Business-to-business (B2B) payments are often thought of in terms of the large value transactions which occur between and among large enterprises. But, small businesses, even very small businesses, like large ones, have to pay their suppliers and collect from their business customers. The ability to make and receive these payments in a timely fashion is often a critical factor in the success of the small business: a shop unable to buy new inventory won’t be able to sell much. The means to affect these transactions remotely without visiting the customer’s location or enabling employees to handle purchasing are key to growing a small enterprise. The move toward eMoney also creates a digital transaction record which is key to establishing credit.
In this report, we examine the impact of electronic B2B payments on the development of the DFSs ecosystem in developing countries. We look at the requirements of businesses, at the benefits of using electronic payments, and the trends affecting this market. In a section called “Second Order Benefits”, we look at how the use of electronic B2B payments may accelerate the adoption of eMoney and electronic payments in general. We conclude with recognizing some of the barriers to adoption of B2B payments, and outlining some considerations for policy makers.
The authors of this technical report are Bennett Gordon, Erin McCune, Allen Weinberg, Carol Coye Benson, Janine Firpo, and Quang Nguyen.