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How Buy Now, Pay Later Can Help B2B Merchants Accelerate Growth

  • 5 min read

Ecommerce is growing in popularity and there’s an increased demand for digital payments in the B2B marketplace. As such, BNPL is a natural fit for B2B merchants.

In this blog, you’ll learn:

  • The benefits of BNPL for B2B buyers and merchants

  • Why integrated payments are key to making BNPL work for B2B commerce

How Buy Now Pay Later Can Help B2 B Merchants Accelerate Growth

Looking for a way to supercharge your business and delight your business-to-business (B2B) customers?

Offering a buy now, pay later (BNPL) option can make payments easier and more flexible for your customers. Meanwhile, you’ll speed up cash flow, enhance customer service, and boost business growth.

BNPL has been sweeping the business-to-consumer (B2C) world for a years, particularly among millennial and Gen Z consumers. After all, who doesn’t want to take home the products they want now while holding onto their cash for a little longer? Most BNPL solutions allow customers to split their purchases into three or four installments with little to no interest. The process is instantaneous and has no impact on their credit scores.

Those same millennials in the consumer marketplace are often at the helm of the B2B buying process in their workplaces. And they want options there, too. With the growing popularity of ecommerce and an increased demand for digital payments in the B2B marketplace, BNPL is a natural fit for customers looking for more credit options.

In this article, we’ll break down how offering a buy now, pay later option can benefit your B2B customers while amplifying your business. We’ll also share how pairing BNPL with integrated B2B payments solutions takes the pain out of payment processing.

What are the benefits of buy now, pay later for B2B buyers?

In this (almost) post-pandemic economic climate rife with supply chain disruptions and labor challenges, customer experience has never been more important. A flexible BNPL payment option can foster customer loyalty and increase the number of purchases customers make. Beyond that, when you give your buyers a way to delay full payment and make installment payments instead, they get:

1. The freedom to make purchases of higher order value

When payments are broken up over three to four months, buyers can afford to be freer and more far-reaching with their purchasing decisions. Affirm, a US-based BNPL provider, reports that merchants who provide this type of short-term financing can expect to see increases in average purchase size ranging from 31% to 84% depending on the industry.

2. An affordable B2B financing option

Obtaining desirable B2B financing for small and mid-market businesses can be challenging. A short-term credit solution that’s built into the purchasing process is a welcome option for companies that could use some breathing room in the cash flow department.

3. An easier way to pay online

With entire workforces marooned at home, B2B businesses have had to adapt their payment processes over the last year and a half. Just like consumers, B2B buyers are more receptive than ever to doing business online. Adding a buy now, pay later option to your B2B ecommerce channel may have the same explosive effect on sales as tossing a match into a pool of gasoline.

What are the benefits of buy now, pay later for B2B merchants?

Your turn. Merchants have a lot to gain by offering a BNPL option. With thinning margins and fierce competition, many B2B companies are looking for more ways to differentiate their business. Flexible payments are a growing area of interest for B2B customers. By offering buy now, pay later, you can capitalize on that interest and expect:

1. More predictable and faster cash flows

The nature of BNPL solutions means merchants get paid in full, up front. No more waiting 30 or 60 days per antiquated payment terms. Like credit card providers, BNPL solution providers ensure merchants are usually paid for transactions within 24 to 48 hours with zero chargeback liability.

Those near-instant payments mean there’s more cash flowing to your business’ bank account. This makes resource allocation, purchasing, and business planning easier and smarter. With more predictable, reliable payments, your business can operate more efficiently by:

  • Paying expenses in a timely way

  • Purchasing inventory

  • Paying down debts

  • Reinvesting in the business

  • Forecasting for the future

2. Enhanced business growth

Increased sales from buyers eager to hold onto their cash longer with a BNPL option has the potential to boost your bottom line. You may even find new customers in small and mid-market businesses that are hungry for financing options. When you factor in the higher conversion rates associated with offering buy now, pay later—20% to 25% higher according to Affirm—these boosts in sales could be significant.

And with faster cash flow from BNPL providers paying you upfront, you’ll have more freedom to take on initiatives that drive business growth. Since BNPL payments are digital, you’ll also save time and resources that you might otherwise spend processing checks.

3. Increased customer loyalty

When it comes to attracting and retaining B2B customers, every interaction counts. Giving clients the flexibility of holding onto their cash longer could be an important factor for customer loyalty.

Since BNPL goes hand-in-hand with ecommerce and digital payment solutions, offering this option is like doubling down on the kind of customer service that buyers—particularly of the millennial variety—prefer.

Integrated payments are the key to making buy now, pay later work for B2B commerce

All businesses can benefit from a payment solution that’s embedded directly in their enterprise resource planning (ERP) system. This makes it easier to reconcile payments across all your channels with your ERP automatically. All the better if that solution supports payments across ecommerce, point of sale, and accounts receivable channels.

If you want to offer a BNPL option to your B2B customers, an automated system is not optional. That’s because BNPL services integrate exclusively with modern payment solutions.

In addition to providing you with the ability to offer buy now, pay later to your customers, opting for an integrated payments solution gives you an array of other benefits like savings on processing fees and faster collections.

About the author

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Heather Hudson

Heather Hudson is a Toronto-based journalist and writer who specializes in writing compelling content for SaaS businesses, particularly in fintech and personal finance.

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