Author

Dan Brightmore

Published

14 January 2025

Estimated Read time

3Mins

Yuno and PayPal team up to simplify Digital Payments for merchants with flexible options to broaden market reach and unlock new revenue streams

Yuno a leading payment orchestration platform, has announced a strategic collaboration with PayPal, a global leader in Digital Payments processing. This collaboration significantly enhances Yuno’s offering, giving merchants seamless access to PayPal’s vast active user network. This now surpasses 400 million worldwide.

Unlocking revenue streams with Digital Payments

Yuno-powered merchants can now effortlessly offer PayPal’s secure and flexible payment option, broadening their market reach and unlocking new revenue streams. Trusted by millions worldwide, PayPal allows users to make purchases, transfer funds, and pay bills in a fast, easy, and secure way, without the need to repeatedly enter card payment information, contributing to reducing digital footprint and providing the security users are looking for. 

Including this partnership, Yuno now supports over 300 global payment methods via its intuitive, user-friendly interface, making it easy for merchants to scale quickly by offering the most popular and locally-relevant payment methods in each market. Yuno’s platform also provides access to other innovative features. These include one-click checkout, advanced fraud protection, and optimised payment routing. This boosts transaction success rates and prevents lost sales in the wake of outages at a payment provider.

Catherine Kaupert, Global Head of Partnerships of Yuno, commented: “We’re thrilled to team up with PayPal, a well-known and trusted name in Digital Payments processing globally. This integration further strengthens Yuno’s capabilities, allowing our merchants to tap into PayPal’s extensive network and drive growth with ease. Together, we are simplifying payments, making them more secure, and enabling businesses to scale without friction.”

Paola Fuentes, Head of Partnerships for Hispanic Latam at PayPal, added: “Our affiliation with Yuno integrates our entire product portfolio. Including PayPal Checkout and credit and debit card payment processing to provide cutting-edge payment solutions for both customers and businesses. By joining forces, we are expanding the benefits of both companies’ offerings, giving consumers the option to select the payment method that suits them best and take advantage of instalments. According to recent data from AMVO, this is one of the main incentives for Mexican consumers to make purchases through the digital channel”.

Last year, Yuno secured $25 million in a Series A round led by Andreessen Horowitz, Tiger Global, DST Global Partners, Kaszek Ventures, and Monashees, fuelling its expansion across Asia, Europe, the Middle East, and Africa.

About Yuno

Yuno has emerged as a dominant force in global payment orchestration. Its core mission is to empower global commerce by enabling businesses of all sizes to accept and disburse Digital Payments anywhere in the world. Furthermore, fostering financial inclusion.

Yuno enables businesses to access over 300 payment methods worldwide. As well as innovative features including one-click checkout, smart routing, and robust anti-fraud tools via a single unified, easy-to-use interface. Yuno serves a global customer base that includes McDonald’s, inDrive, Rappi and other renowned brands across more than 80 countries.

About PayPal 

PayPal has been revolutionising commerce globally for more than 25 years. The company creates innovative experiences that make moving money, selling, and shopping simple, personalised, and secure. PayPal empowers consumers and businesses in approximately 200 markets to join and thrive in the global economy.

  • Digital Payments

Author

Dan Brightmore

Published

8 January 2025

Estimated Read time

4Mins

Industry thought leaders from Marqeta, the global modern card issuing platform, offer a detailed outlook of the fintech industry for 2025, with predictions around personalisation, digitalisation and the evolving regulatory landscape

Payments will turn fully personal, with tailored credit, rewards, and BNPL at scale in 2025

In my opinion, a major global payment trend of 2024 has been hyper-personalisation. A new generation of customers is driving a shift toward personalisation at scale, expecting their FinTech services to be unique and tailored to individual needs. Modern consumers want a future where financial services integrate seamlessly into their digital lives and keep pace with their evolving needs. 

As a result, we are seeing trends, such as personalised credit offerings and rewards booming. In an industry with increasingly low consumer loyalty, brands and financial institutions must go beyond traditional interactions with FinTech. For example, the recent Marqeta State of Credit report found that of UK consumers who use more than one credit card, 43% confirmed that they would use a credit card more frequently if better rewards were offered. By moving to a dynamic, rather than set rewards structure, consumers can earn benefits tailored to their spending habits and preferences in real time. 

Increasingly with innovations like Buy Now Pay Later (BNPL), consumers are guided to credit options specifically suited to them and their needs. In 2025, we will increasingly see personalised BNPL payment plan options being offered in real time. Often within existing payment apps and products we already use daily. We are also seeing B2B payments emerging as a strong trend. Ensuring gig workers, sellers and partners get paid efficiently while offering robust expense management and financing. I anticipate we’ll see more demand for innovative B2B payment solutions that enable seamless money management across 2025.    

Marcin Glogowski, SVP Managing Director for Europe and UK CEO

2025 will be a year of rapid innovation in financial services  

In today’s digital-first world, traditional payment infrastructure is no longer enough to keep up with the demands of consumers. The front door of a bank is now an app, digital wallet usage is increasing. New, flexible services have a growing prevalence on the market. In 2025 and beyond, customers will continue to drive a shift toward modern services which keep up with the rate of digital and mobile innovation.

The ramifications of changing consumer trends could lead to the traditional roles of banks, such as ATMs and as physical branches, disappearing. To ensure continued customer loyalty, all financial service providers will be forced to innovate and offer consumers the embedded, seamless and instantaneous services that they desire. 

Consequently, across 2025, we are likely to see new technology and solutions being offered to reduce unnecessary friction for consumers trying to pay and get paid. We are already seeing increased demand for Accelerated Wage Access (AWA). A Marqeta study shows that 74% of gig workers ages 18-34 would be interested in an employer who offered an option to get paid immediately. As businesses and workers grow tired of cash flow restrictions and having to wait for monthly pay slips in an otherwise instant, digital world. As new services evolve, competition in Fintech will be enhanced and the financial industry will be forced to grow and evolve. 

Nicholas Holt, Head of Solutions and Delivery, Europe

Proactive compliance strategies will lay the foundation for fintech in 2025

With banking and FinTech partnerships under increasing regulatory scrutiny, the stakes around compliance have never been higher. In this environment, Fintechs can no longer afford a reactive approach to compliance. Instead, they should adopt proactive compliance strategies that go beyond simply seeking to avoid fines and that are embedded into the everyday makeup of their culture and product strategies, helping to build trust, ensure stability, and foster sustainable growth. 

At Marqeta, we’re committed to embedding compliance into our company’s culture, helping to mitigate risks and create a foundation for long-term success for us and our customers. Proactive compliance strategies allow organisations to leverage advanced tools and position themselves to adapt to shifting regulatory demands while showcasing a genuine commitment to transparency. 

Alan Carlisle, Chief Compliance Officer

  • Cybersecurity in FinTech
  • InsurTech

Author

Simon James

Published

6 January 2025

Estimated Read time

5Mins

Simon James, CEO of PayComplete, on why 2024 was a pivotal moment for cash and what the future holds

After several years of doom and gloom and many proclaiming the death of cash, the last 12 months have well and truly put that idea to bed. Despite many expecting the COVID pandemic to be the last nail in the coffin, four years later, cash is still in widespread use. The future looks bright. Recent figures from the British Retail Consortium (BRC) underscore the story of 2024… Cash is no longer on the way out and is set to remain a critical part of the payment ecosystem and economy for the foreseeable future.

What happened with cash?

The resilience and ongoing importance of cash to payments, finance, and the economy is down to two factors. Firstly, it’s clear now that consumers care. Recent research from PayComplete’s ‘Why won’t cash just die?!’ report found 89% of consumers view the ability to pay in cash as important to customer satisfaction. More importantly, when it is removed as a payment option, only 26% of consumers comply. Meanwhile, an even larger group (36%) vote with their feet and walk away without making a purchase.

It’s not just customer experience that’s impacted by the absence of cash as a payment option. Brand perception also suffers. Research findings discovered nearly half (47%) of consumers believe organisations that don’t accept it are putting profits ahead of customer satisfaction. Moreover, when denied the opportunity to pay in cash, respondents felt a range of emotions, including inconvenience (54%), outright annoyance (52%) and, for those who walked out without making a purchase, anger (16%). Failure to offer this payment choice is a big risk for businesses. It can negatively impact customer satisfaction, brand reputation, and lead to outright anger from customers.

