We all feel that the world of payments is changing, but we wanted to gather current data across key European markets to find out exactly what this evolution looks like at the consumer level. While some of our findings reinforce commonly held assumptions, others have been revealing – particularly those around Pay by Bank. Across the markets we surveyed, we found substantial consumer familiarity with Pay by Bank solutions. Overall, nearly three-quarters (73%) have some degree of familiarity with this payment method.
Notably, in markets including the United Kingdom, Spain, and the Netherlands, familiarity exceeds 90%. To some extent, this reflects the success of domestic A2A payment schemes – iDEAL in the Netherlands is a prime example – but it also highlights the opportunity for the next generation of Pay by Bank offerings that are emerging, for example, pan-European solutions that utilise the open banking framework. Conversely, in France less than 1 in 3 people we surveyed were familiar with Pay by Bank, indicating that consumer awareness and merchant acceptance need to be grown considerably. We do see commonalities across borders though – consumers place a high importance on speed, security, and simplicity when it comes to assessing online payment methods.
I believe that the adoption of Pay by Bank will be driven by its ability to address these demands, and the growing maturity of the open banking framework that can be used to facilitate instant payments will be a further catalyst. However, as our research shows, payment preferences and habits remain highly diverse and the rate of adoption will be uneven. In countries such as France, for example, there is much less willingness to try new online payment methods than in Spain. Even as the shift towards instant digital solutions accelerates, traditional payment methods are likely to retain a significant share of transaction volume for the foreseeable future.
I founded Brite Payments in 2019, not long after PSD2 came into effect, and as a number of open banking use cases were being explored. Open banking provided us with a new way to approach both the speed and security aspects of A2A or Pay by Bank payments. Open banking APIs provide excellent bank-level security, while the open banking rails provide us with a framework to build out our own proprietary network for processing transactions in real time. While it’s no surprise that consumers value speed and security, the findings of our research validate our approach.
Illustrating our commitment to addressing speed and efficiency, in 2023 we announced our Brite Instant Payments Network (Brite IPN) – a proprietary network that facilitates 24/7/365 instant processing through Europe’s open banking infrastructure. Smart routing optimises payments for speed and most efficient routing, while the instant processing reduces the risk of payment fraud. We offer automated reconciliation and reporting, which reduces operational costs for merchants, while also equipping them with a more complete, out-of-the-box solution. Consumers benefit from seeing transactions immediately reflected on their bank balance, giving them a better picture of their finances.
On the security side, open banking makes it possible for consumers to complete A2A payments using the same login and authentication they use to access their banking app. This high level of security, ensured through the bank's APIs, also eliminates the risk of card theft and various types of card fraud.
Our research indicates that younger demographics are more likely to have used Pay by Bank, and that those that do use it for online payments do so more frequently than their older cohorts. I think this reflects the fact that so-called “digital natives” are more predisposed to trying new technologies – including digital payment methods – and adopting those technologies that best serve their needs. I am not surprised to see usage higher amongst younger age groups. For us at Brite, it’s less about targeting a specific demographic, and more about equipping merchants with a solution that helps them address consumer demands that are common across all ages and demographics. I’ll sound like a broken record, but it comes back to speed, security, and convenience.
You’re right, it is a key insight. Consumers clearly have an expectation that they receive payments quickly from businesses – whether in the form of refunds, disbursements, withdrawals or payouts. Business to consumer payments have been overlooked for some time, so we developed our own product aimed at meeting and exceeding consumers’ expectations for faster payouts.
Our Time2Money feature is one way that we give users more transparency, with timestamps indicating exactly when they can expect to receive funds on their account. The process is also made more user-friendly, and less prone to error, through our 'Single Sign' capabilities – reducing the number of steps and amount of information required in order for users to receive funds.
On the technology front, we continue to invest in our proprietary network – Brite IPN – so that we can offer a complete instant payments solution that is not contingent upon multiple vendors. This allows us to adapt quickly to evolving market needs. We’re bringing on board more tech talent, in particular at our hub in Málaga, to drive this development and to build upon our strong culture of innovation. A big focus this year is increasing our local presence in a number of key markets, and offering our complete set of products in several major European countries. The result will be that even more merchants and businesses will be able to offer an instant payments product that delivers the speed, security, and convenience that our research shows consumers greatly care about.
For more information about Brite Payments, please visit: https://britepayments.com/
Lena Hackelöer is the founder and CEO of Brite Payments, and a recognised leader in the fintech industry, with diverse experience built in businesses including Klarna and Qliro. Lena’s experience makes her uniquely placed to speak knowledgeably about Open Banking and its impact on the wider European payments landscape.
Brite Payments is an instant payments provider leveraging Open Banking technology to process A2A payments in real-time between consumers and online merchants. With Brite, consumers authenticate themselves using their bank’s usual identification method. Brite operates across 21 markets in Europe and is connected to more than 3,800 banks within the EU.
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