In today’s challenging economy, inefficient payments are more than an inconvenience. They can delay reimbursements, create cash flow management challenges and contribute to frustrating employee and customer experiences. But unfortunately, payment bottlenecks are all too common. For example, 45% of businesses say manual reviews impede their B2B payment processes. And 28% cite cash flow visibility as one of their top payment problems.
“Ensuring the seamless flow of payments, whether it’s to an employee or to a vendor, is critical for businesses to remain competitive,” says Jon Zimmermann, U.S. Bank vice president and group product manager.
U.S. Bank Card as a Service (CaaS) eliminates some of the most pressing payment challenges by enabling companies to embed a virtual card solution into their app or platform.
With CaaS, you can reimagine the payment process, offer new payment services and improve the customer or employee experience.
The top 5 B2B bottlenecks
The B2B payments ecosystem is complex, with payment processors, companies, banks, employees and vendors all moving money. However, manual processes and multiple systems add even more challenges.
Here are some of the most common bottlenecks within B2B payments and how CaaS technology helps:
1. Delayed reimbursement and complex payment distribution.
Companies need to send money to employees for travel or other business-related expenses. However, this straightforward task is often bogged down by manual processes, internal approvals and delays. Sending checks or electronically distributing funds to employees after the fact adds more days to the already lengthy timeline. “It’s time-consuming and companies need a better way to distribute funds,” Zimmermann says. With CaaS, companies can push virtual cards directly to their employees, who can use them to make purchases. Managers can even send cards directly to their team members, speeding up the process by avoiding additional requests to finance and human resources.
The virtual cards include spending controls and limits that eliminate the need for a lengthy approval process.
2. Complicated reconciliation.
The above challenge then creates another in the form of collecting receipts and reconciling charges made by employees. “This is a painful process for everyone involved,” Zimmermann says. “There’s the collection, aggregation and then analysis of all of those expenses, which is a significant task, and then all that data may be coming from multiple systems.” CaaS reduces the need to collect receipts and reconcile employee transactions with approvals. Instead, companies can track the use of virtual cards in real time by integrating the transactions with their banking and ERP/accounting systems.
3. Security risks and fraud loss.
According to the 2023 Payments Fraud and Controls Survey, 65% of companies report that they’ve been victims of attempted or actual B2B payment fraud. “Fraud loss is a real issue for many of our clients,” Zimmermann says. The survey also showed that 80% of organizations sought support from their banking partner to reduce their fraud risk. CaaS helps reduce fraud via multiple security features, including tokenization, which provides a unique secure token for each digital card, expiration date, and security code for each virtual card. Companies can also establish card limits on purchases and issue short expiration periods.
4. Complex system integrations.
It’s not uncommon for companies to use multiple systems for various aspects of their payment and reimbursement programs. However, expensive and time-consuming integrations delay projects and prevent users and customers from experiencing the value of digital payment solutions. The suite of payment APIs offered by CaaS makes virtual card integration easy.
5. Dissatisfied employees and customers.
A key part of attracting and retaining great talent is ensuring that the systems they use for their jobs simplify their lives – not make it more challenging. Complex expense solutions and lengthy reimbursements can lead to frustration, which can ultimately contribute to employee turnover. On the other hand, if you can improve your payment process and make it a convenient, reliable part of employee work life, then something that is a challenge becomes an advantage. “If you're making the lives of your employees easier, you're going to attract and retain better talent,” Zimmermann says.
B2B payments are an evolving space, and current challenges are giving way to opportunities. Tap into the power of U.S. Bank Card as a Service, and you’ll prepare your company to take advantage of embedded payment benefits and say goodbye to bottlenecks.