However, the value consumers place on cash goes beyond it being a way of completing a transaction. It is also seen as critical to supporting local communities. Interestingly, the research found 65% of consumers know card payments incur charges for businesses, resulting in nearly a quarter (22%) actively choosing to pay in cash instead. In fact, over half (57%) of consumers want to help businesses save money by paying in cash, which jumps to 71% for small businesses, tipping, and personal services. Paying with cash, therefore, is not simply a way of transacting with a company. For many shoppers, it’s a sign of support.

Regulators and lawmakers protect cash

However, consumers continuing to care is only part of the story. Furthermore, an important factor has been the steps regulators and governments have taken to protect access to cash. In the UK, 2024 was the year that the FCA’s Access to Cash came into force. This made it a legal requirement for banks and building societies across the UK to provide a minimum level of access to cash. Across the pond, similar measures have been taken by Connecticut, Massachusetts, Colorado and Tennessee as US states move to enshrine access to cash into law. With lawmakers realising its importance, and creating regulations to protect access to it, the long-term future of cash is now secure.

What does it all mean?

2024 has been a watershed year for cash and its future. No longer are there debates and discussions about a cashless society. Instead, it is here to stay, and, with that certainty, it makes it far easier for businesses to plan for their own future. Businesses waiting to see what would happen with cash before deciding if it was part of their future now have a conclusive answer and can plan accordingly. Moreover, those who have already taken steps to move towards a cashless future will need to reverse course or risk facing consumer wrath.

The rise of CashTech

The good news for businesses is that cash management and handling technology hasn’t stood still these past few years. There is a combination of smart hardware and software to finally unify management, processing, and handling. CashTech is a new set of solutions that make it quicker, easier, and more efficient than ever before for businesses to handle cash. Combining hardware and software, CashTech solutions enable enterprises to digitise their handling. Making it easy to assess business-critical areas like cash flow management and better support accounting and business management processes. By automating handling, businesses can also avoid the unnecessary costs of discrepancies and inefficiencies from manual processes.

In the coming years, when we look back on 2024, we will see it as the year the future for cash was confirmed. Talk of a cashless future and the death of hard currency was wide of the mark. While cash may not usurp debit and credit card payments, neither will they bring about its end. With the future now clear, it’s time for businesses to adopt CashTech in 2025 and turn inefficient processes into a game-changing competitive advantage.

About PayComplete

PayComplete is the global leader in cash management solutions, combining bleeding edge hardware solutions with game changing software, unifying cash management with other key payments and operational systems. Dedicated to innovating self-service experiences and operations for both consumers and employees, The PayComplete IoT platform is made up of an adaptable set of SaaS and machine software, intelligent devices, and professional, technical and merchant services. PayComplete Connect unifies the management of transactions, users, devices, and data across the enterprise, bringing digital precision to cash transactions and systems. PayComplete serves a broad range of industries, including retail, transportation, financial services, vending, cash centers, mints and more.Industry leaders, work with PayComplete to make their cash transaction-based businesses more innovative, agile, and efficient.

  • Digital Payments

Author

Nick Merritt

Published

18 December 2024

Estimated Read time

4Mins

Nick Merritt, Executive Director at Designit, on six developments shaping the future of banking in 2025

Retail banks are entering 2025 with a heady mix of ambition and trepidation. A bewildering blend of technological wizardry and ever-shifting customer expectations has forced banks into a relentless cycle of adaptation. To stay ahead, six key areas are emerging as the lodestars guiding their strategies for the coming year.

Digital Transformation and Automation – Predicting Your Needs Before You Have Them

Imagine a world where banks predict your needs before you’ve even realised them. From AI-driven chatbots that never sleep to robo-advisors whispering bespoke investment tips into your ear, automation is rewriting the rulebook on customer interaction. But the magic isn’t confined to the shiny front-end; back-office systems are also getting a makeover. Robotic Process Automation (RPA) is busy in the engine room, banishing inefficiencies and sidestepping human error with quiet efficiency.

And then there’s the matter of personalisation—a concept that banks are finally treating as more than a marketing buzzword. Armed with advanced data analytics, banks are no longer just responding to customer needs—they’re predicting them. Pre-approved loans or a savings plan tailored to your Friday night wine habit? No problem.

Cybersecurity: Evolving as Fast as the Threats

With this digital power comes a greater need for vigilance. Cybercriminals are evolving just as quickly, turning cybersecurity into a battlefield. AI-driven fraud detection tools now scan for anomalies with hawk-like precision, while biometric authentication methods—fingerprints, faces, even voices—transform our bodies into passwords.

Cyber resilience has become essential, ensuring banks bounce back swiftly from attacks. Trust, in banking as in life, remains hard-won and easily lost.

Sustainability: ESG as a Competitive Advantage

Environmental, Social, and Governance (ESG) criteria have transitioned from being a footnote to taking centre stage. Customers are no longer content with bland promises of responsibility—they’re demanding action. Enter green loans with their tempting interest rates, ESG investment funds that let you save the planet while saving for retirement, and carbon-neutral pledges that make you feel virtuous about your overdraft.

It’s not just a moral imperative; it’s good business sense. In a world increasingly attuned to sustainability, ESG is a differentiator. Banks that can convincingly wear the green badge of honour are more likely to attract eco-savvy customers and forward-thinking investors alike.

Embedded Finance & Partnership Models

Embedded Finance might sound like jargon, but it’s quietly reshaping how we interact with money. Why go to a bank when the bank can come to you—disguised as a “Buy Now, Pay Later” button on your favourite shopping app or as a seamless payment option in your rideshare app? Banks are waking up to the fact that ecosystems, not high-street branches, are where the action is.

Partnerships with fintech firms are unlocking new avenues for growth. Whether it’s integrating loans into car dealership platforms or powering payments for subscription services, embedded finance is giving banks a chance to slip into customers’ lives in ways they barely notice—but deeply appreciate.

Cryptocurrencies: Cautiously Testing the Waters

And then there’s the crypto conundrum. Once the domain of tech evangelists and speculative investors, cryptocurrencies are elbowing their way into the mainstream. Bitcoin ETFs have made it easier for traditional investors to dip a toe into the crypto waters, while Ethereum and Ripple (XRP) are offering solutions that align with real-world banking needs.

Ripple’s laser focus on cross-border payments could revolutionise international money transfers, slashing costs and speeding up transactions. Ethereum’s smart contracts, meanwhile, promise to simplify complex processes like loan approvals. And Bitcoin, the poster child of the crypto world, is slowly gaining traction as a viable payment method.

Yet, it’s not all smooth sailing. Volatility, scalability issues, and a regulatory environment that can best be described as “uncertain” are significant hurdles. Still, with pro-crypto voices gaining ground, 2025 might just be the year retail banks cautiously dip their toes into the digital currency pool.

Personalisation: The Age of “Me”

Customers expect their banks to understand more than just account numbers; they want personalised interactions that anticipate their ambitions. Advanced analytics are turning this into reality, moving banking from transactional to relational.

Imagine a bank that adjusts your credit card rewards for your travel habits or nudges you toward your dream car before you even start shopping. Personalisation isn’t just a service upgrade—it’s a survival strategy.

Looking Ahead to 2025 and Beyond…

The opportunities for retail banks in 2025 are as immense as they are complex. Digital transformation is reinventing customer experiences, ESG is aligning institutions with the values of an increasingly conscientious public. Meanwhile, Embedded Finance is quietly rewriting the rules of engagement. Cryptocurrencies, for all their challenges, are becoming harder to ignore, while data-driven personalisation is making banking feel more like a partnership than a transaction.

For banks willing to embrace these shifts, the rewards are clear: deeper customer loyalty, stronger revenue streams, and a reputation for innovation. Standing still is no longer an option.

  • Digital Payments
  • Neobanking

Author

Dan Brightmore

Published

17 December 2024

Estimated Read time

4Mins

Ripple, a leading provider of digital asset infrastructure for financial institutions, has announced Ripple USD (RLUSD) will be available on…

Ripple, a leading provider of digital asset infrastructure for financial institutions, has announced Ripple USD (RLUSD) will be available on global exchanges. RLUSD is an enterprise-grade, USD-denominated stablecoin. Created with trust, utility, and compliance at its core, it is backed by Ripple’s years of experience working with crypto and the existing financial system.

RLUSD will be initially available on Uphold, Bitso, MoonPay, Archax, and CoinMENA. Additional listings will be made on platforms such as Bullish, Bitstamp, Mercado Bitcoin, Independent Reserve, Zero Hash and others in the coming weeks. Each RLUSD token is fully backed by U.S. dollar deposits, government bonds, and cash equivalents. Designed to ensure its stability, reliability, and liquidity. To maintain the highest standards of transparency, Ripple will publish monthly, third-party attestations of RLUSD’s reserve assets, conducted by an independent auditing firm.

