One of the takeaways from our Pulse on Payments report issued late last year was how important it is to offer your customers a choice in the method they use to pay their bills. When it comes to B2B payment options, data from a recent survey completed by the Association for Financial Professionals (AFP) reinforces the importance of B2B businesses supporting many different payment methods.
For the first time, AFP segmented different B2B payment types and benchmarked costs in its 2022 Payments Cost Benchmarking Survey, underwritten by A/P software provider Corpay. Some 347 treasury professionals weighed in on payment processes at their companies, and the report offers detailed data on cost, perception of cost and much more.
Here are three high level stats we found particularly interesting when it comes to benchmarking B2B accounts receivable processes.
92% of organizations take B2B payments by check
Checks continue their steady decline, but are still the most utilized B2B payment type for incoming payments – with the share of companies that accept checks the same regardless of size. That said, companies are processing fewer and fewer checks each year - half as many as they were in 2015. That year saw companies processing a medium volume of 1,000-1,999 a month, compared with 500-999 per month in 2021.
73% of companies are moving toward electronic payment methods
After checks, ACH credit (including EDI), Fedwire/CHIPS, ACH debit and credit cards are the most utilized B2B payment methods, according to the research. Their median volume of ACH transactions has doubled in the last six years, survey respondents reported, to 1,000-1,999 per month from 500-999.
Data from Nacha, the governing body of the ACH network, supports that. The network moved 5.3 billion B2B payments in 2021—valued at $50 trillion— a 20.4% increase from 2020. ACH B2B payments are up 33.2% in just the past two years.
It costs between $1 to $2 to receive a check and between 26 cents to 50 cents to receive an ACH transaction
Financial professionals know that checks cost more to handle – and that’s a driver to move to electronic payments. The median cost to issue and receive paper checks hasn’t changed since 2015, according to the report. It remains at $2 to $4 per check to issue, and $1 to $2 to receive. For ACH transactions, the cost is lower on both the issuing and receiving sides, between 26 cents to 50 cents per transaction.