P2P payments and fuel card payment technologies

Payment technologies continue to evolve. While the payment process has adapted and improved in every industry from retail and entertainment to healthcare and fleet payments, one segment – payment between peers – has seen an incredible transformation. Known as person-to-person or peer-to-peer (P2P) payments, these electronic transactions are made between people through a P2P payment application such as Cash App, PayPal, Square Cash, Venmo, or Zelle. P2P payments can be sent and received via mobile device or a home or laptop computer. The convenience and access that these P2P payment apps offer has changed the payment landscape in a way that no one fully anticipated, even in the trucking industry and for fleet card companies.

The total transaction value from P2P mobile payments is expected to hit $1.7 trillion in 2024. This marks a 22.8% increase from the $1.4 trillion in 2023. The convenience of this payment method means analysts are expecting more consumers to adopt it. As a result, its total transaction value is forecast to increase, albeit at a slower rate. By 2026, the total transaction value of P2P mobile payments in the US is projected to surpass $2.2 trillion.
— Oberlo

Although the P2P payment industry is predominantly consumer-driven, the growth and convenience it offers have inspired fintechs to simplify business to business (B2B) payments transactions as well. This payments innovation has impacted fuel card use and digital payments for the trucking and transportation industry as well. 

The move from paper payment to digital for some can seem daunting

In trucking and transportation, a move to digital payments can feel like a giant leap for some. While a traditional paper billing system may be cumbersome and slow, one of the key challenges in driving adoption of digital payments within the logistics industry is building trust among the payers and payees.

Many truckers and carriers are comfortable with traditional payment methods, such as paper checks, because they provide tangible proof of payment. — PYMNTS.com

Also, some trucking companies still rely on paper checks because they don’t have the resources to implement the digital platforms necessary to accept digital payments. That puts these companies at risk because of the high levels of fraud and human error that accompany manually executed invoices and receipts. Further, manual processes and paper chasing can be extremely time-consuming.

Since the trucking industry is constantly moving, the ability to make real-time fleet payments via mobile app or device and P2P solutions could create very useful efficiencies for a trucking fleet. The good news is the ever-changing payments landscape is putting pressure on the trucking industry to simplify fleet payments – and the industry is listening.

Factoring to augment cash flow and keep your drivers on the road

Not all trucking companies have the short-term resources they need to stay afloat. This is especially the case for owner-operators as well as small- to medium-sized fleets, since they usually operate within slim profit margins. As such, when invoice payments are delayed by an average of 40 days, having adequate cash flow can be critical. Quick invoice payments are necessary to keep fleet operations running and trucks on the road. Fleet factoring solutions can provide valuable resources to guarantee quicker invoice payments, and these kinds of solutions come with fuel card company offerings. When you sign up for a fuel card for your trucking business, factoring is another tool your fuel card provider will likely offer.

In an industry that is literally on the move, quick, dependable payments are crucial for keeping operations running smoothly. With a business strategy that includes invoice factoring, trucking companies of any size can streamline their operations and gain the cash flow they need to grow within the industry. Another great benefit: Invoice factoring does not add debt to a company’s financial statement.

The WEX approach to factoring (AR financing) is simple: Offer truckers easy, transparent factoring services with no hidden fees. With more than 30 years of experience in trucking financing and the best customer service in the business, WEX is the trusted cash flow partner in over-the-road for trucking fleets large and small.

Companies like WEX offer a variety of fleet products, notably WEX Capital, that offer factoring (also known as account receivable financing) to enable immediate invoice payments and optimize cash flow for multiple aspects of your fleet operations. When cash flow is healthy, fleet managers can better access the resources they need to keep their business running smoothly and their drivers paid. Companies like WEX also offer over-the-road fleet cards that provide real-time access to funds for fuel, hotels, and more.

WEX is a leading, global fintech solutions provider, simplifying payments and back-end business processes in the fleet management, benefits management, and corporate payments areas. To learn more, please visit the company’s About WEX page.

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Editorial note: This article was originally published on September 23, 2019, and has been updated for this publication.

Resources:
Oberlo
Pyments.com