“Early on, Ripple made a deliberate choice to launch our stablecoin under the NYDFS limited purpose trust company charter. Widely regarded as the premier regulatory standard worldwide,” said Brad Garlinghouse, Ripple’s CEO. “As the U.S. moves toward clearer regulations, we expect to see greater adoption of stablecoins like RLUSD. They can offer real utility and are backed by years of trust and expertise in the industry.”

A Growing Ecosystem Supporting Global Adoption

Key RLUSD partners include leading global exchanges, market makers, and payment providers. They are set to drive adoption and usage across the Americas, Asia-Pacific, UK, and Middle East regions. RLUSD is ideal for financial use cases and allows institutions to:

  • Facilitate instant settlement of cross-border payments.
  • Access liquidity for remittance and treasury operations.
  • Seamlessly integrate with decentralised finance (DeFi) protocols.
  • Reliably bridge between traditional fiat currencies and the crypto ecosystem. Ensuring a seamless and efficient transition when entering (on-ramping) or exiting (off-ramping) the crypto space.
  • Provide collateralisation for trading tokenised real-world assets such as commodities, securities, and treasuries onchain.

Early next year, Ripple Payments will use RLUSD to facilitate global payments on behalf of its enterprise customers. Ripple Payments has served $70 billion in payments volume and counting. Furthermore, it has near-global coverage with 90+ payout markets. Moreover, this represents over 90% coverage of the daily FX market. RLUSD is available on both the XRP Ledger and Ethereum blockchains, offering flexibility and scalability for a broad range of financial use cases.

RLUSD: Raising the standard for Stablecoins

Raghuram Rajan, former Governor of the Reserve Bank of India, and Kenneth Montgomery, former First Vice President and Chief Operating Officer of the Federal Reserve Bank of Boston, will join the RLUSD advisory board. They will provide strategic guidance on regulatory, financial, and operational aspects to support RLUSD’s stability and growth.

Rajan and Montgomery join the ranks of the existing advisory board including former Federal Deposit Insurance Corporation (FDIC) Chair Sheila Bair, Vice Chairman of Partners Capital and former CENTRE Consortium CEO David Puth, and Ripple co-founder and Executive Chairman Chris Larsen.

“Stablecoins could become the backbone of private payments by offering a secure, scalable, and efficient alternative to traditional systems. With its focus on compliance and reliability, RLUSD aims to establish new standards for trust and to play a pivotal role in shaping the future of payments. Joining the Advisory Board provides me an opportunity to counsel RLUSD as it embarks on its journey in the rapidly evolving financial landscape,” said Raghuram Rajan, former Governor of the Reserve Bank of India.

“I am excited to join Ripple’s advisory board at such a pivotal moment for digital finance,” said Kenneth Montgomery, former First VP and COO at the Federal Reserve Bank of Boston. “Stablecoins are rapidly emerging as a cornerstone of the payments landscape. They are delivering the speed, efficiency, and cost-effectiveness that traditional systems often struggle to achieve. I look forward to collaborating with the Ripple team to support the global growth and adoption of RLUSD. Unlocking new opportunities for financial inclusion and modernising the future of payments.”

Ripple: modernising the future of payments

RLUSD sets the standard for stablecoins, combining innovative functionality with the regulatory rigor and credibility of an NYDFS-issued New York limited purpose trust company. Furthermore, this highlights Ripple’s leadership in fostering trust and transparency in digital assets.

Ripple’s President Monica Long commented on X: “The release of RLUSD marks a new chapter – both for the XRP Ledger, as well as Ripple, for use in our $70B payments flows. Combining our 10+ years in the business; the rigour and compliance required with stablecoin issuance by a NYDFS chartered company; and an experienced Advisory Board – RLUSD is launching from day one with credibility, utility and a whole host of partners ready to support it!”

  • Digital Payments

Author

Dan Brightmore

Published

27 November 2024

Estimated Read time

3Mins

Yuno enables organisations to transform online checkout experiences, allowing customers to pay securely without the need for passwords

Yuno, a leading global payment orchestrator, announces that Mastercard’s Click to Pay at checkout is now available to all Yuno clients.

Click to Pay helps improve customer experience by ensuring purchases can be made securely and quickly with just a few clicks. It significantly decreases the instances of cart abandonment that plague the e-commerce industry. According to Mastercard research, nearly two-thirds of shoppers still struggle through manually entering their card details. Around 25% of carts are abandoned because checkout is too complex or slow. The average online shopping cart abandonment rate worldwide reached 70.19% in 2023, according to Statista. This resulted in an estimated $260 billion recoverable loss in e-commerce sales annually in the US and EU alone. Plus, fraud rates are seven times higher online than in stores. Criminals exploit exposed card numbers, creating headaches for cardholders and huge losses for merchants and card issuers.

Click to Pay with Yuno and Mastercard

Yuno’s single-click Click to Pay integration, which is enabled in 40 markets across the world, goes beyond just reducing cart abandonment. It also translates to increased sales and conversions for merchants with digital payments. Yuno offfers a secure and familiar digital checkout option trusted by millions of cardholders worldwide. It empowers businesses to boost customer confidence and improve the shopping experience. Yuno’s ability to offer Mastercard Click to Pay access to merchants is especially crucial for businesses expanding into new markets, where brand recognition can be a challenge. With Yuno, merchants can offer a globally recognised payment solution that eliminates friction at checkout almost anywhere in the world.

Yuno

Juan Pablo Ortega, Co-Founder and CEO at Yuno, commented: “At Yuno, we are constantly seeking out the best solutions to streamline payment processes and enhance security, while delivering speed. Making Mastercard’s Click to Pay at checkout feature easy to integrate for all of our customers supports our commitment to removing barriers to global commerce. We’re making sure our customers can focus on running their businesses without any unnecessary headaches.’’

Mastercard

Diego Szteinhendler, Senior Vice-President, Fintechs, Merchants and Digital Platforms, Mastercard Latin America and the Caribbean, added: “Digital consumers expect an intuitive, frictionless and secure experience. To support this demand, we’ve built a robust digital infrastructure with a suite of acceptance and payment services, including Click to Pay. Through partnerships like the one with Yuno these are becoming available to millions of consumers across Latin America and beyond.”

Yuno’s clients, including Viva Aerobus, Bacu, and Habibs, have already begun taking advantage of Mastercard Click to Pay at Checkout via Yuno. It is helping them deliver a secure and convenient user experience for their customers across the globe.

About Yuno

Yuno has emerged as a dominant force in global payment orchestration, with a core mission to empower global commerce by enabling businesses of all sizes to accept and disburse payments anywhere in the world, fostering financial inclusion. It enables businesses to access over 300 payment methods worldwide as well as innovative features including one-click checkout, smart routing, and robust anti-fraud tools via a single unified, easy-to-use interface. Yuno serves a global customer base that includes McDonald’s, inDrive, Rappi and other renowned brands across more than 80 countries.

  • Digital Payments

Author

Dan Brightmore

Published

21 November 2024

Estimated Read time

2Mins

Mastercard integrates its Multi-Token Network (MTN) for tokenized deposits and tokenized assets with Kinexys Digital Payments (formerly JPM Coin)

Mastercard’s blockhain Multi-Token Network (MTN) has connected to Kinexys Digital Payments as a payment settlement solution. This will enhance the availability of B2B cross-border payments to business applications on MTN.

Kinexys Digital Payments is a next-generation payment rail powering real-time value transfer. Also, it uses commercial bank money and is offered through Kinexys by J.P. Morgan, the firm’s Blockchain business unit.

Mastercard’s MTN Blockchain meets JP Morgan’s Kinexys

Mastercard’s MTN brings together a set of API-enabled, blockchain-based tools and standards for innovative business models under one platform.

Kinexys by JP Morgan and Mastercard are respectively providing solutions designed to improve the efficiency of commercial transactions. Furthermore, these solutions aim to improve the cross-border payment experiences common for such transactions. They will achieve this by providing greater transparency and faster settlement as well as reducing time zone friction.

By integrating Mastercard MTN’s connectivity with Kinexys Digital Payments, mutual customers of MTN and Kinexys will be able to settle B2B transactions through a single API integration.

Kinexys – JP Morgan’s Blockchain business unit

“At Kinexys, we believe our solutions can play a transformative role in the ecosystem for digital global commerce and digital assets, where the value proposition of commercial transaction venues is enhanced by the availability of commercial bank payment rails that can natively integrate with any digital marketplace or platform. We look forward to supporting our clients engaging with the MTN ecosystem and collaborating further with Mastercard in the digital space.”

