As we navigate the complexities of B2B digital payments, businesses must stay up-to-date on these trends. The payment options landscape is evolving rapidly from virtual cards and mobile payments to AI-driven financial solutions.
Businesses that want to stay ahead of the curve must know the latest trends and statistics shaping B2B digital payments. According to the Worldwide Digital Payments report by Statista, the digital payments market's total transaction value is projected to reach US$10.64 trillion in 2024.
This blog post will explore the key insights into the digital payment world that can help you save time and money. By understanding and leveraging them, businesses can position themselves for success in 2024.
Use of Virtual Cards
Virtual cards are becoming a game-changer for B2B in 2024. These alternatives to physical cards are a secure and efficient financial tool due to their ability to streamline payment processes. This efficiency is crucial when businesses deal with numerous transactions, allowing them to focus on strategy rather than getting tangled up in payment logistics.
Security is crucial when adopting virtual cards, especially in the B2B payments landscape, where large sums of money are often at stake. Virtual cards minimize the risk of unauthorized access or fraudulent activities, offering a level of security that traditional payment methods often struggle to match.
Virtual cards also provide real-time transaction data. This transparency is vital for businesses to stay on top of their finances. Instant access to transaction details gives them insights into spending patterns, helping them identify cost-saving opportunities and make informed financial decisions.
As B2B companies increasingly recognize the importance of efficiency, security, and transparency, virtual cards emerge as a financial tool that aligns perfectly with the demands of the modern business landscape.
Key Statistics
- Juniper Research predicts digital card transactions will exceed 121 billion globally by 2027, representing a 340% growth from 2022.
- The global value of virtual card transactions is expected to rise to $6.8 trillion in 2026.
- 55% of CFOs affirm that their teams frequently make payments with virtual cards due to digitization.
- A study by Mastercard calculates that virtual cards can drive cost savings of $0.50 to $14 per transaction.
- According to the Payments Association, only 2% of transactions are made using virtual cards.
Mobile Payments
In 2024, mobile B2B payments will be crucial to business transactions. Merchants can complete transactions with a few taps on their smartphones, whether in the office, on the road, or in a meeting. Mobile payments' accessibility has become integral to daily business operations.
What makes mobile B2B payments attractive is their flexibility in managing finances on the go. Merchants no longer need to be tied to a desktop or traditional POS; they can authorize and track payments through their mobile devices. This enhances convenience and accelerates business, enabling merchants to adapt to the demands of the modern marketplace.
Adopting mobile payments is a strategic imperative for small enterprises and large corporations. As businesses recognize the need for agility and responsiveness in their processes, mobile payments become a cornerstone of modern commerce. It bridges convenience and efficiency in the dynamic world of B2B transactions.
Key Statistics
- The U.S. mobile payment market was valued at $53.5 billion in 2022 and will grow to over $607.9 billion by 2030.
- Juniper Research says mobile payments will make up 79% of all digital transactions by 2025.
- Mobile payments accounted for 5% of all online transactions.
- Mobile payments will comprise more than half (51.7%) of global e-commerce payment preferences by 2024.
Cryptocurrency Payments
2024 will witness a notable shift with cryptocurrency's increasing acceptance and integration. Cryptocurrencies, like Bitcoin, operate on decentralized networks, ensuring transaction transparency and security. Recognizing their advantages, businesses embrace cryptocurrencies as a viable option for B2B transactions.
One factor driving cryptocurrency adoption in B2B payments is its potential to reduce costs. Traditional payment methods involve intermediaries, which leads to extra fees and delays. Decentralization eliminates the need for intermediaries, resulting in quicker and more cost-effective transactions. This appeals to businesses engaged in international trade, where traditional transactions can be cumbersome and expensive.
Blockchain, the technology behind most cryptocurrencies, ensures a secure and transparent payment ecosystem. It facilitates a distributed ledger that records all transactions across computer networks, making it impossible to alter transaction data. This security level is crucial for driving confidence in using cryptocurrency for B2B payments.
Key Statistics
- In 2013, there were only seven cryptocurrencies. Today, there are over 20,000 active cryptocurrencies worth over $1 trillion.
- According to Insider Intelligence, U.S. crypto payment adoption will grow by a 21.3% average annual rate from 2022 to 2025 and worldwide volume by 12.6%.
- There are over 425 million cryptocurrency users worldwide.
- International B2B blockchain transactions could top $1.7 billion by 2025.
- By 2025, the number of B2B cross-border transactions on blockchain will reach 745 million.
- B2B cross-border payments on blockchains will account for 11% of the total B2B international payments by 2024.
Real-time Payments
In 2024, the spotlight is on real-time transactions. Imagine business payments happening instantly, like sending a text or email. Real-time payments allow businesses to receive funds immediately after initiating a transaction. This eliminates the delays associated with bank processing times, providing a seamless experience.
One of the main benefits of real-time payments is improved cash flow. In traditional payment systems, funds take days to move between accounts, leading to delays in fulfilling orders, paying suppliers, or settling invoices. Real-time payments cut this waiting period, enabling companies to access funds instantly and allocate resources efficiently. Accelerated cash flow enhances liquidity, creating a more agile and responsive business environment.
