Banks, consumers and merchants have all rushed to adjust their operations over the past year, changing their once-routine approaches to payments as open banking developments swept the world. Financial institutions (FIs) and FinTechs are collaborate with increasing frequency to improve the availability and reach of open banking, particularly in the United States, where creating transparent and secure payment experiences is becoming increasingly critical for merchants looking to retain their customers .
Consumers expect more safety and speed, no matter where they shop, with recent PYMNTS The data finding that 86% of Americans with annual income over $ 100,000 believe companies should protect their data at all costs. To enable this convenience and security, merchants must adopt open banking solutions that can enable easy payment on the customer side and faster data sharing on the merchant side, enabling businesses to create marketing and product offerings. more personalized. and take control of the customer relationship.
In the last US Open Banking Tracker®, PYMNTS analyzes why merchants need to stay on top of emerging payment trends, including real-time and open banking developments, to meet consumer needs and take control of the customer relationship. It also examines the growing importance of contactless and account-to-account (A2A) payments in this space and how merchants can take advantage of these tools.
Around the American open banking space
The use of contactless payments has accelerated over the past year as customers move away from cash and cards to digital methods. A recent study found that 91% of US consumers now use contactless payment methods like mobile wallets or contactless cards when shopping, for example. It is therefore imperative for merchants to adopt open banking solutions that can provide the convenience and flexibility that consumers need to maintain control of the customer relationship.
Getting buyers to embrace open payments supported by banking services first requires them to trust those payments, but a recent study found that 52% of consumers around the world still don’t know what open banking means. He also revealed that 61% are sure they haven’t used open banking to make payments, making education the first step in developing the confidence to move payments supported by open banking forward. Merchants and banks need to act quickly to ensure consumers understand how open banking solutions work and the benefits they offer, including how they can support fast and convenient payment methods such as mobile wallets.
Banks also work closely with FinTechs to bolster open banking initiatives and support financial innovation as the need arises. FinTech and application programming interface (API) provider Plaid recently announced a partnership with US Bank that will allow the latter’s customers to seamlessly connect with third-party FinTech applications, for example. The two also aim to connect Plaid’s beta portal solution to the US bank’s MyControls app to enable more connectivity and ease of use for customers. These and other collaborations between banks and FinTechs in the United States are expected to affect the payment preferences and needs of Americans in the years to come.
To learn more about these and other stories, visit Tracker’s News & Trends.
TD Bank explains why supporting data-driven payments is key to engaging consumers
Consumers are looking for flexible payment experiences wherever they shop, putting pressure on their favorite merchants to keep up. Retailers need to enable various payment methods across all channels to maintain customer engagement and transactions, and the integration of A2A payments and digital wallets could help them do just that. Barry baird, responsible for payment capacity and delivery to TD Bank, PYMNTS said in a recent interview. To learn more about how the integration of digital payments underpinned by open banking can help merchants take control of the customer relationship, visit the Tracker’s Feature Story
Deepening: How Adopting Real-Time Payments Can Help Merchants Retain Mobile Customers
More and more consumers are now using their smartphones at the point of sale (POS), gravitating to digital contactless or peer-to-peer (P2P) payment methods instead of cash or cards. This growing interest in emerging payments, in turn, represents a key opportunity for US merchants to integrate real-time or open payment methods. To learn more about how the integration of real-time payments could help merchants gain a competitive advantage when it comes to engaging and retaining today’s digitally-driven customers, visit the Tracker’s Deep Dive.
About the tracker
the US Open Banking Tracker®, a PYMNTS and Endava collaboration, examines how open banking developments affect U.S. retail payments trends and future developments.