In the 2020 Outlook for commercial and enterprise payments—recently released for our members and soon to be generally available for download—we point out four major themes around which developments relate.
One of the themes is ‘resourcefulness; provide information and functionality; ease of interaction.’ In the referenced posting from Finextra, the author discusses the evolution of B2B payments and the increasing impact of cloud on the space:
‘By 2020, US business to business (B2B) payments are expected to reach $23.1 trillion according to Deloitte. This is driven by cloud technology, which is accelerating the digital transformation of the payments industry, providing customers with a myriad of convenient payment methods.’
There has been accelerated activity in B2B now for several years across the board, as the technology advancements have sort of had to play ‘catch up’ with consumer experiences. The path to funding for innovation tends to be tied to expected revenue in X time frame (5 years is a good guess), and those who follow corporate financial processes know about challenges in ‘turning around the aircraft carrier’.
So one challenge is that payback is not as quick as consumer, while another is finding developers/entrepreneurs who understand how to deal with the B2B space in the first place. So that has taken some time but now it is in full gear with startups, collaborations, acquisitions and partnerships all over the place, allowing for complementary tech skillsets and business savvy to reach the awaiting corporate masses, who clearly want things the same during working hours.
So much of the new tech is cloud-based and provides more easily integrated solutions that can be accessed quickly and changed as necessary.
‘Finextra spoke with Nadav Sharir, VP engineering at Behalf, about the company’s recent report ‘Cutting Edge B2B Payment Trends in 2020’ and how the cloud is driving and accelerating transformation of the payments industry… “I believe that the ability to have a speedy cycle to experiment with new channels and capabilities and the ability to quickly measure and expand accordingly are what makes financial institutions that are cloud-based to have a competitive advantage versus companies that are unable to experiment and react so quickly,” he states.’
There was once an American soap opera called ‘As the World Turns’, which lasted 54 years on TV (until 2010). It is not likely to happen again. The world is turning much faster now and financial institutions should be adapting.
Overview by Steve Murphy, Director, Commercial and Enterprise Payments Advisory Service at Mercator Advisory Group