What Is Data Enrichment Within Payments? And Why Is It Important?
In an increasingly digital landscape, financial data is everywhere, but much of it is messy, incomplete, and hard to make sense of. From cryptic payment descriptions to scattered account records, raw financial data often falls short when it comes to clarity and value. That’s where financial data enrichment comes in. Financial data enrichment transforms unstructured data into clear, structured, and actionable insights, helping businesses improve reporting, streamline operations, and deliver a better customer experience. In this article, we’ll explore financial data enrichment, how it works, and why it’s so important. Topics covered include: What is data enrichment? Data enrichment is the process of enhancing raw data by adding additional context, attributes, or information from internal sources or third-party data from external sources. It transforms incomplete, ambiguous, or isolated data points into meaningful, connected information, making the data more valuable, insightful, and actionable. In financial services, data enrichment means taking basic financial data, like a transaction record, and adding layers of information such as merchant names, locations, or customer behaviour insights to make the data useful for analysis, compliance, and customer experience. It’s used by: How does financial data enrichment work? Financial data enrichment uses a combination of data sources, rules engines, machine learning models, and APIs to clean, classify, and add meaning to financial transactions and records. Here’s a breakdown of how it works: Types of financial data enrichment There are many types of financial data enrichment. Here are some of the most common categories: Financial data enrichment The broadest category, financial data enrichment, enhances financial records with additional details like: This ensures better financial reporting, customer analytics, fraud detection, and hyper-personalised financial services (like spending insights or financial health scores). Customer data enrichment Customer data enrichment enhances customer records with additional information (from internal or external sources) such as: This improves customer records for better communication, targeting, and relationship management. Payment data enrichment This type of data enrichment focuses specifically on payments data, enhancing each payment record by adding: Payment data enrichment improves payment reconciliation, reporting accuracy, fraud monitoring, customer dispute resolution, and customer-facing transaction descriptions in apps. Transaction data enrichment Transaction data enrichment takes individual financial transactions and enriches them with context: This enhances financial management tools, makes transaction histories clear for customers, improves loyalty and rewards programme targeting, and enables better AML and risk monitoring. Banking data enrichment Finally, banking data enrichment enhances broader banking data beyond transactions, including: This supports smarter credit risk assessment, personalised financial products, open banking integrations, and better Know Your Customer (KYC) and anti-money laundering (AML) compliance. Why is data enrichment important in financial services? Raw financial data is often messy, incomplete, or poorly structured. Payment transactions might contain cryptic merchant codes or incomplete descriptions, and bank transactions could show up as a string of numbers or indecipherable merchant IDs. Without financial data enrichment, businesses struggle with everything from inefficient reconciliation processes and a poor customer experience to compliance risks due to incomplete or unstructured data. However, with financial data enrichment, businesses can turn fragmented, ambiguous financial records into structured, reliable, and actionable insights. Benefits of financial data enrichment Financial data enrichment comes with a range of benefits: In essence, financial data enrichment transforms raw financial data into a valuable asset for operational efficiency, customer experience, and data-driven decision-making. Open banking and data enrichment explained Data enrichment technologies, such as account information services (AIS), are at the heart of the open banking revolution. They allow third parties to use APIs to access customer account data, enabling a range of new and exciting services, including account information services (AIS). Authorised AISPs (account information service providers) use API technology to access a customer’s bank account and view account information. This service is particularly useful in customer onboarding and verification. At Brite we call this part of our open banking products Data Solutions. When financial institutions combine data enrichment with payment data at the onboarding stage, they gain richer, real-time insights into a customer’s financial behaviour and identity. This creates a faster, smoother, and more secure onboarding experience while strengthening compliance and fraud controls. Here’s how: To summarise, combining payment data enrichment with customer onboarding and KYC turns a basic identity check into an opportunity to gain richer insights, enhance compliance, and deliver a faster, smarter customer experience. For an idea of what that looks like in practice, take Suicide Zero: a Swedish non-profit organisation dedicated to reducing the number of suicides in Sweden. Faced with the challenge of ensuring a continuous and reliable stream of donations, when signing up as a monthly donor was cumbersome, Suicide Zero implemented AIS through Brite Data Solutions. Brite’s Data Solutions product automates the collection of address and account information via BankID, significantly reducing the number of form fields required and eliminating manual entry errors. This integration has made the donation process more user-friendly and efficient, reducing dropouts and administrative workload. Read the full case here Learn more about Data Solutions and data enrichment Data enrichment and open banking go hand in hand, fitting like a glove, with many European companies benefiting from new and exciting payment services. From car charging payments, charity donations, and insightful consumer lending, businesses can now offer new and exciting payment solutions for consumers like never before. Contact one of our in-house payment experts if you want to learn more about how open banking and data enrichment technologies like AIS can improve your payment infrastructure.
