From Fraud Fears to Gen Z CFOs, 5 Trends Driving B2B’s Digital Shift

Digitizing B2B payments is typically a one-way street. Businesses don’t typically revert to paper payments after embracing technological advancement.

But that doesn’t mean some firms don’t still need a little push to get the ball rolling.

While digitizing B2B payments may look different for every business, the pressures on organizations to innovate are coming from several shared angles that can include fraud concerns, cross-border complexities, real-time expectations, heightened security demands and shifting workforce demographics.

These factors, as well as many others, are converging to create a new payments paradigm where the agility to adapt is a competitive advantage. The result is that, across certain operational relationships, automating and digitizing B2B payments is no longer a forward-thinking ambition — it’s becoming a necessity. The five reasons below spell out why.

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Automation has long been a cornerstone of payment innovation, but the infusion of artificial intelligence (AI) is taking it to new heights. Businesses are increasingly deploying AI to enhance invoice processing, manage complex accounts payable (AP) workflows and predict cash flow trends with unprecedented accuracy.

AI-driven systems can help to streamline reconciliation processes, identify discrepancies before they escalate into disputes and offer predictive insights that help firms optimize their cash positions.

“Businesses often adopted payment automation in parts,” Holly Tennent, director, B2B payment solutions and card product management at Bank of America, told PYMNTS. “It’s important to ensure that we’re capturing the different priorities of AP, IT, treasury and procurement stakeholders.”

PYMNTS Intelligence research found that more than one-third of middle-market firms now utilize AI for at least half of their AP processes. Because of this, these businesses are 47% less likely to report high levels of operational uncertainty. This is a critical advantage, as they often operate with tighter margins and have greater sensitivity to cash flow disruptions than larger competitors. 

At the end of the day, PYMNTS has found the question isn’t whether firms will automate and evolve their back offices. It’s how quickly and effectively they can do it.

“For a long time, the industry has offered up paperless alternatives to payments,” including virtual cards, and real-time payments are poised to gain even more traction, Alex Hoffmann, general manager of North America at Edenred Pay, told PYMNTS. “What GenAI adds on top of all this is that beyond the payment, we can automate the invoice-to-pay cycle.”

See also: Fraudsters Love Clerical Errors; Automation Helps Eliminate Them

PYMNTS intelligence found that, despite their declining popularity for personal transactions, checks still account for nearly 40% of U.S. B2B payment volume. In fact, 68% of companies relied on checks for B2B payments in 2023, and 70% of businesses stated they have no plans to discontinue their use in the next two years.

“If you have not operationalized your procurement process appropriately, [and] if you don’t have a certain level of maturity, you’re receptive to fraud,” Michael van Keulen, industry principal, procurement at Coupa, told PYMNTS in an interview posted in February. “Fraud prevention isn’t just a finance problem or a procurement problem — it’s a business imperative.”

Many firms can tend to perceive checks to be low-cost or “free,” but manual processing creates hidden expenses. Time, labor and delayed payment cycles add to these costs, and fraud losses only amplify the financial burden.

“A lot of fraud is in the checks. If you cut out checks, you cut 60% of fraud right there,” Ernest Rolfson, founder and CEO of Finexio, told PYMNTS.

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The consumerization of payments has shaped expectations in the B2B arena. Clients now expect instantaneous transactions, mirroring the ease and speed of P2P platforms like Venmo or Zelle. In response, companies are embracing real-time payment solutions to meet the growing demand for immediacy.

According to PYMNTS intelligence, nearly 65% of companies reported that their clients now expect faster payments, especially when dealing with high-value transactions. Real-time payment infrastructures not only enhance customer satisfaction but also improve cash flow management — a critical factor for firms navigating today’s volatile economic environment.

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The transformation of B2B payments is also increasingly being driven by changing demographics within the workforce. As millennials and Generation Z professionals take on leadership roles, their preferences and expectations are influencing how companies approach payments.

These digital-native generations prioritize user-friendly platforms, seamless integrations and automated solutions. They’re also more likely to advocate for embedded finance solutions that provide greater transparency and efficiency. As a result, businesses are investing in intuitive, streamlined payment systems that align with the expectations of a younger, tech-savvy workforce.

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The rise of digital-first business models has only amplified the need for seamless cross-border payments. As companies expand internationally, navigating complex regulatory landscapes and mitigating currency fluctuation risks becomes paramount. Innovative FinTech solutions are addressing these challenges through multi-currency accounts, real-time currency conversion and blockchain-powered settlements.

Moreover, collaboration between traditional financial institutions and agile FinTechs has led to more efficient payment rails designed to facilitate cross-border transactions. The demand for streamlined international payment solutions is especially pronounced among mid-market firms seeking to expand their global footprint without incurring prohibitive transaction costs.

For B2B firms, cross-border payments are among the most promising use cases for stablecoins, as PYMNTS has covered.

The convergence of these trends is accelerating the pace of change within the B2B payments ecosystem. While innovation is essential, it must be balanced with security, compliance and user-centric design. As automation and AI continue to advance, cross-border solutions become more robust and generational preferences shape business expectations, companies will need to remain agile to thrive.

Ultimately, those who can harness these trends to create seamless, secure and scalable payment solutions will be best positioned to capitalize on the opportunities ahead. The future of B2B payments is being written now — by those bold enough to embrace the transformation.

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