Naveen Mallela, Co-Head of Kinexys by JP Morgan

MTN – Mastercard’s Multi-Token Network

“For years, both Mastercard and Kinexys by JP Morgan have been committed to innovating for the future of digital asset and commercial infrastructure. By bringing together the power and connectivity of Mastercard’s MTN with Kinexys Digital Payments, we are unlocking greater speed and settlement capabilities for the entire value chain. Moreover, we are excited about this integration and the new use cases it will bring to life, leveraging the strengths and innovations of both organisations.”

Raj Dhamodharan, executive vice president, Blockchain and Digital Assets at Mastercard

  • Blockchain
  • Digital Payments

Author

Dan Brightmore

Published

11 November 2024

Estimated Read time

3Mins

UBS Digital Cash aims to increase efficiency, transparency and to enable the programmability of money movements for corporate and institutional clients

Cross-border payments often lead to delayed settlements. As a result, this creates a fragmented view of liquidity positions for companies. The aim is to increase transparency and security with blockchain-based payments via UBS Digital Cash. Moreover, this should in turn facilitate timely payment processing. In addition, companies should be able to manage intraday-liquidity and adjust liquidity buffers on their accounts more easily in the future. This is thanks to greater visibility of their total cash positions.

USB Digital Cash with Blockchain

Andy Kollegger, Head UBS Institutional & Multinational Banking, says: ”UBS Digital Cash going forward aims to enable our clients to make cross-border payments in a much more efficient and transparent way. Furthermore, Blockchain-based payment solutions for cross-border payments are a strategic focus for UBS. With the successful UBS Digital Cash pilot, we have reached another important milestone.”

In the pilot, transactions with multinational clients and banks were successfully carried out. These included domestic transactions within Switzerland and cross-border payments in US dollars, Swiss francs, Euros and Chinese yuan. Additionally, the pilot also included the transfer of liquidity between various UBS companies. UBS plans to expand and develop its UBS Digital Cash offering in further steps.

The advantages of Blockchain-based payments solutions

Pilot participant Janko Hahn, Head Treasury Operations at Autoneum, says: “The UBS Digital Cash pilot showcased the key advantages of blockchain-based payment solutions. They make cross border transactions faster, on time and provide a seamless traceability, which is a huge benefit when operating in a global market.”

Xiaonan Zou, UBS Head Digital Assets, Group Treasury, adds: ”We see the interoperability between UBS Digital Cash and other digital cash initiatives as key for the financial industry. In addition to their role in correspondent banking, they also have the potential to streamline and simplify the settlement of tokenised assets in the capital market.”

How does UBS Digital Cash work?

For the payment process, UBS Digital Cash uses a private blockchain network to which only the permissioned clients have access. The settlement is performed via smart contracts, which, for example, automatically execute payments as soon as predefined conditions are met. Client transfers at UBS are recorded and processed in a digital system for recording transactions. They are independent of currency, practically in real time and around the clock. UBS Digital Cash complements UBS’s involvement in a wide range of market initiatives. These include the Swiss National Bank-led project Helvetia for real wholesale Swiss franc Central Bank Digital Currency (wCBDC), as well as the Agorá project, led by the Bank for International Settlements (BIS) together with seven central banks, to unlock central bank money and tokenised deposits from commercial banks in the cross-border payment context.

About UBS

UBS is a leading global asset manager and the leading universal bank in Switzerland. In addition, the company offers diversified wealth management solutions and focused investment banking functions. With the acquisition of Credit Suisse, UBS has assets under management of $5.7 trillion as of the fourth quarter of 2023. UBS supports its clients in achieving their financial goals through personalised advice, solutions and products. Headquartered in Zurich, Switzerland, the company operates in more than 50 markets around the globe. UBS Group AG shares are listed on the SIX Swiss Exchange and the New York Stock Exchange.

  • Blockchain

Author

Dan Brightmore

Published

5 November 2024

Estimated Read time

3Mins

New collaboration between Plumery and Payment Components
will enable financial institutions to adopt instant payments without overhauling existing core banking infrastructure

Plumery, a digital banking experience platform for customer-centric banking, has announced a new partnership with Payment Components, a leader in payments and open banking solutions. By decoupling digital experience and payments processes from legacy systems, institutions can now innovate more flexibly and efficiently. They can streamline operations while maintaining their existing core banking frameworks.

Progress for Payments

By leveraging Plumery’s innovative approach and Payment Components’ expertise, this partnership allows clients to accelerate time-to-market and future-proof operations against regulatory shifts such as the Instant Payments Regulation (IPR). Financial institutions can offload the burden of implementing new digital channels and instruments, such as real-time payments, without altering their core systems.

The IPR aims to make instant payments fully accessible to consumers and businesses across the EU. Currently only a minority of service providers support instant payments. While such regulatory changes usually impact core banking infrastructure, the Plumery and Payment Components partnership ensures these systems remain unaffected.

“This partnership is crucial for institutions needing to rapidly modernise without overhauling their entire infrastructure. Together, we offer a powerful, flexible solution that enables our clients to embrace innovation while staying ahead of regulatory changes like the IPR. Adding Payments Components to our partner ecosystem solidifies our commitment to creating cutting edge solutions that embrace digitisation.”

Ben Goldin, Founder and CEO of Plumery 

This global partnership offers a streamlined path to modernisation, enabling financial institutions to stay compliant, competitive and responsive to ongoing market shifts with solutions ready to support firms as they navigate the evolving financial landscape.

“Our collaboration with Plumery will empower financial institutions to seamlessly adopt modern payment technologies, addressing the complexities of regulatory changes, all while minimising disruptions to existing systems. We wanted to work with Plumery because both our company’s share a similar approach, work ethic and most importantly because of the compatibility of our products.”

Sotirios Nossis, Founder and CEO of Payment Components

Plumery

Headquartered in the Netherlands, Plumery’s mission is to empower financial institutions worldwide, regardless of size, to craft distinctive, contemporary, and customer-centric mobile and web experiences.

Plumery operates with a diverse team that embodies a unique combination of seasoned expertise and vibrant innovation. This blend has been cultivated through years of experience at start-ups, scale-ups, and established financial institutions, and most notably at globally leading financial technology companies, where they were instrumental in creating disruptive digital banking solutions and platforms that now serve 300+ banks globally.   

Plumery’s Digital Success Fabric platform provides banks with the foundation for success beyond fast-time-to-market by expediting the development of their digital front ends while significantly cutting costs compared to in-house initiatives or solutions with high total cost of ownership (TCO). 

Payment Components

At Payment Components, we’re reshaping the fintech landscape on a global scale. Today, our solutions are essential for more than 65 banks and financial institutions across 25 countries. We provide componentized solutions in a range of domains, including AI banking, open banking, account-to-account payments, and financial messaging technology. We achieve this through continuous innovation, building software components that help financial institutions become digital champions and deliver richer payment services to their clients. Our name reflects our belief: complicated processes in the financial industry will be replaced by AI-assisted dedicated components. We stand for simplicity, speed, and constant innovation

  • Digital Payments
  • Neobanking

Author

Gunnar Már Gunnarsson

Published

9 October 2024

Estimated Read time

4Mins

Gunnar Már Gunnarsson, Co-founder & CTO of PAYSTRAX on the potential for tokenisation to improve digital payments

The forward to the Bank of England’s most recent report on innovation in payments begins with the words:

“The concept at the heart of money is trust – a trust which is hard won but easily lost.”

In today’s financial climate, where digital transactions have become the norm, trust and security are more crucial than ever. However, 84% of consumers don’t completely trust online payments, and many drop out before they complete a purchase online due to safety concerns and a lack of payment options.

Tokenisation presents a way forward, offering an increased level of trust and efficiency that could tackle the concerns of consumers. And offer business increased security in the payments process. By replacing sensitive payment card information with unique identifiers (tokens), this technology provides a safe way to handle payment data from seller to consumer.

As the future of payments continues to evolve, safety, simplicity and global alignment will be essential. Tokenisation stands at the forefront of this with the potential to not only reduce fraud but also improve the customer experience.

An extra safeguard against cybercrime with tokenisation

The issue many businesses and customers face is that their data remains exposed during transactions. This increases the risk of fraud and company liability issues in the event of data breaches. Tokenisation technology replaces sensitive data with a unique, randomly generated string of symbols that cannot be easily interpreted. This provides an extra safeguard against cybercrime. This added level of security benefits both consumers and businesses. It can reduce vulnerabilities in everything from online purchases to mobile payments.

