Accepting Online Payments from Multiple Gateways

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Traditional B2B invoicing, on-account arrangements and payments by checks prove increasingly inefficient when companies can get immediate payments using credit cards and integrating other mobile payment systems into their eCommerce platforms. Technology and faster communications, secure encryptions of financial information and growing acceptance of mobile payments are influencing business-to-business organizations to offer more payment options to their customers. Integrating multiple payment solutions not only leads to faster payments and better cash flow but also simplifies accounting and provides backup verifications of customer payments for taxes, financial reporting and borrowing capital for business expansions.

Consumer buying behavior drives the mobile payment industry, and companies like eBay and Amazon have encouraged greater consumer acceptance of paying for goods and services with mobile payments and new technologies like Apple Pay, Samsung Pay, Google Wallet and Bitcoin. PayPal now handles vast numbers of online payments, and anyone can use its system to send or receive money. Some eCommerce implementations still require using the traditional payment processes of negotiating prices, submitting purchase orders and invoicing clients, but more and more companies and buyers are taking advantage of omni-channel payment options. Paper checks are subject to theft, generate high processing costs and are often returned by banks for insufficient funds. Studies show that eight billion invoices paid by check cost U.S. businesses $100 billion in annual processing costs.[1]

Most B2B companies struggle to implement electronic payment systems primarily because of the challenges of integrating with out-of-the-box accounting software and antiquated legacy systems. However, 91 percent of all adults now use mobile phones and can easily pay companies directly with debit checking cards, credit cards or other mobile payment options.[2] Customizing a B2B website for multiple payment options provides long-term benefits that will only increase with time and enable increased automation of company processes. These include automated options for recurring billing, interactive voice response or IVR technology for confirming orders and taking credit card or billing information and Virtual Negotiation technology for speeding agreements and handling payment disputes. Mobile payments grew more than 9 percent annually in 2013 and now account for more than 40 percent of global revenue.[3] McKinsey predicts a sustained annual growth rate for mobile payments in excess of 6 percent that should surpass $2 trillion annually by 2020.

Accepting multiple payment types increases the value of any eCommerce platform by empowering customers and simplifying the billing-payment cycle. It's a new world for B2B companies that stand to benefit from these technologies, but there are issues to consider. Most mobile payment services charge percentages of transactions, fees for each transaction and standard monthly charges that can increase product costs and reduce profits.

New regulations also increase the standards of care that companies must provide to ensure that financial information stays secure. B2B companies that also sell retail products usually have multiple payment systems in place, but companies that only sell to businesses might need to learn the ins and outs of mobile payments, POS software and using credit card intermediaries. Most businesses find that integrating these payment systems are worth the extra effort. The benefits of doing so for B2B organizations include:

  • Satisfying customer demand for alternative ways to pay
  • Enabling mobile payments from anywhere at anytime from any device
  • Speeding payments with mobile invoicing
  • Increasing customer convenience and fostering better user experiences
  • Enhancing data-mining intelligence gathering
  • Optimizing sales reporting and income verifications
  • Improving financial transparency
  • Strengthening traditional B2B billing practices
  • Allowing salespeople to accept payments in the field without asking customers for confidential financial information
  • Empowering proprietary app users to view invoices and remit payments directly from within their apps
  • Accepting multiple currencies and performing automatic conversions through payment-provider intermediaries

Mobile payment options become increasingly important for B2B companies to remain competitive, and most companies should offer their buyers the most popular payment options at a minimum. The easier that companies make paying for products, the faster they get paid and the more customers they attract and satisfy.

 

Common Payment Options for B2B Companies

Key considerations for B2B companies that want to add new payment options include interoperability and integrating payments with existing back-office systems. Most ERP and CRM software can integrate mobile payments with banks, payment processors and accounting software. In some cases, it might be necessary to customize the existing software to integrate fully with invoicing, financial accounting and accounts receivable to build a seamless process. For example, there could be problems if customers pay parts of invoices with different payment methods. The most popular ways for people to pay online for products in the United States include PayPal and credit cards, and the most common B2B payment options include PayPal, credit and debit cards, on-account payments and WorldPay.

PayPal and PayPal Pro

PayPal offers a turnkey approach for accepting online payments, and smaller B2B operations can accept PayPal payments directly while larger companies usually choose the PayPal Pro version, which offers collaborations for setting up and integrating shopping carts, integrating other mobile payment providers and connecting with Web development teams, business partners and B2B billing platforms. Regardless of version, B2B companies can use PayPal to pay their own suppliers, consultants and vendors and enjoy the following benefits:

  • Accepting most common credit and debit cards
  • Allowing customers to pay with PayPal credit accounts
  • Simplifying PCI compliance for payment encryption and security practices
  • Receiving payments from customers without requiring them to leave B2B websites
  • Optimizing checkout experiences for B2B customers who buy products using self-service
  • Generating better user experiences through simplified payment options
  • Supporting virtual terminal technologies
  • Integrating with the API layer of all types ERP and B2B accounting software
  • Offering fully customizable options for B2B companies
  • Supporting HTML, SDK packages and NVP and SOAP APIs
  • Simplifying API-integrated reporting, refunds and system updates

Credit Card Payments

Credit and debit card payments have largely replaced cash transactions even in face-to-face business transactions, and they're critical to doing online business. B2B companies face risks of PCI and DSS compliance when accepting credit cards and handling the financial information of their customers. Despite advanced NFC communication protocols, encryption technology and supposedly fraud-proof EMV credit cards, identify thieves and hackers still managed at least 1,540 data breaches in 2014, which was up 46 percent from the previous year.[4] B2B companies face fines and lawsuits if they don't comply with DSS and PCI regulations, and these companies and their customers are frequent targets because credit cards usually have higher spending limits. Using an intermediary so that companies never receive, store or transmit financial information is one strategy for ensuring compliance.

