Buy Now, Pay Later (BNPL) has transformed B2C commerce by allowing consumers to defer payments without traditional credit. Now, it’s reshaping B2B financing, offering SMBs a flexible alternative to bank loans. 

For many businesses, BNPL can mean the difference between growth and stagnation. It’s a powerful tool to optimize cash flow and support growth. Being able to purchase supplies, equipment or services—while spreading payments over several months—can mean the difference between continued growth and stagnation.

The rationale behind B2B BNPL is simplification and accessibility, enabling businesses to benefit from more agile financial solutions tailored to their specific needs.

This article explores this development in depth, analysing how it works, its benefits and the opportunities it represents for businesses, while highlighting the challenges and prospects for the future.

Buy Now, Pay Later: a fast-growing solution

While BNPL is already well established in B2C commerce, its adoption in B2B is still relatively recent. Companies, keen to access more flexible payment options, are increasingly turning to this alternative to overcome traditional financing constraints. The emergence of specialist fintechs has greatly facilitated this transition, making the integration of BNPL smooth and efficient within business ecosystems.

According to Juniper Research, the value of BNPL transactions could reach $687 billion by 2028, a significant increase on the $334 billion estimated in 2024. This is driven by the digitalization of payments and the growing adoption of integrated financing solutions. This growth reflects a growing need for alternative solutions to traditional bank loans.

What is BNPL for B2B?

B2B BNPL is based on a simple principle: a company can purchase a product or service immediately and defer payment, either in several instalments or at a later date. Unlike traditional loans, which often require guarantees and cumbersome procedures, BNPL offers fast, seamless access to finance, directly integrated into the purchasing process.

Thanks to this model, companies can focus on their development rather than short-term cash management. This type of financing is particularly useful for fast-growing companies, which have to cope with major expenditure while waiting for payments from their own customers.

Companies have always used trade credit, with payment terms negotiated with their suppliers. But with the increasing digitalization of transactions, B2B BNPL is emerging as a modern version of this model, simplifying procedures and offering greater flexibility to both buyers and sellers.

Thanks to new technologies and fintech platforms, BNPL is now seamlessly integrated into the purchasing process, reducing the administrative burden and speeding up access to finance. It also makes financing terms and payment deadlines more transparent, so there are no nasty surprises.

How does BNPL work for B2B?

B2B BNPL is based on a well-structured value chain involving several stakeholders:

1. A company purchases a product or service from a supplier.
2. The supplier approves the order and delivers the goods.
3. A BNPL provider pays the supplier upfront.
4. The buyer repays the BNPL provider in installments or at a later date.

This model is advantageous for all parties. The supplier is paid immediately, the buyer benefits from flexible financing, and the BNPL service provider generates income via service fees or interest on deferred payments.

Why do SMBs use BNPL?

1. Better cash management

SMBs often have to juggle cash receipts and supplier payments. BNPL lets them purchase essential resources immediately without straining their cash flow, giving them greater financial flexibility.

With extended payment terms, SMBs can better manage their cash flow and avoid financial tensions. As a result, they can plan their investments with greater peace of mind and avoid the risks associated with slack periods.

2. An alternative to traditional financing

BNPL is a fast, flexible alternative to bank loans. It requires no collateral and can be set up instantly via online platforms.

Fintechs specializing in BNPL have developed risk assessment models that are more agile than those of traditional banks, making it possible to grant finance to businesses that might not otherwise have access to it.

3. A growth accelerator

With easier access to finance, SMBs can invest more quickly in their development, recruitment, equipment, commercial expansion, and more. BNPL lets them move forward without waiting.

This rapid and flexible cash injection removes the financial barriers to growth, giving businesses the means to exploit new opportunities as they arise.

The challenges of B2B BNPL

While B2B BNPL represents an undeniable opportunity, it is not without its challenges. These include the management of non-payments, which can jeopardize suppliers' cash flow if buyers run into financial difficulties. 

Dependence on fintechs is another critical issue: companies need to ensure that these solutions are reliable and offer sufficient guarantees in the event of technical or economic problems. 

Players such as Defacto, which offers flexible, integrated B2B BNPL solutions, are seeking to meet these challenges by combining speed and financial security.

Companies wishing to adopt this model need to ensure that they fully understand the terms of the contracts and the rates applied. Increased transparency and rigorous evaluation of BNPL providers are essential to ensure safe adoption of this financing solution.

BNPL is the next key tool for SMBs

BNPL in B2B is more than just a payment facility: it’s a genuine growth lever for businesses. By offering a modern alternative to traditional credit, it gives SMBs easier access to the resources they need to grow.

As more and more fintechs integrate this solution into their offerings, it’s clear that B2B BNPL will continue to spread and transform business financing practices.

‍Learn how RollingFunds built its own SMB BNPL facility with Defacto.