The payments landscape today is markedly different from what it was just a few years ago. Constant technological innovation and the implementation of AI systems have become priorities, partly influenced by the impact of the COVID-19 pandemic on consumer behaviour. The shift towards a cashless society is evident in certain regions, with more businesses and consumers embracing digital payment solutions for their convenience, speed, and security.
Much like in the first quarter of 2024, in Q2 2024 the payments and commerce industry saw a surge in strategic partnerships, reflecting a trend towards collaboration to leverage complementary strengths. These alliances are essential for driving innovation, expanding market reach, and improving service offerings. Companies are increasingly recognising that partnerships can provide access to new technologies, customer bases, and expertise that would be challenging to develop independently.
Looking ahead, the payments and commerce industry is poised for further transformation, and several key trends are expected to shape the future of the sector. These include continued technological innovation that will further revolutionise payment systems, making them faster, more secure, and more efficient. Moreover, as digital payments gain more and more ground, regulatory frameworks will continue to evolve to address issues such as data privacy, cybersecurity, and financial inclusion. Companies will also need to stay agile to navigate these changes, partnering with key players to ensure that their systems remain ahead of the curve.
In Q2 2024, the travel payments sector witnessed major alliances between travel companies, fintech firms, and payment processors to streamline transactions and offer more flexible, secure, and convenient payment solutions.
One of the most noteworthy partnerships involved Mastercard, which collaborated with HSBC Middle East to advance the development of travel payments in the region. This agreement was built on the existing relationship between the two companies, to enhance and innovating travel payment solutions. The collaboration focused on addressing the evolving needs and preferences of customers while ensuring compliance with industry regulations and legal requirements.
Mastercard also worked with Ant Group and 12 international payment partners of Alipay+ to launch the International Consumer Friendly Zones programme in Shanghai. The main goal of the initiative is to improve the travel experience for international visitors and support the expansion of local businesses in China. Backed by relevant authorities and local governments, the programme includes over 20 major shopping districts, popular tourist sites, both of Shanghai's international airports, key high-speed rail stations, and a fleet of 25,000 taxis in the city.
Also in Asia, provider of digital payment services and technology AsiaPay partnered with Airswift, a boutique airline based in the Philippines. This partnership involves Airswift adopting AsiaPay as its main digital payments provider and integrating the PesoPay Payment Gateway into its system. This integration allows Airswift passengers to use various payment methods, such as credit cards, e-wallets, and Netbanking, which makes the payment process more straightforward.
With the shared goal of enhancing the travel experience in Thailand, the Tourism Authority of Thailand (TAT) has expanded its partnership with Alipay+. To better cater to today's mobile-savvy travellers, TAT launched the Alipay+ D-hub and Amazing Thailand e-Card exclusively on Alipay for Chinese tourists and gradually made them available to other Alipay+ payment partners. TAT was one of the first tourism boards to launch Alipay+ D-hub, a customisable in-app programme that featured essential travel and cultural information, local merchants recommendations, and city and province guides of Thai destinations.
Klarna expanded its partnership with Expedia Group, and introduced its flexible payment options to US travellers, allowing them to book flights and accommodations using its interest-free Pay Now or Pay in 4 options across Expedia.com/Klarna and Hotels.com/Klarna. This expansion follows successful launches of Klarna in the UK, Germany, Finland, and Sweden.
In a separate development, global commerce platform WEX has been selected as Booking.com’s preferred provider of virtual cards to streamline travel-related transactions for its customers. The agreement between the two companies designated WEX as the primary virtual card provider for Booking.com, reflecting its role in improving payment solutions that support Booking.com's goal of simplifying transactions in the travel sector.
In a bid to advance contactless payments within the industry, Europe-based softPOS provider Softpay teamed up with Visit Group to introduce tap-to-phone payment solutions for the global travel and hospitality sector. Softpay and Visit Group worked together to eliminate the need for physical terminals while improving the payment experience for guests and partners around the world. In essence, both companies pooled their efforts to support a payment ecosystem that offers efficient transactions.
Vietnam Airlines' digital transformation journey was advanced by partnering with travel technology company Amadeus. This collaboration facilitates the integration of its Altéa Passenger Service System(PSS) into the airline’s systems. The integration provides a comprehensive suite of solutions for inventory management, reservations, ticketing, departure control, and digital services. Altéa PSS technology was designed to enhance operational efficiency and user experience, offering advanced features for both the aviation and tourism sectors.
