B2B Digital Payments Stats for Merchants to Know in 2023

Apr 19, 2023 by Zazil Martinez

The B2B space has shifted toward digital payments in the last decade. Consumers are spending more on contactless and cashless payment options than ever before. There were more than $8 trillion in digital transactions in 2022.

COVID-19 changed how businesses process and pay invoices, accelerating digital payment methods adoption. In this post, you will find the top B2B Payments statistics merchants should know about to help navigate the second half of 2023.


Cashless & Contactless: Digital is the Standard for B2B Payments

Cashless and contactless payments have snowballed as a preferred payment option among consumers and businesses. These digital options became popular for streamlining payments for customers and merchants.

Unfortunately, companies' accounting and finance departments could not say the same. Despite the availability of faster, more accessible digital payment options, businesses would stick to checks, cash, and credit cards.


Digital Payment Alternatives Becoming Mainstream in B2B

One factor underpinning this growth in B2B is the rise of digital payment alternatives like virtual terminals, digital wallets, and virtual expense cards.

  • Digital wallet users will exceed 5.2 billion globally in 2026, up from 3.4 billion in 2022, representing strong growth of over 53%.
  • The value of the global virtual cards market in 2022 was USD 13.31 billion. (Grandview, 2022)
  • Transaction volumes surpass $9 trillion annually as these digital alternatives continue growing.

Learn more about virtual expense cards and how they work.


Replacing Paper-Based Systems is Key to Business Continuity

Businesses today still use cash, checks, and physical invoices. Still, rising pressures to reduce costs and increase cash flow drive companies to replace these paper-based systems with digital alternatives that reduce friction and labor costs.

The costs of using paper-based payments can be extremely high. In the US, $3 trillion is estimated to be tied up in a business's outstanding accounts receivable (AR). The average business has 24% of its monthly revenue held up in AR, payment terms, or trade credit.

Many of these problems stem from poor billing and AR practices that can be solved with digital tools and automation.


State of B2B Digital Payments in 2023

Let's take a look at the latest digital payment statistics to get a better understanding of today's B2B payments ecosystem.

Digital Payments

  • The transaction value for the Global Digital Payments Market was USD 5.44 trillion in 2020. It is projected to be worth USD 11.29 trillion by 2026, registering a CAGR of 11.21% during the period of 2021-2026.
  • Total transaction value is expected to show an annual growth rate (CAGR 2023-2027) of 11.80% resulting in a projected total amount of USD 14.78 trillion by 2027. (Statista, 2021)
  • The total number of digital wallet users will exceed 5.2 billion globally in 2026, up from 3.4 billion in 2022, representing strong growth of over 53%. (Juniper Research, 2021)
  • The preferred method of global online shoppers is digital wallets (49%), followed by credit cards (20%) and debit cards (12%). (Worldpay Global Payments Report, 2023)
  • US e-commerce sales reached $1.03 trillion in 2022, passing $1 trillion for the first time. (Digital Commerce 360, 2023)
  • Mobile payments transaction volume reached $1.7 billion in 2021, a 27% annual increase. (Bloomberg, 2021)
  • The United States mobile payments market is expected to register a CAGR of 13.4% during the period 2022-2027. (Mordor Intelligence, 2023)
  • The value of contactless payment transactions will reach $10 trillion globally by 2027; from $4.6 trillion in 2022. (Juniper Research, 2022)

Electronic Invoicing

  • Digital Invoices are approximately 70% cheaper than traditional invoicing. (e-Invoicing Market Report)
  • The Business Payments Coalition and the Federal Reserve are piloting a standardized B2B electronic document exchange system in the United States. The initiative seeks to establish a standardized e-invoice model and create an electronic document exchange network similar to the PEPPOL system developed in Europe. (EDICOM, 2023)
  • The average cost to process a single invoice is $13.11, but Adobe estimates the cost at between $15 and $40 for a single invoice.
  • More than 70% of companies still use paper invoices and have not yet replaced their traditional methodologies. 64% are willing to utilize electronic invoices in the future. (Payables Friction Index, 2022)