For merchants, this is particularly beneficial. By keeping sensitive information, such as customers’ card details, outside their own systems, they minimise the risk of security breaches. Tokenisation also helps businesses meet compliance standards, such as PCI-DSS (Payment Card Industry Data Security Standard). With no need to store or transmit sensitive data, companies can lower their security management responsibilities and reduce the overall costs of compliance. Tokenisation facilitates this easier compliance by deferring regulatory requirements across regions. Businesses can then rely on tokenised data instead of managing the security of the original PAN (Primary Account Number).

Enhancing the payment experience with tokenisation

Friction during transactions has long been an issue in finance, costing the industry $2 billion dollars a year in lost payments. Consumers increasingly expect faster and more seamless payments in all aspects of their life, from in store shopping to online purchases.

With tokenisation technology, the payment process becomes faster. Sensitive information no longer needs to be re-entered or verified externally during each transaction. This reduction in data exposure reduces the risk of fraud while maintaining the rapid pace of real-time payments. Overall this creates a secure and safe payment process for businesses while not interrupting the real-time user experience.

Frictionless payments aren’t the only benefit of tokenisation. With customers being more likely to complete purchases when a tokenisation system is in play, with Visa reporting that authorisation rates improve by 2.1% using the technology. This is mostly due to the dynamic card-on-file information that tokenisation provides. It reduces payment failures and ensures a smoother purchase process, with failed payments no longer an issue.

A final example for how tokenisation enhances payment experience both user and provider side can be found in B2B Cross-Border payments. The market is projected to grow significantly, with estimates indicating a 43% increase to reach $56.1 trillion by 2030. The risk of fraud grows with this, alongside increasingly in depth and complex international laws and national regulations, companies need both security, and to be customer facing in their plans. Technologies that secure payments and provide seamless transactions, like tokenisation, are pivotal in supporting this growth by reducing risks and improving efficiency.

The future of payments

As alternative payment methods and RTP networks continue to rise, tokenisation will be crucial in creating a global payments ecosystem that is both secure and frictionless. Visa has issued over 9.5 billion tokens globally, with Mastercard reporting over 50% year-over-year growth in tokenised transactions. This rapid adoption highlights the importance of tokenisation in building secure, efficient payment networks.

By reducing fraud, simplifying security management, and improving the overall customer experience, tokenisation is set to play a leading role in shaping the future of payments. Especially as digital and cross-border transactions become increasingly important.

It’s more than just a security measure. It’s a critical technology that enhances the entire payment ecosystem, making transactions faster, safer, and more efficient for all parties involved.

Gunnar Már Gunnarsson, Co-founder & CTO of PAYSTRAX

  • Cybersecurity in FinTech
  • Digital Payments

Author

Berkley Egenes

Published

7 October 2024

Estimated Read time

4Mins

Berkley Egenes, Chief Marketing & Growth Officer at Xsolla, on the legislation changing financial services

The European Union’s Digital Market Act has sent tremors through digital payments. The legislation is designed to stop Big Tech’s monopoly over vital online services, from search engines to messaging apps. But beneath the surface, one of the most fascinating battlegrounds is how the Digital Markets Act will impact the lucrative world of digital payments. A space long dominated by a few influential players. This will affect how industries, including the video game industry, monetise these services.

Big tech’s digital tollbooth

For years, the platform owners have controlled much of the infrastructure around digital payments. Major platforms have tightly controlled access, charging app developers and merchants fees for every transaction processed. Furthermore, they take hefty cuts from each purchase through their ecosystem. The impact of the Digital Markets Act may vary across different platforms. Some companies will need to adjust their models to fit the legislation. Others may push back or delay changes through legal and regulatory channels. 

The Digital Markets Act specifically targets a select group of ‘gatekeepers’, defined by their user base, revenue, and platform reach. Not every platform or company will be obligated to follow the Digital Markets Act’s rules. However, companies like Apple and Google, fall under the Digital Markets Act’s direct scope. The legislation now obliges these companies to open their platforms. This will allow smaller players and third-party services to operate without being strangled by eye-watering fees or exclusionary policies. 

The impact on monetisation with Digital Payments

The big question is how this will impact the business models of the gatekeepers and the developers who rely on these platforms. For years, the mobile platforms have depended on hefty commission fees. Often as high as 30%, these monetise digital payments within their ecosystems. These fees have been a central sticking point for developers, particularly video game studios, which sometimes generate billions in revenue through in-app purchases and microtransactions. 

Free-to-play mobile games specifically rely heavily on players making in-game purchases, from cosmetic skins to virtual currency. Under the current system, a significant chunk of that revenue is siphoned off by platform holders. They collect commissions on every transaction. This has forced game developers to either raise prices or accept slimmer margins while operating within the confines of strict payment policies. 

The Digital Markets Act is disrupting this current model. Game developers have been fighting the ability to direct players to alternative payment methods. They may now have the freedom and access to offer alternative ways to market and monetise their game while still having the player experience on the mobile phone. As a result, for the first time, consumers may be able to choose alternative payment processors. This potentially reduces costs for players and developers alike. 

For video game developers, particularly indie studios, the Digital Markets Act could represent a long-awaited relief from the large hold of app store economies. Developers can now distribute, market and sell their digital items and bundle packs through their online web shop or mobile SDK. By exploring these alternative options, developers will be retaining more of the profit per transaction. They could invest in better content or offer custom promotions to players – a win for both creators and consumers in the gaming industry across Europe.

Don’t ignore the challenges

The Digital Markets Act ushers in a brave new world of competition and choice for consumers, but it’s not all plain sailing. While the Digital Markets Act is designed to promote competition, the actual implementation of its provisions is still subject to regulatory developments and potential litigation. This means the full impact of the Digital Markets Act could take time to materialise. Moving towards a more open payment system demands a mountain of technical tweaks and a watchful eye from regulators. The real headache will be getting all these different payment systems to talk to each other while keeping security watertight. 

Consumers also have to consider how they will adapt to these changes. While there are many benefits, changing habits takes work. The success of the Digital Markets Act will depend on effective communication, education, and transparency to ensure consumers are aware of the new options and their benefits.

A new era for Digital Payments?

While the Digital Markets Act promises greater choice and a more level playing field, the road ahead will be anything but smooth. While the Digital Markets Act’s potential to break down monopolistic practices is significant, its effects may not be felt immediately. Regulatory processes, litigation, and slow consumer adoption could mean the transition to a more open digital payments landscape occurs gradually over time. Gatekeepers have maintained a firm grip on payment infrastructure for years, charging high fees that have eaten into developers’ profits. But with the Digital Markets Act tearing down some of these walls, game studios may have the flexibility to finally bypass gatekeepers and offer cheaper in-game purchases, subscriptions, and services directly to consumers.

While the Digital Markets Act opens doors for smaller developers and alternative payment options, it also forces companies to rethink their monetisation strategies. This could potentially pass new costs onto consumers in other ways. What is clear is that the digital payments landscape is in flux. How the tech giants, game developers, and consumers adapt to this new reality will define the future of monetisation in the digital economy. The game is far from over, and the real winners have yet to be decided.

Berkley Egenes, Chief Marketing & Growth Officer, Xsolla

  • Digital Payments

Author

Tetyana Golovata

Published

17 September 2024

Estimated Read time

5Mins

Tetyana Golovata, Head of Regulatory Compliance at IFX Payments, on builidng compliance into business culture

Regulation plays a critical role in shaping the fintech landscape. From Consumer Duty and FCA annual risk reporting to APP fraud, the tectonic plates of the sector are shifting. Whether you consider these regulations as benefiting or hindering the industry, businesses are struggling to keep up. 

According to research by fraud prevention fintech Alloy, 93% of respondents said they found it challenging to meet compliance requirements. In a new study by Davies a third of financial leaders (36%) said their firms had been penalised for compliance breaches in the year to June. The FCA brings in its operational resilience rules in March 2025. So, it is more important than ever to ensure your company makes the grade on compliance. 

Learning lessons from history

Traditionally, FX has struggled with the challenge of reporting in an ever-developing sector. As regulatory raise the bar on compliance, responsible providers must help the industry navigate the changes and upcoming deadlines.

Fintechs and payments companies are entering uncharted waters. They face pressure to beat rivals by offering more innovative products. Regulators have struggled to keep up in the past. Gaps in legislation have allowed some opportunists to slip between the net, as seen in the collapse of FTX. Because of this, implementation and standardisation of the rules is necessary. This ensures innovation remains seen as a force for good, and to help identify and stamp out illegal activity.

