In daily life as a customer, we are paying for the business, for example, if we scan the QR code to buy a coffee or for train ticket booking we are paying using a credit/debit card.
By Krishna Kumar
These days, B2B payment companies are designing CMS solution for B2B business to ease the payment collection. Collect UPI / IMPS / NEFT / RTGS payments and automates the reconciliation in real-time as well.
There are new age CMS that handles payment collection, automatically track every payment in real-time and also provide web-based MIS and reports.
What is B2C and B2B Payments
In daily life as a customer, we are paying for the business, for example, if we scan the QR code to buy a coffee or for train ticket booking we are paying using a credit/debit card. We called these payments B2C payments.
These payments where both parties are in business, for example, a retail business makes payment to a supplier to buy products or a restaurant buys vegetables from a vendor.
As we have seen there are many challenges for payments.
Payments are directly transferred to the bank accounts, to identify the payment business we often have to comprehend bank statements. This is done to check whether the supplier and validate the UTR number. If a business receives few payments per day they can manage it, but when the business receives hundreds or hundreds of payments daily this leads to a reconciliation problem. Manually checking the bank statement to identify every customer payment is hard and prone to manual errors and suspense accounts.
B2B businesses will face toughness in elevation if the business are still dug in with the old manual reconciliation process.
Understanding B2B Payments Vs. Payment gateways
Most e-commerce websites are B2C, as they use payment gateways for payment and reconciliation, B2B payments are high ticket size payments, payment gateways charge in percentage-based pricing models. For example, if a business transfers funds of 5 Lac to a business if the transaction charge is even 1% the charges become INR 5,000. So, B2B business collects payments via bank transfer or traditional CMS solutions provided by banks.
Traditional CMS Solutions
CMS solutions are provided by all top banks. These solutions help businesses create unique virtual bank account numbers for every customer and share the VA number to customers to make payments to the virtual account number for easy reconciliation.
Challenges in Bank’s CMS Solution
– Should open a bank account with the bank who provides CMS solution, in case business using a working capital loan with another bank, they could not open an account with another bank for CMS solution
– For CMS solutions businesses must pay for setup costs and AMC, also banks take weeks to set up CMS.
– Integration is complicated also take a minimum of 4 to 6 weeks
– Technical aspects dependencies involved like IP whitelisting, private key and public key signing.
– Bank MIS solutions are not user friendly and hard to use. It looks like a decade old product.
– Most banks virtual accounts number does not support UPI payments
Modern CMS by Paysharp
– Businesses can keep any bank account and use CMS, no setup or integration cost, get CMS in one day.
– Technical integration, Paysharp provides developer-friendly simple REST APIs and webhooks also provides 1:1 integration support to go-live
– Feature-rich CMS solution which is 15X better than Bank’s CMS solution
– Dedicated relationship manager
– Pricing is based on the number of transactions not based on volume, Cost wise it is cheaper than a SaaS subscription
How CMS helps to grow business
Solves the hard old reconciliation problem, beyond that modern CMS integrates with the client system and makes the reconciliation automatic and real-time. Features like acceptance payments from UPI apps like Gpay and PhonePe, remitter whitelisting, auto-reject payment based on rules.
(The author is founder of Paysharp payment solutions, making B2B payments simplified. Views expressed are personal and do not reflect the official position or policy of the Financial Express Online.)