In 2019, the global B2B payments market hit $732.4 billion, took a pandemic hit in 2020 at $868 million, only to bounce back impressively to $125 billion by the end of 2021. Yet, that’s not the end of the tale. Juniper Research projects an eye-popping leap, aiming for the global B2B payments industry to top $111 trillion in 2027, a massive jump from its already notable $88 trillion in 2022. It’s not just about the figures, the real twist in the future of B2B payments is digitalization, spotlighted by Gartner’s Future of Sales Report, envisioning 80% of B2B interactions happening in the digital realm by 2025.
Brace yourself as we dig into this blog, unraveling five major trends shaking up the B2B payment scene in 2024 and beyond.
What are B2B Payments?
What exactly are B2B payments? Well, they’re the financial nuts and bolts that connect one business to another. Think of it as a company settling invoices, covering expenses, and paying for goods/services from another business. It’s a bit like when a software company pays a cloud service for hosting — that’s a B2B transaction. Unlike everyday B2C shopping, where consumers directly buy products, B2B payments are the behind-the-scenes transactions that keep the business world rolling.
Five B2B Payment Trends to Look Out for in 2024
1. Payment Orchestration for B2B
The year 2024 is an important step forward for business-to-business payment trends because the idea of Payment Orchestration (PO) has become more well-known. This advanced concept involves a central platform that brings together different ways of making payments and it’s quickly becoming popular. The global market for payment orchestration platforms, which was valued at $1.13 billion in the year 2022, is expected to grow significantly. It could increase at a CAGR of 24.7% from the year 2023 up until the year 2030. These platforms are becoming like conductors who ensure smooth coordination and improvement between different payment services. They make it easier for companies to process payments and help make transactions more efficient overall.
2. The Era of Digital Currencies in the B2B Space
In 2024, another buzzworthy trend shaping B2B payments is the surge in Digital Currencies. This means businesses are hopping onto the cryptocurrency wagon, incorporating these digital assets into their transactions. As of November 2023, a whopping 10,748 different cryptocurrencies were floating around, totaling about $1.50 trillion in value, underlining their growing significance. Between 2018 and 2020, the global usage of cryptocurrencies skyrocketed by nearly 190%, with this momentum charging forward into 2022. In the real business world, companies are warmly embracing digital currencies like Bitcoin and Ethereum for financial transactions, tapping into decentralized blockchain tech to guarantee secure, transparent, and efficient cross-border payments. This shift highlights a growing inclination toward innovative and adaptable financial solutions amidst the evolving landscape of B2B payments.
3. Efficiency with Real-time B2B Payments
Real-time payments (RTPs) are marked by fast and instant processing that removes any waiting time and improves how businesses operate. This change is supported by an expected increase of 289% in the worth of these real-time payment dealings from 2023 to 2030. India is at the front in this field, with an impressive 89.5 billion transactions in 2022 and a very high year-over-year growth of 76.8%. Making up for 46% of worldwide real-time transactions in that year, India clearly shows it is the top country for innovation in real-time payments. As businesses worldwide seek to enhance speed and accuracy in their financial transactions, real-time B2B payments are becoming very important, and it is something businesses should pay attention to and use as we see changes in 2024.
4. Increased Adoption of Virtual Cards
The B2B payment landscape in 2024 is marked by the surging trend of increased adoption of virtual cards, particularly flourishing post-COVID. Virtual cards, digital payment methods offering unique details for single or defined-period transactions, have seen exponential growth, with the global market projected to reach $65.0 billion by 2030, exhibiting a compelling CAGR of 21% from 2021. In Australia, the appeal for virtual cards is strong, capturing 54% of businesses already using purchasing cards and a higher 60% among those currently not employing purchasing cards. The interest amplifies in regions like Canada and the U.S., where purchasing cards are prevalent, with 74% and 93% of businesses, respectively, finding virtual cards an attractive option. As businesses increasingly seek secure and flexible payment solutions, the heightened adoption of virtual cards promises to reshape the dynamics of B2B transactions, offering enhanced security and efficiency on a global scale.
5. The Rise of Buy Now Pay Later (BNPL) Services
The rise of Buy Now Pay Later (BNPL) Services, traditionally synonymous with B2C transactions is steadily extending its influence into B2B use cases. This phenomenon, representing a $100 billion global industry, has seen a surge in adoption with 360 million users worldwide, projected to reach a staggering 900 million by 2027. Recent data underscores the widespread appeal, with 60% of individuals having experimented with BNPL services and nearly half (46%) presently engaging in payments through this flexible option. While BNPL has conventionally empowered consumers, its increasing integration into B2B transactions in 2024 promises enhanced financial flexibility and convenience for businesses, reshaping the arena of payment dynamics on a global scale.
Wrapping Up
In 2024, B2B payments will witness five transformative trends: real-time efficiency, virtual cards’ rise, payment orchestration, digital currency integration, and BNPL services’ extension into business transactions. Emphasizing innovation and adaptability, these trends promise enhanced efficiency, security, and flexibility, reshaping the B2B payment scenario.
Elevate your cards, payments, and lending tech with Verinite. As specialists in the field for over a decade, we lead digital transformations for Financial Institutions, Third-Party Payment Processors, and Fintech companies — contact us today for tailored solutions and unparalleled expertise in technology services.
Debasis Mohanty
Debasis heads the delivery for all client engagements at Verinite. He has a long track record of delivering high quality, responsive, secure and cost-effective business and technology solutions in BFSI domain. Outside his work, he is an amateur animator, a sports enthusiast, a voracious reader and a Trivia buff.