Culture vs Business

Culture has become a prominent factor in regulatory news. We have seen cases of large fines and public censure relating to cultural issues. FCA COO Emily Shepperd observed in a speech to the finance industry, “Culture is what you do when no one is looking”.

Top-level commitment is crucial when it comes to organisational culture. Conduct and culture are closely intertwined. Culture is not merely a tick-box exercise. It is not defined by perks like snack bars or Friday pizzas. Rather, it should be demonstrated in every aspect of the organisation, including processes, people, counterparties, and third parties.

In recent years, regulatory focus has shifted from ethics to culture. Recognising its crucial role in building market reputation and ensuring compliance with rules and regulations. Furthermore, boosting client confidence, and retaining employees. The evolving regulatory landscape has significantly impacted e-money and payments firms. Moreover, regulations are strengthening each year. Each regulation carries elements of culture, as seen in:

  • Consumer duty: How do we treat our customers?
  • Operational resilience: How can we recover and prevent disruptions to our customers?
  • APP fraud: How do we protect our customers?

Culture Drivers

Key drivers of culture include implementing policies on remuneration, conflicts of interest, and whistleblowing. However, for it to become embedded it must touch employees at every level.

This is showcased by senior stakeholders and heads of departments facilitating close relationships with colleagues across a company’s Sales, Operations, Tech and Product teams to build a collaborative environment. 

Finance firms must recognise the trust bestowed on them by their customers and ensure the protection of their investments and data is paramount. Consumer Duty may have been a wake-up call for some companies, but progressive regulation must always be embraced and their requirements seen as a baseline rather than a hurdle.

Similarly, the strengthening of operational resilience rules and the upcoming APP fraud regulation in October are to be welcomed, increasing transparency for customers. 

Compliance vs Business 

Following regulatory laws is often viewed as a financial and resource drain, but without proper compliance, companies are vulnerable to situations where vast amounts of money can be lost quickly.

A case in point is the proposed reimbursal requirement for APP fraud, which will mean payment firms could face having to pay compensation of up to £415,000 per case.

Complying not only safeguards the client and their money, but also the business itself. About nine in ten (88%) financial services firms have reported an increased compliance cost over the past five years, according to research from SteelEye.  Embedding compliance earlier in business cultures can be beneficial in the long run, cutting the time and money needed to adapt to new regulations and preventing the stress of having to make wholesale changes rapidly. 

Building a cross-business compliance culture 

Compliance is a key principle at IFX Payments, and we strive to be a champion in this area. In response to these challenges, the business restructured, establishing dedicated risk and regulatory departments, along with an internal audit function. 

Regulatory compliance aims to support innovation by developing and using new tools, standards, and approaches to foster innovation and ensure product safety, efficacy, and quality. It has helped the firm to navigate the regulatory landscape while driving growth and maintaining high standards.

This organisational shift allowed each business line to own its own risk, with department partaking in tailored workshops designed to identify existing, new, and potential risk exposure. Shared responsibility for compliance is the only way to create a culture which values it. We see this as a great way for organisations to drive innovation while sticking to the rules. 

  • Digital Payments

Author

Dan Brightmore

Published

19 August 2024

Estimated Read time

6Mins

FinTech Strategy met with Stiven Muccioli, Founder & CEO at BKN301, to discuss digital payment services connecting North Africa, the…

FinTech Strategy met with Stiven Muccioli, Founder & CEO at BKN301, to discuss digital payment services connecting North Africa, the Middle East, and Europe.              

BKN301 Group is a London based fintech provider that offers Banking-as-a-Service, connecting North Africa, the Middle East, and Europe. The company aims to address the financial inclusion gap in these regions. It provides digital payment and banking platforms to unbanked populations. BKN301 has successfully partnered with fintechs in Egypt and Qatar, serving millions of customers and providing access to financial services. They are also focused on expanding their market in Europe. The company aims to become a leader in the industry and bridge the gap between Europe and the Middle East.

At Money20/20 Europe, FinTech Strategy spoke with BKN301 Founder & CEO Stiven Muccioli to find out more…      

Tell us about the genesis of BKN301…

“I launched the company in 2021 with the vision to create the biggest tech provider for a digital banking service connecting North Africa, the Middle East, and Europe. We are looking at the demographic sheet of the world… In Europe, we are overserved by the banking system and it’s quite tough to create new projects in the FinTech space. It’s hard to scale past Europe, into the Middle East and North Africa. Ours is an operation in its early stages. There is a huge penetration with mobile devices in the Middle East and North Africa, but at the same time there are a huge amount of people unbanked.

So, we have created the platform to allow digital banks to start fast and with low cost. Basically, we are the ‘backbone’ for the new digital banking era in the Middle East and North Africa. We also work with many companies across Europe. However, we are very focused on the connection between the Middle East, North Africa and Europe. Also, we are focused on the remittances business and cross-border payments because many working abroad in Europe don’t have access to the banking system in Europe. And there are many digital banks in Europe trying to fulfil this gap for new customers.”

Tell us about your career journey…

“I began 15 years ago in the startup business and founded two other companies. The first one, Tippest, was a copycat of Groupon in Italy. This was founded with a group of friends in 2011 and we were able to scale successfully, leading to its sale in 2015. Following that, I moved to the US where I spent some time as an angel investor. In 2016 I came back to Italy to start a new company. It was a corporate venture operation inside of the Iccrea Bank, one of the biggest banking groups in Italy. We created a company named Ventis. It delivered the first super application that merged e-commerce and the digital bank.

We created a platform capable of delivering an e-commerce service, and at the same time digital banking services, payment cards, accounts and more. We managed this part of the business for the Group and reached good numbers. In 2020, we sold the company and today it is the third biggest payment player in Italy.”

Tell us about some of the successful partnerships BKN301 has been involved in…

“We have seen great successes with key partners such as Damen. Damen is a e-payment company in Egypt serving 18 million customers. Thanks to our technology, they are able today to provide a digital payment application to millions of Egyptians. They are now connected and have access to a range of financial services to save money and receive remittances from Europe and across the Gulf. A very successful story in terms financial inclusion.

It’s the same in Qatar where we serve a partner that provides service to labourers and construction workers – there are around 700,000 such workers in Qatar. A good example of financial inclusion because we provide the platform for a low-cost digital banking platform connecting unbanked people to Europe.”

What are some of the key challenges financial institutions are facing that you can help them with? What problems are companies asking you to solve?

“At BKN301, we’re focused on our technology and building an ecosystem based on APIs so we’re able to provide those APIs to digital banks – with us, they save time and money. So, the integration cost is far less than a traditional integration cost. They’re able to work multi-market because we are in different markets and they won’t have any legacy agreement with big corporates. We provide APIs so they can develop and use them for core banking and processing.”

“Every year there is a new wave of news, but we don’t know how long each trend will it last… A couple of years back blockchain was at the core and everyone want to add a feature, sometimes without any reason. Now it’s the same with AI. To build a concrete platform on AI or on blockchain, you need many years, and a lot of investment, to be focused. I don’t believe companies that come out after six months saying they are now AI based. It’s impossible to build a real platform based on AI that quickly. We need to define the real companies. So, which one has the mature technology. It’s a good wave and I think there is a huge need. For example, anti-money laundering controls driven by AI could be a game changer.”

And what’s next for BKN301? What future launches and initiatives are you particularly excited about?

“This year we want to get more established in the market in Europe, so we will be focused on expansion. The goal for us is to become the door, the access bridge, between Europe and the Middle East. We aim to become a backbone for the new financial ecosystem across the region.”

Why Money20/20? What is it about this particular event that makes it the perfect place to showcase what you do?

“Every year there is a new wave of news… A couple of years ago blockchain was at the core and everyone wanted to add some feature on blockchain, sometimes without any reason. And now it’s the same with AI. To build a concrete platform on AI, or on blockchain, you need to be focused for years and have a lot of investment – it can’t be done in six months. So, as with blockchain, we need to define the companies making real progress with established technology based on AI, the same as we did with blockchain. It’s a good wave that can meet a huge need, for example with anti-money laundering controls, and Money20/20 is a great place to learn more about where the industry is at today.”                                                                           

  • Digital Payments

Author

Harry Menear

Published

30 July 2024

Estimated Read time

3Mins

Digital payments enable access to financial services by underserved members of society at a time when the digital divide is widening.

