Focused on Bank Payments: Journey from Inception to Enduring Influence
In a recent discussion as part of the 'In Focus' webinar series, industry experts gathered to explore the opportunities and challenges surrounding merchant adoption of Global Payments' Open Banking payment offering, such as Bank Payment. The discussion was held in partnership with Token.io and featured Ellie Duncan, head of content at Open Banking Expo, Matt Jackson, vice president of partner management at Token.io, and Cormac Bane, product manager at Global Payments.
The discussion centred around the potential for various sectors to adopt the payment method, with a focus on retail, e-commerce, and cross-border transactions. One notable example of retail adoption is Walmart's partnership with Fiserv to enable instant Pay-by-Bank payments starting in 2025. This collaboration showcases the potential for merchants to benefit from lower interchange fees and faster fund availability by bypassing card networks, particularly in sectors with high transaction volumes and thin margins.
Both e-commerce and in-person sales can leverage instant Pay-by-Bank solutions to improve the customer experience. Cross-border and treasury-heavy verticals stand to benefit from enhanced payment transparency, speed, and cost efficiency as open banking and real-time payment rails become more prevalent. This enables better liquidity management and compliance, as outlined in the AFP Payments Guide 2025.
Merchants may reap several benefits from adopting open banking payments, including reduced payment processing costs by avoiding credit/debit card network fees and faster settlement times that improve cash flow management. However, the cost savings are not always straightforward and depend on the implementation and the merchant’s business model. Additionally, open banking solutions may require an investment in technology integration and customer education.
Current consumer awareness and usage of open banking payments like Pay-by-Bank are limited, with about 11% of U.S. adults trying it in the past year. However, there is a higher interest among Gen Z and millennials (72% and 66% willing to use, respectively) and wealthier consumers, indicating targeted marketing could accelerate adoption. Education campaigns highlighting benefits such as enhanced payment security, convenience, and speed can attract early adopters. Leveraging partnerships with large merchants to showcase real-time, fee-saving payment options can build trust and knowledge. Using incentives like discounts or loyalty rewards for customers choosing Open Banking payments may drive trials.
Real-time payment rails and instant settlement features of Bank Payment contribute to merchant cash flow improvements. The increasing digital payment volumes (projected to reach $33.5 trillion by 2030) and account-to-account transfers signal a favourable environment for open banking payment offerings. Digital wallets and bank account-to-account methods are expected to dominate both e-commerce and point-of-sale payments in the coming years, supporting merchant interest in such solutions.
In summary, merchants adopting Global Payments' Open Banking Bank Payment offering can realize savings and operational efficiencies, particularly in retail and e-commerce, supported by growing consumer willingness and advancements in instant payment infrastructure. Awareness strategies focusing on targeted education, partnerships, and incentives are essential for scaling adoption in diverse verticals.
Sources: - Federal Reserve on Pay-by-Bank use case and adoption [1] - AFP Payments Guide on cross-border and treasury impacts [2] - McKinsey and industry payment statistics projecting growth and trends [3] - The webinar series is hosted by Open Banking Expo.
- The open banking payment offering from Global Payments, such as Bank Payment, holds potential for various sectors, including retail, e-commerce, and cross-border transactions, as was discussed in the 'In Focus' webinar series.
- Implementing open banking payments can help merchants achieve reduced payment processing costs by avoiding credit/debit card network fees and faster settlement times for improved cash flow management.
- The increased use of account-to-account transfers, along with the growth of digital payment volumes, creates a favourable environment for open banking payment offerings like Bank Payment.
- Merchants can attract early adopters of open banking payments through education campaigns, strategic partnerships with large merchants, and incentives like discounts or loyalty rewards.