In Q2 2024, partnerships in cross-border payments facilitated the development of new platforms offering real-time settlement, reduced transaction fees, and improved compliance with regulatory standards across different jurisdictions.
PayU’s partnership with PayPal immediately stands out, as both companies work together to improve cross-border payments for India-based merchants. Through this partnership, PayU is expected to combine its suite of solutions and expertise with PayPal, aiming to optimise the cross-border payment experience for India-based merchants and traders. Throughout this strategic deal, PayU leveraged PayPal ISU 2.0 Checkout to give customers the possibility to access a more personalised, secure, and inclusive payment experience.
Mastercard was involved in two major cross-border payment-focused partnerships in Q2 2024. The first one focused on broadening its partnership with Equity Bank to enhance cross-border payment capabilities for the bank's customers. Through this expanded collaboration, Mastercard and Equity Bank aim to allow customers to send money to 30 countries. This initiative focuses on improving cross-border financial transactions in Kenya, promoting financial inclusion, and supporting economic growth and stability in the region.
Mastercard also partnered with Canadian fintech VoPay to offer customers the possibility of moving money quickly and securely with Mastercard Move. The primary goal of this partnership was to simplify both domestic and cross-border money movement for businesses, customers, and fintechs in the region of Canada.
Visa was also involved in a noteworthy collaboration with Standard Chartered, which was welcomed into the Visa B2B Connect network. In addition to its participation in the Visa B2B Connect multilateral payment network, Standard Chartered joined the company as a new settlement partner. Both financial institutions worked together to meet the needs, preferences, and demands of customers in an ever-evolving market, while also prioritising the process of remaining compliant with the regulatory requirements and laws of the industry.
Borderless AI partnered with Nium to transform cross-border payments within the Employer of Record (EOR) sector. By leveraging Nium’s platform, Borderless AI could offer instant fund transfers, facilitating the management of payroll, taxes, expenses, and financial obligations in over 190 countries.
Cross-border payment platform dLocal partnered with Open English, an online English-learning platform active in over 30 countries. This collaboration was designed to enhance learning opportunities for more than 1.5 million students by offering accessible and cost-effective payment solutions. The partnership introduced various payment methods to Open English’s platform, including bank transfers, Visa Debit, cash payments, instalments, Boleto, and Pix. dLocal also partnered with Eneba, a marketplace focused on the gaming industry to deliver accessible gaming for the LATAM market, and joined forces with the KCB Group to highlight Kenya’s potential as a financial and technological hub.
Temenos advanced its cross-border payment capabilities by partnering with Mastercard to leverage Mastercard Move. Temenos’ integration with Mastercard Move’s full range of money transfer services offered banks and financial institutions, as well as their customers more choices in the way they sent and received money abroad.
Citi joined forces with Emirates NBD to introduce a 24/7 USD clearing service in the Middle East. The partnership allowed Emirates NBD to become the inaugural bank to implement Citi’s round-the-clock USD clearing service, which ensures continuous availability for corporate and retail clients across its UAE and Kingdom of Saudi Arabia branch networks. This initiative addressed operational challenges arising from varying transaction cut-off times within the UAE thus facilitating smoother payment flows in the region.
The payments landscape in 2024 is marked by diverse and innovative methods that cater to the evolving needs of consumers and businesses alike. In Q2 2024, several notable trends and strategic partnerships emerged in this sector, reflecting the industry's dynamism and its response to technological advancements and market demands.
One of the most noteworthy developments in this space comes in the form of a partnership between the Network for Electronic Transfers (NETS) Group and Klarna. This collaboration involved the integration of Klarna’s payment methods into NETS' ecommerce checkout system for merchants in Sweden, Norway, and Denmark. The initiative was designed to enhance NETS' services in the payments industry by enabling merchant partners to provide consumers with Klarna's payment options. Consumers benefitted from a single technical integration and gained the ability to choose from various BNPL and instalment products.
Similarly, Klarna joined forces with Sainsbury’s PLC with the aim of making its payment methods available at the online checkouts of three brands, namely Argos, Habitat, and TU. Following this partnership, shoppers were able to choose from Klarna’s three interest-free payment options: they could pay immediately and in full with Pay Now, pay in 30 days with Pay Later or over three equal instalments with Pay in 3.