The United Nations emphasises financial inclusion as a driver for economic development, including it as component eight of the Sustainable Development Goals for 2030. The World Bank defines financial inclusion as crucial economic development and social progress that ensures equal access to financial products and services. 

In recent years, accessibility to financial services has improved rapidly as financial technology has advanced. The 2022 World Bank report revealed that 71 percent of people in developing countries had access to a bank account in 2021, a 42 percent jump from a decade earlier. 

The key driver of this development in financial inclusion is the growth of digital payments, which surged during the COVID-19 pandemic, according to the CFA Institute. 

Role of digital payments 

Digital payment technologies, such as digital wallets, online mobile banking apps, and contactless transactions, contribute to the growth of financial inclusion. Compared to traditional methods, digital payments offer multiple benefits.

Reduced costs are one reason digital payments have become a significant cause of economic growth. They allow lower barriers to entry for underserved people. 

With more people having digital financial accounts, the underprivileged can receive wages, government benefits, or remittances more easily. 

Digital transactions provide a safer alternative to physical cash transactions. The digital records for each transaction help people manage their finances and increase transparency in businesses. They also help mitigate the risks of theft or fraudulent activities. 

Accessibility

Digital payment solutions significantly improve accessibility to financial services. They eliminate geographical barriers for people living in remote areas as long as there is internet access. 

Online platforms make it easier for people to conduct transactions, pay bills, and access credit and insurance services from anywhere. They also allow instant payments that happen in seconds without the need for third parties. 

The accessibility of digital payments extends to people with disabilities. Mobile banking apps often include features such as voice commands, screen readers, and accessible interfaces that cater to them. 

Case Studies

Many digital payment initiatives have successfully promoted financial inclusion in marginalised communities. 

One of them is India’s Jan Dhan-Asdhar-Mobile (JAM) Trinity initiative, which was launched in 2014. The Pradhan Mantri Jan Dhan Yojana programme aims to provide universal access to banking facilities with at least one basic banking account for every household. This programme promotes financial inclusion in rural areas by offering zero-balance accounts with debit cards.  

Meanwhile, the Aadhar programme introduces a biometric digital identity for Indian residents, simplifying access to financial services. Lastly, the Mobile Network programme focuses on growing mobile network infrastructure to facilitate digital payments. 

Challenges and Solutions 

Still, the challenges of achieving financial inclusion through digital payments persist. In 2022, 1.4 billion adults remained unbanked. Meanwhile, increased accessibility also comes with the consequence of more people becoming prone to potentially unscrupulous lending practices, especially since the underprivileged often lack sufficient financial knowledge to avoid such schemes. 

Thus, financial education is crucial so that more people can effectively protect their wealth. The government should initiate financial literacy programmes for the people. The programmes could also be conducted through online platforms to reach more communities. 

In addition, increasing security technology is also important to overcome the risk of fraudulent activities. AI technology might solve this problem, as it can efficiently detect suspicious patterns and mitigate fraud schemes. 

Future Outlook

Digital payments’ future role in driving financial inclusion will become more prominent as mobile and internet penetration increases. Governments should prioritise investment in telecommunications and internet infrastructure to reach their optimal potential. 

AI-powered solutions are expected to continue to develop and offer many ways to accelerate digital finance adoption. With the advancement of technology, security and customer experience will also improve. 

  • Digital Payments

Author

Dan Brightmore

Published

25 July 2024

Estimated Read time

6Mins

FinTech Strategy met with Merusha Naidu, Global Head of Partnerships at Paymentology, to discover more about the global issuer processor

Banks, digital banks and fintechs, around the world, trust Paymentology to issue and process all forms of cards and transactions, at scale. Paymentology offers a cloud-based platform, rich data, a global footprint and proven track record powering industry leaders and game-changers.

A global issuer processor with on the ground teams in 50+ countries across 14 time zones, Paymentology’s founders saw that the payments industry was stagnant and limited, in both capability and ambition.

In March 2021, Tutuka and Paymentology merged, resulting in a ‘payments and card processing powerhouse’. The merger combined the ultra-advanced, multi-cloud platform of Paymentology with the global reach and experience of Tutuka to revolutionise cloud-based processing globally. 

Tutuka was traditionally a financial services company, that provided payment processing technologies, software and services, and application programming interfaces (APIs) for e-commerce and digital transacting across countries in Africa, Latin America, Southeast Asia, and the Middle East, while Paymentology processed for legacy banks in Europe and the UK. The merger enabled banks and fintechs to integrate into a single API, go live and issue cards almost anywhere in the world.

At Money20/20 Europe, FinTech Strategy spoke with Global Head of Partnerships, Merusha Naidu, to find out more…

Tell us about the genesis of Paymentology?

“Paymentology is a global neo processor. We work with banks and fintechs to help them issue their own cards, whether prepaid, debit or credit, virtual or physical. The beauty of the platform is that it’s fully cloud native. So, we’re scalable. We’re focused on speed to market so when you are working with a fintech, or a digital bank, it’s all about two things. How do you innovate? And then how do you go live quickly? Those are two areas of the business that we really focus on. Not only is our tech state of the art, with everything built in the cloud, all of our infrastructure is also in the cloud, including things like our connection to schemes.

We were the very first issuer processor to connect to Visa Cloud Connect, via cloud endpoints in Europe. Being first in embracing modern practices, we ensure our processes are next-generation, thanks to our fully cloud-native and digital infrastructure.

What makes us different? We operate across UK, Europe, the Middle East, Africa, Latin America and Asia Pacific; we are truly global, operating across all five regions. One of the things that makes that possible is our tech. A customer can integrate with us once and then launch across five regions if they wanted to, or multi-market rollouts. We offer a huge ability to scale using integration. Our customers are able to replicate that digital first experience across every single jurisdiction. So, whether it’s Kenya and Dubai and then Saudi Arabia and Portugal, they can have the same experience across the world.”

Tell us about your role at Paymentology?

“I’ve been with Paymentology for 14 years. Prior to taking up my current role as Global Head of Partnerships, I was the Regional Head of Asia Pacific. So, when you look at partnerships, I was asked a question recently at a talk: ‘What would my message be to issuers across the industry?’ My message is that you can’t do it alone. If you want to create truly scalable, innovative solutions, you’ve got to work with partners and collaborate with the best in class. We know we are best in class when it comes to issuer processing, but we also create ecosystem partners that close the gap when it comes to creating really valuable payment ecosystems.

Whether it’s top core banking providers, leading cloud services, or premier card manufacturers, these are the partners we collaborate with. This allows us to confidently assure our customers that we work with the best, to deliver the best, across the entire value chain.”

Tell us about some of the successful partnerships Paymentology has been involved in…

“We were the first company to deliver flip card technology for our client Mox. Paymentology embedded its global processing capability into the platform, to enable Mox to launch its ground-breaking feature to ‘flip’ between debit and credit spending on the all-in-one Mox card. This allows you to have one physical card, one virtual card number, but in the background, we link it to two different accounts. It gives the customer real flexibility around how they can spend, because if it’s everyday purchases, they can use their debit account or their prepaid account. If they have larger purchases, they can switch in the app and use their credit facility. So, it really gives customers flexibility and choice – two things at the heart of what we do.

“Cross-border payments for us is key. Meanwhile, everyone talks about being digital first. For us, tokenisation has helped and we have a superior partner, MeaWallet, to help us deliver this. Elsewhere, crypto has been seen as a sore point but it’s coming back and people again want that flexibility. So, having a way for customers to spend their crypto, converting crypto to free apps and making sure that data is at the heart of all that. It’s about learning about our customers, understanding what our customers want and using our data to make informed decisions, or giving our customers data so that they can make the decisions.”

And what’s next for Paymentology? What future launches and initiatives are you particularly excited about?

“We’re excited about being able to deliver flexibility, control, agility. Because the Paymentology platform is so agile, in the future you will be able to plug in even more different components into the offering. So, a customer can add in rewards and loyalty points. For example, airlines have a platinum MasterCard product, so it opens them up to all of the MasterCard loyalty rewards, airport lounges, all of those benefits. It’s all about being innovative and keeping up with that innovation and growing with customers.”

Why Money20/20? What is it about this particular event that makes it the perfect place to showcase what you do? How has the response been to Paymentology?

“Paymentology is headquartered in the UK so it’s important for us to make sure we’re representing business across Europe. This is the centre of the world for banking innovation. People look to this event to really learn about what’s happening in the industry globally and discover what trends are going to come up. What should we be doing? How can we innovate together and learn from each other? That’s one of the things I really love about Money20/20; the talks in all of the panels are so interesting and I always leave knowing more. Being in the payments industry, and especially being an issuer processor, it’s important for us to learn from the industry and understand where we need to move so that we can stay at the forefront of developments.”

