Over the past 20 years, there has been a revolution in how consumers make payments — transactions have transformed into digital experiences that are a seamless part of the broader commerce landscape. Consumers' expectations have now shifted: every payment must be effortless, simple and secure.

So why haven’t B2C payouts — where businesses make payments to individuals — undergone the same advancements?

Businesses send around $20 trillion to consumers and non-payroll employees annually, making these low-value, high-velocity payouts one of the most promising opportunities in the payments industry. But despite this volume, B2C payouts are currently overlooked and are in dire need of an overhaul.

The process of B2C payouts remains slow, complex and plagued by recipient friction, even though they often run on the same rails as consumer payments. To break free of this logjam, companies must strive to embed digital value transfer capabilities in their user-facing applications. By doing so, they can save time, drive growth and revenue and offer an improved user experience when conducting such payouts.

B2C payout experiences need an overhaul

B2C payouts encompass a wide range of transactions. Anything from incentives, rewards and rebates, to royalty, creator economy and gig disbursements can be classified as a B2C payout. 

Too often businesses still rely on traditional payment rails such as ACH, Push-to-Card and wire transfer with many of these transactions being high-velocity, low-value. These payout types are rapidly expanding, fueled in part by the growth of the global gig and creator economy.

Why are these traditional methods insufficient? Some are simply inconveniently expensive — a $50 fee for a wire transfer erases too high a percentage of the value for money on a low-volume payout. Checks must be mailed, ACH bank transfers must clear the intricacies of traditional banking and neither is guaranteed to work internationally. Push-to-Card transactions send payments to an individual debit account, regardless of whether a recipient wants to receive their payout somewhere else.

The challenges are compounded when payments are made internationally and must cross borders. Such transactions raise new challenges, including currency exchange rates, varying international banking regulations and additional processing time, resulting in delays, increased fees and a lack of transparency in the payout process.

What’s more, because gig workers or global creators are often underserved by traditional banking systems or lack access to bank accounts altogether, receiving payments through Push-to-Card mechanisms or bank transfers may involve labyrinthine procedures, costly transaction fees and lengthy waiting periods just to access their wages. 

Imagine this friction across a number of individual payouts, and the pressing need for alternatives powered by new technologies becomes ever more apparent.

The digital value revolution

Embedded digital value payouts offer a secure and efficient approach that sidesteps the confines of traditional payouts. Digital value APIs embed value transfers directly into the applications or systems used by customers, streamlining the payout process and ensuring that payouts are made in the very same digital sphere to which users have grown accustomed.

For example, cross-border money remittances have long been associated with high fees and prolonged processing times. Digital value transfers break down geographical barriers, facilitating faster and more cost-effective international payouts. This innovation has significant implications for global financial inclusion, allowing individuals and businesses worldwide to transact seamlessly and at less cost.

Additionally, as the gig and creator economies continue to enjoy tremendous growth, digital value transfers enable mass payouts regardless of banking allegiances or internal payroll limitations, empowering gig workers and creators with timely and reliable access to their hard-earned money.

Digital value payouts create a win-win for consumers, businesses and merchants. For example, gig workers can instantly receive a payout in the form of closed-loop digital value to spend at a grocery merchant, instead of a payment to their bank account. The grocer offers a discount to the gig worker, knowing that the value is “locked-in spend” at their store and there are no interchange fees. Meanwhile, the gig worker benefits from free, instant funds and a way to make their wages go further.

And it’s not just businesses and merchants that benefit. Consumers are afforded instant access to funds, personalized payment options and a more streamlined user experience. A recent survey carried out by our company, Runa, found that 63% of gig workers would rather receive instant digital value instead of delayed ACH bank transfers and checks. 

The changing face of B2C payouts

B2C payouts today stand at an inflection point – and digital value payouts hold the key to a faster, frictionless industry characterized by convenience and efficiency. The onus is now on businesses to embrace this revolution and transform their relationship with the constituents they serve, ultimately saving time, reducing costs and driving revenue growth.

As digital value adoption increases, it will become a more widespread, cash-like asset and seamless payouts will become the norm. Eventually, these cash-like transactions could be as ubiquitous as transactions across standard household payment methods like Mastercard and Visa, allowing businesses to offer better user experiences and faster services. 

Businesses must seize the potential of digital value as the catalyst for a new era in B2C payouts.

Runa is a digital value infrastructure that enables people to pay and get paid by anyone, anywhere, instantly. The Runa network reaches more than 1 billion people and connects merchants, organizations and individuals for fast, affordable and data-rich payouts in more than 30 countries and 20 currencies. For more information, visit runa.io.