Discover® Global Network, a leading global payment network, has released the second segment of its 2024 Payment State of the Union, providing critical insights into the commercial payments landscape. Commissioned by Discover Global Network and conducted by 451 Research of S&P Global Market Intelligence, this study surveyed thousands of decision-makers at corporations and small to medium-sized enterprises (SMEs) across APAC and globally. The aim was to understand their priorities, challenges, and plans for future adoption in commercial payments. Discover Global Network will share additional insights into emerging trends at the upcoming Global Fintech Fest. Here are the key findings from the APAC market:
Traditional Payment Methods Remain Popular; APAC Businesses Eye Digital Solutions
- Credit cards (61%), ACH/EFT/Wire/Direct debit (54%), and cash (47%) are the most commonly used payment methods for business expenses.
- 61% of APAC businesses are investing or are open to investing in commercial payment solutions.
- Over the next 12 months, businesses plan to increase the use of digital payment methods for employee travel (50%), employee compensation (46%), and supplier payments (45%).
“While commercial payments are increasingly moving towards digital solutions, the transition lags behind the pace seen in consumer payments due to the complexities of expense management,” said Chris Winter, Head of International Markets (APAC) at Discover Global Network. “As technology advances, businesses must focus on enhancing the security of their payment programs to guard against fraud.”
Modernizing Payment Approaches: Focus on Expense Management, Security, and Fraud Prevention
- Key initiatives for APAC businesses include improving expense management tools (47%), offering more payment options (39%), and streamlining accounts receivable processes (39%).
- The most crucial features of commercial payment solutions are travel expense management (92%), strong security (91%), and fraud prevention (90%).
Ongoing Digital Transformation with Challenges
- Major pain points for APAC businesses include lack of visibility across expense types (35%), difficulty managing expenses (34%), and delays in receivables (33%).
- Challenges in managing employee travel expenses include misalignment of travel expenses with costs (38%), timely reimbursement (38%), and tracking and forecasting travel (34%).
- Managing commercial payments data is challenging due to issues with data integration (47%), excessive time spent on data cleaning (47%), and integrating business systems (44%).
Virtual Card Numbers (VCN) Expected to Grow
- 53% of APAC businesses do not currently use VCN, and 66% do not use VCN for business expenses.
- VCNs are seeing high future implementation interest, with 29% of APAC businesses planning to invest in or explore VCNs.
- Businesses using VCNs have experienced improved transaction security and reduced risk (65%), greater efficiencies (64%), and better expense reconciliation (59%).
“Virtual card numbers offer businesses enhanced payment capabilities and better serve their needs and employees. It’s encouraging to see many businesses considering VCN solutions,” said Winter. “Whether for increased security or improved expense reconciliation, Discover Global Network is committed to helping businesses of all sizes benefit from our solutions.”
