20 years: Corporate banking
In this video, Ritu introduces what business-to-business payments are. She further outlines how they are different from B2C and P2P payments, as well as looking at how they have evolved over the years, particularly in relation to modern technological developments.
In this video, Ritu introduces what business-to-business payments are. She further outlines how they are different from B2C and P2P payments, as well as looking at how they have evolved over the years, particularly in relation to modern technological developments.
Every monetary transaction is followed by a payment transfer between parties, whether that's B2C, P2P, or B2B. Business-to-business payments are for transactions between businesses and corporations. B2B payments tend to involve high-volume, high-value repetitive transactions using processes that can take a significant amount of time. B2C transactions are fast and easy to execute. While the industry has been around for a long time, digital developments over the last 20 years have significantly changed the way payments are executed.
Key learning objectives:
Understand what B2B payments are
Outline some key industry trends
Examine some of the digital developments in the B2B space
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Business-to-business payments are for transactions between businesses, or corporations. They involve multiple levels of checks, choice of channels and payment formats that make them more complex and process driven. B2B payments tend to involve high-volume, high-value repetitive transactions using processes that can take a significant amount of time. B2C transactions are fast and easy to execute.
The most common ways of making B2B payments include paper cheques (declining, but still a substantial part), cash, electronic transfers through banks and cards.
Digital developments over the last 20 years have significantly changed the way payments are executed. There have been increases in speed of processing, improved transparency and multiple channels have emerged. The results are better Management Information, automation with minimal human intervention, positive cash flows and efficient controls.
New initiatives regulations such as the Open Banking initiative and the second Payment Services Directive have played a significant role in influencing the digitisation of the payments landscape.
The regulatory framework has:
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