One problem faced by all B2B businesses is that of customer nonpayment. When a payment becomes past due, business owners face the unwelcome task of having to pursue it. But, how do they go about this task? Anyone running a business will know there is a lot to do. Chasing down unpaid debts is just another task to add to a very long list. It’s no wonder, then, that companies ignore so many past due accounts until a considerable time has passed. Yet, by taking a proactive approach, it is more possible to recover debts. When it comes to chasing down unpaid B2B payments, fintech could be the answer.
Mitigating the Risk
The truth of the matter is that taking a proactive approach is effective in mitigating the risk of nonpayment. Business owners who delay pursuing past due accounts reduce their chances of collecting. The curve is an exponential one, and this makes it vital to pursue debt recovery proactively.
So, how can B2B business owners employ predictors to make pursuing debts more profitable and successful? Debt collection needs to be a top priority. Therefore, it is vital to know where to begin.
Could an Upfront Payment Be the Answer?
For some B2B business owners, it would be difficult to ask for payment upfront. Requesting payment before the delivery of goods or services isn’t always the norm. However, especially for larger orders, requesting a deposit is a possibility. Simply requesting a down payment sends the customer a key message. This could be enough to elicit the remaining amount due on time.
Having A Clear Debt Collection Policy
Another problem faced by B2B businesses is that, frequently, there is no dedicated department for debt collection. Since nobody enjoys making debt collection calls, it is common for procrastination and delay to occur. Meanwhile, the account continues to go further and further past due. Having a clear policy for debt collection is a must. A company needs to put a strict system in place for who will make the calls, and at which point. There must be an outlined process that involves contacting the nonpaying customer via specified methods and at specified times. It can only be by adhering to the system that companies will see consistent results.
Utilizing B2B Payments Fintech
Modern technology has a key role to play in being proactive about debt collection. B2B payments fintech is now out there that allows companies to harness the power of machine learning. A company culls data from a customer’s previous financial activity. Doing this helps the company to then determine whether he or she is likely to make a payment. Big data and business analytics are sciences that work. When a company identifies those who are most likely to pay, it can put in place the right proactive approach.
When considering B2B payments fintech, it’s important to look at the process of making payments. Are B2B customers only able to use cash or checks to pay? If so, it comes as no surprise that payments are not regularly forthcoming. Facilitating speedy and convenient payments is the key to success. By adopting the latest cutting-edge B2B payment solutions, business owners can simplify and streamline their debt collection procedures. By putting in place an IVR telephone payment system and a web portal, making payments immediately becomes easier. Customers can use their preferred payment methods and pay at a time to suit them. As a result, revenue collection becomes simpler, quicker, and more effective.
BillingTree’s B2B payments fintech solutions are the way forward for small businesses of all kinds. By offering reliable and fully compliant solutions for B2B businesses, we keep your cash flowing.