Non-traditional providers reshape B2B payments landscape

By 2030, non-traditional providers could handle 75% of online consumer payments.

Embedded finance is reshaping B2B payments in Asia, with fintechs and digital wallets expected to handle one-thirds of online consumer payments by 2030. The shift is fueled by rising demand for seamless financial integration, especially from MSMEs that dominate economies like the Philippines.

"The shift toward embedded finance in B2B is driven by the growing demand for seamless financial integration," said Lito Villanueva, Executive Vice President and Chief Innovations and Inclusion Officer at RCBC, and Founding Chairman of FinTech Alliance PH. "Businesses—especially MSMEs, which make up 99% of businesses in the Philippines—are looking for ways to streamline operations and enhance customer experiences through integrated financial services."

According to Villanueva, the embedded finance market in the Philippines is projected to grow 23% annually and exceed US$7 billion by 2029. "You can now see how big the opportunity is... that urgency has only grown post-pandemic," he said.

Seah Li Yun, Asean Banking & Capital Markets Leader at EY in Singapore, explained that embedded finance in B2B involves integrating services such as buy now, pay later and invoice financing directly into business platforms. This enables a one-stop-shop experience for customers, offering efficiency, real-time insights, and better cash flow management.

However, the growth of fintechs presents a significant challenge to traditional banks. "Non-traditional providers like fintech players have the advantage of being agile and unencumbered by legacy systems," said Seah. "They can scale quickly and design tailored solutions using real-time data, AI, and predictive analytics to forecast behavior and drive personalised marketing."

To stay competitive, both Seah and Villanueva emphasise the importance of partnerships. “Banks and non-traditional providers should look at forming strategic partnerships,” Seah said. Villanueva added that RCBC is already meeting this challenge head-on through open finance, API-driven innovation, and collaborations like its partnership with API Risk to promote cognitive banking.

Looking ahead to 2030, embedded finance is expected to become a strategic core of B2B operations. "It will be defined by three things—experience, efficiency, and intelligence," Seah said. She added that integrated platforms will support everything from customer payments to supply transactions and employee reimbursements.