The Payments Podcast by Bottomline

Episode Transcript

Owen McDonald (Host): Welcome to The Payments Podcast. I'm your host, Bottomline managing editor, Owen McDonald. We've got one amazing year in B2B payments chasing another this season. Corporates face colossal changes due to AI, while optimal payment security and efficiency remain elusive. For insights on what to expect in 2026, we've called in Bottomline's Jeff Feuerstein in the US and Richard Ransom in the UK.

They're with us now. Richard Ransom, Jeff Feuerstein, welcome back to The Payments Podcast. 

Richard Ransom: Thank you.
Jeff Feuerstein: Thank you, Owen.

Owen McDonald (Host): Thank you both for being here. Kicking off with you, Jeff, security and payments automation are tightly linked, and they are top priorities for corporates amidst rising cyber threats. How do you see the landscape for b two b payments fraud in 2026 broadly speaking? What technologies will be most critical for navigating that landscape, Jeff?

Jeff Feuerstein (Guest 1): Yeah. So, Owen, you're exactly right. Fraud losses are rising. Fraudsters are more sophisticated than ever, And, therefore, there's more tools and procedures companies need to be implementing, than really ever before, particularly in the US where check payments and fraud are are still a huge challenge. Organizations, we think, should be taking a layered approach.

That means, you know, focusing on moving as many of your payments to electronic payments so that you can reduce impacts of potential, check fraud. Right? 

Vendor verification. Know your vendors. Know all of your beneficiaries. Implement anomaly detection. Find ways in all of your processes where, whether they're your internal solutions, your technology providers, your bank partners, make sure that their solutions help protect you from from fraudsters. You know, so you can combat things like business email compromise, put procedures in place, etc. 

And lastly, really, as you touched on, the AI environment is certainly getting stronger. Use of AI, in payments is is critical. And so leverage AI and, again, transaction monitoring, where you can to make sure you're securing your entire payment network.

Owen McDonald: So a very multilayered approach. Turning to the strategic role of payments in the finance function, Richard, you've spoken about the growing importance of payment hubs and the need to have a, quote, payments champion, unquote, to break down organizational silos. How can corporates pick the right person or team to better unify AP, AR, treasury, all to drive more strategic value from payments?

Richard Ransom: So, Owen, the payments champion can come from any area of the office of the CFO. Typically, we've seen this role organically forming from accounts payable (AP), where timely accurate payments are part of the core responsibilities. So the right person will understand the interrelationship of the money in from accounts receivable (AR) and the money out of AP. And the working capital management that has to happen in between in treasury operations to keep the money flowing through and build the business efficiently. So this individual or team are then really well placed to bring fragmented technology and process together by articulating the value of consolidation from an accuracy, timeliness, security, and visibility point of view across all of these areas of finance.

And what we find this does, is start to create a value center rather than a collection of cost centers.

Owen McDonald: Fraud prevention and regulatory readiness go hand in hand. Jeff, with NACHA 2026 requirements on the horizon, including anomaly detection and risk based processes overall, what steps should be taken right now to prepare for compliance and to strengthen anti-fraud frameworks generally?

Jeff Feuerstein: It's really timely. The upcoming rules are coming in effect - it's a two phased approach - so they're coming into effect, first in March and then in June. So it's important businesses are really aware of these changes. And in short, the rules are requiring businesses to verify ownership of the recipients that they're sending payments to. Right? So you need to have a user-validated data source before sending any of those funds. So what does that mean inside the corporate and the business? You've got to start thinking about your internal processes, and most importantly, implement fraud monitoring tools for that transaction monitoring, anomaly detection, and account validation.

It starts, of course, internally. Identify where your fraud risks can be in the organization, but then implement technology to monitor vendors, and transactions. This is, of course you know, with the NACCHA rules - it's always specific to ACH, But, we've got the the sort of framework where you've got to start looking at everything that you're doing [across] your payments and your entire payment strategy, identify where you're sending checks today because that's where the real risk is, and then implement that through the upcoming NACCHA rules.