Across Europe, cloud-based technology bank Viva.com entered a strategic collaboration with BANCOMAT to allow its Italian merchant network to accept the latter’s payment methods. The main goal of this partnership was to allow Viva’s Italy-based merchants to accept the PagoBANCOMAT and BANCOMAT Pay payment methods.
As part of their strategic alliance, the two companies intended to expand their reach beyond current borders, while also providing merchants across Europe with the capability to proactively cater to international customers’ needs by implementing their preferred payment methods. Through these initiatives, merchants received much-needed support in advancing their global commerce operations and ensuring simplified and convenient transactions.
UK-based PPRO joined forces with Afterpay to provide US, Europe, China, and Hong Kong-based ecommerce merchants and PSPs with additional capabilities. As part of their partnership, PPRO and Afterpay intended to allow ecommerce merchants and PSPs with operations based in the US, Europe, China, and Hong Kong the ability to sell directly to US consumers who use the latter’s solutions.
Global fintech company Unlimit partnered with Moby, an Italian ferry and transportation company, to enhance Moby’s online booking system and support its sustainable transportation efforts by incorporating various payment methods. This integration was expected to simplify the booking process, improve customer engagement, and streamline transactions. Moreover, the collaboration aligned with a growing trend where passengers prioritised sustainability in their travel and payment choices, as according to the ABTA Holiday Habits Report 2023/24, 41% of travellers prefer companies with strong sustainability records.
Global financial technology provider Adyen has formed an important partnership with xnPOS to deliver an integrated payments solution for the hospitality sector. This collaboration offered hoteliers Adyen’s complete end-to-end payment services and financial management through a unified platform. The integration with xnPOS included various payment options such as Pay at Counter, Pay at Table, and ecommerce transactions via the QR-based xnPOS GO system for guest self-ordering and payments. As part of this partnership, xnPOS unveiled a mobile point-of-sale (POS) and payment device which merged the xnPOS POS system with Adyen’s payment processing capabilities, providing a mobile and PCI-compliant payment solution.
In Q2 2024, we witnessed a growing momentum in BNPL and Open Banking payments, reflecting the industry's clear evolution and consumer demand for flexible and secure financial solutions. BNPL services continued to gain popularity, offering consumers an alternative to traditional credit by allowing them to split purchases into manageable instalments.
The Federal Reserve Bank’s June 2023 Survey of Consumer Expectations indicates that 19% of consumers have used BNPL for payments in the past year. Juniper Research forecasts that the global BNPL market will grow from USD 334 billion in transaction volume in 2024 to USD 687 billion by 2028. In the United States, Insider Intelligence/eMarketer projects that BNPL transaction values will increase from USD 80.8 billion to USD 124.8 billion over the same period.
In this context, Affirm announced a partnership with Apple Pay to offer BNPL loans to Apple Pay users later this year. Through this partnership, Apple device users will gain access to BNPL loans from Affirm on iPhones and iPads. Additionally, instalment loans through credit and debit cards are expected to be available on Apple Pay in the US, involving issuers such as Citigroup, Synchrony, and Fiserv.
The two companies aim to meet customer needs and preferences in a changing market while adhering to regulatory requirements. In essence, this collaboration aimed to provide users with more payment options, combining the convenience and security of Apple Pay with Affirm's features thus enhancing Affirm's presence in the BNPL sector.
In other developments, Celerant Technology expanded its integration functionalities with Sezzle, a provider of BNPL solutions. Previously available for Celerant's ecommerce platform, the integration allowed retailers to offer BNPL options at the point of sale in physical stores. Celerant’s retail point-of-sale software includes two platforms that integrate with Sezzle: Cumulus Retail eCommerce, a cost-effective SaaS solution for small-to-medium retailers, and Stratus Enterprise eCommerce, a solution with advanced and custom functionality.
Open Banking payments provider Trustly announced an expanded collaboration with Cross River Bank to provide instant payments through the integration of the FedNow Service. This partnership extension aimed to improve Trustly’s instant payment capabilities by leveraging Cross River’s API endpoint. Trustly initially partnered with Cross River in September 2021 to launch Instant Payouts in the US. At that time, Trustly's platform enabled US businesses to offer near-instant payouts to customers' bank accounts.
