From Pymnts · PYMNTS · · 1m 20s
B2B Payments Battle Over Time
Buyers want to pay later, suppliers want cash earlier. Who funds the gap?
In brief
Buyers want to pay later, suppliers want cash earlier. Who funds the gap? B2B payments platforms now finance the time between buyer and supplier cash flows, creating new working capital opportunities. Originally reported by Pymnts.
The Time Gap Problem
Buyers want to preserve cash while suppliers want it sooner; bridging that gap requires someone to finance the interval.
Payment Terms Create Finance Opportunity
A company buying goods on 60-day terms effectively receives financing from its supplier during those 60 days.
Working Capital as a Priced Asset
The working-capital cycle surrounding a payment can last 30, 60 or 90 days, representing liquidity for buyers and receivables for suppliers.
Multiple Ways to Bridge the Gap
Banks, supply-chain finance programs, early payment discounts, or fintech companies can arrange funding for the time gap.
AP and AR Platforms Converge
AP platforms track invoice approval and payment timing, while AR platforms monitor supplier invoices and collection patterns.
Who Controls the Cash Flow
The key is which institution decides when the buyer’s cash becomes the supplier’s cash and who earns the return for financing the interval.
The Financial Opportunity
Platforms that control payment data can identify financing demand earlier and determine which bank or capital provider funds it.
The main idea
B2B payments platforms now finance the time between buyer and supplier cash flows, creating new working capital opportunities.
