Payment Rails Old And New Move To Digitize B2B Transactions

The global pandemic is accelerating digitization, and it’s not a trend lost on the B2B payments landscape. Indeed, organizations large and small are increasing their use of electronic payment rails to move funds in various ways. But as this week’s Payment Rail Innovation Tracker reveals, some B2B FinTechs are taking this moment as an opportunity to drive adoption of non-traditional rails to facilitate B2B trade.

Mastercard, AptPay Embrace Push Payments

Mastercard’s Mastercard Send solution, a push payments platform that wields card and bank rails to move funds, will be integrated into the AptPay solution, the companies recently announced. AptPay operates a digital payment platform in Canada for businesses, connecting clients to its own network of financial institutions and a variety of payment rails.

The integration will expand those transaction offerings for companies with a focus on enhancing businesses’ cash flow management, the companies said. AptPay can now allow its business customers to wield Mastercard Send to push funds into cards, bank accounts or mobile wallets in near real-time, which, the firms noted, can also help these companies migrate away from paper checks and related fraud risks.

In addition to its partnership with AptPay, Mastercard recently released new research on the impact of the pandemic on B2B payments, finding that small and medium-sized businesses are embracing digital payment rails like cards to navigate disruption.

Fifty-seven percent of surveyed SMBs said they have increased their use of electronic B2B payment methods, with card transaction volume seeing the greatest leap. Cash and checks, meanwhile, have seen a decline.

“The pandemic has made it painfully clear how labor-intensive current business payment processes are, especially for small and medium-sized businesses,” said Ron Shultz, executive vice president, New Payments Business, North America at Mastercard, in a statement. “With cash flow more critical than ever, we’re seeing an accelerated shift to digital B2B payments as businesses of all sizes look to safeguard their operations today and prepare for the future.”

Distichain Enhances B2B eCommerce With Blockchain

To streamline B2B payments within B2B eCommerce workflows, Distichain is embracing blockchain. The company recently announced that its B2B eCommerce Software-as-a-Service offering will be enhanced through a partnership with SECDE Digital Custodian, a collaboration that can facilitate digital wallet technology as well as escrow services and banking within the B2B eCommerce portal.

Citing the friction of traditional payment rails, including wires and cards, the companies said B2B traders can face a slew of friction points like low card limits. Distributed ledger technology allows businesses to bypass these legacy infrastructures to connect, trade and transact on a unified portal.

Plastiq Tackles Card Rail Friction

Addressing one of the biggest pain points of commercial card rails — acceptance — is Plastiq, which recently announced the general availability of its Plastiq Accept solution. The product supports card acceptance without the burden of high interchange fees, which are often cited as the biggest challenge to B2B suppliers when accepting card payments from their corporate buyers.

Focused on accelerating payment collections, Plastiq Accept is also pointing to cash flow disruptions as a result of the pandemic as another reason why vendors must embrace card rails.

“COVID-19 and the associated restrictions have caused a domino effect of late payments across the economy,” said Eliot Buchanan, CEO and co-founder of Plastiq, in a statement. “As cash reserves run dry, many businesses have been unable to pay suppliers, as they simply don’t have the cash on hand. This has left suppliers unable to pay their own bills due to these late or missed payments.”