Using payments to drive growth: the Amex perspective

The coronavirus pandemic has had a profound impact on all industries, forcing many businesses to become digitally agile almost overnight. Over the past sixteen months business spending habits have changed dramatically, with many forced to cut costs and pivot and shift priorities at certain times to adapt to the new circumstances. 

However, the uncertainty of 2020 is giving way to hope. Our new research, the Global Business Spend Indicator by American Express, signalled signs of optimism for UK businesses, finding that B2B spending levels were set to grow at an average of 1.4% in the second quarter compared to the same period last year, as businesses took advantage of growth opportunities. 

In particular, our research found that businesses are looking to increase spend on streamlining, digitising, and adding flexibility to payments processes to help meet their growth goals. Not surprising when half of UK businesses (49%) report tricky payment processes to be negatively impacting their relationship with suppliers. And as part of this digitisation, one third (36%) expect their use of virtual cards to increase over the next 12 months, while a similar number (32%) expect to increase the number of electronic bank transfers.

Amidst increasing competition as restrictions ease, payments are set to be a key differentiator, so businesses must ensure they are laying the right foundation to set themselves up for success. 

While our research clearly suggests many UK businesses are already making steps in the right direction, here are our three top tips for payments perfection for those not wanting to fall behind: 

1. Choice is a must-have

Advances in technology have meant there are now more ways to pay than ever, and as a result, customers have higher expectations than ever. In today’s payment environment, choice and availability are must-haves.

And, with the rapid rise in ecommerce and ever-increasing competitiveness, a broad range of payment options represent a prime way for businesses to stand out. Not only will it open the doors to more customers – which translates into higher revenues for the company – but a smooth, effortless payment process will also increase levels of satisfaction in customers, making them more loyal and more likely to recommend your business.

Whether online bank transfer, mobile wallets, direct debit, or app-based payments, there are a huge variety of payment technologies available to help smooth the way and ensure your customers can pay you quickly and effortlessly, via their preferred method.

2. Picking the right partners

Now, more than ever, it’s important to get the right partners in place. As businesses emerge from the pandemic and set their sights on future growth, they need their strongest allies there to support them. 

Our research found that some of the main barriers to payment automation are around security and error concerns, which is understandable given the risk for financial and reputational damage should an automated payment go awry. Finding an established, reputable payments partner is vital to relieve such apprehension. 

This is not an area in which to experiment – take time to research and find payment partners that have a proven track record in powering businesses to success. Consider where the pain points are with your current payments systems and ask questions of prospective new partners – what support do they offer, what programmes do they integrate with, can they offer an end-to-end service? By going into these conversations knowing what your business needs are, you’re much more likely to find the right solution. 

3. Technology is the future

In the business world, every little advantage helps. With multiple forms of technology at our fingertips, it’s important to lean on them to do the heavy lifting, so that you can focus on the things machines can’t do. 

One sure-fire way to improve efficiencies within your business is to automate payments. The UK has the second highest share of businesses that have fully or mostly automated their payment processes – including receiving payments from business customers (52%) and making payments to suppliers (47%) (The Global Business Spend Indicator by American Express leverages survey data from more than 3,600 companies across Australia, Canada, Japan, Mexico, the UK, and the US). 

It’s clear that investing in automation is no longer an optional extra, but an essential for businesses looking to save time on financial admin. 

Beyond automating payments, there are also a growing number of tools that can help with forecasting, budgeting, and planning. Our research reveals that many businesses are reviewing spend more regularly (27%) and making budgets more granular (21%). All these tools combine to help businesses manage their finances more efficiently and save time to concentrate on strategy and growth. 

We’re at a time when businesses up and down the UK are looking to build back better as the economy begins to recover. Evolving your payments processes to meet your business and customer needs will be one key factor in the competition to come out on top. The future of payments lies in freedom of choice and in harnessing software that streamlines the process to create a frictionless experience. It’s up to businesses to respond and seize the options available to them.

About Dean Henry

Dean Henry is the Executive Vice President of Business Financing, Payments & Digital Experiences for American Express’ Global Commercial Services business. Global Commercial Services serves small, mid-sized, large, and global companies, and Dean is responsible for leading a team focused on scaling non-card financing products, AP automation in business systems, cross-border payments, supplier payments, and digital experiences and platforms in the US and worldwide.

About American Express

American Express is a globally integrated payments company, providing customers with access to products, insights and experiences that enrich lives and build business success. Learn more at americanexpress.com and connect with us on Facebook, Instagram, Linkedin, Twitter, and Youtube.