Where cards stand between businesses
The Federal Reserve Bank of Cleveland published a research brief on B2B payment methods in September 2026. It covers the United States, but it is the cleanest picture anywhere of how businesses pay each other and why cards sit where they do.
Businesses moved off cheques. They did not move to cards. They moved to bank transfer, and the card stayed where it was: small purchases, travel, the odd supplier who happens to take it. The brief's explanation is one sentence long. Recipients decline cards once the transaction is big enough for the fee to matter, and in B2B almost every transaction is.
The same pattern, closer to home
Mastercard's own data for the Asia Pacific region, and Mastercard has an interest in the answer, says card spend on cardable domestic B2B payments in Australia more than doubled between 2017 and 2023, with virtual card spend nearly tripling across the markets measured. That is fast growth from a small base. Across the same markets, bank transfer still carries more than three fifths of the spend that could go on a card. Mastercard names the supplier-side friction too: manual reconciliation when the transaction arrives without enough data to apply it.
The Australian Taxation Office gave an unintended data point in October 2026 when it withdrew credit card acceptance. More than 60% of the card value it received came from privately owned and wealthy groups, public companies and multinationals. B2B card use is not a small business habit. It is a treasury instrument used by businesses with large, fixed outflows and a card cycle behind them.
Why the fee lands where it does
The merchant wears it and prices for it
A retailer accepting a card pays the merchant fee, builds it into price and accepts it as the cost of selling to people who carry cards. Margins are set with the fee inside them.
The supplier wears it and did not price for it
A supplier's prices were set on bank transfer. A customer paying a $40,000 invoice by card hands the supplier an $800 cost the quote never included, and the supplier either surcharges, refuses or absorbs it.
Gets the benefit, carries none of the cost
The card cycle gives the buyer 30 to 55 days and a rebate. Every incentive to use the card sits with the buyer. Every cost of accepting it sits with the supplier. That is why it does not move.
The anomaly is not that B2B is behind. It is that the card model asks the party with no benefit to carry the cost. Consumer cards worked because the merchant could price for it. A supplier cannot reprice a trade book for a payment method one customer in ten uses.
What has to change for cards to move in B2B
Not the technology. Virtual cards, tokenisation and straight-through processing have been available for a decade. Three things have to change, and they are commercial, not technical.
- Someone other than the supplier has to be the merchant. If the card transaction is with the supplier, the supplier wears the fee, the card data and the PCI scope, and the Cleveland Fed's $300 ceiling holds. If the card transaction is with a third party who pays the supplier by bank transfer, the supplier is indifferent to how the buyer funded it.
- The buyer has to pay for the days. The card cycle is worth something to the buyer. The honest model charges the buyer for it as a service, rather than hiding it in the supplier's margin or in a surcharge the customer resents.
- The remittance has to arrive with the money. Mastercard's reconciliation point is the one suppliers raise first. A bank transfer with a remittance advice naming the invoices is something a cash application team can use. A card settlement with a reference number is not.
Where this goes
Regulators are already pushing in this direction without meaning to. Australia's surcharge ban removed the supplier's one tool for passing the fee back, which forces the question of who carries it into the open. Interchange on commercial cards was held at 0.8% while consumer fell to 0.3%, which says the regulator sees commercial cards as a different product with a different buyer. Both decisions make the supplier-as-merchant model harder to sustain and the third-party-as-merchant model more obvious.
None of this applies to a supplier whose customers do not ask to pay by card, or a buyer without a commercial card programme. For them, bank transfer is the answer and will stay so.
Our view is that B2B card volume grows, but not through suppliers putting terminals on their accounts receivable. It grows through structures where the buyer chooses the card, pays for the cycle, and the supplier receives a bank transfer and a remittance advice exactly as they do today. The last place cards have not won is the first place the merchant has to be someone else.
The card payment is with us. The supplier is paid by bank transfer.
Flow is the buyer side: card-funded settlement inside your ERP or bank, or from the portal with Flow Direct. Flow Receive, the Supplier Network, is the supplier side: your customers pay by card and you never accept one.
Sources: Federal Reserve Bank of Cleveland, Payments Research Brief, B2B Payments: A Gradual Shift from Checks to Electronic Payment Methods, 21 September 2026. Mastercard Insights, Commercial cards address a longstanding payments anomaly, 2024. Commissioner of Taxation statement on credit cards, 2 October 2026. Reserve Bank of Australia, Review of Merchant Card Payment Costs and Surcharging, Conclusions Paper, March 2026. US figures are in US dollars.