Japan B2B Payment Services Voice of Customer, 2021

Japan B2B Payment Services Voice of Customer, 2021

Emerging Technology Adoption and Strategic Partnerships Set to Unlock Growth Opportunities

RELEASE DATE
13-May-2021
REGION
Asia Pacific
Research Code: PBBB-01-00-00-00
SKU: TE04011-AP-MT_25434

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Description

The Japanese government encourages a shift toward cashless through initiatives such as the tax rebate program and open banking law reform. As the proportion of customers using cashless transactions rises, businesses increasingly seek solutions to complement their B2B2C needs. A staggering 55% and 70% of companies received payments today are from consumers and SMEs, respectively. B2B2C payments needs are driving B2B payment solutions development, while demand for B2B solutions alone is far lower.

Frost & Sullivan studied 101 businesses in Japan between January and February 2021 to assess the current state of the industry and uncover actionable insights to drive digital B2B payment services in Japan. The study found that the digital B2B payments transaction value looks set to register a 3.3% compound annual growth rate (CAGR) from 2021 to 2026. There is room for improvement for financial services providers serving the B2B space, particularly in fees, as 69% of companies surveyed think that the current fees are too high. About one-third of polled companies feel that transaction fees for local and international transactions should be lower. Besides fees, companies’ ability to cope with fluctuations in payment volumes and cash flow problems are key issues that need to be addressed.

Market developments point to the untapped potential beyond digitizing businesses. Harvesting the opportunity with industry digitalization is often matched with the adoption of emerging technologies, such as artificial intelligence (AI), Big Data, robotic process automation (RPA), and cloud. Whereas digitization can lead to automation of the payment process, digitalization is much more than that and can lead to more efficient and effective use of resources. It can facilitate more advanced functionality, including dynamic payment routing that can solve customer pain points.

In Japan, business potential does not always translate into business success. Size does matter. The reality on the ground is that despite the need, Japanese companies are in no rush to embrace change. Nevertheless, change is on the horizon as business needs challenge the inertia resisting change. Already, we see partnerships providing added value and businesses getting the benefits. The momentum is building, with credit card market participants establishing a comprehensive B2B payments ecosystem through partnerships with accounting services, transportation services, and office supplies providers.

This study covers Japan. This report’s target audience includes financial services providers and payment services providers keen on understanding the financial services needs of business customers in Japan.

Author: Mei Lee Quah

RESEARCH: INFOGRAPHIC

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Table of Contents

Why is it Increasingly Difficult to Grow?

The Strategic Imperative 8™

The Impact of the Top Three Strategic Imperatives on the Japan B2B Payments Industry

Growth Opportunities Fuel the Growth Pipeline Engine™

Key Findings

Market Definitions

Survey Objectives and Methodology

Key Questions this Survey Answers

Japan B2B Payments Market Outlook to 2026

Japan B2B Payments Market Outlook to 2026 (continued)

Summary of Japan B2B Payment Trends

Overview of Japan B2B Payments Value Chain Opportunities

Japan B2B Payments Value Chain by Service Type

Overview of Japan B2B Payments Flow Solutions

Japan B2B Payments Flow Solutions for Factoring

Japan B2B Payments Flow Solutions for Receiving Payments

Japan B2B Payments Flow Solutions for Making Payments and Enabling Suppliers

Japan B2B Payments Flow Solutions for Payment Analytics and Accounts Automation

Forecast Assumptions

Japan B2B Payments Transaction Value Forecast

Japan B2B Payments Transaction Value Forecast Analysis

Japan B2B Payments Transaction Value Forecast—Credit Cards

Japan B2B Payments Transaction Value Forecast Analysis—Credit Cards

Japan B2B Payments Transaction Value Forecast—Bank Transfers

Japan B2B Payments Transaction Value Forecast Analysis—Bank Transfers

Market Penetration Timeline—Participants’ Strategic Approaches, 2017–2020

Market Penetration Timeline—Key Findings

Competitive Analysis Based on Number of Customers and Annual Revenue

Annual Revenue

Annual Profit Margin

Sales Channels

Expenses Composition

Composition of Payment Receivers and Senders

Incoming and Outgoing Transactions by Focus Industry

Types of Financial Services Currently Used

Types of Financial Services Currently Used by Focus Industry

Top 2 Financial Services Providers by Type of Services

Current Practices in Payments, Bulk Payments, and Accounts Reconciliation Strategy

Average Accounts Payable Terms by Focus Industry

Average Accounts Receivable Terms by Focus Industry

Issues with Current Payment Practices and Unfulfilled Needs to Be Addressed

Satisfaction Level with Current Financial Services Providers

Growth Opportunity 1: Strategic Partnerships for Digital B2B Payments Solutions Development

Growth Opportunity 1: Strategic Partnerships for Digital B2B Payments Solutions Development (continued)

Growth Opportunity 2: Technology Adoption for Digital B2B Payment Solutions Enhancement

Growth Opportunity 2: Technology Adoption for Digital B2B Payment Solutions Enhancement (continued)

Conclusions and Recommendations

Three Big Predictions

List of Exhibits

List of Exhibits (continued)

Legal Disclaimer

The Japanese government encourages a shift toward cashless through initiatives such as the tax rebate program and open banking law reform. As the proportion of customers using cashless transactions rises, businesses increasingly seek solutions to complement their B2B2C needs. A staggering 55% and 70% of companies received payments today are from consumers and SMEs, respectively. B2B2C payments needs are driving B2B payment solutions development, while demand for B2B solutions alone is far lower. Frost & Sullivan studied 101 businesses in Japan between January and February 2021 to assess the current state of the industry and uncover actionable insights to drive digital B2B payment services in Japan. The study found that the digital B2B payments transaction value looks set to register a 3.3% compound annual growth rate (CAGR) from 2021 to 2026. There is room for improvement for financial services providers serving the B2B space, particularly in fees, as 69% of companies surveyed think that the current fees are too high. About one-third of polled companies feel that transaction fees for local and international transactions should be lower. Besides fees, companies ability to cope with fluctuations in payment volumes and cash flow problems are key issues that need to be addressed. Market developments point to the untapped potential beyond digitizing businesses. Harvesting the opportunity with industry digitalization is often matched with the adoption of emerging technologies, such as artificial intelligence (AI), Big Data, robotic process automation (RPA), and cloud. Whereas digitization can lead to automation of the payment process, digitalization is much more than that and can lead to more efficient and effective use of resources. It can facilitate more advanced functionality, including dynamic payment routing that can solve customer pain points. In Japan, business potential does not always translate into business success. Size does matter. The reality on the ground is that despite the need, Japanese companies are in no rush to embrace change. Nevertheless, change is on the horizon as business needs challenge the inertia resisting change. Already, we see partnerships providing added value and businesses getting the benefits. The momentum is building, with credit card market participants establishing a comprehensive B2B payments ecosystem through partnerships with accounting services, transportation services, and office supplies providers. This study covers Japan. This reports target audience includes financial services providers and payment services providers keen on understanding the financial services needs of business customers in Japan. Author: Mei Lee Quah
More Information
No Index No
Podcast No
Author Mei Lee Quah
Industries Telecom
WIP Number PBBB-01-00-00-00
Is Prebook No
GPS Codes 9702-C1,9705-C1,9657,9A66-C1