Amsterdam, 5th June 2018 – A report published today by payments processor RS2 warns that the payment industry must consolidate omni-channel payments, card payments, and direct-from-bank Open Banking payments into new ‘Open Payments’ platforms to meet the demands of connected customers and the retailers serving them.
The report, Open Retailing and Open Banking—Payments Industry Challenges, examines the trends and technologies that are driving change in global commerce. It finds that:
- Mobile, contactless, and digital payments are fulfilling their promise of revolutionising retailing, hastening the decline of cash
- Omni-channel sales will account for more than half of total European retail sales by the end of the decade
- Regulation is a major driver of change, both directly, such as demands for new security standards, and indirectly, such as new fintech providers changing consumer expectations of financial service providers
- Open Banking, and similar schemes, require the payments industry to enable card-less, and usually in-app, bank account-initiated payments for all checkout types, both physical and digital
These trends and changes are forcing retailers to be much more receptive to new payment types to meet consumer demands and keep up with competitors as well as reduce costs and drive operational efficiencies.
In order to support retailers, payment providers must invest now in creating Open Payments platforms that can interact with any payment ecosystem—whether that’s card payments, wallets that rely on card ecosystems such as Apple Pay and PayPal, or card-less payments through Open Banking.
“Furthermore, these Open Payment platforms need to offer more than payments. Services such as device management, customer insight, security, and compliance are valued highly by retailers, especially when they take advantage of access to customer account data under Open Banking.
“Whether it’s in-app, contactless, or via a chatbot in Facebook, consumers are eagerly adopting a wide range of ways to pay. In parallel, the advent of Open Banking has accelerated the card-less ecosystem and merchants are keen to harness the capabilities it offers. As payment types and networks fragment, it’s becoming increasingly important to take an open approach,” said Radi Abd El Haj, CEO and Executive Director, RS2. “Payment acquirers and processors need to offer choice, flexibility and ultimately openness, to ensure they can meet retailer and consumer demands. Open Payment platforms are essential to respond to these short-term changes, but more importantly, lay the foundation to capitalise on the value chains of the future.”
The report was created using the results of recurring market research, plus the views of leading retailers and industry experts. Open Retailing and Open Banking—Payments Industry Challenges can be downloaded here: https://www.rs2.com/open-retailing-open-banking-payments-industry-challenges/
