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Payment Solutions To Help Businesses Scale in an Era of Economic Turbulence

As 2022 comes to an end, the global economic landscape is looking increasingly bleak. COVID-19, war, sanctions, energy shortages and inflation all contribute to a mood of uncertainty amongst business owners, and even the most successful companies are thinking hard about what the future might hold.

So how can businesses stay competitive during a looming economic downturn? And more importantly, if a business is showing signs that it’s time to scale, what technologies can be leveraged to expand into new markets whilst keeping the current customer base happy?

Today, I’m going to look at how modern fintech solutions can help business scale, and more specifically, how the right payment methods can increase a merchants’ chances to profit from new customers, as well as building trust, and increasing consumer satisfaction.  

Specifically, I’ll be exploring how Open Banking solutions can help to diversify a company’s payment portfolio, aiding European and UK expansion. I’ll also explain the importance of payouts in day-to-day operations, and how the right solution can significantly improve efficiency. Hopefully, by the end of this short post, you’ll understand the advantages of adopting the most appropriate payment technologies into your workflow, especially if your business is considering a move to new markets. 

Achieving payment diversity using Open Banking

Across Europe, payment preferences vary significantly between countries, and plenty of region-specific options are used in preference to big names such as Visa and Mastercard. If you’re planning on expanding into Europe (or the UK) for the first time or growing your reach further, you must ensure your checkout offers all of the local payment options that your potential customers know and trust. 

Unfortunately, in my experience, some payment providers can take several months to implement those additional payment methods, so if you’re looking to stay agile and competitive, you’ll need a better solution. This is where Open Banking technology comes into play. 

Open Banking allows businesses to deploy a single payment solution that effectively integrates multiple payment methods, offering greater checkout flexibility with setup times of days rather than months. 

Open Banking in a nutshell

Open Banking (sometimes called pay-by-bank) is a regulatory framework and payment technology that radically streamlines digital payment processes, offering greater security for both merchants and consumers, while considerably improving the overall checkout experience of your online store. 

So what exactly is Open Banking? In a nutshell, the technology allows customers to make payments straight from their bank accounts. Open Banking services allow businesses to connect to over 2,000 major UK and European banks using a single integration. One of the most noteworthy advantages of OB transactions is speed, with transfers typically completed in under 15 seconds. 

Here are some of the advantages you’ll enjoy by adding Open Banking to your payment portfolio:

  • Fewer manual data inputs result in improved conversion.

  • Successful transaction rates are typically higher than with credit or debit cards. 

  • Compared to typical card transactions, fees tend to be lower.

  • Fraud and Chargebacks are effectively reduced to zero.

It’s clear that if you value streamlined, fast payment processing, Open Banking offers significant advantages, allowing cost-conscious businesses to provide greater customer protection from a unified solution that works efficiently across the EU and UK. 

Global Payouts — an efficient way to pay private and legal entities

Although checkout conversion and revenue generation rates are essential metrics to uphold as a business begins to scale, many companies regularly issue payouts to legal and private entities. Therefore, the right payout solution could significantly improve operational efficiencies, especially if payments need to be sent across borders or implemented on a mass scale.

Common payout issues 

The biggest issue encountered by businesses when making payouts to vendors, partners, or employees is prohibitive transaction costs. A currency conversion commission is levied every time a cross-border payout is sent, which can soon add up. 

As well as prohibitive costs, payouts can cause logistical headaches too. Mistakes inevitably creep in if a company makes regular mass payouts involving hundreds of simultaneous cross-border transactions. The result is funds being sent to the wrong person or payments held up due to administrative errors. Fixed banking times and processing complexities can often compound these problems, wrestling in a tarnished reputation and a loss of trust from stakeholders.

Important considerations when choosing a payout solution 

Although it sounds obvious, I’d always recommend businesses do their research when looking for a payout solution to ensure it meets all of their requirements. For example, will you be using an API to enable payout functionality, or would you prefer to manage everything from a single dashboard? The best fintech solutions allow operators to manage numerous payment orders and receipts while checking the operational status of payouts from the same unified interface.

Whatever solution your company implements, the result should be a streamlined process with a simple-to-initiate payout sequence. Sending funds to multiple (mass) recipients should be straightforward, no matter their region or the payment method they prefer (international or local cards, e-wallets, or bank accounts, for example). It also goes without saying that recipients should be able to receive their funds in native currencies, not just in EUR, GDP or USD.

Summing up 

Inflation and global supply chain issues are creating profound feelings of economic uncertainty as we end 2022. However, the eCommerce landscape is constantly evolving, and overall growth remains strong. If you want to scale your business rapidly or expand into new markets with the least amount of friction, the shifting digital landscape and increased competition will make it ever more crucial to build a diverse portfolio of payment options, as well as identifying the right technologies and payment service provider to implement them. 


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