Spotlight on Banking Payments: Exploring Emerging Applications
The Money Platform Embraces Pay by Bank: A Cost-Effective Alternative to Traditional Payment Methods
The Money Platform, a leading digital payment platform, has announced the adoption of Pay by Bank as a payment method. This move positions Pay by Bank as a cost-effective and increasingly attractive alternative to other payment methods, particularly credit cards, due to potential long-term savings of up to 8% on fees for merchants.
The emergence of Pay by Bank as a competitive option, particularly for consumer-facing businesses aiming to reduce payment processing costs and operational complexity, was discussed in a recent webinar hosted by Ellie Duncan, head of content at Open Banking Expo. The webinar, which attracted participants from around the globe, including Canada, United Kingdom, United States, Afghanistan, and many more, aimed to encourage further adoption of Pay by Bank among customers.
Comparatively, established methods like Buy Now Pay Later (BNPL), which is rapidly growing with a global transaction volume projected to exceed $450 billion by 2026, offers flexible installment payments. In contrast, Pay by Bank emphasizes direct bank payments and lower merchant costs.
Another payment method compared was card-based digital payment innovations like Click to Pay, which focus on speeding checkout and securing transactions through tokenization and biometric authentication. Pay by Bank, on the other hand, simplifies the process by allowing direct bank-to-merchant transfers, avoiding card networks and related fees. However, card payment methods often benefit from quicker user familiarity and broad existing infrastructure.
To encourage further adoption among customers, The Money Platform and similar services are likely employing strategies inspired by behavioral science and the payment industry’s best practices. These strategies include reducing friction through seamless enrollment, building habitual use and social proof, highlighting cost savings and transparency, and targeting demographics already comfortable with digital payments, particularly Millennials and Gen Z.
The webinar, which had George Huntley, chief executive officer at The Money Platform, and Matt Jackson, VP partner management at Token.io, among its participants, aimed to compare The Money Platform's adoption of Pay by Bank with other payment methods and delve into the strategies employed to drive mainstream uptake. Clare Haskins, head of revenue operations at Ecommpay, also participated in the discussion.
The Money Platform's adoption of Pay by Bank positions it at business events like the Open Banking Expo, showcasing this cost-effective payment method as an alternative to traditional payment methods. This direct bank-to-merchant transfer system, contrasting with methods like Buy Now Pay Later and card-based digital payments, aims to reduce fees and operational complexity for consumer-facing businesses. In the quest for mainstream uptake, they employ strategies combining behavioral science and payment industry best practices.
