Asia Pacific businesses face challenges in B2B e-commerce payments

Fintechs offer automated payment solutions that consolidate payment methods and reduce costs.

The shift of B2B buyers and sellers towards digitalised platforms has had an impact on the B2B payments market. This shift within the B2B e-commerce sector has affected payment revenues, according to the Global B2B Payment Trends 2022 report, published in September 2022 by yStats.com, a global market research provider focusing on Ecommerce and Payments.

This has led experts to forecast growth in global wholesale payments to $2.6t by 2025, the report cited McKinsey, following a -5% decline in 2020. According to BCG, also cited in the report by yStats.com report, the wholesale segment of payment revenues is forecast to grow at a CAGR of +6.6% from 2020 to 2025. The global wholesale payment revenues are likewise forecast to reach a value of $0.7t (€0.6t) by 2030.

With this global expansion of the B2B or wholesale payment segment, fintechs are offering innovative solutions so that in 2021, 83% of B2B buyers worldwide will prefer to make purchases via digital platforms. 

Great Expectations, Great Challenges

Progress is not without its obstacles. In the Asia Pacific, businesses in the four major markets of China, Japan, India, and Australia seek new ways to complete B2B transactions, the Global B2B Payment Trends 2022 report revealed.

In China, B2B sales made via credit accounted for about 51% of total B2B sales in 2022, down from 55% in 2021. About 38% of China businesses offered existing clients trade credit to encourage repeat orders, whilst 27% did so to give their customers more time to pay. The other 20% of businesses provided trade credit to win new customers, as reported by Atradius, also cited in the yStats.com report.

In Japan, only 13% of small and medium-sized enterprises (SMEs) introduced cashless B2B payments in 2021. Meanwhile, 42% of SMEs admitted to being wary of using cards due to limited B2B payment options. Additionally, only 10% of B2B SMEs in the country introduced credit card payment as of Q1 2021, compared to 61% of B2C SMEs, according to the Ministry of Economy, Trade and Industry, cited by yStats.com. 

Meanwhile, in India, payments via credit accounted for about 49% of total B2B sales in 2022, 42% of which were offered to continue business with existing customers as reported by Atradius, cited in the yStats.com report.  

In Australia, Buy Now, Pay Later is gaining traction as a B2B payment method, with 56% of B2B sellers revealing that they attracted new customers after introducing this payment form, according to ACA Research cited by the yStats.com report “Global B2B Payment Trends 2022.”

B2B Solutions for Omni-commerce Business Models

In response to these challenges, companies such as NTT DATA Hong Kong Limited, part of the NTT DATA Corporation, are addressing these issues by developing solutions that integrate finance and software-as-a-service (SaaS) offerings.

Fintech firms today can offer businesses a range of payment acceptance and processing solutions to give B2B businesses options that include credit or some emerging alternative payment methods. 

For its part, NTT DATA has built a solid track record, expertise, and a reputable brand and today supports transactions in over 150 transaction currencies and 25 settlement currencies across a range of payment platforms. Its solutions also accept all major international cards whilst also supporting local payment options and alternative payment methods such as e-wallets and bank transfers.

“Our automated solutions empower organisations and enterprises with a consolidated platform that gives them the ability to add to supplier payment needs on top of our buyer acceptance solutions in their businesses,” said Shinichiro Nishikawa, Head of Global Payments and Services Division at NTT DATA Corporation. “We help buyers and sellers streamline and automate their payment process, providing value to upstream and downstream transactions.”

Designed to serve omni-commerce business models, these customisable B2B payment options conveniently consolidate forex exchange expenditure and manage regional business transactions on one automated platform.

The integrated payment experience across multiple sales and supplier channels efficiently manages payments from multiple payment providers and channels and controls the associated costs, all whilst reducing fraud and risk.

Teppei Yamamura, Deputy CEO of NTT DATA Hong Kong Limited, said, “The solutions give you management control of your payment configuration across upstream and downstream processes so that you can be in charge of your business strategy and leave the payment considerations to us.”

He added that NTT DATA’s solutions help buyers and sellers harness the power of automation and bring the next generation of collaborative experiences through trusted innovation and security, whilst adding agility and more resilience to the business.

Businesses and suppliers can future-proof their partnerships by identifying opportunities to manage commissions for the supplier’s partnership and accommodating newly emerging payment methods or functions. Create value in upstream and downstream transactions with solutions that help ensure timely payments on vendor invoices, avoid late fees, and capture early payment discounts when possible.

Most importantly, they must work with a globally trusted payment partner who understands that suppliers, payments, business, and system need to work hand-in-hand for their success.