Research sponsored by AvidXchange shows compelling new insights on the future of financial technology (fintech) in the business-to-business (B2B) space.
B2B fintech has transformed from simple, on-premise accounting systems that help organizations manage their financial data to cloud-based, dynamic solutions that leverage disruptive technologies to transform financial processes. Among the most talked about innovations are artificial intelligence (AI), blockchain and machine learning and big data.
Read the full whitepaper: Embracing Emerging Technologies — The Future of B2B Fintech
Research reveals B2B companies are more knowledgeable and open to adopting these technologies. However, it also shows most businesses are unaware of how these technologies play a part in daily processes and provide newfound advantages.
Here, we take a closer look at three technologies impacting the B2B fintech space and how they are embraced by customers.
Technologies Impacting B2B Fintech
Artificial Intelligence (AI)
Research respondents are most familiar with AI as an emerging technology. Forty-three percent are aware of its use in fintech applications, such as AP automation. This is likely a result of the revolutionary change AI has already created across industries. In fintech, the technology enables work in real time and creates deep personalization that helps to build customer relationships.
Many B2B companies are leveraging AI to improve operations, including financial services, with 83 percent of businesses citing it as a strategic priority. The technology can boost labor productivity by up to 40 percent by automating mundane tasks that take up valuable time. By automating this work, companies can cut hiring costs and free staff for more fulfilling, strategic responsibilities.
Nearly one-quarter of CXOs believe AI will have the biggest positive impact on their organization in the next five years. Eighty-four percent of businesses say AI will enable them to obtain or sustain a competitive advantage. And 75 percent say AI will allow them to move into new businesses and ventures.
Coined “the technology of trust” by Goldman Sachs, blockchain is a distributed network of records data that can record payments and other transactions quickly and in a highly transparent, verifiable and permanent way. It relies on cryptocurrencies, such as bitcoin, as a medium of exchange. There’s limited knowledge of blockchain’s abilities among B2B fintech users. Slightly more than a quarter of research respondents aware of its use in fintech.
Read more: How To Become The CFO Of The Future
It’s already widely used in peer-to-peer payment services—supporting millions of transactions per day—and supply chain tracking, and it promises to offer B2B companies far more fintech advantages, transforming e-commerce.
Machine Learning and Big Data
Companies of all sizes are continually inundated with massive amounts of data. Traditionally, they rely on trained analysts and data scientists to harness the information and produce insights and analytics that are important components of business intelligence. Now, machine learning and big data technology, also known as predictive analytics, can help.
About one-third of AvidXchange research respondents are aware of machine learning and big data in the B2B fintech space. And adoption is on the rise. IDC reports worldwide revenues for big data and business analytics will surpass $203 billion by 2020.
Because it can analyze historical data, spot habits and make predictions, the technology can forecast financial trends, predict market risk, reduce fraud (and even delay a potentially fraudulent transaction until a human makes a decision), and identify future opportunities. It can also produce actionable insights gleaned from advanced reporting and data analytics tools. That results in in-depth visibility to give high-level members of an organization strategic insights.
Are innovations like these essential to the B2B market? We asked Chief Growth Officer Dan Drees at AvidXchange to share his thoughts based on his own experience and his company’s research.
“These fintech trends are undoubtedly influencing the B2B market right now, most of which are similar to what we’ve seen in the consumer market, but will ultimately have a much more powerful effect on the role of finance, Drees said. “Organizations are recognizing the importance of leveraging innovations when scaling and developing a long-term competitive advantage.
“It’s only a matter of time before these technologies are considered mainstays rather than emerging, so business leaders should take steps now to identify how their teams can utilize fintech to help drive growth.”