American Express (NYSE:AXP) has joined forces with Boost Payment Solutions to enhance the processing of commercial virtual cards for U.S. merchants. This partnership aims to simplify transactions for businesses accepting American Express, leveraging Boost’s Intercept solution for automated processing. As digital payments continue to evolve, the collaboration seeks to address existing challenges associated with manual processing methods, offering a more streamlined and efficient option for businesses.
In recent years, the transition towards digital payment solutions has seen varying levels of adoption across different sectors. Despite consumer transactions largely embracing digital methods, business-to-business (B2B) payments remain predominantly manual, with checks still being a primary payment form. This highlights the potential impact of initiatives like the American Express and Boost collaboration in pushing industries towards digital solutions.
What Benefits Does Boost Intercept Offer?
Boost Intercept automates the processing of virtual card payments, reducing reliance on manual email-based methods. This automation shortens the time between payment authorization and fund settlement, thus improving cash flow management for businesses. By minimizing manual intervention, suppliers can streamline their operations and focus on core business activities.
Why Haven’t Businesses Fully Embraced Digital Payments?
Many businesses hesitate to adopt digital payment systems, often perceiving them as costly and complex. However, experts argue that these beliefs are misleading, as digital transformations can be both smooth and cost-effective. With the right partnerships and solutions, companies can experience operational and financial benefits, making the transition less daunting and more advantageous.
Rebecca Schultz, Chief Marketing Officer at Boost, highlighted that approximately half of B2B payments still occur via check, despite the technological advancements available. This reliance on traditional methods contrasts starkly with consumer trends and underscores the need for modern payment solutions. Schultz suggested that with streamlined processes, businesses could swiftly transition to digital payments systems.
Paul Christensen, CEO of Previse, pointed out that while virtual cards are favored by 80% of buyers, they represent only a small fraction of accounts payable transactions. One of the main issues is supplier acceptance, which remains a stumbling block in broader adoption. Addressing these obstacles can unlock the potential for virtual cards to reduce cash flow challenges significantly.
As businesses increasingly look to digital solutions, partnerships like that of American Express and Boost might catalyze change in B2B payment methods. With the automation of processes and addressing of existing barriers, virtual cards could offer a viable alternative to traditional payment methods. This could play a significant role in improving cash flow and reducing uncertainties for businesses.
