How to Make Payments Less Painful for Small Businesses

by Steve Murphy 0

This article appears in the wake of several recent strategic partnership deals in the cash cycle solutions space. The author of this piece is the CFO of Billtrust, a fintech that assists suppliers to better manage their receivables. In October Visa announced a strategic partnership with Billtrust, including an undisclosed investment. The Visa partnership with Billtrust seems targeted at improving the virtual card account STP solution’s ability to actually reconcile with supplier receivables systems. This is one of the missing links with virtual card accounts, even the buyer-initiated model that creates straight-through processing to a merchant bank account, but still requires separate receivables posting. Earlier this year Billtrust had also received a $50 million funding round designed to expand their payment cycle platform.

Additionally, there are countless systems that customers can use to make payments, which leaves suppliers with the added challenge of trying to integrate them with their A/R system, especially when it comes to integrating with their preferred methods of delivery and format. Always put the customer first; this not only makes it easier for them to make payments, but makes them want to so they can keep their cash flowing as well. Customization not only helps establish a positive and mutually beneficial relationship, but if organizations can deliver invoices in the customers’ preferred format, that means payments can happen even faster……New types of payments, like virtual credit cards, are becoming increasingly popular in the B2B world. For the buyer, this payment method brings ease of payment delivery and more.

 There is a sliding scale in business payments with regard to the usage of paper-based processes, with small businesses most heavily reliant on checks and paper invoices. This is where the slew of modern solutions and partnerships between networks and fintech solutions has been gaining momentum in the past 18 months.  Digital processes across the cash cycle are keys to extracting hard costs and finding opportunities through data. This piece provides a high-level overview of how one fintech approaches it.

Overview by Steve Murphy, Director, Commercial and Enterprise Payments Advisory Service at Mercator Advisory Group

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