Ushering new-generation payments
Ramzi Dziri, Open Banking Product Manager at LUXHUB, tells us more about the advent of a new type of digital account-to-account payments, requiring no intermediaries and presenting a lower risk of payment failure.
A changing regulatory environment, the ongoing digital transformation and the current health situation have all had a significant impact on the world of payment. The result has been reflected in a record number of transactions processed in the last two years, leveraging sometimes the innovative services provided by fintechs. Many startups, as well as tech giants, have therefore entered the payment/finance sphere, offering cheaper and yet very efficient, user-friendly solutions that provide customers with seamless and frictionless experiences.
Open Banking-enabled secure, low-cost, and increasingly instant payments
“One of the main goals of PSD2, along with giving access to account information to more entities, was to enable the initiation of payment directly from a bank account, and therefore to stimulate competition – and eventually innovation – within the European market,” first explains Ramzi Dziri, highlighting that regulation has – and still is – playing a key role in the development of innovative financial services.
Recently, the European Commission once more expressed its ambition to further embark on this journey, with the desire to enable instant payments in Europe in the years to come, and even to turn the continent into a global leader in this sector that is currently dominated by US giants. As highlighted by commissioner McGuinness, “instant payments are seen as a game-changer. The benefits go beyond speed and round-the-clock availability. When combined with new add-on services – such as ‘request to pay’ – they can support innovative business models, like payment initiation services”.
Moreover, the current context – from the ever-growing digital transformation impacting all companies to the pandemic that is still shaking the world and transforming the habits of consumers – also favoured the development of new means of payment, with constant growth in the percentage of non-cash payments.
The demand for digital is unprecedented and the newer generations are eager to use digital and intuitive solutions
Photo: © Bernard De Keyzer BDKZ for FINTECH BELGIUM