The MACH Alliance is a not-for-profit member organisation that promotes open and best-of-breed enterprise technology ecosystems. We exist to protect MACH core principles (Microservices-based, API-first, Cloud-native SaaS, and Headless) and support buyers on standards, interoperability, and other important considerations when moving from legacy to a composable architecture. All members undergo a stringent certification process so businesses are confident they choose the right solutions to deliver future-proof technology. In just four years we became the de-facto ‘go-to’ organisation that helps enterprises embark on a digital transformation based on MACH principles. We have over one hundred members, and we see global adoption growing year on year.
Fintech is one of those areas we are diversifying into, and we already have Stripe and Adyen as members, and Paypal and J.P. Morgan as supporters. Four years ago, after I started working for the global payment service provider (PSP) Nuvei, I wrote an article on how COVID-19 has quickly changed how customers shop and engage with brands and retailers – this is essentially what drives brands to innovate to meet these needs. Whether it is click & collect, buy online and return in-store, endless-aisle, or conversational commerce – it involves processing a transaction, either to authorise a payment or make a refund. Customers expect an optimised checkout experience with all relevant payment methods available, as well as swift returns and the ability to get their money back. They want to pay with the payment methods they are comfortable with, not just the big card schemes.
In addition to what customers want, industry standards and regulations like the introduction of 3DS2 and PSD2, and Open Banking also play a role. This means there is now much more transparency and innovation. This is all powered by APIs, giving companies access to their customers’ data, allowing them to offer rich experiences across all channels, understanding their customers better, and building more brand loyalty while increasing the lifetime value of customers.
Relying on monolithic solutions slows down deployment and holds companies back, which the fintech sector, being an innovative industry, realised. Traditionally, PSPs offered a ‘close’ system with a gateway, acquiring, and risk management, but that did not provide enough flexibility to merchants. It also negatively impacted performance and resulted in higher costs – quite an equivalent to a monolithic ecommerce platform (‘one size fits all’). Nowadays merchants are far savvier, and PSPs realise it’s not a zero-sum game. We see an emergence of specialist players in fintech like payment orchestration platforms, Open Banking solutions, fraud and risk management solutions, and localised payment method providers. The merchants can now pick and choose from all these solutions, reduce their total cost of ownership (TCO), and go faster to market with a robust payment strategy which they can keep evolving.
I think we will see increased transparency in the fintech world and a more open payment processing approach. This means the ability to integrate a variety of payment gateways, acquirers, risk and fraud management solutions, localised payment methods, and others. This enables merchants to have more choices without relying on one dominant provider to do everything for them. They are now collaborating with multiple acquirers and routing their transactions, based on who performs best and delivers the highest approval rates. Interoperability is also key, as any fintech provider will need to transmit data between various systems. Making these open APIs available and enabling integrations between various solutions will be an important aspect in ensuring that.
Let us take as an example what some retailers have been doing recently – launching a marketplace proposition (we also have leading vendors in that category). When you have a marketplace, you don’t just think about the transaction with the consumer, but also the remittance (payout) that needs to happen with the third-party brand, you need to think about seller onboarding, and about ‘know your customer’ (KYC). All these functions can be offered by ‘monolithic’ PSPs but can also be provided by best-of-breed solutions, which help deliver better process performance and efficiency.
Tal is a global ecommerce SaaS executive with over 15 years of experience in developing New Business strategies, business partnerships, and new client acquisitions. He is experienced in linking technology to brands and retailers and ecommerce strategies and helping to deliver business and IT transformation. He previously worked for Rakuten when launching their UK marketplace, and helped Pitney Bowes, Criteo, and Nuvei to grow their retail customer base. Currently, he works as Partnerships Director at Cloudinary.
About MACH Alliance
The MACH Alliance is a not-for-profit industry body that advocates for open and best-of-breed enterprise technology ecosystems. We are a vendor-neutral institution that provides resources, education, and guidance through a global community of industry experts to support companies on their journey. We exist to protect MACH core principles and support buyers on standards, interoperability, and other important considerations when moving from a legacy to a composable technology infrastructure. Our MACH Certification programme aims to give enterprises confidence they are choosing best-in-class vendors that can deliver future-proof technology.
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