How Millennials and Gen Z are driving B2B payment innovation

Did you know that 71% of business buyers today are Millennials or Gen Z?

The way businesses handle payments is changing, and younger generations – Millennials and Gen Z – are leading the charge. These digital-first generations have grown up with technology, and their expectations for speed, convenience, and security are reshaping B2B payments.

Read on to learn how Millennials and Gen Z are influencing payment innovation, what businesses need to know to keep up, and what the future holds for B2B transactions.

The digital-first mindset: From leisure streaming to workplace efficiency

Millennials (born between 1981 and 1996) and Gen Z (born between 1997 and 2012) have a strong preference for digital and mobile solutions. They’ve grown up with instant access to entertainment, news, and more via their smartphones. Convenience and speed are not luxuries for these generations. They are the standard.

According to the U.S. Department of Labor, Millennials currently make up the most significant portion (36%) of the workforce in the U.S. with Gen Z rising (18%). So a generation of tech-savvy people is also deciding how to implement these technologies into their jobs and businesses. Gen Z, while younger, are truly digital natives and are much more adept at leveraging their networks to support their new business ideas.

What’s changing in B2B payments?

In many B2C spaces today, instant payments, contactless transactions, and digital wallets are the norm. This shift is now making its way into the B2B space, where these generations are expecting, and driving, the same level of efficiency and flexibility in business payments as they experience in their personal transactions.

In fact, PYMNTS research shows that 85% of Gen Z and 82% of Millennials prefer contactless digital payments over traditional methods. This means that paper checks, slow approval processes, and manual invoicing are quickly becoming outdated in favor of virtual payment solutions.

Traditional B2B payments are quickly becoming outdated, with multiple manual steps involved in processing invoices, approvals, and fund transfers. However, younger decision-makers are pushing for innovation in three major areas:

1. Digital and mobile payments are becoming standard

Business payments are shifting toward mobile and digital platforms. Just as people use Apple Pay for personal purchases, businesses are moving toward mobile-friendly payment solutions. Virtual cards, real-time payments, and digital wallets for corporate use are on the rise. These tools make transactions faster, safer, and easier to track.

2. Faster, more flexible payment methods

Millennials and Gen Z professionals value speed and efficiency. That’s why they are embracing alternative payment methods like Buy Now, Pay Later (BNPL) for business purchases, automated invoicing, and real-time payments. Businesses that adopt these options can improve cash flow, reduce processing times, and build stronger relationships with suppliers.

3. AP automation is streamlining payments

Automation is another major factor in B2B payment innovation. Automated AP solutions are helping businesses manage invoices, detect fraud, and predict cash flow needs. Instead of manual processes that take days (or even weeks), automation allows payments to be processed in minutes, reducing errors and improving efficiency.

Why businesses need to adapt

As Millennials and Gen Z take on leadership roles, businesses that don’t adapt to these changing payment preferences risk falling behind. Here’s why embracing modern payment solutions is essential:

Faster payments improve cash flow: Delayed payments can hurt business operations. Real-time and digital payment solutions help companies get paid faster and manage cash flow more effectively.

Better security and fraud prevention: Traditional payment methods, like checks, are more vulnerable to fraud. Digital payments, through automated processes, provide added security and transparency.

Enhanced supplier and partner relationships: Businesses that offer flexible, convenient payment options build stronger relationships with their suppliers and partners. Faster payments and easier transactions lead to better collaboration and trust.

How to prepare for the future of B2B payments

If your business is still relying on outdated payment methods, now is the time to make a change. Here’s how you can get started:

1. Invest in digital payment solutions

Choose payment platforms that offer modern solutions like virtual cards – tools that simplify transactions while offering added benefits such as improved security, spending controls, and revenue-generating opportunities through rebates.  

2. Automate your payment processes

AI and automation can reduce manual work, speed up payments, and minimize errors. Consider adopting automated invoicing and payment approval workflows to save time and improve efficiency.

3. Offer more payment flexibility

Consider integrating flexible payment options, such as Buy Now, Pay Later (BNPL) or installment plans, for your business customers. This can help improve cash flow and strengthen relationships with partners who need more payment flexibility.

4. Stay ahead of security risks

As digital payments grow, so do cyber threats. Businesses should invest in fraud detection tools, two-factor authentication, and secure payment processing to protect sensitive financial data.

The bottom line: The future is digital. Are you ready?

Millennials and Gen Z are redefining the way businesses approach payments. Companies that embrace digital, fast, and flexible payment methods will not only meet the expectations of younger generations but also gain a competitive advantage to set them up for future success.

By adopting modern payment solutions now, businesses can improve cash flow, strengthen relationships, and position themselves for long-term success. The future of B2B payments is digital so make sure your business is ready for it.

For more insights and updates on corporate payments, check out:

• Your guide to virtual card rebates
• 2025 payment trends
• Is the secret to better cash flow management AI?

Learn more about how WEX payment solutions can be tailored to your business, so you can accelerate and streamline operations while creating lasting growth and success for your organization.

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The information in this blog post is for educational purposes only. It is not legal, tax or investment advice. For legal, tax or investment advice, you should consult your own legal counsel, tax, and investment advisers.

Sources:
Forrester
U.S. Department of Labor