VIDEO | Visa: the highs and lows of B2B payments - Trade Finance Global

VIDEO | Visa: the highs and lows of B2B payments

By Ben Ellis, Carter Hoffman

Ben Ellis is the global head of Visa B2B Connect. In this role, Ben leads the ongoing growth and evolution of Visa B2B Connect. Launched in 2019, Visa B2B Connect is a net new, open network that allows banks and their business clients to send and receive high-value cross-border business payments to more than 100 markets quickly, securely and at a lower operational cost. Prior to this role, Ben served as the global head of strategy for Visa Business Solutions, a team that brings to life innovative products and solutions to Visa’s clients and partners who support businesses of all sizes – from SMBs to large multi-national corporations – and governments around the world. Previously, Ben helped expand Visa’s consulting and analytics capabilities and managed Visa’s enterprise risk team. Prior to joining Visa, Ben was a partner in McKinsey & Company’s financial services practice. At McKinsey, Ben’s work focused on helping financial institutions drive growth and improve profitability, all while managing the risk associated with doing so. He spent significant time serving clients in the U.S., Canada, Mexico and Brazil. Ben holds a B.S. in Mathematics and a B.S. in Economics from MIT, and an MBA from Stanford’s Graduate School of Business.  He lives in San Francisco with his wife and two kids.

Carter is a Research Associate at Trade Finance Global focusing on the impact of emerging technologies on international trade. He holds international business and science degrees from Queen's University and Brock University in Canada as well as the European Business School in Germany. Carter’s work has been featured in publications and articles supported by the SME Finance Forum, managed by the International Finance Corporation, World Trade Organization, and International Chamber of Commerce.

Last updated on 01 Dec 2022

21 Nov 2022 4 min reading time

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Visa

Estimated reading time: 4 minutes

To learn more about the cross-border B2B payments landscape, Trade Finance Global (TFG) interviewed Ben Ellis, global head of Visa B2B Connect.

Cross-border B2B payments landscape

It is important to note that a concise overview of cross-border B2B payments will not fully encapsulate the space and its multi-jurisdictional intricacies.

In addition to the complexities of having multiple markets involved, business transactions naturally need to be able to convey additional data—such as which invoice is being paid—alongside the payment itself, something consumer payments do not need to consider.

According to Ellis, “It’s one of the more complicated business challenges.

“We did some research a short while back, and one of the things we discovered is about 70% of corporates have pain points tied to cross-border B2B payments.”

The research referenced was conducted by East & Partners on behalf of Visa Inc. in June 2019, looking at cross-border payments across 20 countries.

Many of these pain points Ellis mentions tie back to the unpredictability of the transaction.

Businesses often do not know where they are along the route, when they will arrive, or if there will be extra fees attached.

All these unknowns can make it difficult for the ultimate importer and exporter to confidently pass the full value of their offering along the supply chain.

Ellis added, “I think the industry is responding terrifically well.

“One of the things I think the industry is really good at is listening to clients—both financial institutions and their corporate clients—and working to innovate and to come up with ways to solve some of these pain points.”

One of these innovations is Visa B2B Connect.

Visa B2B Connect

When Visa began to examine some of these pain points, some of the aspects of a solution became clear.

Ellis said, “It takes good technology; it takes a good set of rules so that banks know what to expect when they engage; it takes an organisation that’s used to working with banks in a very structured and regulated environment; it takes a company that can do this at scale.”

These elements led Visa to create a network called Visa B2B Connect—a multilateral network where banks can send B2B cross-border payment data to other recipients on the network.

By applying many of the same rules and infrastructure as its traditional business, Visa can help drive secure, predictable, and efficient cross-border payments around the world.

One of many: the issue of standardisation

Any conversation about trade or financial digitalisation would not be complete without a nod towards the challenge that standardisation—or a lack thereof—provides and some solutions for how to overcome it.

Ellis said, “Standardisation is absolutely an issue, and one of the ways we address it is by building flexibility.”

For Visa, this means remaining open to the array of different messaging formats and standards that clients are currently using.

The world may be moving towards ISO 20022, but if a particular bank is not yet prepared to send a message in that format, there needs to be another approach they can take in the meantime.

Ellis added, “What we try to do is to build optionality into how things connect, so the standards that clients are using—whether it’s the ISO standard or the MT (messaging types) standards that folks may already have in place—that we can do the translation and make sure that it all flows through.”

By avoiding rigidity in these processes, organisations like Visa can help foster that 20% growth rate that the industry hopes to achieve throughout the remainder of the decade.