B2B payments play a pivotal role for the financial services industry, enabling cash flows and business operations on a day-to-day basis. As businesses accelerate their digital evolution, the demand for fast, secure, and seamless payment infrastructure is surging in markets. Fintechs are taking this opportunity to provide frictionless and embedded payments with integrated solutions for both consumers and merchants. Yet, when you operate in a regulated industry seeking presence in a new market, understanding how the payments work is crucial. Let’s deep dive into the core barriers faced and how we can overcome them strategically.
Existing barriers of new markets
Regulatory compliance
Each country and industry has its own compliance demands, from Anti-Money Laundering (AML), Know Your Customer (KYC), and sanctions screening requirements to data localization laws. Navigating that patchwork of regulatory bodies is the biggest barrier to expansion. Tight licensing requirements and tax rules is another strong door to push through to entry in new markets. In some countries, payment businesses need to partner with a licensed entity to operate legally; while others require local settlements in domestic currency. Keeping up with such global compliance requirements is costly and resource-intensive.
Technological integration
Financial institutions face significant challenges in adopting new solutions due to their reliance on legacy systems and customized workflows. Even cost-effective or feature-rich solutions often see low client adoption if they cannot be integrated seamlessly. This is largely because enterprises are bound by long-term contracts and obligations to their existing systems, which are crucial for maintaining operational efficiency, security, managing cash flow, and fostering economic growth. Financial services providers can definitely empower their systems by integrating and leveraging relationships with Fintechs providing B2B payment layers.
Customer acquisition
Financial services firms are cautious about adopting new payment solutions, partly due to the conservative nature of technology integration within the industry. Their primary concerns revolve around the security, stability, and reliability of B2B payment platforms. When engaging with a financial services client, the focus isn't merely on selling software; it's about gaining their trust with critical aspects like cash flows and liquidity management. Without a strong reason to change and sufficient proof of concept, overcoming this barrier becomes a significant challenge.
Operational challenges
Managing multi-currency flows, local payment preferences, and cross-border settlement processes adds layers of operational burden in the emerging markets. It is harder to maintain liquidity management and customer satisfaction for inflexible payments. Fragmentation adds to poor visibility, delayed settlements and higher cost of operations. These affect the client satisfaction and working efficiency for the financial services companies to adopt a new platform.
A strategic playbook: how to overcome the barriers
In order to crack the code, B2B payment platforms must focus on three key enablers:
Leveraging digital payment solutions
Modern B2B payment platforms are built to scale globally while adapting locally. A platform like Verto can support real-time payments, automated reconciliation, embedded compliance and flexible Forex management. Tacking the issue of technological integration, running sandboxes can provide controlled risk exposure and build trust with the financial services clients.
At Verto, the APIs complement open banking and effectively remove the obstacles posed by disparate banking systems, thereby enabling a seamless payments option.
Providing diverse payment options
According to an EY report, the APAC region has witnessed the biggest adoption of digital wallets and super apps compared to North America and Europe. B2B customers are looking for payment tools that can work within their existing ecosystem and offer diverse options. One size fit all strategy does not make the cut for companies requiring flexibility in bank transfers, wallets, local payment methods.
Verto’s multi-currency wallets, automated Fx conversations and smart management of payments is opening the heavy doors in the new markets.
Building strong relationships with partners
The biggest factor of growth in the B2B industry is through trusted partnerships with banks, legal advisors, regulatory bodies, and local or regional banks. It is often difficult to bake that trust in the product along with offering the best price, integration, and reason to change. Therefore, building relationships on the basis of compliance and proven technology can provide a path to market entry.
Verto grasped this opportunity to leverage the technological capabilities and customer centricity and offers its expansion in new markets for payments with global and local accounts.
Move fast, build smarter
Once we navigate the real-world complexities of the payment world, there’s a significant opportunity to transform and change how payment offerings work.
A right combination of complaint infrastructure, customer-focused tech, and strategic partnership, the barriers can be cleared and turned into long-term competitive advantages. As industry leaders are recognising the benefits of real-time payments for global commerce, B2B payments are on the road to evolve for the financial services industry.
Verto is designed to help financial services providers in the new and emerging markets with speed, security and scale. Our integrated and seamless systems are customised to empower the next phase of growth. With licenses in seven major African countries with the ability to transact with 49 currencies, our infrastructure signifies fundamental change and opportunity we bring to the table.
Share this article
