IoT Payments: How Connectivity Drives Business Value and Security

Patrick Bermingham of Adflex

Start‑ups and established firms alike are turning to the Industrial Internet of Things (IIoT), yet many overlook a critical element: seamless payments, according to Patrick Bermingham, CEO of digital‑payments specialist Adflex.

Designing an in‑house IoT payment solution presents steep hurdles—most notably security risks and a lack of interoperability. A single misstep can jeopardise a business’s entire operation.

Why the risk matters

Traditional manufacturing and heavy‑industry sectors hold the greatest potential for IoT‑enabled payments¹. They still rely on antiquated, inefficient, and insecure financial workflows, making them ripe for transformation². For example, smart factories can set stock‑level thresholds that automatically trigger purchase orders and instant payments to suppliers.

Automated payments free up human capital by reducing paperwork such as invoice reconciliation, call‑off delivery notes, and batch ordering, while boosting accuracy.

Moreover, an integrated, stakeholder‑agnostic platform simplifies issuance and acceptance of digital payments. It captures, stores, and processes transaction data in real time, enhancing visibility, flexibility, and reducing transaction costs.

Beyond operations, there are strategic gains. Late payments cost the global economy $3 trillion annually³, with one in ten invoices paid late. Shifting to automated, digital supply‑chain payments ensures timely processing, strengthening buyer‑supplier relationships.

When executed correctly, IoT payments can deliver both operational and strategic value. However, many companies rush to build proprietary systems in pursuit of a competitive edge—an approach that often backfires.

Flying solo on security

Adhering to evolving regulations such as PCI‑DSS is essential. Non‑compliance exposes firms to data breaches, fraud, brand damage, and hefty fines.

Maintaining compliance is costly, requiring penetration testing, skilled developers, and continuous infrastructure updates.

With global data‑breach incidents—like the UK’s removal of Huawei equipment from critical telecoms infrastructure⁵—the risk is unacceptable. Integrating an independent, stakeholder‑agnostic payment platform that handles compliance reduces these dangers dramatically.

Secure, interoperable IoT payments also bolster a merchant’s offering. End‑to‑end encryption and tokenisation replace sensitive data with meaningless tokens, ensuring intercepted data is useless.

Additionally, placing interoperability responsibilities on an independent provider allows rapid scaling. An agnostic platform accepts a wide range of payment methods—credit, debit, purchasing cards, and alternative payment methods (APMs)—enabling suppliers to work with a broader client base.

In a better‑connected world, why go alone?

Connected payment networks streamline financial processes, and buyers increasingly seek innovative supplier payment options, as seen in rising tender requests. Yet for B2B merchants, delivering IoT payments quickly, cost‑effectively, and securely is a complex challenge best tackled with third‑party solutions.

Before exposing themselves to data breaches and operational inefficiencies by building an IoT payment system from scratch, firms should explore proven third‑party platforms that bridge buyers and suppliers, reducing costs, boosting efficiency, and strengthening corporate relationships.

The author is Patrick Bermingham, CEO of digital payments specialist Adflex.