New data from a survey on B2B payments suggests that U.S. companies are moving away from check-based payments, although checks have far from disappeared.
The 2010 AFP Electronic Payments Survey (www.afponline.org/payments) showed that the typical organization makes only 57% of its B2B payments by paper check
Underwritten by J.P. Morgan Treasury Services, the report follows earlier AFP surveys that found 74 percent of organizations made B2B payments by check in 2007, down from 81 percent in 2004.
Where prior surveys showed a clear intention by U.S. corporations to shift volume to electronic payments, results this year show they are succeeding, particularly with their major trading partners. Nearly half of the survey respondents expect their organizations to convert B2B payments to major suppliers from checks to electronic payments in the next three years.
Cross-border payments can be a major driver of electronification:
According to the survey, a full 69 percent of cross-border payments transmit through wire transfers
, 14 percent using checks and 12 percent from payments sent via treasury operations that the organization has in local countries. Contractual requirements, transaction size, cost and currency risk influence the choice of payment method.
In terms of transaction volume, 78 percent of participating organizations send at least some of their payments cross-border
Looking forward, many organizations look forward to adopting same day settlement ACH services for tax payments. Mobile payments have yet to take hold in business payments, although many firms are watching trends in that space.
Read full press release: http://news.yahoo.com/s/usnw/20101108/pl_usnw/DC95439