We break down how B2B payment processing works, the best methods and providers to consider, and how to simplify the whole process so your business can get paid faster, more securely, and with less admin.
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Processing payments between businesses shouldn’t feel harder than delivering the product or service in the first place. But in reality, B2B payment processing can be slow, complex, and expensive, which can get in the way of growing your business the way you want to.
B2B payment processing refers to the systems and services that allow one business to pay another in exchange for goods or services. These payments are often larger, more frequent, and more complex than B2C transactions, requiring features like invoice matching, approval workflows, flexible payment terms and integration with accounting software.
Here’s how a typical B2B payment flow works:
Unlike consumer payments, B2B transactions can take days or even weeks to clear, especially when approvals or cross-border payments are involved.
Many businesses still rely on manual or semi-digital processes, leading to lost invoices, late payments, and hours of unnecessary admin.
Here’s how to simplify your B2B payment processing:
Streamlining the process can not only help you save time and costs, but it also makes life easier for your customers, too.
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The most secure B2B payment methods include bank transfers, virtual cards, ACH payments, and digital payment gateways that offer PCI-compliant encryption and fraud detection. These methods protect sensitive financial data, reduce the risk of fraud, and offer traceability for large or recurring transactions.
Let’s look at them in a bit more detail:
For extra protection, look for PCI-DSS compliant platforms and enable multi-factor authentication wherever possible.
Payment processing requires connecting multiple players in a secure chain, including payment gateways, issuers, banks and payment service providers. The way your payment processing service manages that chain has a direct effect on the speed and cost of your payments. Here’s what to consider when choosing a provider:
For example, iwocaPay offers B2B payment processing with instant bank transfers and a built-in BNPL option, meaning you get paid in full, and your customer gets time to pay.
Yes, most modern B2B payment processing solutions offer direct integrations with popular accounting software like Xero, QuickBooks, Sage, and NetSuite. These integrations allow you to automatically sync payments, reconcile invoices, and track cash flow in real time, reducing manual data entry and the risk of errors. Some platforms also let you automate invoice generation and payment reminders, helping streamline the entire order-to-cash process.
Switching from manual payments to online B2B payment processing can have an immediate impact on your cash flow, especially if you’re looking to optimise payment processing for ecommerce.
If you sell via a B2B e-commerce platform, having a checkout that's designed for ecommerce payment processing ensures you’re offering a consistent, competitive experience. B2B is more complex for ecommerce than B2C, since it often involves:
Your processor should be able to:
Solutions like iwocaPay or Stripe are great options for handling B2B online payment processing while also adding extra value-add options like B2B BNPL.
To reduce transaction fees in B2B payment processing, consider switching from credit card payments to bank transfers or direct debit, which typically come with lower or no fees. Payment processors, like iwocaPay, offer fee-free bank transfers, helping you avoid the high percentage-based costs associated with cards.
While still found in some areas, cheques and credit cards are increasingly being replaced by faster, digital methods. That said, here’s how they stack up:
If you’re still relying on either, it might be time to explore digital-first alternatives that are cheaper, faster, and easier to manage.
Late payments
Delayed payments can seriously impact your cash flow and working capital. Chasing invoices manually takes time and can strain customer relationships.
Automating your invoicing process ensures invoices are sent on time, every time. Pair this with instant payment options, like iwocaPay’s Pay Now, to make it easier for customers to settle up quickly and securely, with no card fees.
Manual reconciliation
Matching transactions to invoices manually for payment reconciliation is slow, error-prone, and resource-heavy.
Save time by using a payment processor that integrates directly with your accounting software. This allows for real-time syncing, automated reconciliation, and better visibility over what’s paid and what’s overdue.
High transaction fees
Credit card payments often come with percentage-based fees that eat into your margins, especially on high-value B2B transactions.
Switch to bank-to-bank transfers or use a provider like iwocaPay, which offers fee-free instant payments. The savings on each transaction add up fast, particularly for growing businesses with high volumes.
Complex approval workflows
B2B payments often require multiple layers of approval, slowing things down and increasing the chance of missed payments.
Choose platforms that support multi-level approval flows and allow for custom reminders and alerts. This helps keep everyone aligned and payments moving without bottlenecks.
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Given the larger sums involved, as well their business-critical nature, processing B2B payments brings a high-level of responsibility. When processing B2B payments in the UK, make sure your systems comply with:
These standards cover rules for protecting customer information, invoice communication and format as payment processing – which can add up quickly. That’s why the best modern B2B processors come with built-in compliance features to help you stay on top of requirements and keep your customers and business safe.
B2B payment processing doesn’t have to be complex – in fact, the simpler your systems, the easier it is for customers to pay and the more time you can focus on growing your business. iwocaPay is designed to help businesses get paid faster, offer better terms to your customers, and reduce unnecessary admin, all while staying compliant and in control.
iwocaPay helps businesses simplify B2B payments with:
Ready to streamline your B2B payments? Get started with iwocaPay today.
For B2B businesses who want to get paid instantly while offering flexible payment terms.
For trade customers who want to increase their purchasing power while keeping control of their cashflow.
