In another example of the numerous partnerships and collaborations we have seen during the past couple of years in the B2B payments space, the 2006 startup Bill.com (based in Silicon Valley), and Comdata (a Fleetcorp company), announced a deal that will add virtual cards as a payment type for Bill.com customers. During the past five+ years, virtual cards have become a much greater presence in automated payables flows, with small to medium businesses as a primary target of these digital payables and card services. Comdata has been particularly aggressive in its expansion of B2B payments services both directly to corporate clients and through partnerships with PSPs across segments.
‘More than 50 percent of corporate B2B payments are still made by paper checks, according to a recent AFP survey. Virtual credit card payments offer an efficient, alternative way forward – minimizing the costs, time and manual labor associated with paper-based processes. Through the new agreement, Bill.com will be able to add to its existing arsenal of payables options a virtual credit card backed by Comdata’s industry-leading scale and expertise.’
The AFP survey mentioned in the above excerpt from the posting is actually now two years old, and we are expecting a refreshed survey sometime in Q1 2019. We tend to think that checks will show a steeper decline during the past two years and this reduction in paper will accelerate as the next decade approaches. What was clear is that the paper check usage issue tends to have a sliding scale, with SMEs utilizing them much more than larger companies. Given the focus on payments automation solutions for SMEs during the previous two years, extraction of paper in financial processes should be quite evident in the near future.
‘Bill.com was founded with a mission to make business payments for small and medium businesses simple. “As businesses and their suppliers continue to embrace digital business payments, virtual credit cards offer another option for removing paper from the supplier back-office,” said René Lacerte, Founder and CEO of Bill.com.’
Our members can keep track of the latest developments and trends across the B2B payables space, with virtual card growth being highlighted in a report titled U.S. Commercial Cards Market Forecast, 2016-2022: Growing at a Healthy Pace, released in October 2018.
Overview by Steve Murphy, Director, Commercial and Enterprise Payments Advisory Service at Mercator Advisory Group
