The Consumerization of the B2B Space
July 12, 2022
The following was adapted from a video segment produced by Galileo in cooperation with PYMNTS.
The digitization and personalization of financial solutions products has grown by leaps and bounds in the consumer sector, and the same trend will start to penetrate the B2B world, according to Archie Puri, Galileo Chief Product Officer.
“What has really brought this front and center for consumers is solving key friction points, whether it’s earning, spending, paying, saving, borrowing, protecting or investing. This evolution is going to continue onto the B2B side,” Puri said in a recent interview with PYMNTS.
However, personalization in the B2B sector will be far more complex than the consumer side, given the variety and nuances of the average company’s financial services needs. “We’ve given businesses tools for some things, but not for others,” Puri said. “How can we build this for businesses with all of the same principles and jobs to be done?”
This is a clear market gap waiting to be filled, given the recent acceleration of growth in the B2B payments space driven by the pandemic and other factors. “It’s the perfect alignment of the stars,” said Puri. “Tech investment has grown exponentially, we have seen below the glass innovation, and then a catalyst event. When you combine that catalyst event with accelerated digitization, the time is now for businesses.”
Furthermore, now that millennials and Gen Zers are in decision making roles in the business world, adoption of these new B2B financial services technologies are that much more likely since Gens Y and Z are used to these solutions from their experience on the consumer side.
But while there is a clear demand in the B2B space, there is some catch-up that needs to happen in a few key areas. “We call it the CORR principle,” said Puri. “Converting customers, streamlining operations, reducing risk, and growth revenue. So, while we’ve given businesses tools to grow revenue and convert customers, we haven’t given them the tools to operate more efficiently and reduce their risk.”
For example, businesses are now dealing with rising labor costs, multiple strategic partners, and other complexities, so they are looking for cohesive finance solutions to bridge all these moving parts. Puri explained further, “Businesses want liquidity and connectivity.” Additionally, businesses can use embedded finance solutions as a competitive advantage. “Businesses are getting access to capital and liquidity far sooner,” noted Puri.
Are there pros and cons that come with personalization in the B2B world, like that of the consumer sector? Puri sees it as all positive. “Am I able to get the right financial products for my business at the right stage of my journey? What kind of real time data can I give my lenders about my growth so that they are able to tailor the right products for me? The more these businesses evolve and succeed, the better it is for the entire ecosystem.”
Covid has permanently changed the B2B payments space. “Invoice reconciliation, supplier portals, liquidity, underwriting, better management of working capital, and payment choice are still trends,” Puri said. “But now connectivity and mobility are going to be a very big part moving forward.”
Enjoy our Insights?
Overcoming the Banking-as-a-Service (BaaS) Adoption Curve: Insights for FIs
Learn how FIs can drive real revenue growth and stay competitive by embracing BaaS. Discover the priorities and strategies in our latest report.
What is an Issuer Processor Platform and How to Work With One?
Learn about the crucial role of issuer processing in electronic payments, the benefits they offer, and the key components involved in selecting one.
How BaaS Is Helping Banks Compete in 2023
Discover the benefits of Banking as a Service (BaaS) and how it can help traditional banks stay competitive in the digital age. Download the latest Embedded Finance Tracker® by Galileo and PYMNTS to learn more.
Corporate Hierarchy: Track Expenses with Spend Taxonomy
Don't let economic uncertainty derail your corporation in 2023. Optimize business spending and reduce costs by tracking expenses at various levels with spend taxonomy.
How Any Brand Can Capture the BaaS Opportunity in 2023
Banking as a Service allows brands to create new revenue streams, improve CX, embed financial services, and enhance the customer value proposition.
Till Partners with Parents and Banks to Teach Kids About Money
With an app and debit card, Till Financial enables parents to impart to their kids valuable lessons about saving, spending and managing their financial lives.