Payment Acceptance Rate (PAR) vs Conversion Rate (CR) Explained
Payment Acceptance Rate versus Conversion Rate – confused? You’re not alone, and you shouldn’t be. These two metrics are crucial for any business handling online transactions, but their definitions and how they apply can sometimes seem blurred. Therefore, let me clear up the confusion and explain what exactly Payment Acceptance Rate and Conversion Rate mean. Read on, as I detail their distinct differences within online payment and what you need to know to understand and improve your payment performance. What is Payment Acceptance Rate or PAR? Firstly, Payment Acceptance Rate, or PAR, refers to the percentage of attempted payments that are successfully processed, focusing solely on the final stage of the payment process. Conversion Rate (CR) is a broader metric that measures the percentage of website visitors or leads that complete a desired action, like making a purchase, which includes steps before the payment, like adding items to a cart and entering shipping details. This is clear… isn’t it? Without context, the above explanations are clearly different and easy to understand. Yet problems arise when used across different industries. The problem with payments is that they are everywhere, from everyday spending to once-in-a-lifetime purchases. Because of this, payment terms often need to be simplified and made universal wherever possible so that they can be understood across sectors. Unfortunately, conversion rate has fallen into this trap. Why is Conversion Rate Different? Put simply, merchants want consumers to buy, and consumers want simple payment journeys that allow them to pay easily. Within this, merchants need to understand how easy consumers find the payment experience and, more importantly, the effort required to complete a payment. This need is universal and industry agnostic. But some industries are more payment savvy than others. Large e-commerce merchants, for example, understand consumer journeys from the very first moment a consumer lands on their website. They track, analyse and target specific touchpoints to influence every aspect of the buying journey. For e-commerce merchants, the definition of conversion rate above can be very broad and start at any point the merchant deems important to track. Because e-commerce journeys are so varied, conversion rate becomes an important metric. Yet here, context is key. Some merchants require account sign-up, others need to calculate shipping before the payment journey starts, and some require consumers to make a reservation. The list goes on. Less payment-savvy industries may not have such diverse consumer journeys. Consider paying your water bill. The amount is presented on the screen, and you pay it. There is no shipping, no voucher codes, just a simple payment. For these merchants, there is less need for the broader usage and, more importantly, understanding of conversion rate. They care about when the consumer starts the payment journey because there isn’t much else the consumer can do. The vast difference in consumer experience has created a problem. Human beings crave simplicity and look for ways to make this happen. At some point in time, someone somewhere decided, “If conversion rate is well understood as an industry term, let’s just apply it to every payment journey!”. Payment companies can now talk to ANY merchant in ANY industry using the same language. Amazing! However, this oversimplification has created more ambiguity, not less. So what can we do? It’s essential to know your own position and definition of conversion rate. For merchants, if your key metric is measuring conversion from when a consumer lands on your website, so be it. But be clear and intentional with your definition. Especially when discussing your payment strategy with a payment provider. When discussing conversion rate, specify when the payment acceptance rate journey starts and ends for you. This can be from when a consumer clicks the ‘Complete Purchase’ button or lands on the checkout page. The latter is sometimes crucial to merchants who are design/brand-focused and want to understand the effect of a provider’s brand on conversion, compared to other payment methods. This then influences where payment methods are placed in the checkout and the consumer segments they should be available to. Clever stuff. And it’s all tied back to our golden conversion metric. How does Brite solve the conversion rate definition problem for businesses? At Brite, we’ve divided our definitions of conversion rate into two buckets: Brite conversion and bank conversion. We are acutely aware of the nuances and considerations outlined above. We have many experienced payments people in the building who’ve seen almost everything across multiple industries and regions. When engaging with prospects, we are both pragmatic and consultative. We want to know what’s important to you and how you measure success. However, we also understand the nuances of different industries and how they influence the performance of a payment method. Introducing User Session