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FinTech
8 minutes read

B2B Payment Processing: Digital Payment Solutions

by Robert Kazmi
FinTech
8 minutes read

B2B payment processing is a big industry. B2B payments are expected to top 25 trillion dollars by 2022. With so much money changing hands, businesses must have a secure way to quickly charge and accept payments for goods and services. There are digital payment options available to businesses, but you’d be surprised how many businesses still write and receive checks for business-to-business payments.

Whether you are a small business owner or CEO of a large corporation, you should consider moving away from paper checks and exploring digital payment solutions. FinTech has made sending and receiving payments, tracking invoices and cash flow, and financial security easier to manage than ever before. The future of B2B payment processing is approaching rapidly. The B2B payment processing industry will continue to grow alongside the massive volume of B2B payments that are made every year.  

With industry growth comes further innovation, and this means that there will be even more quick, safe payment processing solutions available to businesses in the future. For now, though, the best way to process payments digitally is through a payment gateway.

What is a Payment Gateway?

Even if you are unfamiliar with the term payment gateway, you have likely used one if you have bought anything online. Payment gateways may seem complex, but they are just digital credit card readers. These digital payment processors make online payments secure and reliable. Payment gateways help facilitate digital B2B transactions, and they are quickly becoming one of the most popular ways to process B2B payments

A payment gateway makes B2B credit card processing easy. It allows you to streamline your accounts receivable and payable processes. Payment gateways ensure secure transactions, and they make filing your taxes easier too

The COVID-19 pandemic has further highlighted the importance of digital payments. The digital trends during the pandemic have accelerated. More businesses are realizing the importance of moving away from check and cash payments as delays in the mail system have brought the traditional B2B payment methods grinding to a halt. Business processes and decisions need to move faster than ever before to keep up with demand and an evolving digital economy. It no longer makes sense to wait for paper checks and outdated payment systems to process B2B payments. 

What Payment Solutions are There for B2B Transactions? 

The B2B payments industry is robust. This is good news for small business owners or anyone running a business because there are a ton of great B2B credit card processing options available on the market. There are traditional banks, FinTech firms, and B2B industry specialists who are all embracing digital banking

Let’s take a closer look at some of the B2B payment processing solutions that caught our eye. Keep in mind this list is by no means exhaustive. There are a lot of different options in the B2B payments industry. We have highlighted a few of them as a way to help you get the ball rolling.

QuickBooks 

Isn’t QuickBooks accounting software? That’s right, QuickBooks also offers business-to-business payment solutions. QuickBooks users can send their customers invoices via email and get notified when their invoice is viewed and paid. QuickBooks also offers a unique feature for B2B transactions called progress invoicing which allows your customers to pay invoices in installments. 

Customers have two different payment options when they receive your invoice. They can pay via credit card or through a bank transfer. If your customers pay with a credit card, QuickBooks charges you 2.9% plus .25 cents per transaction; all payment gateway options will charge you for B2B credit card processing. However, the fees charged by each company for credit card processing may vary so it pays to shop around and find the best fees. 

Additionally, since QuickBooks is such a powerful accounting tool, users can expect all incoming and outgoing payments to automatically sync with their bookkeeping. This makes keeping track of all your transactions and filing taxes very easy. 

Stripe

This B2B payment processor is very popular with small business owners. As a matter of fact, it is impossible to talk about payment processing without mentioning it. Stripe integrates seamlessly with payment systems and comes loaded with APIs to ensure that users can unlock additional functionality by combining it with other platforms. It gives business owners a payment gateway, a merchant account, and billing capabilities. 

Stripe charges 2.9% and .30 cents per transaction for every B2B payment made through their system. This payment solution can get expensive as your business grows, but Stripe does offer scalable, custom-pricing for businesses that outgrow their small business model

Small business owners like Stripe because it is easy to use and implement into their business. This is a great payment gateway solution for smaller businesses, but larger operations will likely want to choose another payment solution. Whatever your situation is, make sure to implement it correctly. Companies that specialize in eCommerce services can help you.

Transpay

So far, our B2B payment solutions have not touched upon the issue of sending or receiving payments from other countries. International bank transfers can often come with expensive fees. Transpay is an international payment solution that helps reduce the costs of international bank or wire transfers

Transpay charges $5 to $20 per international transaction. This payment option allows you to directly send money to your intended recipient’s bank account in their local currency. If you are receiving money from an international business, they would pay the transaction fee. Transpay does not support credit card payments at this time, only bank transfers. 

Transpay supports over 200 countries and 60 different types of currency. There are no fees charged on B2B transactions between two customers in the United States. Unless you have international customers, Transpay is probably not the best B2B payment processor for your business. 

Chargebee

This is an interesting B2B payment solution. Mainly, because it offers free service to businesses who do $50,000 or less in revenue. Chargebee does not offer a payment gateway so you will have to pay fees associated with that, but this payment processor is adept at handling detailed pricing structures and offers robust billing and subscription management tools. 

The more revenue you make, the more expensive Chargebee’s services get. Chargebee’s pricing model is tiered, but as we said previously, if your revenue doesn’t exceed $50,000, Chargebee’s services are free. 

You will have to integrate a payment gateway in order to accept payments, but Chargebee makes this process easy. This payment processor option is a good choice for businesses who want to try digital payment solutions but are uncertain if they want to pay for this service. 

Due

This B2B payment processing solution is one of the best choices for businesses that sell services that include billable hours. This includes bookkeepers, lawyers, and other professionals who bill by the hour. Due offers electronic invoicing and time tracking features among many others. 

Due users can use the platform to send invoices via email. Due also allows users to create payment reminders for their customers and also send recurring invoices for regular services or goods rendered. Billable hours can be tracked and added right to your invoices too. 

Due charges a 2.8% fee for processing credit card payments. This company is also reportedly working on a B2B payment app that will allow customers to send and receive money through an app that is linked to their bank account much like CashApp or Venmo. 

Plastiq

This B2B payment solution is a lot different than the rest, mainly because it focuses on making payments instead of receiving them. This service allows you to simplify all of your B2B payments through your credit card. You probably have some vendors who prefer a bank transfer, and others who want a wire transfer. You may even have some sellers that would prefer a paper check from your business. 

Plastiq approves and sends payments to your vendors based on their preferred method of receiving payment whether that be a check, a bank transfer, or a wire transfer. You are only charged through your credit card for all transactions. So no matter what type of payment your seller prefers, you always pay with your credit card. 

Plastiq charges a 2.5 percent fee for every transaction. These fees are just added to the charges made by paying your vendors. This service helps you simplify your B2B payment processes and helps you keep track of all your payments in one place

Final Thoughts on Digital Payment Solutions 

Most businesses will need to make and receive payments from their business peers. B2B payment processing can be tricky due to the volume of transactions as well as the value of the transactions. Leaving your financial security in the hands of antiquated financial payment processes seems like a bad idea. 

Paper checks slow down your payment processes, limit your cash flow, and present a financial security risk. There are a myriad of B2B payment processing tools available today. Certain payment solutions are designed to better serve some businesses more than others. There is a digital payment solution that is right for your businesses’ needs. Take the time to explore all of the advancements FinTech has made, and research B2B payment options to find the right choice for your business.

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