B2B Payments Transaction Market Poised to Grow at a Robust Pace Owing to Rise in Digital Adoption
It is a multi-trillion dollar market globally and comprises financial transactions taking place between merchants, suppliers and vendors. B2B payments can involve credit transfers, direct debits, digital payments, purchase cards and cheques. They streamline the process of exchange of goods and services between organizations by providing efficient payment rails. With the COVID-19 pandemic accelerating digital adoption across industries, contactless B2B payments have gained prominence.
Key Takeaways
Key players operating in the B2B payments transaction market includes Mastercard Inc., FIS, Stripe, Inc., Paystand, Inc., Flywire, Squareup Pte. Ltd, Edenred Payment Solutions, Payoneer Inc., American Express, Visa Inc., JPMorgan Chase, Adyen N.V., Billtrust, Coupa Software Inc., Dwolla, Inc., Earthport PLC, FLEETCOR Technologies, Inc., Intuit Inc., Nvoicepay, Inc., Optal Limited, Paytm Mobile Solutions Private Limited, PayPal Holdings, Inc., TransferWise Ltd. (Now known as Wise), and Scoot and Ride. These players are focusing on offering innovative digital payment solutions and expanding into global markets.
The B2B Payments Transaction Market Size provides significant growth opportunities such as increased adoption of cloud-based solutions, digital currencies for cross-border payments and enhanced spends analytics. Key players are focusing on strategic partnerships and mergers & acquisitions for expanding their geographic footprint in high growth regions including Asia Pacific, Middle East, Latin America and Africa.
Market Drivers and Restraints
The global B2B payments transaction market is estimated to be valued at US$ 1,576.61 Bn in 2024 and is expected to exhibit a CAGR of 9.7% over the forecast period from 2024 to 2031. Factors such as the growth of small and medium enterprises, proliferation of B2B e-commerce, and emergence of FinTech are contributing to the increasing demand for digital B2B payment solutions. However, cybersecurity concerns related to digital payments and lack of digital payment regulations in some countries are some of the challenges restraining the growth of B2B payments transaction market.
The key driver for the B2B payments transaction market is the rise in digital adoption due to the COVID-19 pandemic. With lockdowns and movement restrictions implemented globally during the pandemic, businesses accelerated their shift to digital platforms for transactions and payments. Contactless and digital B2B payment methods like online bank transfers, digital wallets and payment gateways saw a significant surge in usage. This trend highlighted the need for efficient and seamless digital payment infrastructure between businesses, driving the growth of the B2B payments transaction market. However, cybersecurity concerns regarding digital transactions are a key restraint as businesses are cautious about sharing their financial details online. Implementation of robust security protocols is needed to address such issues.
Segment Analysis
The B2B payments transaction market can be segmented on the basis of payment type, enterprise size, and industry vertical. The payment type segment can be further divided into domestic payments and cross-border payments. Within payment type, the cross-border payments sub-segment dominates currently due to the increasing globalization of businesses and the need for seamless international money transfer capabilities.
Global Analysis
Regionally, North America holds the largest share in the global B2B payments transaction market currently due to high adoption of digital payment solutions among business enterprises in US and Canada. The Asia Pacific region is expected to grow at the fastest rate during the forecast period. The rise of globalized business in various industries such as manufacturing, retail and e-commerce in highly populated countries such as China and India is driving the demand for B2B payment solutions in Asia Pacific. Countries such as China, Japan and India are projected to become major contributors to the revenues of B2B payments vendors globally by 2031.
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