Melio: 2021 Was the Year of Entrepreneurs

Last year brought us the “Great Resignation” as more and more people quit their jobs to work for themselves. As those entrepreneurs turn to digital services in record numbers, demand is growing for tools to help them manage their B2B and B2C payments processes with consumer-like ease, says Prashant Gandhi, chief business officer at Melio. Read his thoughts in the PYMNTS eBook, “In a Word: 50 Thought Leaders Sum Up 2021.”

COVID-19 turned everyone’s lives upside-down — but especially for entrepreneurs, the global health emergency presented a choice of fight or flight. Knowing they had to innovate to succeed, entrepreneurs increasingly turned to digital services to help start, run and grow their businesses. Many embraced eCommerce to remain operational, and consumers favored electronic and contactless payments over cash. The demand even impacted business-to-business (B2B) payments, a space that had traditionally lagged behind business-to-consumer (B2C) in embracing digital technology.

In response to state lockdowns and restrictions, small business owners — entrepreneurs who take on significant financial risk to pursue their passions — began using digital services to improve their cash flow and modernize their payments ecosystems. To inoculate their businesses, they reexamined how to better manage their cash flow through smart payables and receivables management, choosing systems that give them more options for how to fund their obligations and reduce bookkeeping-related work through automated reconciliation.

Technical agility is no longer solely the domain of big business. Today, entrepreneurs of smaller companies have the tools they need to digitize their payment systems — and after making the transition, the impact is profound. Online B2B payments enhance company cash flow, help employees gain more control over their finances and optimize financial health while improving efficiencies and reducing errors.

Additionally, customers reap the benefits. Eighty-one percent of small businesses say that upgrading to a digital payment solution has improved customer satisfaction, with 73% saying that digital payments will be the new normal for their business going forward.

In the old world of paper checks and manual accounting, nearly 40% of small businesses reported spending five hours or more a week on managing payments. As owners go digital, they reclaim this time for their business. These newfound hours help entrepreneurs do what they do best — innovate.

Even in the face of unprecedented challenges, digital payment tools helped small businesses thrive and adapt in 2021. Looking toward 2022, it is critical that entrepreneurs continue to embrace innovation — including but not limited to the digitization of the payments ecosystem — to push their businesses forward.