Conversion Here at Brite, we’ve added another conversion tool to our arsenal: user session conversion. This metric complements Brite and bank conversion metrics that merchants and other providers are accustomed to considering. But this metric signals more intent. Imagine buying a last-minute gift for a loved one. You’re stressed, but you also aren’t sure what to get. In this situation, many of us are juggling multiple browser pages and apps, searching for inspiration on one and almost checking out on another. Sound familiar? It’s messy and a reminder that technology can’t solve human forgetfulness (for now, at least). In the midst of this buying madness, you start the payment journey with Brite. You then remember your loved one hates the colour you’re buying, and you must look for another colour. But other colours are out of stock. Damn. You drop out of the buying process and exit the Brite experience. If we were to use our Brite conversion as intended, this consumer would have dropped out and not converted. We have very little information about why. Instead, merchants hold Brite accountable and assume that a problem with the experience forced the consumer to drop out. But this is clearly wrong. Brite had nothing to do with the choice to drop out, and
Payment Settlement: What Is It, and How Does It Work?
When a customer makes a purchase, the transaction goes through a list of stages, including authorisation, approval, and batching before reaching the final stage: payment settlement. Payment settlement concludes the transaction and allows businesses to access the funds. For that reason, the speed and efficiency of the process can impact a business’s cash availability and financial management. In this article, we’ll cover what payment settlement means, how the process works, and best practices for ensuring an effective payment settlement process. What does payment settlement mean? Payment settlement is the process of finalising a financial transaction between a buyer and a seller. When a customer makes a purchase, the transaction goes through different stages, including authorisation and batching, before reaching settlement. The settlement process is the final stage of the transaction – it’s when the funds are transferred from the buyer’s account to the seller’s, concluding the transaction and enabling the business to access the funds. For that reason, the speed and efficiency of the payment settlement process can affect a business’s cash availability and financial management. The payment settlement process: How it works Payment settlement takes place at the end of the transaction life cycle: Different types of payment settlement Because there are multiple parties involved in payment settlement, there are different types of settlement: Finally, there is net settlement vs gross settlement: Payment settlement: Best practices Effective payment settlement is essential for businesses to ensure smooth cash flow, minimise risks and optimise transaction processing. To achieve it, here are some best practices to follow: Optimise settlement timing Based on your business needs, you can choose between real-time, batch, or scheduled settlements. If you have high transaction volumes, batch settlement at set intervals – e.g., at the end of the business day – can help you reduce processing fees. Monitor and reconcile transactions regularly Conduct daily reconciliations to compare settlement reports from payment processors with bank statements. Bonus points for using automated reconciliation tools – they can help you flag discrepancies early. Minimise settlement delays Work with payment providers that offer faster settlement times, such as instant or same-day settlement. Ensure the correct merchant category codes to avoid delays due to risk classifications. Reduce settlement fees If your transaction volumes are high, negotiate lower interchange rates with your payment processor. Choose payment methods with lower processing costs, such as ACH over credit card payments when applicable. Improve fraud prevention and chargeback management Use strong authentication measures, like 3D Secure, for card-not-present transactions. Implement real-time fraud detection tools to reduce disputes and prevent chargebacks. Ensure compliance with regulations Follow PCI DSS (Payment Card Industry Data Security Standard) for secure payment processing, and stay compliant with Anti-Money Laundering (AML) and Know Your Customer (KYC) regulations for international transactions. Work with reliable payment partners Choose a trusted payment processor, such as Brite Payments, or an acquirer that provides transparent reporting and robust security measures. If you operate internationally, make sure they offer multicurrency settlement capabilities. Payment settlement using Brite IPN However, when it comes to A2A payments for the best results, a proprietary network, connected to thousands of bank accounts across Europe, is the way to go. If you would like to find out more about Brite Payments’s smooth settlement for its Instant Payments and Payouts products, get in touch now.
