A Review of B2B Payments in 2023

May 24, 2023 by Zazil Martinez

The COVID-19 pandemic prompted a shift towards digital payments that continues to evolve. Businesses faced new challenges and adapted their payment processes to meet changing demands. Considering the post-pandemic landscape, we provide valuable information on payment trends in 2023.

As the world recovered from the COVID-19 pandemic, how we make payments changed. More people started using digital payment methods, which continued as things returned to normal. Businesses faced new challenges reopening and trying to adapt to the changing circumstances. They had to learn how to adjust their payment processes to meet customers' new demands.

Governments also recognized the benefits of electronic invoicing and started to regulate how businesses use it. This meant more companies had to move from traditional to electronic payment methods.

This shift was significant for businesses working internationally. They had to embrace new payment systems to make things smoother and more efficient.

To help you understand all these changes, we have gathered information about how businesses make payments in 2023, considering the post-pandemic situation.

 

What's the biggest digital payments trend for 2023?


There will be a significant surge in embedded B2B payments in 2023. This seamless, instant solution integrates directly into business platforms, cutting the need to navigate multiple tools and streamlining the payment experience. With embedded B2B payments, transactions occur effortlessly, boosting efficiency and saving time.

This payment system offers convenience and empowers businesses to focus on core operations. With swift and secure transactions, productivity is enhanced, allowing businesses to focus on growth and strategic objectives.

 

Evolution of digital payments


Most businesses have accepted that digital B2B transactions are here to stay. But accounting departments seek more than "any" digital B2B payment solution. Usability for the accounting team and the customer is the key differentiator among the best-in-class platforms.

One of the most significant shifts in the industry 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, it was more accessible than ever to streamline payment processing. Now programs plug into an ERP the accounting department is familiar with, 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 2023


B2B payment trends

  • The B2B Payments Transaction market size was valued at US$ 868.02 million in 2020 and is expected to hit US$ 70 billion by 2030 with a CAGR of 10.7% from 2021 to 2030. (Precedence Research, 2021)
  • The global B2B payments market size is expected to grow from $1,043.16 billion in 2022 to $1,136.60 billion in 2023 at a compound annual growth rate (CAGR) of 9.0%. (The Business Research Company, 2023)
  • Through the first half of 2022, B2B volume on the ACH Network was 2.9 billion payments, up 16% from the first half of 2021. (AFP, 2022)

Digital payments

  • Contactless payments grew 92% in the past few years and will continue to grow.
  • 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)

Electronic invoicing

  • The global e-invoicing market size reached US$ 11.2 Billion in 2022. (IMARC Group, 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.

Virtual card

  • The global virtual cards market size was estimated at USD 13.31 billion in 2022 and is expected to reach USD 15.87 billion in 2023. (Grand View Research, 2021)
  • By 2026, the virtual card transaction value will hit $6.8 trillion. (Juniper, 2021)
  • The global value of virtual card transactions is expected to rise 260% from $1.9 trillion in 2021 to $6.8 trillion in 2026. (Juniper, 2022)
  • In the Virtual Cards Market, North America has established itself as the market leader with a significant market share. (Straits, 2022)

Accounts Receivable Automation

  • Accounts Receivable Automation Market worth $6.5 billion by 2027, growing 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)

Moving forward in 2024


From the data, it's clear that accounting departments can save time and resources by allocating to higher-level tasks through:

  • Reducing manual processing
  • Automating their AR and AP departments
  • Migrate to a complete e-Invoicing platform
  • Leverage virtual cards
  • Provide easy-to-use digital payments systems

Financial professionals should focus on something other than data entry in 2023. After the pandemic, it was clear to many companies that their AR systems had to evolve to thrive in a remote environment.

At Paystand, we strive to help businesses process payments faster by automating an organization's entire cash cycle. Built with blockchain and cloud technology, our platform integrates with all major accounting ERPs. The best part? We have a track record of cutting DSO by 60% and the cost of receivables by 50%.