Visa, MasterCard and American express are pushing for universal adoption of a tokenization system in all online transactions -- both B2C and B2B -- where all credit and debit transactions are replaced with token that's associated with the 16-digit primary account number. B2B companies can register with a PCI-compliant processor that assigns a token for each transaction. Customers enter their credit card information on the website as usual, and the purchase is authenticated, but the third-party vendor stores the information, assigns a nickname for the transaction (the token). The B2B site uses the token to receive their funds but never stores financial information, so it remains protected from hacking, employee theft and even company mismanagement. The approach complies with PCI regulations, but companies might need customizations or payment plugins to integrate these features into their business systems and link seamlessly to ERP and CRM software.

Purchase Orders, Invoicing and House Accounts

Unlike B2C websites that require upfront payments, many B2B operations offer their clients more flexible payment terms to purchase on account, issue purchase orders and be invoiced later. Some companies offer their customers credit terms or encourage prospects to try the company’s products risk-free. Some companies still use a traditional approach and choose an intermediary to hold funds until products are shipped to a client's satisfaction, but that's becoming less common as online payments gain wider acceptance due universal mobile payments, credit card company delivery guarantees, business credit cards and advances in payment processing, tracking and monitoring transactions.

Some companies provide open accounts for their employees to buy products up to preset cash limits, and some bulk buyers might need to bill separate store accounts. Each of these scenarios requires back-office customizations, careful management, excellent tracking and full transparency, and B2B companies often need special capabilities to manage these processes.

Fortunately, technology and software can be customized to handle all kinds of billing strategies, integrate with other payment options, generate a synchronized accounting of purchase and payment activity and generate warnings and holds based on spending limits. Customizations can also speed up invoicing and billing in the following ways:

  • Sending invoices automatically to multiple addresses or routing them to decision-makers for approvals
  • Splitting invoices among different shipping addresses
  • Enabling authorized users to access account information
  • Encrypting financial data to comply with financial regulations
  • Gathering tax information and forwarding payments to the appropriate taxing authorities
  • Generating automatic reminders
  • Assessing late fees, fast-pay discounts, interest charges and collection fees
  • Following up on customer service issues to boost payments
  • Processing check payments with remote-capture deposits to speed availability of funds
  • Streamlining the traditional PO system to accelerate invoicing and payments
  • Managing electronic fund transfers

Even the classic B2B invoicing and billing methods become more efficient with customizations to the API layers of back-office software and front-end customer management features. Company decision-makers can automate billing, reduce staffing needs and billing errors, reduce payment processing costs and still receive payments faster.

WorldPay

WorldPay, which is an international payment processing company that's listed on the London Stock Exchange, delivers global sales processing capabilities for B2B eCommerce platforms, and companies can use these services at physical locations, online and on mobile devices to broaden their payment options. Key benefits for B2B companies include handling multiple currencies and using Apple Pay and Android pay systems as well as major international credit cards. New payment methods are becoming increasingly common, and WorldPay will likely be among the first processors to add these new payment options as they become available. The benefits of offering this option to customers include:

  • Providing an intermediary between customer financial information and B2B companies so that administrators don't need to worry about PCI and DSS compliance issues
  • Ability to view all payment transactions on an integrated Business Dashboard
  • Leveraging tools for managing procurement, staffing needs and spending based on the processor's strong analytics capabilities
  • Getting ready to accept online payments in as little as 24 hours
  • Viewing real-time data on the live dashboard
  • Triggering instant notifications and updates
  • Managing returns with one-click efficiency
  • Sending invoices electronically and following up on customer service issues related to payments and invoices

The WorldPay API integrates easily with back-office software, installs quickly and optimizes the customer onboarding process. WorldPay's support team and Partner Portal allow B2B companies to run automatic background and credit checks on business associates and customers for extending credit, entering partnerships and other initiatives.

Other Payment Options

Integrating multiple payment options might include flexible billing, seasonal billing and other special arrangements based on customer value, length of the business relationship and other criteria. Ensuring a seamless process in special billing processes requires integrating customizations in the API layers of back-office accounting and inventory management software and front-end CRM and customized user-experience integrations. Getting paid accurately and timely can affect every aspect of an eCommerce platform, so it's critical to develop billing customizations with a skilled development partner to ensure regulatory compliance, full integrations and access to tools for accelerating collections if they become necessary.

Tips for Building an Omni-channel Payment Environment from B2B eCommerce & Integrations

Today's expanded payment options are essential for companies that want to build a versatile eCommerce platform that connects with all types of buyers and third-party associates. Our experienced engineers can help your company fine-tune integrations with the most popular payment options while addressing any security problems that arise from accepting mobile payments such as limiting access to staff and stakeholders to confidential buyer financial information. We'll help you customize your platform for related issues like offering better mobile invoicing, optimizing traditional B2B payment methods, integrating new payment options and ensuring regulatory compliance. Call or contact us today at B2B eCommerce & Integrations for answers to your mobile payment questions or to schedule a consultation about any issue involving building a better eCommerce platform with design and function customizations.


 

References:

[1] American Banker: Check Please! The Future of B2B Payments https://www.americanbanker.com/news/check-please-the-future-of-b2b-payments

[2] Webbiquity.com: 21 Vital Mobile Marketing Facts and Statistics for 2014 webbiquity.com/marketing-research/21-vital-mobile-marketing-facts-and-statistics-for-2014/

[3] McKinsey,com: Global Payments 2015: A Healthy Industry Confronts Disruption www.mckinsey.com

[4] Creditcards.com: Credit card fraud and ID theft statistics www.creditcards.com/credit-card-news/credit-card-security-id-theft-fraud-statistics-1276.php