In business to business (b2b) transactions, the options to pay for lumpy invoices over time haven't changed all that much in the last few decades. Some are still heavy touch, slow and inefficient, impacting a Supplier’s ability to sell more products, get paid sooner or maximise cash revenue.
Comparably, business Customers tend to delay payment of invoices, especially lumpy ones, due to limited 'just in time', time efficient and cashflow friendly options offered by Suppliers.
Businesses are wanting choices around how to pay for the universe of potential purchases. An online option that is pain free, fast & cash flow efficient for situational or repeat purchases can be a new addition to these options. New and innovative fintech products such as a Pay-Over-Time solution can provide benefits, both to Suppliers and business Customers.
Procuret is continuingly investing in technology. Today we provide a Pay-Over-Time solution called ‘Pay In Instalments’ - allowing professional and essential services businesses to purchase the products and services they need now, and pay in predictable monthly instalments over time.
Since launching in 2019, we have seen Australian growth mindset Businesses turning to ‘Pay in Instalments’ as a flexible payment option for their purchases. With a seamless and digital sign-up process that can take 2 minutes, a Business can purchase an item immediately from a Supplier and commit to paying for it in monthly payments with automatic direct debit from either a bank account or card.
‘Pay in Instalments’, is designed entirely for Business purchases (with the seamless elements familiar to buy-now-pay-later services). Businesses can purchase items they need, at once, allowing them to better match the value generated from the purchase with terms of payment.
To understand how Pay-Over-Time solutions like ‘Pay in Instalments’ work, let’s consider a business purchase.
Sarah's architecture practice is growing, and she needs the latest CAD software licenses for her expanding team. She receives a quote for $17,500 from her Supplier. The quote is more expensive than she budgeted for, but the licenses quoted have the exact features she prefers.
The next steps show how she purchases the licences with a flexible payment solution.
Sarah discovers the offer to Pay-Over-Time. On the Supplier quote, she sees the $17,500 price alongside a message that the licenses could also be hers for 12 monthly payments of $1,590. That payment includes all of Procuret's fees. This 12-way split catches her interest, because paying $17,500 immediately doesn’t fit in her budget. But paying $1,590 every month is more manageable.
Sarah clicks the ‘Pay Monthly’ link to proceed. She then enters the invoice number and amount and sees exactly what her payment schedule will be and agrees to it. The entire process is online, does not require any paperwork and takes 2 minutes. All she needs handy is her driver license, ABN and preferred payment method. Procuret’s technology processes the data she enters and notifies her of a successful decision within minutes. Terms and eligibility criteria apply.
Sarah's purchase is now finalised. Her Supplier gets immediate upfront payment. The payment plan with Procuret frees the Supplier from having to collect Sarah’s payments. And Sarah gets the CAD software licenses she needs at once.
Sarah makes her first monthly payment according to the payment schedule and the rest of her payments are automatically debited from her nominated card. She knows exactly what she owes and can edit her payment method by signing in her Procuret dashboard.
In this transaction, Sarah pays a Procuret service fee which is spread over the term of the instalment plan, based on the set up selected by the Supplier with Procuret. Suppliers can also set up a no fee arrangement option for their Customers with Procuret.
With the increased consumption of SAAS products (such as Xero, Atlasian, Campaign Monitor, Canva…), businesses are becoming more and more accustomed to paying monthly as they go. This has helped businesses familiar with the concept of Pay-Over-Time solutions to make the transition across other purchases.
Suppliers selling to these Customers can benefit from low set up impost and huge upside potential for sales volume. Operating without a ‘Pay-Over-Time’ choice for Customers, can end up placing them at a competitive disadvantage.
Other Supplier benefits include higher average order values (AOV) and conversion rates, along with lower abandonment and Customer acquisition costs. The increased likelihood of repeat purchases and Customer satisfaction can add loyalty to your brand.