B2B Payments Transaction Market Size To Rise USD 2.70 Bn By 2032

Published Date : 29 Aug 2023

The global B2B payments transaction market size surpassed USD 1 billion in 2022 and is projected to rise to USD 2.70 billion by 2032, anticipated to grow at a CAGR of 10.50 percent during the projection period from 2023 to 2032.

B2B Payments Transaction Market Size and Growth Rate From 2023 To 2032

Market Overview:

Business-to-business payments, or B2B payments, are developing quickly as technology and economic realities continue to place a greater premium on efficiency, speed, and effectiveness. When two businesses exchange money for services and products through a supply chain process, this is called B2B processing. It enables safer transactions for businesses that engage in normal, periodic transactions and offers several services to end customers, including payroll, accounts payable, accounts receivable, and acquisition departments. Additionally, end users are using innovative technologies like AI, ML, and others more frequently to enable quicker and safer payment processes while lessening the strain on accounts payable.

The B2B (business-to-business) payments transaction market refers to the exchange of funds between two or more businesses for goods, services, or other commercial transactions. Unlike B2C (business-to-consumer) transactions where a business interacts directly with individual consumers, B2B transactions involve businesses interacting with other businesses.

Regional Snapshot:

North America currently holds most of the global market share for B2B payments and is predicted to maintain this position during the forecast period. North America, particularly the United States, has been a pioneer in adopting and developing advanced financial technology (FinTech) solutions. The region's strong technological infrastructure and innovative ecosystem have contributed to the rapid evolution of B2B payment solutions. North American businesses have been early adopters of digital transformation in their operations, including payment processes. The shift from traditional paper-based methods to electronic payments, such as ACH (Automated Clearing House) transfers, wire transfers, and virtual cards, has been widespread in the region.

Asia-Pacific is anticipated to experience significant growth throughout the forecast period because of growing digital transformation initiatives across the IT and telecommunications sector and increasing investments in advanced payment systems and IT. The rise of e-commerce and cross-border trade is boosting the demand for streamlined B2B payment processes. As businesses are increasingly engaging in international transactions, there is a growing need for efficient cross-border payment solutions that could handle different currencies and payment methods. Fintech companies and startups are introducing innovative payment solutions tailored to the B2B sector. These solutions often offer features such as real-time payments, automated invoicing, and integrated supply chain financing.

Report Highlights:

  • By payment type, the domestic payments segment dominated the market in 2022, the segment is expected to grow at a significant rate during the forecast period. Domestic transactions align more closely with business hours, reducing the potential for delays caused by time zone differences. This convenience can be a significant factor in the dominance of the domestic payment segment.
  • By enterprise size, the large enterprises segment dominated the market, large enterprises have the resources to invest in advanced payment infrastructure, including electronic invoicing systems, payment automation software, and dedicated treasury departments. This allows them to optimize their payment processes for efficiency and cost-effectiveness. With their significant transaction volumes, large enterprises have the ability to negotiate favorable terms with banks, payment processors, and other financial institutions. They can demand lower fees, quicker processing times, and tailored solutions that suit their specific needs.
  • By payment mode, the digital segment of payment mode is observed to generate the fastest rate of growth during the forecast period. Many digital payment platforms can be seamlessly integrated with accounting and enterprise resource planning (ERP) systems. This automation reduces the likelihood of errors and streamlines record-keeping and reconciliation processes. Digital payments can offer advanced security features, such as encryption, multi-factor authentication, and real-time monitoring. These features help mitigate the risk of fraud, which can be a significant concern in large B2B transactions.
  • By industry vertical, the BFSI segment is expected to generate significant revenue throughout the forecast period. The BFSI sector's infrastructure allows it to handle a high volume of transactions, making it suitable for the demands of the B2B market, where numerous transactions occur between businesses on a daily basis. Banks and financial institutions have access to a wealth of financial data. They can provide valuable insights to businesses about their transaction patterns, cash flow, and financial performance, enabling better decision-making.

