The New Operating System for B2B: Payments, Software and Data

There’s no shortage of complexities when it comes to the business relationship between buyers and sellers.

There are payment methods, terms, timelines and compliance issues, to name just a few. Add economic uncertainty and high interest rates that make money scarce, and you place additional pressure on a business to run efficiently.

There’s no silver bullet for simplicity or efficiency. As Jay Dearborn, chief strategy officer at WEX, told Karen Webster for the “What’s Next In Payments” series, bringing B2B payments fully into the digital age needs a global platform with three elements — payments, data and software — working concurrently to help simplify commercial transactions.

“The network of buyers and sellers is incredibly complex,” said Dearborn. “When I think about modernization, I’m always trying to think about our largest customers and our smallest customers. What are the use cases that payments will help them unlock, creating more ease in the way that they do their business?”

Getting there is no easy task, given the fact that some enterprises — especially smaller ones — may be hesitant to embrace new ways of paying and getting paid. Entrenched behavior begets inertia. Inertia can only be overcome by the value-added proposition that shows companies there’s a better way to do things, which translates to better margins.

No matter the solution being deployed, he said, “the onboarding has to be easy. Using the software has to be easy.”

Much of WEX’s inspiration to improve small businesses and trucking and logistics firms’ fortunes comes from what’s happening in the consumer world as so much of daily financial life is lived on mobile devices, he said. Underpinning it all is the ambition of wrapping different functionalities into mobile phones that enable instantaneous payments that are trusted by all parties.

“What we’re trying to do is bring the way that they manage their business into a phone and help that WEX customer invoice and manage their own customers and collect payments,” he said.

Dearborn’s comments came as part of the continuing “What’s Next in Payments” series focused on payments modernization.

Modernizing B2B payments, no matter the vertical, must focus on the details surrounding the transactions themselves — whether the payments are reliable, at the right cost points and whether funds flow safely and securely.

Then, data must be married with the payment so that sellers can get invoices out the door more easily, and buyers can move from procurement to payment in streamlined, digital fashion, he said.

“It’s the software layer that creates ease for the customer,” said Dearborn.

WEX makes its mark primarily in B2B payments but offers a range of solutions — from corporate cards to fleet payments and employee benefits. Through the years, the company has broken down the silos that exist between those operations, forging an ecosystem of commerce that has as its foundation a shared payments and data layer that enables enhanced functionality across its different products.

With the connected approach, Dearborn said his company is in the business of simplifying the very act of running a business.

Last year, WEX bought Payzer, a cloud-based field service management software firm focused on residential HVAC. The small business contractors are the buyers, and the combined efforts of WEX and Payzer serve as the “operating systems” for these smaller firms, he said.

“You’re capturing the [data and payments] while you’re transacting with your OEMs in order to get the supplies you need, so it’s both pay in and pay out,” he said.

Another key example of how data and payments are being married effectively rests with the electric vehicle (EV) industry, he said. WEX has its products in 19 million internal combustion vehicles — and EVs represent an opportunity in the near and long term. The long-term opportunity lies with helping companies manage their fleet assets, right down to keeping those vehicles charged in the field — while paying for those charges whether the employee takes that vehicle home to charge or uses a corporate lot.

Advanced technologies help improve data flows, Dearborn said.

“I’m excited about artificial intelligence, both in terms of what I’m seeing in our ecosystem as well as the future possibilities,” he said.

Over the past six months, WEX has launched a new wave of fraud detection tools that use AI to enhance its fraud-fighting models. AI is also being used in the company’s present-day efforts via chatbots that let customers know about their benefits choices and give them advice about HSA, FSA and retirement accounts.

No matter the application or the business vertical, said Dearborn, “you need the same version of the information which allows people to manage their businesses however they want to manage their business … and they have better productivity, cash flow and peace of mind.”

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