Owen McDonald: To move on to embedded payments, which are heating up! So is the role of PSPs (payment service providers) like Bottomline and other intermediaries in this area. Richard, Jeff, I'd like to hear from both of you on this. How do you see embedded payments advancing - specifically among mid market and enterprise firms? Richard, let's go to you first.

Richard Ransom: Yeah. This is really interesting for us. So the rise in new embedded payments use cases, particularly in the UK, are being driven by the use of open banking for us. And account-to-account payments as well, which sort of disintermediates the card rails from these processes. So the card rails have settlement windows, authorization networks, and many mouths to feed. 

And what we've found that people want in embedded payments is the payment to move from A to B, from buyer to seller immediately rather than there be any gap where settlement delays happen. So removing the settlement delays is really key. Open banking helps to do that. And this near instant money movement lends itself to embedding payments deeper into B2C and lower value B2B flows. Like paying an invoice immediately directly from your accounting system without having to leave the application and go to another platform. Or adding a payment link to a bill that can be paid instantly and easily reconciled by the supplier because all of the necessary reference detail is carried in the payment. 

For embedded payments to really fly in midsize and enterprise, the ability to initiate a payment without having to authenticate with your bank each time will be key. So this is coming very soon. In the UK, those account-to-account payments, driven by open banking or what's also called pay by bank, still need every payment to have an authentication to the bank. What we'll see in the future - with variable recurring payments - is the ability to authenticate once and just say, yep, every time I get a bill from this supplier and I say go, you can pay it. That's fine. And you can set limits on the maximum value that might be.

Owen McDonald: Jeff, what do you see for embedded payments, next year?

Jeff Feuerstein: So Richard gave a great view and it's right in the UK as well as in the US, which is enabling businesses make payments, use all of the call it the features, functionality of their bank partners while being within their financial system. Right? And so meet your customers where they are. Enable them to do what they need to do inside their financial system without what we often call the swivel chair of moving between solutions.

You know, really, as a payment service provider, we're trying to help corporates do that, but we're also helping fintechs and businesses who are trying to get into payments, support their businesses with broader solutions, with broader payment functionality. And that's enabling this additional approach of embedded payments where we've got partners in the invoicing space and want to get into payments, partners who are in procure-to-pay but haven't really figured out how to monetize payments with virtual card, and digitized payments. So we are enabling the broader ecosystem to support payments today, ultimately driving to that best, you know, customer experience, where the customer is getting the simplified approach, getting more payments out of their system - hopefully in a digital way - and improving their cash flow.

Owen McDonald: Looking now at ISO 20022 potential resistance to change, Despite enhanced remittance data and all that portends, many corporates are resistant to ISO 20022 adoption. They seem immune to the charms of richer data, straight-through-processing, and better cash reporting. Why, Richard? What are the barriers and how can solution providers help corporates embrace the new messaging?

Richard Ransom: ISO 20022 is a global standard for payments. There's massive advantages for payment infrastructures, banks, and corporates in terms of standardization, potential interoperability, and supporting fraud prevention through data sharing. So I absolutely see the positives of global standards in payments. However, I think we've got a balance the reality of corporate payment processes today and how ISO 20022 adoption is being sold to those corporates. I don't want to downplay the obvious advantages of structured remittance data.

We do need to look at why, across Europe, after many years of SEPA, industry and the European Payments Council believes only 10% of SEPA credit transfers use these fields. And I think a lot of this has to do with the problem has gone, in a way. So over the last thirty plus years, business payments in the UK and Europe, at least, have evolved from a posted check with a remittance attached to an electronic payment with a PDF traveling in parallel to the recipient. After many years where reconciling remittance advices was a manual or imperfect optical character recognition task, today's ERPs can machine-read PDFs easily and ingest the important data reconciliation and reporting. And this happens already without structured data.

And there are definitely cases where two organizations in a complex supply chain will work out between themselves the data that they need to share to make their business really fly. You know, they might have thousands of items on an invoice, and they might want to just share that data separately to a PDF saying what date things were paid. And this is fine. But what we're seeing happen is organizations are working this out themselves. They're using unstructured data fields and working out their own formats for the structure of that, that works for them rather than having to bend to the structures that are defined in this standard.

