The Case For Electronic Payments
While a large majority of B2B businesses are still relying on paper checks to process vendor payments, we are starting to see a shift towards electronic payment methods. We recently hosted a webinar, Payments 101: An Introduction to Electronic Payments, with CPA Academy that explored the growing popularity of electronic payments, the different B2B payment options out there, the advantages and disadvantages of each, and steps to help you decide what payment method makes the most sense for your business.
In order to better understand the current B2B payments landscape, we wanted to know how accounting firms and their clients have been using electronic payments. To find out, we asked our audience of around 400 participants these three questions:
- What payment methods are your clients using today?
- When it comes to choosing the best payment method, what do you consider most important?
- Why do you feel companies are not using electronic payment methods?
What Payment Methods Are Your Clients Using Today?
One would think that this question would showcase much more check usage. While 37 percent is still high, it is very interesting to see that more than 50 percent of clients are already taking advantage of some sort of electronic payment method whether that be ACH, corporate card, or wire transfer. What exactly does this mean? As an industry as a whole, we are beginning to see a movement to quicker and safer payment methods.
When it comes to choosing the best payment method, what do you consider most important?
Security is always top of mind for finance executives, and more than 50 percent of respondents agree that security is most important. Yet, 75 percent of B2B businesses make payments via the most targeted vehicle for payment fraud: checks. So, what does this tell us? That while security is top of mind, finance professionals are sticking to a payment method due to ease and routine.
Why do you feel companies are not using electronic payment methods?
What’s interesting is that the most common reason for not using electronic payment methods is due to perceived risk. In this case, the key word is “perceived” since electronic payments are still a relatively new payment method. While ACH and wire transfers do have risk associated to them, virtual cards and corporate cards are among the safest forms of electronic payments. Not to mention most of these payment methods are safer than checks.