Are Card Payments Getting Simpler Or More Complex?

by Sarah Grotta 0

 A column in Finextra brings to light a topic regarding payments that probably doesn’t get enough attention. Much of the technical development going on in payments is helping providers to streamline and simplify their operations and bring new solutions to light. The effect, however, is rarely simplification for consumers. They are bombarded with choice, which can be nice, but options also creating marketplace confusion which is most unhelpful:

The processes and IT systems needed by a retailer to send card payments to a bank for authorization, and subsequently to settle them, are simple. Many retailers have their own payments systems in place to do this, whilst others use payment service providers (PSPs). In both cases, the interaction between those systems and the banks have not changed much for many years. They get updated occasionally to cater for new requirements like contactless, but these are relatively minor technical evolutions, rather than large-scale disruptions.

However, things are more complex is on the customer side, where the shopper uses a card and interacts with the retailer.

Retailers now see payments as a means to compete for shoppers and show that they are up-to-date, modern and relevant – to appeal to millennials and their shopping behaviors. Contactless helps in this endeavor; as do Apple and Android Pay. But retailer wallets, integration with loyalty schemes, order ahead, click-and-collect and other shopping behaviors all need to be accounted for in the context of payments.

The writer suggests that retailer payment hubs are the solution. They may be helpful to sort out payment types, but if every retailer and payment provider is devising a different hub of their own or using different hub solutions, the consumer may still be left with a confusing view of their payments.


For a retailer’s payments strategy to be fulfilled with relative ease, a payments hub should allow disparate systems to consume the payment services through a range of means – whatever is the simplest in the circumstances – be it web services, APIs or even legacy protocols. Retailers need to ensure they have the right payment systems or the right PSPs available to them that can effectively deliver the simple bit, as well as offering a means to deal with complex integrations.

Overview by Sarah Grotta, Director, Debit Advisory Service at Mercator Advisory Group

Read the full story here