So I think this is probably a problem that doesn't necessarily need fixing with structured written information, and certainly, at 10% seems to be that the businesses aren't really looking to fix it. They've had the opportunity. They haven't done anything about it. So our experience is when any new standards and file formats are introduced into payments, the corporates tend to seek insulation from the change as you mentioned. 

I look longer term for the tangible business benefits or have a meaningful ROI. And I don't think there's enough in the structured remittance data to make corporates have to move there. The advantages of the great economy aren't enough for this to be a mandatory change. So I think we'll always be in this situation where a lower percentage of organizations will take the structured data because they just don't need to do anything else. There's nothing in a business case that will drive them to do it.

So, yes, these formats are good. And, yes, we should look to standardize where we can. There will always be insulation from this change, and organizations will always look at other ways and more efficient ways to exchange data between themselves.

Owen McDonald: Yeah. Jeff, any any thoughts on that?

Jeff Feuerstein: I think what I would comment is, you know, there's payments in the US where, and I'll use check and ACH, right - the lower cost of payment, the better way to send data has existed for decades. And yet, you know, to Richard's point, businesses have their own reasons [for not changing]. Often, it's inertia for why they've done things the way they do it and why they continue to do it that way. Right? And so it's not necessarily the cheapest form of payment. It's not necessarily the best form of data. But what we have found, with our customers, frankly, is when we are passing the right amount of data, we're paying businesses the way they want to get paid, well what happens, is vendor relationships actually end up improving. Businesses can start negotiating things like discounts. Businesses can get a better experience. 

So, you know, that inertia is obviously a very hard thing to overcome. But sometimes when you do do it and, you know, maybe it's not the regulatory reasons, but you do it for for the betterment of the business, both the business and the overall trading partner, relationship improves.

Owen McDonald: Okay. Last question. It's about data visibility and cash forecasting next year. Jeff, Richard, you have each emphasized the importance of visibility and forecasting. How will innovations like payment behavior analysis and centralized payment hubs improve liquidity management for corporates in 2026?

Jeff, let's hear from you first.

Jeff Feuerstein: Central payment hubs are available to businesses to improve forecasting, cash visibility, improved ways to see money come in and see money go out, right, to make payments and to get paid. And when you get that level of prediction, you're up-leveling your ability to forecast your cash. You're improving your ability to manage your liquidity. And so businesses have a real opportunity, to leverage AI, machine learning on the data that's coming in, on the payments that are going out, to improve their cash flow across the business.

Owen McDonald: Richard, how about it? Thoughts on data visibility and cash forecasting?

Richard Ransom: Just to add something to Jeff's excellent answer there. I think, what we've seen happening, which is great, is when organizations have centralized their payments into a hub, and bank connectivity is established to all of their different banking partners to service that payment hub. So they're servicing the payments out. Those connections also allow them to have a centralized route for download and visibility of a statement data across all the multiple banks and accounts. Once you can get all that data really quickly into one place, that's a real key to forecasting accuracy.

So everything that Jeff said is helped by the fact once you've got that connectivity to banks sorted for payments, then you're gonna be having that, that connectivity back for all the other data that can come back and really help your forecasting accuracy and visibility. And all those other tools and all the things you can put around that all come from having that data as soon as you can possibly get it.

Owen McDonald: Only one thing seems clear right now. The 2026 outlook is cloudy. What we have confirmed today is that 2026 is going to be a pivotal year in B2B payments. We can't be totally certain of the outcomes, so we value expert opinions. On that note, a huge thanks to our guests, Bottomline's Richard Ransom and Jeff Feuerstein.

To our audience, the smartest people in B2B payments, thanks for listening. Hit subscribe and catch us again on your favorite podcast platforms, including Apple, Spotify, Blubrry, iHeartRadio, and YouTube. Bye for now.

The Payments Podcast, from Bottomline.