Cross-border B2B payments are primarily accomplished the same way they were 20 years ago. They’re made on a bilateral basis, which could be slow and expensive to process. Whenever we talk to financial institutions, we find a significant amount of their stress and friction comes from the cross-border space.
Visa is one of a number of companies aiming to change that. With roughly $120 trillion in annual B2B payment spend, Visa is helping streamline a variety of processes by reimagining the way corporate payments are made from the ground up.
In addition, to address the $10 trillion opportunity in cross-border B2B payments alone, Visa created Visa B2B Connect, a multi-lateral network that facilitates corporate cross-border B2B payments directly from the originating to the receiving financial institution. To scale the network, Visa is partnering with technology providers to help financial institutions worldwide easily connect to Visa B2B Connect and provide fast, secure, and efficient international payments for their corporate clients.
B2B payments have not kept up with consumer payments, which are now the expectation in terms of customer experience. With Visa B2B Connect, we’re able to help our financial institution clients simplify global payments by removing the friction of costs and a time gap between buyers and suppliers around the world.
This development comes not just from demand by large multinationals, but by businesses of all sizes. Smaller, digitally native companies are looking at B2B payments and asking why they are so hard to conduct and expensive. These organizations are used to simple payments in their consumer lives, so why not in their work lives? It was time to really rethink what that cross-border experience should be like. Over time, these new payment flows will represent a massive shift in terms of how payments are made.
The entry of fintechs helps increase the capabilities of B2B payment solutions on the market. In many cases, fintechs are a critical part of the answer that we’re seeking. They’re often addressing important parts of the value chain or challenges that can be addressed in granular detail, and then cooperatively brought to the market.
Innovation means fully embracing the customer’s perspective. The consumerization of B2B payments means customers are going to dictate what the future is. It’s everyone’s job to continue the pace of innovation so we can keep meeting and exceeding our customers’ expectations.
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