United Kingdom B2B Payments Market

Market Overview

The United Kingdom B2B Payments Market size was valued at USD 89.05 billion in 2022 and is expected to reach USD 96.23 billion in 2023. It is projected to reach USD 200.78 billion by 2031, growing at a CAGR of 8.2% during the forecast period (2023-2031).

Business-to-business (B2B) payment promotes safer transactions for merchants requiring recurring, periodic transactions and offers a variety of tasks to end users, including accounts receivable, accounts payable, payroll, and acquisition departments. It may involve a one-time or recurring transaction based on the buyer and seller's contractual arrangement. Business-to-business (B2B) payments are more complex than business-to-consumer (B2C) payments because B2B payment processing takes longer to approve and settle the transaction.

Increasing digitalization and automation in the B2B payment system have increased its demand among business owners for networking and connecting with various suppliers, distributors, and retailers worldwide. In addition, the expansion of global trade and the increase in cross-border transactions involving many suppliers, wholesalers, retailers, and businesses are the primary forces propelling the global market. However, a rise in commercial payment fraud and the closure of some companies due to the COVID-19 epidemic is expected to hinder market growth. On the contrary, developments in transparency across B2B payments and a rise in partnerships between B2B payment operators and FinTech titans are projected to offer attractive growth prospects for the market.

Market Dynamics

Global B2B Payment Industry Drivers:

Use of Technology in the B2B Payment

With the development of technology that facilitates secure and dependable commercial transactions, B2B payment has grown exponentially. Instead of relying on the conventional technique of sending and receiving payments, business owners are embracing technology-based B2B payment platforms. In addition, automation in the payment system has increased its demand among business owners for networking and connecting with various worldwide suppliers, wholesalers, and retailers. The Automated Clearing House (ACH) is a business-to-business (B2B) payment method faster and more efficient than conventional methods. This type of transaction utilizes a routing number and bank accounts to transfer funds from one entity to another electronically. Thus, technological progress in B2B payment will drive market expansion during the forecast period.

Global B2B Payment Industry Restraint:

Business Losses and Discontinuation Reduces B2B Payments

As a result of the COVID-19 pandemic, B2B payment has decreased due to company losses caused by a downturn in demand for products and services, a shift in client preferences, and other factors. In addition, the cessation of operations across various industrial verticals and the limited trading of products and services are significant factors restraining market growth. In addition, several businesses need more finances to pay their suppliers, which hinders the expansion of the B2B payment sector.

Global B2B Payment Industry Opportunities:

Digitalization of Payments System

As business owners seek real-time updates on payment transactions, digital B2B payments are replacing traditional methods such as paper checks and cash payments. Companies expect digital systems and payment choices from their marketplaces and third-party suppliers. In addition, digitalization decreases trade restrictions and payment frictions, enabling B2B payments for worldwide vendors. In addition, digitalization increases the transparency of corporate transactions and reduces the risk connected with B2B payments. Moreover, unlike traditional payment methods, digital prices are less reliant on the operating hours of a particular institution or bank, which provides the buyer with more flexible payment-receiving hours. Hence, these variables present the profit potential for the future expansion of the B2B payment sector.

Regional Analysis

By 2030, the United Kingdom B2B payments market is anticipated to be worth USD 1540 billion with a CAGR of worth 8% over the forecast (2022-2030).

Segmental Analysis

In the United Kingdom, the B2B Payment Industry is segmented into five categories: Payment Type, Payment Mode, Enterprise Size, and Industry Vertical.

By Payment Type

The United Kingdom B2B Payments Market is categorized into payment type as domestic payments and cross-border payments. The domestic payments segment earns the maximum share of the market.

By Payment Mode

The United Kingdom B2B Payments Market is categorized into payment mode as traditional and digital. The traditional segment dominates the market share.

By Payment Method

The United Kingdom B2B Payments Market is categorized into payment method as ACH, wire, cheque, cash, demand draft and credit card. The ACH segment earns the maximum market share.

By Enterprise Size

The United Kingdom B2B Payments Market is categorized into enterprise size as large enterprises, medium-sized enterprises, and small-sized enterprises. The large enterprise segment earns the maximum share of the market.

By Industry Vertical

The United Kingdom B2B Payments Market is categorized into industry vertical as manufacturing, IT and telecom, metals and mining, energy and utilities, BFSI, and others. The manufacturing segment is the most dominating sub-segment of the market.