Wired Money: An overdue revolution in B2B payments
By Tom BlomfieldJul 20131 min read
At the inaugural Wired Money conference in London on Monday, I talked about the need for long overdue revolution in B2B payments. For those of you unable to attend, here is an overview.
Fifteen years ago, eBay was an exciting new marketplace for people to buy second-hand goods. But making payments for those products was next to impossible online. PayPal innovated around that problem, making it easy for consumers to make and take payments online. Today, companies like Stripe and iZettle are continuing this revolution.
Consumers now don't have to think about payments - they're instant, convenient and intuitive. But not so for companies.
Businesses have been neglected by the digital payments revolution. Left in the dark ages, they rely on antiquated payment methods such as cheques, which still account for an astounding 80% of B2B payments in the US. To make it worse, any accountant will tell you that managing Accounts Receivable is a laborious job of sending invoices, chasing late payments and manually reconciling bank accounts. The result is that UK businesses are suffocating under £30bn of late payments.
At GoCardless we want to solve that problem by making it simple for companies to take Direct Debit payments online, which puts them in control of when they are paid. Integrations with accounting software platforms mean payments can be automatically reconciled against invoices.
By being resolutely data-driven, our automated payment system has helped businesses such as the Ask Driving Schools reduce their accounting time by 80%. Invoices, payments and receipts don't need to be re-keyed and manually reviewed. We can leave computers to manage payments and accounts for us - with the right identity and authorisation processes in place.
GoCardless is one of the leading companies in the B2B payments revolution making these transactions seamless, convenient and automated. The revolution will (dare I say, hopefully), render 90% of accounts departments redundant. Companies will have more time and money to spend on their products, their customers, and their growth.