Virtual Card Spend

  • B2B virtual cards will account for almost 80% of virtual card transactions by value, as that transaction value doubles over the next 5 years. (Virtual Cards: Consumer & Business Adoption, Competitive Analysis & Market Size 2020-2025)
  • The value of transactions processed by virtual cards will more than treble over the next five years, increasing from an anticipated $1.6 trillion in 2020. (Juniper Research, 2020)
  • The global number of virtual card transactions through mobile payment methods will grow from 5 billion in 2022 to 53 billion in 2027. (Juniper Research, 2022)
  • The US will account for $71 billion in B2B virtual card revenue by 2027, representing 72% of global revenue. (Juniper Research, 2022)
  • Virtual cards offer significant protection from fraud attempts, as demonstrated by the fact that 66% of companies paying by check experienced actual or attempted fraud, compared to 34% using ACH debits and just 3% using virtual cards. (Juniper Research, 2022)

Manual Processes

  • 65% of businesses said they spent a shocking 14 hours per week on average completing administrative tasks related to collecting payments. (Quickbooks, 2021)
  • 40% of CFOs said the use of checks has become less common as a result of digitizing accounting operations. (PYMNTS, 2022)
  • Check usage continues to decline for B2B payments in the US, falling to an all-time low of 33% (AFP Electronic Payments Survey, 2022)
  • There is an estimated $3.1 trillion in US businesses’ outstanding accounts receivable (AR), and the average US business has 24% of its monthly revenue held up in AR, terms, or trade credit. (PYMNTS and Fundbox, 2020)
  • Large US companies took around 58 days on average to pay suppliers in Q1 2021. That is a 5.5 percent increase from 55 days in 2020.

Accounting Automation
  • The accounts receivable automation market size is expected to grow from USD 1.7 billion in 2019 to USD 3.0 billion by 2024, at a CAGR of 12.1% during the forecast period.
  • The global market for accounting software is expected to be $20.1 billion in 2026, a growth of 8.02% CAGR from 2018 – 2026. (Fortune Business Insights, 2022)
  • The productivity software market, which includes office and collaboration applications, was forecast to reach nearly USD 62 billion in 2020, with revenue predicted to increase at a CAGR of 6.8%, reaching USD 85 billion by 2025.
  • During the projection period, the worldwide market for accounts receivable automation can increase from USD 3.3 billion in 2022 to USD 6.5 billion by 2027 at a compound annual growth rate of 14.2%. (ReportLinker, 2022)

Macro-Trends Shaping B2B Payments

Several macro-trends are creating footholds for non-traditional competitors like Paystand to serve better mid-size and enterprise B2B payment processing needs:

1. The digitization of B2B commerce and growth of B2B networks (shift to digital payments)

  • Global B2B Payments Market is valued at USD 994.20 Billion in 2022 and is projected to reach USD 2146.70 Billion by 2030 at a CAGR of 10.10% over the forecast period.
  • 74% of B2B buyers today research at least one-half of work-related purchases online, and 30% complete at least half of their work-related purchases online.

2. The proliferation of online marketplaces and e-commerce platforms

  • This gives manufacturers, wholesalers, and distributors access to new markets and growth.
  • These platforms are also prevalent among wholesalers and distributors unable or unwilling to build their e-commerce infrastructure.

3. The shift away from handling and processing cash and paper checks

  • Many businesses are shifting to more evolved methods of electronic payments. 17% percent of deposited checks are now image deposits, 93% of image deposits are by businesses, and 71% of businesses are also accepting digital payments.

4. Innovation in digital payments and other technology areas that enable more speed, efficiency, and security

  • The Federal Reserve and several payments industry entities, including NACHA (the electronic payments association), The Clearing House, and ClearXchange, have undertaken projects intending to speed up electronic payments in the US and enable same-day or real-time payments.
  • Paystand pioneered the Payments-as-a-Service model for B2B payments and created a bank network to allow businesses to move money electronically without paying transaction fees. It covers over 90% of the US banking market and 98% of all commercial accounts and is used by over 130,000 businesses today.
  • These disruptive new business models are paving the way to bring blockchain into the mainstream B2B transaction payment processing industry. Paystand has been using blockchain technology to ensure that transactions are secure and free of tampering since 2014.

Learn More About Digital Payments with Paystand

The coronavirus outbreak forced many businesses to rethink how they accept payments. It is no longer business as usual. As a result, merchants and customers shifted to digital payment methods to avoid the risk of infection from handling cash and paper checks.

Now is the time to keep making changes to avoid any lasting impact on revenue. If you need help, Paystand makes it fast and easy to get started. We integrate with most ERP software systems and offer flat-monthly pricing to keep costs low and predictable.

If you want to get started with digital payments, book a free demo with one of our payment experts.