Survey Finds Digital B2B Payments are On the Rise Among Small Businesses

It should come as no surprise that the COVID-19 pandemic has altered the way that many small businesses operate. From enhanced safety and cleaning measures to building out other sales mediums, businesses have been forced to quickly adapt to the changing landscape. It seems that this is also true when it comes to business to business (B2B) transactions, with more companies now looking toward digital solutions.

A new survey conducted by Mastercard found that more small businesses are adopting digital B2B payment options amid the current pandemic. Of those surveyed, 57% said that they’ve increased their use of digital B2B payments in the past few months while 64% stated that they’ve been making efforts to encourage their customers to forgo the use of cash or checks. Moreover, 70% of respondents signaled that they would be investing in upgrading their payments systems while 73% reported that digital payments would be the new normal for their operations.

The top reasons cited for the switch – the speed and security that digital payments offer (91%), as well as transparency (87%). Meanwhile several of the businesses surveyed noted that digital payments have assisted them in managing their cash flow. Meanwhile 38% of respondents lamented that they were experiencing cash flow issues associated with late payments as well as long processing times for cash and checks. Critically, nearly half (48%) of business owners said they are now one missed payment away from needing to cease operations.

On a lighter note, two-thirds of respondents agreed that one of the silver linings of the current crisis has been the push for them to adopt or upgrade their digital payment solutions. As a result of these updates, 81% report seeing higher levels of customer satisfaction.

Obviously Mastercard has a vested interest in promoting digital payments over more traditional options such as cash or checks. Of course, that doesn’t mean that there aren’t benefits to these solutions, including the aforementioned improved cash flow. As the company’s EVP of New Payments Business for North America Ron Shultz notes, “The pandemic has made it painfully clear how labor-intensive current business payment processes are, especially for small and medium-sized businesses. 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.”

Elsewhere, while the Mastercard survey focused mainly on B2B payment, digital payments among consumers are increasing as well. This is also notable for small business owners as utilizing these options could help bring in customers. On that front, IDC research vice president Nigel Wallis points out, “IDC research shows that consumers have reduced their use of physical currency to half of what it was before the pandemic, as they increasingly look towards contactless forms of commerce, whether e-commerce, local delivery, and/or ‘buy online and pickup in-store.'”

Although these hectic months might not seem like the best time for further investment, businesses that are able to make these payment changes now are likely to benefit in the long run — just as we’ve seen businesses successfully navigate new options such as online ordering and curbside pick up. The good news is that there are now several B2B payment solutions available that will hopefully make it easier for companies to upgrade their current systems. Therefore, businesses that are still using manual options and paying the price for it may want to take a closer look at their options.


Jonathan Dyer

I'm a small town guy living in Los Angeles looking to make solid financial decisions. I write for a number of finance websites, including HuffingtonPost and Business2Community. I founded in 2015 to focus on personal finance and the emerging FinTech markets.

Other Articles by Jonathan Dyer

Top 10 Personal Finance Articles of the Month — June 2022 

It’s time again for one of my favorite features here on Dyer News: a look at the top 10 personal finance articles of the month. To start, we'll take another look at financial independence and freedom. Then, with the housing market going a bit crazy lately, we'll feature a pair of articles on home buying. Lastly, we'll cover tips for one-income households, finance after death, fighting inflation, and more. As...

Bilt Rewards Launches Travel Portal with Benefits for Cardholders

Last year, the startup Bilt made a splash when it announced a new service that would reward users for paying their rent. That premise was then expanded upon with the launch of the Bilt Mastercard, which is issued by Wells Fargo. Now, continuing to capitalize on both the hype of their product and the demand for travel, Bilt has debuted another new offering for customers. This week, Bilt Rewards announced...

Cash App Introduces Round-Up Investing Feature for Debit Card

Debit card customers looking to grow their investments gained a new, automated option today as Block Inc. (formerly Square Inc.) officially announced a new feature for its popular Cash App. Now, customers with the Cash App Cash Card can opt into Round Ups as a means of growing their investments. When this feature is toggled on, Cash App will round up debit card purchases to the nearest dollar and invest...