The 2007 AFP Electronic Payments Survey showed that while checks are still the dominant payment method for B2B payments, organizations are gradually overcoming the barriers and increasing their adoption of all electronic payment methods-ACH, cards and wire transfers.

The 2007 survey, underwritten by the Electronic Payments Network (EPN) is a follow up to an AFP survey on electronic payments conducted in 2004. In 2007, the typical organization makes 74 percent of its B2B payments by check, down from 81 percent in 2004. Electronic payments are gaining ground, especially at large organizations and those with high payment volumes.

Organizations are more willing to adopt electronic payments today than they were three years ago. Forty-three percent (43%) of respondents say that their organizations are very likely to convert the majority of their B2B payments to major suppliers to electronic payments in the next three years. The top three benefits identified by survey respondents are cost savings, improved cash forecasting and straight-through processing to accounting systems.

The 2007 survey was designed to identify changes in U. S. business payments practices, the drivers of change and the benefits gained, as well as the barriers to B2B payments automation.

Among the barriers to increased use of electronic payments, three issues stand out: information technology and integration constraints, inability of trading partners to send or receive automated remittance information, and difficulty in convincing customers and suppliers to adopt electronic payments. While similar barriers were cited in the 2004 survey, organizations have made progress in integrating electronic payment and accounting systems. For example, 59 percent of organizations have integrated their accounting systems with their ACH payment systems, while 40 percent have done the same for card payments.

A majority of organizations use purchasing cards, especially for small dollar purchases. Three out of five organizations reported increased usage of purchasing cards over the past two years. In addition, 43 percent of wire transfer users increased their wire volume during that time.

"This survey confirms that progress is being made in the migration of B2B payments from checks to electronic payments," said Arlene S. Chapman, CTP, AFP's Senior Consultant, Technical Services. "To smooth the path to a more electronic payments future, payments system users and developers should highlight the business benefits of priority investment in payments automation and mount a concerted attack on the continuing technical barriers to adoption."