Embedded Finance Revolutionizes Checkout Experience for European B2B Merchants

European B2B merchants have long grappled with manual processes and the associated challenges of slow transaction speeds and high operational costs. According to Anil Stocker, co-founder and CEO of London-based B2B payments firm Kriya (formerly MarketFinance), less than 10% of B2B payments are conducted online. Stocker attributes this low figure to the lack of digitalization and limited payment options available in business transactions, with many wholesalers still relying on phone calls or messaging platforms like WhatsApp for payments and invoice exchanges, as stated by PYMNTS on May 25, 2023.

The complexities of B2B payments are further compounded by the conflicting demands of buyers and suppliers. While buyers often request extended payment terms or the flexibility to pay in multiple installments, suppliers and wholesalers prefer immediate upfront payment. This misalignment poses a significant challenge to the payment process.

However, these pain points have created an opportunity for innovation in the market. Stocker believes that the shift to online interactions and cross-border business transactions, accelerated by the COVID-19 pandemic, has highlighted the need for reliable and trustworthy payment solutions. Kriya, a specialist B2B payments firm, has leveraged the concept of embedded finance to integrate its payments and lending technology into third-party ecosystems across the United Kingdom and European markets, including Spain, the Netherlands, and Belgium.

Stocker emphasized that Kriya has successfully integrated its platform with ten B2B marketplaces, spanning various industries such as food and drink, distribution, logistics, and construction. The company has witnessed rapid adoption by buyers, who can conveniently complete their purchases with a single click at checkout.

Furthermore, Stocker sees significant potential in helping traditional wholesalers transition from offline to online operations. He expects this shift to continue as businesses adapt to the digital age.

In the dynamic digital landscape, businesses now have the opportunity to outsource complex credit and payment needs to B2B specialists like Kriya. The company provides a comprehensive solution, offering fast and frictionless payments, flexible lending options, and robust customer authentication processes to minimize risks and enhance the security of online business payments.

The emergence of generative artificial intelligence (AI) solutions, exemplified by ChatGPT’s arrival in 2022, has sparked discussions on their potential to revolutionize various industries, including healthcare, finance, and spend management.

According to Stocker, generative AI has not gone unnoticed in the realm of B2B payments. Kriya has embraced AI techniques to enhance risk modeling and expand their utilization across the entire business spectrum. By leveraging AI, Kriya can efficiently identify and screen customers who align with their business goals. Additionally, the technology aids in swiftly extracting pertinent public information about trade partners and competitors, and it provides real-time alerts on changes in a company’s structure. These applications enable Kriya to develop an accurate and holistic understanding of their clients.

Stocker also highlighted the significant role of generative AI in customer support for B2B payments. Previously, addressing basic and frequently asked questions from SMB owners required dedicated teams to respond via phone or email. However, with the advent of AI, Kriya can automate and streamline this process, enabling a more systematic and efficient approach to customer inquiries.

Stocker concludes that generative AI holds transformative potential across all business functions, and Kriya aims to fully harness its capabilities to drive innovation in B2B payments.

In the US, there are also companies that have leveraged the concept of embedded finance. Some of them represent traditional fintech players such as Square, Stripe, and Paypal. Square offers a range of payment solutions, including hardware and software products, to help businesses process payments efficiently. They provide point-of-sale systems, mobile payments, and online payment solutions. Stripe is a leading technology company that enables businesses to accept payments online. They provide a robust set of tools and APIs for businesses to integrate payment processing into their websites or applications. Although primarily known for its consumer-focused payment services, PayPal also offers solutions for businesses. They provide invoicing, payment processing, and merchant services that cater to B2B transactions. At the same time, with the emergence of fintech, new and exciting players appear in the fintech arena, among them Plaid, Finix, and Whillet. Plaid provides infrastructure and tools to connect applications with users’ bank accounts, making it easier for businesses to facilitate financial transactions and access banking data. Finix provides an infrastructure-as-a-service platform that allows companies to build and scale their own payment infrastructure, empowering businesses to own and monetize their payment systems. Whillet allows consumer companies to provide embedded financial services for their customers in their mobile app or website.