2023’s Business Payments Barometer is ready for its close up

Since 2016 Bottomline has taken the pulse of key finance leaders at companies in Great Britain (GB), and last year we added the United States (US) for the first time, gathering 800 responses per country. The result is a fascinating snapshot of the current state of business payments in both countries as well as a look into the issues that will define the next few years. Next Tuesday, June 13, marks the debut of this year’s report. There’s no shortage of issues coming to the fore and conclusions to be drawn from the report. 

It’s likely we’ll see COVID disappear as a driver of change. Last year the pandemic was the biggest driver of change in the Barometer. We can see now that in its wake, COVID blazed a disruptive trail through many industries, banking and payments included. But let’s not forget that it arguably created the need for new innovative technologies and ways of working. It will be interesting to see whether pandemic disruptions remain or perhaps our respondents have moved on completely. Trailing COVID last year were access to pay-as-you-go technology, mobile payments and regulatory changes. 

Will real-time/instant payments see an uptick in usage? It’s a big question this year for banks as well as corporates. As the Barometer illustrated last year, real-time payments can support a company’s ability to hold on to cash for longer, and that is a positive factor in cash management. Last year was also a tale of two countries: Sixty-eight per cent of all mid-sized companies in the US said they had already adopted real-time compared to 48% of small businesses. Focusing on GB, just over half of respondents said they had adopted real-time payments. That dropped in 2020 and 2021 but sprung back in 2022. Differences in the size of the company also affected real-time adoption in GB. Last year the stakes were high for real-time, and this year they are higher. To quote last year’s report: “Being able to hold onto cash for longer is a tangible benefit of using real-time payments. Given the importance of building resilience around cashflow, some businesses could be rejecting a useful cashflow tool through a lack of understanding of real-time payments.”

Will cashflow management lose its manual component? Speaking of cash flow, last year’s report showed that 32% of companies in the US and 29% in GB still rely, in part, on Excel spreadsheets to manage their cash. Across the board, less than 50% used an automated treasury management system and off-the-shelf cashflow management software. We hope to see a positive shift this year, but this mix goes some way to explaining why cash visibility and forecasting continues to be a challenge for financial decision-makers. 

What kinds of fraud vectors will climb to the top of the table? In 2022, 29% of companies interviewed in the Business Payments Barometer admitted they were victims of fraud, claiming a 10% increase in fraud losses versus 2021. Unsurprisingly the majority of financial decision-makers in North America and Great Britain agreed they should be doing more to mitigate fraud. We expect to see more around insider fraud this year, which can be mitigated by application-level and behaviour monitoring. “How some of this technology has helped many organisations in the past becomes more important with working from home,” said my colleague, James Richardson, last year. “And we tend to focus on applications involved in payments. Whether that’s looking at treasury or payment systems, the system sends out an alert when activities are out of the ordinary. It could be someone suddenly logs on to a system and works at 3:00 am or creates new users to generate payments.”

Will Great Britain and the United States be prepared for change? One of the things that makes this year different – especially in GB – stems from the amount of fundamental change on the horizon – be that the macroeconomic environment or upcoming changes in the payments landscape. From ISO 20022 messaging format to open banking, and the New Payments Architecture (NPA) with its overlay services like Confirmation of Payee and Request to Pay. It’ll be interesting to see how well-prepared companies for what’s to come. 

“What we know for sure is that the future will be creative and transformative,” read the 2022 version of the Barometer. 

Next week we will see how far those shifts in attitude have come. Stay posted.