The business-to-business (B2B) payments market is a very large segment of the U.S. payments industry, with transactions reaching an estimated $35.8 trillion in 2024, according to eMarketer estimates (Off-site). As the vast B2B payments market continues to expand, a pronounced shift toward electronic payments on the consumer side has begun to carry over. But digitization has not yet fully taken over: Nearly one-third (32%) of 2024 B2B transaction volume was transacted via cash and check, per eMarketer, creating considerable opportunity to find more efficiency and modernize the space.
The B2B payments landscape
Most businesses are using checks in some capacity. A Federal Reserve Financial Services (FRFS) survey found that in 2024, 73% of businesses sent or received checks from other businesses, employees, consumers or government agencies, though the share of total payments this usage comprises varies by industry. Check usage rates are highest among very small (78%) and small (73%) businesses, as well as wholesalers (80%), service industry companies (73%) and manufacturers (70%). For businesses, checks have numerous upsides, but they are also imperfect. Businesses must weigh the pain points against the advantage that checks can provide as they evaluate and invest in their payment offerings.
While check use remains common, electronic payment methods are not far behind. And businesses are encouraging of these payment methods, with around half encouraging the use of methods like credit card and ACH, per the FRFS survey.
Instant payments — the newest form of electronic offerings widely available to businesses — can accelerate transaction times from days to seconds and resolve pain points for businesses. And businesses are taking note: 16% of businesses surveyed are already using instant payments, and about two-thirds (66%) are likely to do so if they are offered instant payments by their primary financial institution, according to the FRFS survey.
The opportunity to modernize
The combination of rising B2B transaction volume, increasing digitization of business processes, and emerging payment technology opens the door to shifts in the B2B payment sector. Banks and service providers have the opportunity to provide new payment offerings, including instant payment options, to help businesses of all sizes move to a more modern, automated payments experience.
A new white paper about B2B payments modernization explores the current B2B payments landscape, how it’s changing, and the value businesses see instant payments providing. Topics covered include:
- Checks and the B2B payments market
- B2B opportunity in instant payments
- Emerging B2B use cases for instant payments