2022 has been a year of tumult for much of the payments industry, but the B2B space has provided opportunities for growth and expansion, as customers look to find cost efficiencies, as well as seeing considerable acquisition activity this year.
B2B payments acquisitions in 2022 speak to ongoing market consolidation
While it did impact the rate of IPOs in the space, wider economic uncertainty did little to stem the enthusiasm for acquisitions in B2B payments in 2022, with many companies announcing acquisitions to bolster their offerings.
Fleetcor subsidiary Corpay’s acquisition of Global Reach was one of the most high profile acquisitions this year and will solidify the company as one of the biggest players in the space, rivalled only by Convera, formerly Western Union Business Solutions.
As Corpay President Mark Frey told us earlier this year, “This transaction puts the exclamation point on our position in the non-bank space of being the largest cross-border payments provider by a wide margin.”
For others, acquisitions enabled companies operating in adjacent markets to increase their presence in the B2B space. One such example of this is US-based payment processor Global Payments’ acquisition of EVO Payments for $4bn, in an all-cash deal that adds 4.5 million merchants and more than 1,500 financial institutions to Global Payments’ customer base. The deal is expected to close by Q1 2023 and comes shortly after Global Payments’ sale of its Netspend consumer payments business to Rev Worldwide for $1bn.
For many, acquisitions also provided the opportunity to efficiently expand geographically; iBanFirst’s acquisition of Cornhill, for example, gave it key licences and reach in the UK market.
Payments companies look to B2B for growth
Away from acquisitions, the B2B space has provided critical growth for payments companies that have a presence across multiple sectors of the cross-border payments industry.
Payoneer, for example, saw its B2B accounts payable/accounts receivable (AP/AR) service see 39% YoY volume growth to pass 10% of the company’s overall volume for the first time. Meanwhile, Wise’s business revenue saw 56% YoY growth compared to 47% for personal.
OFX also saw its corporate segment grow by 98% after it completed its acquisition of Firma, which was first announced in December 2021.
Pure B2B players have also had a strong year. Singapore-based Nium expects to remain on a 3X annual growth rate for at least another year, while Flywire saw 40% YoY revenue growth in Q3 22.
New launches in B2B payments for 2022
There have also been a number of new launches in B2B payments, as companies in other parts of cross-border payments look to extend their services to the sector.
One of the most notable of these is from American Express, which launched a cross-border payment solution for small businesses in the US known as American Express Global Pay. This allows businesses to send payments from their business bank account to suppliers in more than 40 countries and across a range of currencies.
Despite a year of ups and downs across the financial industry, B2B seems to have consistently provided opportunities for companies, showing strong returns even in the face of challenging economic conditions. With several large acquisitions in the space set to close in the coming months, B2B will likely continue to prove to be fruitful into 2023.
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