2020 is unlike any year before it.
The Business Payments Barometer gives a snapshot in time before new ways of working transpire. We’ve seen a significant impact on business payments already, with new regulations and greater fraud losses. Staying well-informed of these changes will be a strong focus in 2020, but highest on the agenda will be how companies can accelerate the process of digitization as we deal with and emerge from the COVID pandemic.
2020 payment insights
Changing payment landscape
The payment landscape has changed at a rapid rate over the last five years. New payments initiatives continue to come into enforcement with the report showing an overall decrease in the number of businesses prepared for these changes. Only 8% of decision-makers consider compliance to be a top priority. So, what is causing inaction among businesses?
Real-time payments and paying on time
89% of businesses continue to pay late. The positive news is this is down 3% compared to 2019. However, it’s still too high, especially as we deal with the fallout of a pandemic. Who’s to blame for late payments?
The research reveals a significant drop in large organisations paying late to protect their cashflow. This highlights that Duty to Report and Prompt Payment Code legislation is making a difference, but internal AP processes remain a challenge.
International payments continue to prove a challenge with survey results suggesting they are likely to fall again in 2021, down 4% from the 2019 Payments Barometer. With Brexit on the horizon, what does this mean for international payments?
The survey respondents highlighted a drop in international payments due to reasons such as “difficulty tracking” and trouble “paying on time”; however, the best payment solutions in the market provide real-time tracking dashboards for organisations to monitor payments. Meaning this drop may not need to happen.
Future of payments
Focusing on the next 12-months, it’s important to understand the priorities for financial decision-makers. What’s the reason behind the large drop in compliance this year? Is it because there’s no urgency in these new payment initiatives, or because they don’t understand the benefits?
Changing deadlines and delays give companies an excuse not to prepare proactively. But, urgency isn’t the only reason for this drop.
40 – 47% feel unprepared because they aren’t clear on the benefits.
It’s important, however, to strike the right balance between mandatory priorities compared with those that will enhance day-to-day efficiency in the business.
What’s the top priority for your organisation and does it align?
protecting your business
Compliance, fraud and sanctions
Overall, the concern for payment fraud has declined, suggesting greater resilience in the market. Is better education and a more proactive approach the cause?
However, it’s not all positive…The average cost of fraud loss is on the up. While enterprises were able to recover 4% more in 2020, small businesses, medium and large corporates were not as lucky.
The most shocking fraud statistic? Half of respondents feel it’s a cost they need to budget for. Is this the right approach to payment fraud? The fraudsters certainly hope so.
58% of decision-makers view financial loss as ‘part and parcel’ of running a business
What does this mean for your business?
Businesses respond to the environment and challenges in different ways: whilst smaller businesses feel the most vulnerable to changes in the trading environment, larger companies are most weary of regulatory change. How does your thinking compare with your peers?
Read the full 2020 Business Payments Barometer to ensure you’re investing time and money in the right areas. A crucial consideration for survival and success as we emerge from COVID into a ‘new normal’ payments landscape.
The Business Payments Infographic
Highlights this year's stand out results by company size.
What do the experts think of the 2020 Business Payments Barometer?
We’ve seen the results. We’ve now asked the questions; how will this impact your business and what do the results mean?