Banks and PSPs Prioritize Payments Modernization to Compete

Global payments company BPC and research and advisory firm Aite-Novarica Group have announced the launch of a new report to give payment providers a forward-looking view of the evolution of payments and investment drivers for the modernization.

Drivers of Change in Payments: Modernizing Payments to Create New Value provides an overview of global market trends for merchant payments and several key points to help advance the modernization of existing payment platforms for banks, PSPs and other payment companies providing payment acceptance solutions to merchants.

The report comes on the heels of a pandemic-driven boom in digital payments. Global e-commerce transactions grew by 14% in 2021 and e-commerce volume is expected to exceed $8.3 trillion in 2025. More than half of e-commerce spending is expected to occur through mobile devices and this digitalization of the global commerce has dramatically increased merchant demand for payment innovation to create seamless customer experiences.

The findings of the joint BPC and Aite-Novarica Group report outline how merchants are now requiring payment providers to support multiple payment methods and currencies, manage payments across all channels, and deliver mobile experiences of first online and offline. Increased competition has led to strong pressure on margins, with price now a key distinguishing factor.

“We are excited to share insights from this valuable research, which highlights the evolving role acquirers are set to play in the 21st century payments industry,” said Jane Loginova, chief strategy officer at BPC.

“As banks increasingly focus on value-added services rather than just transaction volume, we have kept that core in our mindset while continuing to serve those who are leading the way in this space,” says -she.

The report explains how the payments industry has evolved into a complex non-linear space, incorporating players and capabilities that allow a merchant to securely accept any type of payment, through any channel, issued by various intermediaries. Banks and other acquirers are prioritizing payments modernization to win new business while reducing costs and maintaining compliance obligations.

Aite Group Senior Analyst Ron van Wezel said: “Our report highlights the importance of adopting new payment technologies that can streamline processes, mitigate risk and provide a payment service that helps the consumer as much as business results for retailers, fintechs and banks.

“We hope our findings will be beneficial to businesses trying to navigate the complex and ever-changing payments landscape during a time of rapid digital disruption around the world,” he said.

Acquirers now face changing customer requirements in a highly competitive regulated environment characterized by new entrants, rapidly changing consumer preferences, emerging payment types and increasingly complex value chains. Acquirers are moving from payment companies to merchant service providers, who can increase sales, contain costs, and provide the best solutions for payment-related needs like fraud management and data analytics.

BPC has built a strong reputation for understanding and mastering the local banking and payment environment and behavior – and is ready to meet the challenges faced by a highly digitized global economy. With 350 customers in 100 countries around the world, BPC has collaborated with all players in the ecosystem, from leading banks to neobanks, payment service providers to large processors, e-commerce giants to start-ups merchants and government agencies to local hail-hauling businesses, contributing to greater financial inclusion using next-generation technology.


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Elaine R. Knight