 93 percent of small businesses accepted Visa, according to Payments Journal.
Cash: According to Payments Journal, 70 percent of small businesses still accept cash as a B2B payment as of 2019.
The B2B Payments Space Right Now.
The B2B payments process industry is competitive and only getting more so. A global pandemic and other pressures in 2020 have added a new layer of tension to accounts payable work, which is already a sometimes-grueling chore of meeting deadlines and keeping vendors and contractors happy. However, those who can overcome the stress may receive a generous reward; in recent years, the volume of global payments made between businesses was estimated to be around $120 trillion.
This section will examine the current state of the B2B payment landscape (as well as any associated issues), how COVID-19 and other factors promote rapid change, and how electronic payment systems can support businesses thriving in uncertainty.
Here are some of the issues with standard payment methods and the current state of the business-to-business payment market.
Payment Methods for B2B.
Different B2B payment processes, especially those not made electronically, obviously have various issues. Providing evidence of a cash payment to a vendor can be challenging, as any business person who has filed a tax return can attest. Even though some vendors insist on it, accepting cash has far more drawbacks than just that. Processing and document reconciliation with electronic solutions will take longer than necessary, just like with checks.
Although ACH payments, wire transfers, and credit cards speed up the process, businesses that promote these methods without implementing a fully integrated, payment-neutral accounts payable automation system will likely lose money.
Traditional, non-automated payment methods increase the cost of processing invoices and provide poor visibility, less valuable data, and longer payment cycles.
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About Account Mein Fintech Solutions 
We are India’s largest B2B Channel Payments Partne
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Created on Sep 18th 2023 02:28. Viewed 183 times.
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