An overview of the global A2A payments landscape – where are we now?

Mark Beresford, Director of Edgar, Dunn & Company, analyses how A2A payments evolved, their potential, and the factors influencing their current development.

The following statement about account-to-account (A2A) payments could have been written five or ten years ago:

‘A2A payments are poised for explosive growth, driven by technological innovation, regulatory momentum, and evolving fraud strategies. Merchants and financial institutions that invest in secure, real-time, and consumer-friendly A2A solutions will be best positioned to capitalise on this digital transformation.’

What is so different now? At Edgar, Dunn & Company (EDC), the key difference between today and five or ten years ago, when A2A payments are described in the context of Open Banking, is related to the stage we find ourselves in. Now, we are very much in the ‘implementation stage’, not in a planning, feasibility, or proof-of-concept stage.

A2A payments – from concept to a distinct and transformative digital payment method

Businesses are capitalising on A2A payments by integrating Pay by Bank services and ensuring their payment systems work alongside real-time payment (RTP) networks around the world. This shift to an implementation stage has reduced the reliance on card payment processing for many merchants while improving transaction processing efficiency. Today, to implement A2A payments is table stakes.

Additionally, a wide range of Open Banking initiatives and the use of application programming interfaces (APIs) have further transformed A2A payments, making them more seamless, secure, and accessible for a wider range of transactions, including online and mobile shopping. This has led to the rise of Pay by Bank options.

Many new A2A solutions are built on top of these modern infrastructures, such as:

• iDEAL in the Netherlands (introduced in 2005 and soon to be upgraded to Wero);
• UPI in India (introduced in 2016);
• PayNow in Singapore (introduced in 2017);
• DuitNow in Malaysia (launched in 2018);
• New Payments Platform (NPP) in Australia (launched in 2018);
• Pix in Brazil (launched in 2020);
• FedNow in the US (launched in 2023).

While the fundamental idea of transferring money directly between accounts is very old, the widespread development and rapid evolution of A2A payments as a distinct and transformative digital payment method has become prominent in recent years, particularly with the introduction of RTP systems and Open Banking.

Moreover, the APAC region continues to be a vibrant hub for A2A payment innovation, constantly pushing the boundaries of speed, convenience, and reach in digital finance. Many popular super apps (e.g., Grab, WeChat Pay, Alipay, Gojek, Shopee, etc.) in Southeast Asia have integrated A2A payment functionalities, allowing consumers to pay directly from their bank accounts for a wide range of services. The widespread adoption of smartphones has made mobile-first A2A payment solutions highly accessible.

On regulations and how they affect the development of A2A payment solutions

Several regulatory developments around the world are having a positive impact on A2A payments. In Europe, PSD2 (soon to be PSD3) and the Instant Payment Regulation will mandate instant payments at the same cost as standard transfers, driving broader adoption and standardisation amongst the European banks. This will benefit merchants and businesses that decide to implement A2A payments.

Regulatory clarity is also enabling banks to offer advanced A2A features, such as commercial variable recurring payments (VRPs), through premium APIs. This is expected to further expand the ecosystem within which banks and businesses will interact in a standardised fashion. Unlike traditional direct debits or standing orders, VRPs offer greater flexibility and control for both consumers and businesses. Regulators in the UK and the EU are encouraging or requiring banks to support VRPs, especially for sweeping, and are expected to expand their mandates to broader commercial use cases.

Meanwhile, in Asian markets such as Singapore, Malaysia, Thailand, and Vietnam, they seem to favour market-driven approaches, allowing banks and fintech businesses to lead innovation under a set of broad guidelines – whereas in the Philippines, it has been much more prescriptive, with explicit regulatory mandates and oversight bodies.

Regulators across the APAC region are pushing for standardised APIs to ensure interoperability, security, and scalability. This is considered crucial for VRP commercialisation. These initiatives are starting to bear fruit and, due to API standardisation, we can see examples of cross-border integration and the commercialisation of VRPs, positioning Asia as a fast-evolving region for Open Finance innovation and a growing API economy.

Tech developments – the means to mainstream A2A payment adoption

As any technology geek will tell you, APIs are critical in modern software development and integration. APIs now account for most of the global Internet traffic, underscoring their central role in enabling seamless connectivity between systems. This will also drive the API economy, Open Finance, and A2A payments that leverage RTP networks. For more information on Open Finance in Southeast Asia, refer to the Twimbit analysis of December 2024.

What will we be saying about A2A payments in five to ten years? There is no doubt that Open Banking is transforming the way financial data is exchanged and leveraged. In the interest of all stakeholders, with time, greater API standardisation is to be expected, and this financial data will be exchanged instantly. The real-time nature of this exchange will enable faster and more precise forecasting for both consumers and businesses. Financial institutions will utilise Open Banking to create bespoke predictive models, using rich datasets, that cater to the unique requirements of clients, customers, or specific market segments.

The integration of Open Banking data with big data analytics facilitates a more profound understanding of both macroeconomic and microeconomic trends. Algorithms powered by AI will be capable of detecting patterns within extensive datasets, thereby delivering precise predictions regarding market fluctuations and consumer behaviour. The future of finance will lie in the seamless integration of Open Banking with predictive analytics and AI. No one bank or company has yet achieved this, but there are early examples of it across the world, such as payment wallets that are A2A payment compliant.

Like a baby learning to crawl, today, fintech is at an exciting early phase of development, ready to explore and grow. We have some way off in the future when fintech will be walking on two feet. Perhaps in three to five years, the future of A2A payments promises to be instant, secure, and seamless, powered by Open Banking, agentic commerce, and a clear and trusted regulatory framework. Rapid growth is expected in use cases, improved security, and a shift toward direct, cost-efficient payments that benefit consumers and that businesses value.

This editorial piece was first published in The Paypers' Account-to-Account Payments Report 2025, which features insights into global trends, key players, partnerships, and the next phase of the A2A evolution. Access the full report to understand where the A2A payments ecosystem stands today and what’s next.

About the author

Mark Beresford is a Director at Edgar, Dunn & Company and has over 25 years of strategic consulting experience in the payments sector. He is responsible for the company’s retailer and merchant payments practice, working with omnichannel merchants and payment service providers across the globe.

 

 

About Edgar, Dunn & Company

Edgar, Dunn & Company (EDC) is an independent global payments consultancy. The company is widely regarded as a trusted adviser, providing a full range of strategy consulting services, expertise, and market insights. EDC’s expertise includes M&A due diligence, legal and regulatory support across the payment ecosystem, fintech, mobile payments, digitalisation of retail and corporate payments, and financial services.