In a digital context, deferred payment methods consistently lead to significantly higher conversion rates. Typically the number of buyers that complete orders increases by 10% to 30% when payment terms are offered, owing to their convenience and efficiency. Whether you call them ‘B2B Buy Now, Pay Later’, ‘Trade Credit’ or something else entirely, solutions that enable online payment terms stimulate growth in the B2B economy.
However, despite the global proliferation of these providers, they often focus on specific regions. This focus makes sense—providing digital trade credit involves challenges like regulatory compliance, swift buyer approvals, risk management, and identity verification based on regional data. Expanding these operations globally is challenging, but imperative for the sustained growth of B2B e-commerce.
To fully understand the significance of a global approach to B2B financing, we conducted a survey of 200 merchants worldwide in collaboration with our partners at Balance. The aim was to discern exactly what they look for in a global payment terms solution. Here’s what we learned.
1. 65% of B2B sellers agree that offering payment terms is crucial for influencing business growth and market expansion.
2. 62% of B2B sellers highlighted the need for a unified payment terms solution that can be seamlessly applied across multiple regions.
3. Only 16% of B2B sellers find it 'very easy' to offer payment terms to B2B buyers in new countries.
4. Marketplace respondents identified three key factors that make trade credit a must-have for global and seamless online trade.
5. Only 43% of larger enterprises expressed a preference for a single solution provider, a figure that contrasts with the average preference rate of 62%.
6. Among companies with revenues of up to $8 million, just 8% found offering cross-border payment terms to be ‘very easy’. In contrast, the highest percentage, reaching 21%, was observed among companies in the revenue range of $80 million to $400 million.
7. 44% of sellers are gearing up to extend their e-commerce operations into Europe in the coming year. Meanwhile, 34% of B2B sellers have set their sights on the Americas.
8. The partnership between Hokodo and Balance has already started helping B2B merchants offer payment terms to customers overseas.
9. Respondents identified 3 key challenges in offering cross border payment terms.
Are you grappling with the challenges of offering payment terms to buyers in other regions? Check out the recording of our recent webinar for insider info and advice from Hokodo and Balance.
