Bigger investments in digital commerce lead to new financing opportunities and more buying power for small and mid-sized business. Rob Rosenblatt, CEO, Behalf, Inc.

Prior to the pandemic, a surprisingly large percentage of B2B commerce still took place via
traditional channels such as in-person sales, assisted selling, distributors, and phone. When
everything shifted to online purchasing, a lot of B2B sellers were really unprepared. But, since
then, we’ve seen a lot of progress. And we’ll a lot more in 2022. Here are four areas I am
watching in 2022 business merchants continue to invest to improve the customer experience
and streamline their business operations.

1. B2B Gets Real About Digital Commerce
Innovation in B2B payments has lagged B2C for many years. The fundamental changes in
buyer/seller interaction models caused by the pandemic have forced the B2B merchant
community to take a fresh look at how payments and financing enhance – or detract from – the
overall customer experience.

In 2022, B2B merchants will continue to fortify the e-commerce experience with the goal of
making the end-to-end buying process as frictionless and differentiating as possible. This will go
beyond the shopping experience. Building on the momentum for Buy Now Pay Later (BNPL) in
consumer retail, B2B merchants will invest in capabilities that enable them to automate the
offering of financing solutions at the point-of-sale. These capabilities will provide their
customers with greater buying power (raising the average ticket) and enhance cash flow
through better matching of cash inflows and outflows. They will also build customer loyalty and
create important operational efficiencies.

2. B2B Buyers and Suppliers Flex on Payment Details
In B2B commerce, “payment terms” are an important aspect of any business relationship.
These financing details have typically been negotiated up front — before the vagaries of
specific transactions can really be considered.

As SMBs take more considered approaches to how they pay for goods to optimize capital
allocation, manage cash flow, and match inventory to revenue flow, B2B merchants will
respond with more flexible financing choices tailored to different types of transactions. We will
move towards a “slider function” built within financing programs that facilitate alignment on
financing details, discounts and payment summaries between buyers and sellers at the
individual transaction level. Longer-term, we will see the evolution of category and
merchandise-specific automation of financing options with the assistance of AI- and analytics-
based platforms.

3. New Financing Options for Small Business
Small businesses desperately need more flexible financing alternatives to traditional business
credit cards and loans. Fintech will be the solution to that problem in 2022 with the emergence
of alternative lending solutions specifically for small businesses. These will come in different
forms — from alternative financing solutions purpose-built for B2B, to all-in-one small business
and spend management credit cards, to neobanks and defi solutions. SMBs have some access
to products like these today, but 2022 will be the year in which we see a laser focus on products
that specifically address the needs for expanded working capital solutions for small businesses.

4. Banks Dive Deeper into BNPL
Some traditional banks view alternative financing solutions like Buy Now, Pay Later (BNPL) as a
threat – to their credit card, credit line and installment loan businesses. JP Morgan Chase, in
particular, has been outspoken about this threat and vowed to defend against it. Others such as
Barclays and SoFi recognize the promise of BNPL and have partnered with MasterCard to offer
BNPL-type services.

In 2022, expect to see more banks incorporate alternative financing and BNPL solutions into
their offerings for consumers and businesses. Some will offer solutions via acquisitions of
fintech startups while others will look to partner with fintechs or build these capabilities from
within. As more banks embrace alternative financing, they will in fact contribute to the
proverbial “rising tide that lifts all boats.” Beside their role as a trusted source of financial
advice, banks have the ability to capitalize on vast reservoirs of spend and payment history to
improve access to flexible financing alternatives for both consumers and businesses.

The web is tailor-made for B2B commerce — always on, 24/7 availability, self-service, nearly
unlimited choice. It creates a wealth of new opportunities for businesses to improve the way
they engage and serve their customers, while also dramatically streamlining their business
operations. I think we’ll see B2B start to really close the innovation gap with B2C in the next 12-