Acount-to-Account online payments as the future of the financial industry
As the digital world has taken over today’s financial institutions and banks around the world, tremendous pressure is put on traditional payment institutions to adapt to the new reality. Credit cards have been part of the consumers’ journey for several decades. Whether paying for goods with a physical card at the corner store or making a purchase online, we’ve all used credit cards at a certain point in our lives. Do the new fintech technologies threaten the existence of cards?
Who are the pioneers of the new revolution?
Today, big companies such as Trustly and iDeal are leading the pack with their innovative payment solutions. The latest innovations in the fintech industry are pushing the boundaries of the payment models. The world is going cashless, and it seems like credit cards will be a thing of the past in no time.
The new wave of payment service technologies such as Pay N Play® allows clients to pay for goods and services using their bank account via mobile applications or through payment processors on the web. With the progress accomplished so far, new payment processors used in the Account-to-Account payment model introduces a faster, smoother, and secure experience for both the customers and merchants.
How has the public received the new payment models?
The new standard for electronic banking has already been adopted in many industries in Europe and around the world. One of the first sectors to adopt new online banking payment technologies was the e-commerce sector. According to statistics provided by Trustly, more than 4500 merchants and retailers have already integrated Trustly as a prime payment option, making for over 9.000.000 transactions a month by 600.000.000 customers.
Threatened by the numerous laws and regulations soon to be enforced by gambling authorities in countries such as the United Kingdom and Germany in terms of credit card usage in Online Casinos, the iGaming industry also seized the presented opportunity to reinvent its payment processing model.
Today, with Pay and Play and iDeal services, players can make deposits and instantly play in online casinos without the need to open an account or register. The players’ BankId acts as the user account baring all necessary information, while also serving as the credential for payments via bank account.
With the electronic payment services of today, Dutch players can deposit in top online Casinos with iDeal, players in Germany can instantly withdraw winnings from online casinos in 3 clicks with Trustly Pay n Play, while individuals in Sweden can pay for invoices on their mobile phones via the Pay Your Invoice app.
The struggle to survive
In recent years, many credit card providers such as Visa and MasterCard have multiplied the efforts to catch with the new trends in fintech. In the United Kingdom, MasterCard launched Pay by Bank in 2006. Accessible via mobile applications and web, Pay by Bank is an Account-to-Account payment model created to facilitate bank transactions between merchants and customers in the UK.
The popularity of the new electronic payment methods based on account to account transactions leave no room for doubts. According to a recent report, the total value of online bank account transactions processed by Mybank was estimated at more than €15 Billion in 2019. These impressive numbers are seen by many experts as the much-needed incentive that could convince more companies to join the race to further improve the online payment experience for end-users.