Skip to main content

Cross-Border B2B Payments will Reach $35 Trillion

How companies pay each other is important. All enterprises need access to effective B2B (Business to Business) payment systems in order to compete effectively. So, what's changed, given the current economic environment?

The payments market has been the target of disruption.

That said, despite the introduction of new innovations, traditional payment methods are still dominant in the B2B marketplace. It's a highly challenging financial system for many businesses, with a lack of transparency causing difficulties for decision-makers.

Traditional commercial bank transfers are not fast enough to make B2B payments management a streamlined process. In the cross-border arena, these challenges are magnified due to high costs.

Furthermore, the slow digital transformation of B2B payments means that established systems are unable to cope with the current global pandemic. Therefore, the B2B payments ecosystem must evolve.

B2B Payments Market Development

According to the latest worldwide market study by Juniper Research, the total value of B2B cross-border payments will reach $35 trillion in 2022. That's up from a COVID-related low of $27 trillion in 2020, representing 30 percent growth.

However, the long-lasting economic impact of the pandemic means that cross-border values will only exceed 2019 values by 2022, highlighting the effect that this major economic disruption will have on businesses around the world.

In the post-pandemic recovery phase, businesses will be more cost-conscious, meaning that cross-border payments vendors must offer compelling lower-cost solutions to their customers, or they will fail to recover lost transaction traffic.


The new market study identified that instant payments, services where funds settle in 10 seconds or less, will account for 9.3 percent of B2B transactions by volume in 2022 -- that's up from 6 percent in 2020.

Meanwhile, instant payments will only account for 6.3 percent of B2B transactions by value in the same year, illustrating the predominantly low value of these payments, due to low transaction limits.

Moreover, the greater value of B2B instant payments adoption is in new capabilities.

"Instant payment schemes are built on ISO 20022, which unlocks additional messaging capabilities. These can be used to inject transparency and build new services such as automation, which will add significant value to complex accounts payable processes," said Nick Maynard, lead analyst at Juniper Research.

Outlook for B2B Payment Transaction Innovation

According to the analyst assessment, this efficiency -- enabled by services including RippleNet and Visa B2B Connect -- will be critical in allowing these financial services operators to compete with innovative fintech start-ups and other non-bank industry players.

Legacy financial service providers must trial new systems now, and refresh their business models, or they will likely lose market share in a highly commoditized post-pandemic B2B payments environment.

Given that the current method of processing invoices and payments is so manual, there is significant upside potential for the introduction of automation to reduce transaction costs, increase processing speed and avoid currency exchange rate calculation errors.

Popular posts from this blog

Digital Transformation Spending Reaches $1.8 Trillion

Ongoing investment in business technology will remain on track, despite concerns about the global economic outlook which continues to evolve in 2022. Enterprise CIOs and CTOs are focused on operational profitability and digital business growth goals that are enabled by strategic IT initiatives. Global spending on the Digital Transformation (DX) of business practices, products, and organizations is forecast to reach $1.8 trillion in 2022 -- that's an increase of 17.6 percent over 2021, according to the latest market study by International Data Corporation (IDC). Many anticipated DX investments will sustain this pace of growth throughout the 2021-2025 forecast period, with a five-year compound annual growth rate (CAGR) of 16.6 percent. Digital Transformation Global Market Development "IDC expects to see aggressive DX technology investment growth in 2022 following a minor slowdown during the pandemic period," said Craig Simpson, senior research manager at IDC . "As orga

Flexible Working: Why Company Culture Matters

The main reasons for the Great Resignation are obsolete leadership, fearful middle managers, and a toxic culture that hinders employee engagement. Perhaps that's why some organizations are still struggling with the consideration and development of a flexible working model.  They're incapable of evolving to a more enlightened approach to work where employees are treated with respect. They're stuck in a bygone era of the 20th-century industrial revolution where 'shareholder value' tops all other values, and where spreadsheets and financial data analysis drives all key decision making. We should not be surprised that 76 percent of human resource (HR) leaders now feel that hybrid work challenges an employee's connection to organizational culture, according to a recent survey by Gartner. A 2022 poll of HR leaders reveals the most challenging aspect of setting their hybrid strategy is adjusting the current organizational culture to support a hybrid workforce. In fact,

Energy Sector IoT Cybersecurity Gains Momentum

The electric distribution industry continues to invest in digital transformation projects. Advanced Metering Infrastructure (AMI) technology is becoming a driver for connected electricity meters, which will reach an installed base of 1.3 billion by 2027. AMI growth is prompting utilities and energy suppliers to revisit their IT infrastructure security and device management operations, according to the latest worldwide market study by ABI Research. Energy Infrastructure Security Market Development Digitization of traditional electricity grids and the modernization of the aging energy infrastructure is among the top concerns for utility operators and governments worldwide. Security for last-mile energy consumption applications was frequently overlooked. "However, the introduction of AMI, smart metering, and grid digitization is steadily increasing spending for secure management services, assisting implementers to transition to IT (information technologies) and OT (operational techno