There’s a fast and easy way to make B2C payments no matter what industry you’re in

When businesses need to make payments to consumers, there can be inconveniences on both sides of the transaction. Inefficiencies with traditional payment methods such as wasted time and unnecessary costs cause frustration for both payors and payees.

Setting up systems to deliver payments for things such as incentives and rewards, rebates, insurance claims, legal settlements or healthcare patient refunds can create managerial headaches and expenses. Manual payments must be generated, tracked and reconciled as well.

Industry trends indicate consumers vastly prefer digital payment methods to a traditional check. According to research from GOBankingRates, 45% of Americans didn’t write a single physical check in 2022. Instead, they chose credit, debit, electronic fund transfers or payment apps, such as PayPal and Venmo, to pay bills. Many people under 35 years of age don’t even own a checkbook.

Do manual checks still make sense in a business-to-consumer (B2C) environment?

“The whole payments cycle is a pain point for businesses, as well as nonprofit organizations, health care companies and governmental entities,” said Andrew Fogt, Director of Sales and Operations for Preferpay^® Payment Solutions at Commerce Bank. “They may have limited staff and resources to internally manage that whole process.”

Manual processes are not only time consuming, but also prone to error. If the business has an incorrect address in the system or the recipient has moved, the check may have to be stopped and reissued. Worse, if the individual can’t be located, the state becomes the custodial holder of that asset through a process called escheatment, which can consume staff time in bookkeeping and related accounting functions.

The time consideration also becomes a factor. Waiting to receive a check in the mail, compounded with additional time for it to clear at the bank can be frustrating to consumers. Prepaid cards may offer a slightly faster solution but can be prone to mail theft.

“A pain point on the consumer side is getting their money fast and efficiently in this digital era,” Fogt said. “If a payment is due to them, consumers want their money quickly and without any fees.”

How to streamline the B2C payments experience

Commerce Bank has pioneered a B2C payment option that eliminates these inconveniences while also offering practical benefits. PreferPay^® allows businesses across any industry to pay consumers quickly through a method called Direct to Debit, enabled by Visa Direct, Visa’s payment solution which helps facilitate the delivery of funds directly to eligible cards, bank accounts and wallets around the world. PreferPay^® also provides ACH and manual check options, though Fogt said for the companies currently signed on, 70% of consumers choose the Direct to Debit option.

By utilizing the capabilities of Visa Direct and the Visa network, businesses can offer a fast way to pay consumers directly via their Visa debit cards. The Commerce Bank PreferPay^® portal can be customized and branded for any business, giving consumers a higher level of comfort and familiarity when logging in since they would most likely be expecting payment from that specific entity, rather than from Commerce Bank.

Commerce has also focused on making the entire login process user-friendly and easy, Fogt said. “We found users don’t like creating new usernames and passwords, especially for a site they may not use frequently. So we’ve established this platform to allow them to authenticate three or more fields of information well known to them, such as a ZIP code, address or phone number to access the system.” The portal will also save their preferences for future payments.

Because Commerce is a bank, they already have advanced fraud and data protection security that extends to the payment card industry (PCI), HIPPA compliance and other sensitive data.

“In the portal, if the payee selects the Direct to Debit option, they simply type in their debit card information and are paid in less than 30 minutes,” Fogt said. “It’s very fast.”

With CommercePayments^® PreferPay^®, our B2C payments solution gives your customers faster access to their funds. With options like Direct to Debit and Direct Deposit, you can improve customer satisfaction and eliminate the need to collect, retain and/or manage customer’s sensitive payment information. Learn more or request a demo here.

CommercePayments^® solutions are provided by Commerce Bank.