Key Statistics
- The value of real-time payment transactions will grow by 289% between 2023 and 2030.
- By 2027, real-time payments are expected to account for 27.8% of all electronic payments globally, up from 18% in 2022.
- Real-time payments are still only a small piece of the overall payments mix in the U.S., accounting for only a 1.2% share of the total payments volume in 2022.
- According to Grand View Research, the global real-time payments market was valued at USD 17.57 billion in 2022 and is expected to grow at a CAGR of 35.5% from 2023 to 2030.
- According to ACI, over 70 countries support real-time payments, with USD 195 billion in transaction volume this year, a 63% year-on-year growth rate.
Financial Use of AI
2024 will witness the adoption of Artificial Intelligence (AI). AI is no longer just a buzzword but a powerful B2B payment tool. It refers to systems performing tasks requiring human intelligence, such as problem-solving and decision-making. AI can analyze financial data and provide valuable financial insights.
One primary application of AI in digital payments is fraud detection. Businesses face threats of fraudulent activity, and AI brings a robust defense mechanism. Its algorithms can detect patterns and anomalies in transaction data, flagging fraudulent activities in real time. This approach safeguards merchants from financial losses and enhances payment security. Businesses leveraging AI-driven systems can stay one step ahead against cyber threats.
AI can also speed up businesses' decision-making processes. Its algorithms can assess creditworthiness and evaluate risk in financial transactions. AI can provide accurate risk assessments by analyzing historical data and identifying patterns, enabling informed decisions. This approach enhances efficiency and contributes to precise and strategic financial management.
Key Statistics
- 72% of business leaders believe AI will improve employee productivity.
- According to Kroll, 56% of business leaders are incorporating AI in their latest cybersecurity efforts.
- 25% of companies already use AI in workflow automation, while 51% plan to do so shortly.
- AI integration in businesses helps improve profits by 38%.
- AI in businesses is expected to generate profits of more than $14 trillion in the year 2035.
- More than 63% of businesses seek cost reductions using Artificial Intelligence technology.
- According to Gartner, 80% of large enterprise finance teams will rely on internally managed and owned generative AI by 2026.
What are the Biggest Digital Payment Trends for 2024?
Integrating real-time payment systems is one of the most exciting developments in AR. With instant payment platforms on the rise, businesses can receive payments faster and more assuredly. This will be a game-changer for cash flow management, allowing companies to make better financial decisions and reduce dependence on traditional banking processes.
Businesses adapting to real-time payments are leading this new era of instant financial rewards. Embracing them leads to streamlined AR processes, a competitive advantage, and the convenience customers demand. Real-time B2B payments are not just a trend but an essential transaction shift.
Evolution of digital payments
Most businesses have accepted that digital B2B transactions are here to stay. However, accounting departments seek more than "any" digital B2B payment solution. The key differentiator among the best-in-class platforms is usability for the accounting team and the customer.
One of the industry's most significant shifts is the preference for integrations or a single payment solution. Before the proliferation of APIs and ERP integrations, most companies purchased multiple software that often didn't fit together. This multi-solution setup often made workflows complex and sluggish for accounting teams and suppliers.
After adopting APIs, streamlining payment processing was more accessible than ever. Now that programs are integrated into an ERP with which the accounting department is familiar, there's no need for an extensive workflow.
Current cross-border B2B payments can plug in integrations, capture data, and automate the payment process, reducing bottlenecks.
The State of B2B Payments in Numbers
- B2B Digital Payment Market size was valued at USD 6.1 trillion in 2022 and is estimated to register a CAGR of 17% between 2023 and 2032. (GMI, 2023)
- The global B2B Payments market size was valued at USD 889436.03 million in 2022 and is expected to expand at a CAGR of 13.26% during the forecast period, reaching USD 1877171.0 million by 2028. (Research Reports World, 2023)
- The ACH Network volume of business-to-business payments for the third quarter rose 9.6% over 2022 to 1.7 billion payments. In the third quarter, the dollar value for B2B payments increased by 1.4% to $13.5 billion. (Nacha, 2023)
- Total transaction value in the Digital Payments market is projected to reach $2,041 billion in 2023. (Statista, 2023)
- In 2023, B2B e-commerce sales are projected to reach $1.8 trillion, accounting for 17% of all B2B sales in the United States. (Gitnux, 2023)
- 73% of consumers prefer to shop and pay with digital methods. (Business Wire, 2023)
- The global e-invoicing market is expected to exhibit a CAGR of 20.26% during 2023-2028. (IMARC Group, 2023)
- The Business Payment Coalition seeks to build and test a virtual network for businesses to exchange e-invoices, establishing an invoice delivery framework between providers.
- The accounts receivable automation market will be worth $6.5 billion by 2027 and grow at a CAGR of 14.2%. (MarketsandMarkets, 2023)
- Switching to automated payables cut accounts receivable departments' operating costs in half and manual processing by 85%. (MarketsandMarkets, 2023)
- On a regional level, the market has been classified into North America, Europe, Asia-Pacific, Middle East and Africa, and Latin America, where North America currently dominates the global market. (IMARC Group, 2023)