Most businesses say payment guarantees help, but only 13% use them

Most businesses think a payment guarantee would help them, but only 13% actually use one. That is the central finding of a October report from PYMNTS Intelligence, done with Plaid, called "The Payment Guarantee Gap: Why Adoption Lags Despite Perceived Value." A payment guarantee is meant to make sure a legitimate payment really arrives.

What the report found

Of the firms surveyed, 76% expected a moderate or significant positive effect on their business from a guarantee. Altogether, 95% expected at least some benefit, and none predicted a negative one. Firms also said better cash flow predictability (78%) and less lost revenue (75%) would count when working out the return on better payment reliability.

Why firms hold back

New financial technology can bring costs and complexity before the benefits show up. The report listed three main worries:

• 74% cited concerns about fitting a guarantee into their systems.
• 64% questioned the guarantee fees compared with the expected benefits.
• 59% said the return on investment was unclear.

Part of the problem is measurement. Many firms have no solid baseline for comparison. A company that counts only direct write-offs may underestimate what failed payments really cost, because the fee can look high next to past losses while ignoring the work of chasing money already owed.

Confidence in existing controls

Among firms that did not adopt guarantees, 73% pointed to confidence in their own internal controls. Yet 44% of those firms could not detect suspected fraudulent payments in real time or within minutes. Across the full sample, 6% of transactions flagged or declined by fraud controls later proved legitimate.

What happens next

The gap may narrow. About 48% of firms expect to adopt or expand payment guarantees within two years. Interest was highest among firms whose fraud controls were already built for real-time, irrevocable payments, meaning payments that cannot be pulled back once sent. Among them, 72% expect to adopt or expand, versus 22% of firms with the least-adapted controls.

The report reads this as a sign that guarantees go along with modernizing payment systems rather than replacing it. It also says targeted use may suit firms better than blanket coverage, especially for payment flows where failures cause outsized operational costs.