  • Digital Payments

Author

Dan Brightmore

Published

15 July 2024

Estimated Read time

4Mins

FinTech Strategy hears from Till Wirth, EVP of Product at Wise Platform, to find out more about its mission to make international payments fast, low-cost, convenient and transparent

At Money20/20 Europe in Amsterdam, Till Wirth, EVP of Product at Wise Platform, took part in an impactful session titled “From Personal Payments to Enterprise: The Changing World of Cross-Border.” Wirth’s panel talk focused on the transformative trends in cross-border payments and their implications for both personal and enterprise financial transactions.

“Wise is a global technology company building the best way to move money around the world. Wise Platform is Wise – but for banks, large businesses and other major enterprises.

We allow our partners to embed the best way to send, receive and manage money internationally into their existing infrastructure, creating value for their business and customers.

Over the past decade, Wise (formerly known as Transferwise) has built a global payments infrastructure that has revolutionised how money moves around the world. Now, thanks to Wise Platform, other companies can gain access to our industry-leading, reliable service seamlessly.

We save partners time and money by allowing them to deploy new products and services to customers seamlessly, helping them to speed up innovation and serve, retain, and grow their customer base.”

FinTech Strategy spoke with Wirth to learn more…

Tell us about the genesis of Wise… Why is this an exciting time for the company?

“For us at Wise, it’s all about continuing towards our mission of making international payments fast, low-cost, convenient and transparent for our customers and partners.

It’s an exciting time for us as we’ve moved over £118bn on behalf of our 12.8 million active customers in the last financial year and helped them save more £1.8bn in fees. Over 62% of Wise’s transfers are completed instantly (in 20 seconds or less). Wise Platform, our global payments infrastructure for banks and enterprises is growing quickly, too, which allows us to bring the benefits of Wise to more people around the world.”

Tell us about your role…

“I lead the Wise Platform Product team building the global payments infrastructure for banks, financial institutions and enterprises around the world. For example, my team built the product behind the collaboration we announced with Swift last year.”

What are some of the key challenges financial institutions are facing that you can help them with? What problems are they asking you to solve?

“Consumers now expect their cross-border payments to be instant, convenient and transparent. And they are moving to providers they can trust to provide these services. As a result, we’re seeing banks focusing on retaining and winning back their customers through improving their cross-border payments experience. This is exactly what Wise Platform is helping them to do.

We work with more than 85 partners globally, including Bank Mandiri, Indonesia’s largest bank by assets, Shinhan Bank, one of South Korea’s oldest and largest national banks, and GMO in Japan to provide them with the capabilities, technology and network to enable fast, secure and cost-effective international payments for their customers. Quickly, directly from their own apps, without any major technical overhaul.”

Tell us about a recent success story…

“In June this year, Wise Platform hit a major milestone when our integration with Nubank, the world’s largest digital banking platform with over 100 million customers, went live.

Thanks to our partnership, Nubank’s premium Ultraviolet customers can now access multi-currency accounts and debit cards powered by Wise directly from their Nubank app. Customers benefit from a convenient user experience that we’ve tested and iterated over the years for our own customers to seamlessly manage their finances internationally.”

Why do you think the evolution of collaboration between banks and fintechs is set to continue?

“One of the reasons is that while banks have scale, they can gain agility in non core focus areas by working with fintechs and deliver significant customer benefits quickly.

Most banks have been built to focus on domestic banking, meaning their global cross-border payments are often not a priority. However, fintechs are better able to specialise and focus on one specific customer pain point. This means they can innovate much more quickly.”

Why Money20/20? What is it about this particular event that makes it the perfect place to showcase what you do? What’s the response been like for Wise?

“It’s a great event that brings the industry together and enables us to discuss the progress we’re collectively making. This year in particular, it was great to be on a panel to discuss how the cross-border payments landscape is evolving and the latest trends we’re seeing. We look forward to the upcoming event in the US later this year.”

  • Digital Payments

Author

Dan Brightmore

Published

11 July 2024

Estimated Read time

5Mins

Digital payments are now the preferred payment method for much of the world, and they continue to evolve.

They were first introduced through the creation of credit or debit cards. These physical cards allowed consumers to spend money without needing cash.

Advances in mobile technology led to online banking apps, mobile wallets, and contactless payments. These methods are even more convenient and are transformative for commerce, online and in physical outlets.

Throughout 2024, there are ten key trends expected to rise as digital payments evolve:

1. Rise of cryptocurrencies in everyday transactions

Cryptocurrencies, or crypto, are digital currencies maintained by a decentralised blockchain system rather than any government or institution. Owning a crypto means possessing assets that are not tangible, hence it is more popular as an investment currently.

Many platforms are gradually integrating crypto into their financial ecosystem. For example, PayPal — the online payment giant — allows users to buy, hold, and sell crypto.

Despite its volatility issues, crypto is predicted to keep growing. It offers fast transactions, easier cross-border payment, and lower transaction fees than traditional methods.

2. Biometric Authentication

The security concerns surrounding digital payments are unchanged, but the method for securing them is improving all the time. This has led to widespread growth in biometric authentication. Biometric authentication allows for more security and convenience than traditional passwords and PINs, which can be forgotten or stolen. It makes impersonation far more difficult.

Biometrics requires users to input unique physical characteristics like fingerprints or facial features (via a camera). Approved in an instant, consumers can make payments easily by verifying with the tap of a finger or by staying still for the camera.

3. Growth of Peer-to-Peer Payments

Peer-to-peer payment apps allow users to send money directly to another user using a mobile device. The convenience of this payment mode made it popular.

Among the most used apps are Zelle, Venmo, and Paypal. Zelle, for instance, gained $307 billion in transactions in 2020, 58% growth on the previous year, and part of a wider trend in digital payments growth during the Covid-19 lockdowns.

This method offers instant transactions advantageous for time-sensitive transactions like splitting bills or sending emergency funds. It also commonly has a low-cost or free transaction compared to traditional banking options.

4. AI fraud detection with digital payments

AI technology has greatly impacted many sectors, including digital payments. Fraud detection with AI is a solution that uses algorithms to analyse large transaction data. This AI tool can recognise suspicious patterns and identify discrepancies that indicate fraudulent activity.

Companies like Visa introduced AI fraud detection this year. The AI-powered security tools are included in the Visa Protect suite. The fraud detection tool, including digital wallets, can be used for immediate payments.

5. Real-time payments (RTP)

Real-time payments make immediate transactions between accounts significantly better than traditional banking systems, which might take days. This is a preferred option for both consumers and businesses.

Businesses can improve cash flow with faster payments, and consumers can access funds immediately. Currently, the RTP frameworks continue to be adopted by worldwide financial institutions. It is expected to be the standard for various transactions, including payroll and cross-border payments.

6. Voice-activated transactions

Voice-activated payment is an innovative method for users to do transactions simply using speaking commands. A payment system such as this can be more convenient for users than the common typing password method.

This form of authentication is possible through voice recognition tools used in mobile apps. Additionally, voice-activated payments offer a high level of security and a smoother consumer experience. As more companies adopt this trend, it is expected to become even more popular in 2024.

7. QR code payments

QR code payments uses a unique QR code that smartphones can scan to authorise transactions. It is usually connected to consumers’ mobile banking apps or mobile wallets as the source of payment.

This contactless payment offers a seamless payment experience that is highly desirable for users. Businesses also benefit from the simplicity of the method by making transactions faster and seamless.

8. Cross-border payments

Cross-border payments are expected to grow consistently as the world moves on from the restrictions of the COVID-19 pandemic. Also, more businesses are engaging in cross-border payments, and 80 percent expect a transaction volume increase in the next 12 to 24 months.

International payments often suffer from high fees and lengthy transaction times. However, companies are expected to improve their capabilities as cross-border payments increase.

9. Buy Now Pay Later (BNPL)

Buy Now Pay Later (BNPL) services are a more accessible of borrowing for payment than traditional methods like credit cards.

They allow consumers to make purchases and spread the cost over time. This method enables minimal or zero percent financing and no initial credit check.

Many e-commerce platforms have integrated these payment system as they become more popular. 

10. IoT devices integration for digital payments

Integrating Internet of Things (IoT) devices with mobile payments helps make the consumer experience more convenient. This innovation allows wearables and smart home appliances to make contactless payments.

Furthermore, IoT devices can also generate data that can be analysed to create a more personalised experience.

  • Digital Payments