UK-based financial technology company Muse Finance launched musePay, a BNPL integration with Xero, backed by Allianz Trade. The integration of musePay and Xero aimed to help businesses better manage their finances by offering additional payment methods. The collaboration with Allianz Trade enabled Muse Finance to provide businesses with more financial tools, enhancing convenience and security.
Financial inclusion efforts also spurred some noteworthy partnerships in Q2 2024 as key industry players formed strategic alliances to extend financial services to underserved and unbanked populations. These collaborations aimed to leverage technology and innovative payment solutions to create more inclusive financial ecosystems.
Advancing the financial inclusion national vision of Jordan, Orange Money and the Jordan Post Company signed an agreement to improve digital financial services in the West Asian country. In essence, this agreement aimed to help both parties to improve the digital financial experience of their customers.
In an effort to tackle financial exclusion and provide access to the financial ecosystem for all stakeholders, KamelPay entered into a five-year processor agreement with Network International. This agreement allowed KamelPay to potentially expand in payroll, commercial, and credit card segments in the UAE. This collaboration also aimed to facilitate transformative digital payment experiences for KamelPay's customers.
Green finance and sustainability initiatives maintained their momentum in Q2 2024, driven by strategic partnerships aimed at addressing climate change and promoting sustainable development. Financial institutions, fintech companies, and environmental organisations collaborated to create innovative financial products and services that support eco-friendly projects and sustainable business practices.
For instance, UK-based Thames Technology introduced Mastercard-approved pre-paid paperboard cards for its clients. The cards were designed exclusively for magnetic stripe use, and they offered a sustainable alternative to traditional PVC cards. The product catered to a growing demand for environmentally friendly financial solutions and was suitable for various applications, including compensation, event cards, and open-loop gift cards. The cards were developed using Holmen Iggesund’s Invercote paperboard, which was produced at an ISO14001 and ISO9001-certified fossil fuel-free mill.
Similarly, financial institution DBS Taiwan partnered with Thales to bring bio-sourced payment cards to Asia. Thales aimed to issue over two million cards to DBS Taiwan for its credit card renewal following its merger with Citibank. In addition, the collaboration geared up to meet the needs, preferences, and demands of customers and clients in an ever-evolving market, while also remaining compliant with the regulatory requirements and laws of the local industry.
In the UK, Snowdrop Solutions worked with Ample Earth, which is a sustainability solution provider helping payment networks and banks identify responsible businesses and create sustainable loyalty programmes. Powered by Snowdrop Solutions' transaction enrichment API, the partnership uncovered deeper insights for Snowdrop customers. By tagging transactions with sustainability indicators, banks and financial institutions gained the ability to educate users about the eco-social friendliness of their purchases and the sustainability commitments of the merchants.
The payments and commerce landscape is experiencing transformative shifts, driven by fast technological advancements, strategic collaborations, and evolving consumer expectations. As we moved through Q2 2024, several key trends emerged that have the potential to shape the future of this sector. The travel payments sector, in particular, is experiencing significant advancements through various alliances, enhancing the convenience and flexibility of payment solutions for travellers.
Moreover, the drive towards financial inclusion is highlighted by several partnerships aimed at extending services to underserved populations. Simultaneously, sustainability initiatives are gaining traction, with partnerships focused on green finance and eco-friendly financial products. Innovations such as biodegradable payment cards and tools for tracking sustainable spending are aligning with growing consumer demand for responsible business practices.
The rise in strategic alliances reflects a growing recognition of the benefits of collaboration. Companies are increasingly forming partnerships to leverage each other's strengths, expand market reach, and drive innovation. These alliances enable firms to access new technologies, customer bases, and expertise that would be challenging to develop independently.
Companies that can navigate upcoming changes, adapt to new technologies, and meet the shifting demands of consumers will be well-positioned for success in this dynamic landscape. The future will likely see continued innovation and collaboration, driving further transformation in the payments and commerce sectors.
To access more information on the global developments that emerged during Q1 2024, be sure to follow The Paypers Global Quarterly Analysis series. This also includes partnerships, acquisitions, and contributions surrounding the investments and M&As that took place during this period.
A dedicated and inquisitive copywriter and blogger, Dragoș has extensive experience in editing and developing content related to IT and tech. After joining The Paypers, his focus turned to the latest fintech, payments, and crypto announcements. For Dragoș, connecting the dots and observing trends and developments in the industry is becoming second nature.
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