B2B Payments Transaction Market Report Scope:

Report Coverage Details
Market Revenue in 2023 USD 1.10 Billion
Projected Forecast Revenue in 2032 USD 2.70 Billion
Growth Rate from 2023 to 2032 CAGR of 10.50%
Largest Market North America
Base Year 2022
Forecast Period 2023 To 2032
Regions Covered North America, Europe, Asia-Pacific, Latin America, and Middle East & Africa

Market Dynamics:


Expansion of businesses on global level

When a business expands internationally, it typically engages in cross-border trade with suppliers, distributors, and partners in different countries. This leads to an increase in cross-border B2B transactions, which in turn drives the demand for efficient and secure international payment solutions. Different regions and countries have unique payment preferences and methods.

As businesses expand globally, they need to adapt to the local payment methods and comply with various regulations. This diversity in payment methods and compliance requirements drives the need for versatile B2B payment solutions that can handle a wide range of transaction types. International business operations require visibility into payment status and transaction tracking in real-time. Modern B2B payment platforms offer real-time tracking, enabling businesses to monitor payment flows and resolve any issues promptly, thus enhancing transparency and accountability. Thus, the expansion of businesses on a global level is considered to be a driver for the market.


Security issues

Hackers may attempt to intercept payment instructions and alter them, rerouting funds to their accounts instead of the intended recipients. This type of attack can disrupt supply chains and relationships between businesses. Employees within an organization can also pose a security risk. If they have access to payment systems and engage in malicious activities, it can lead to financial losses. Implementing proper access controls and monitoring is crucial to mitigating insider threats. B2B payments are often subject to various financial regulations and data protection laws. Failure to comply with these regulations due to security vulnerabilities can result in fines and legal actions. Such security issues are observed to be a restraint for the market.


Technological advancements

New technologies such as real-time payment processing, blockchain, and instant settlement solutions can greatly enhance the efficiency and speed of B2B transactions. This reduces the time and resources spent on traditional payment methods, such as checks and manual processing, leading to faster and more streamlined transactions. Automation and digitization of B2B payment processes can lead to substantial cost savings. Businesses can reduce administrative expenses, eliminate the need for paper-based processes, and minimize the risk of errors that often accompany manual data entry.

Technological advancements allow for the collection and analysis of transaction data. Businesses can gain insights into spending patterns, vendor relationships, and cash flow, enabling them to make more informed financial decisions and optimize their operations. Advanced payment technologies can help strengthen relationships between businesses and their suppliers. Prompt payments, early settlement discounts, and transparent tracking can foster trust and collaboration.


High cost of transaction and lack of real-time visibility

Businesses often struggle to have real-time visibility into the status of their payments. This lack of visibility can lead to uncertainty about cash flow and hinder effective financial planning. B2B payments can come with high transaction costs, especially when using traditional payment methods or involving intermediaries such as banks. These costs can erode profit margins for businesses. Thus, high transaction costs and lack of real-time visibility are considered to be major challenges for the market’s expansion.

Recent Developments:

  • In April 2023, a cooperative endeavor to streamline payment procedures between companies and their worldwide supply chains was unveiled by Coupa, a business spends management (BSM) expert, and Goldman Sachs Transaction Banking (TxB). Payments between firms are frequently accompanied by operational difficulties that are expensive, burdensome, and ineffective. By working together, Coupa and Goldman Sachs TxB seek to make it simple for users to send money domestically, internationally, and in 124 different currencies across 167 different countries.
  • In June 2023, the Open Network for Digital Commerce (ONDC) revealed that B2B transactions were available on its platform. The interoperable government-backed e-commerce network welcomed two businesses as part of this announcement: the B2B trading platform Rapidor and the sales and payments company Signcatch. This is intended for use in B2B transactions by micro, small, and medium-sized businesses. Flexible pricing, bulk order buying, and delivery planning are some of its characteristics. With this declaration, IndiaMart, Amazon Business, and Udaan are now direct competitors of ONDC.

Some of the Prominent Players:

  • American Express
  • Bank of America Corporation
  • Capital One
  • Mastercard
  • Citigroup Inc.
  • TransferWise Ltd.
  • Payoneer Inc.
  • PayPal Holdings Inc.
  • Square Inc.
  • Visa Inc.

Market Segmentation:

By Payment Type

  • Domestic Payments
  • Cross-Border Payments

By Enterprise Size

  • Large Enterprises
  • Small and Medium Sized Enterprises

By Payment Mode

  • Traditional
  • Digital

By Industry Vertical

  • BFSI
  • Manufacturing
  • Metals & Mining
  • IT & Telecom
  • Energy & Utilities
  • Others

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