Get Brite news delivered to your inbox
[hubspot type=”form” portal=”24910633″ id=”8513da80-232b-46d7-a333-9171de5f9234″]
A Quick Guide to FX Payments for Merchants
Money makes the world go round. But first, money must be able to go around the world – and that’s where FX payments come in. FX payments enable merchants to send and receive international payments. However, they also come with certain challenges, making it important for merchants to optimise their FX payments. In this article, we’ll cover what FX payments are, how they work, why they’re so important, how merchants can optimise their FX payment process, and how systems like Brite’s Merchant FX can help. What is an FX payment? A foreign exchange (FX) payment, also known as a forex payment, is an international, cross-border payment that involves converting one currency into another. Types of FX payments include: FX payments enable merchants to pay international suppliers in full, without lengthy delays that could affect their professional relationships. They also enable merchants to process sales from international customers in their own country’s currency while allowing customers to pay in both their own currency and via their preferred payment method. Read more about cross-border payments How do FX payments work? Step by step, here’s a breakdown of how FX payments for merchants work, using an example of a UK merchant paying an international supplier: And that’s it – the merchant’s FX payment has gone through. The bonus of using a system such as Brite Payments’ Merchant FX is that this is all taken care of within our own payments network, the Brite Instant Payments Network, Brite IPN. This makes all the processes much more streamlined and cost-effective as we have bank accounts already established in many countries for the various steps. Why are FX payments important for merchants? FX payments are essential for merchants because they enable international trade, investments and global business operations. Here’s why they matter: Facilitating international trade and commerce Without FX transactions, global supply chains simply wouldn’t function efficiently, as businesses rely on FX payments to pay overseas suppliers, manufacturers, and partners. For example, a UK merchant importing electronics from China must pay in CNY. Supporting global business expansion Companies expanding internationally must pay employees, vendors, and taxes in local currencies. Through currency conversion, FX payments allow businesses to tap into global markets and customers. Managing currency risk and hedging volatility Exchange rates fluctuate, affecting costs and profits. Businesses can use FX strategies, like hedging or forward contracts, to reduce risk. For example, a UK company importing goods in USD might hedge against a weakening GBP to stabilise costs. Enhancing cost efficiency and profitability Smart FX management helps businesses save on fees and optimise cash flow, and competitive FX rates mean lower costs and better margins. A UK exporter receiving payments in EUR, for instance, may use a multicurrency account to avoid unnecessary conversions. Enabling cross-border payments and payroll Remote teams and international freelancers need FX payments for salaries – and companies use FX to pay these employees in their preferred currencies. For example, a UK startup with developers in India and the US may process FX payroll regularly. Powering the instant economy and e-commerce Online stores need FX-friendly payment options to sell to global customers. FX payments are also what allows businesses to accept multiple currencies via payment gateways. In short, FX payments aren’t just a financial process – they’re a strategic tool for businesses to expand internationally, reduce currency risk, and optimise cash flow and costs. FX payment optimisation FX payments are an important asset. However, they’re also subject to certain challenges. To quote Ahmed Ismail, Co-Founder and CEO of Vivowire: “The key challenges include high costs, a lack of interoperability between payment systems, and regulatory compliance. We address this through cutting-edge APIs, partnerships like Brite Payments for transactions, and a robust compliance framework to ensure secure and efficient money transfers.” Read more: Transforming Cross-Border Payments with Vivowire This is also where FX payment optimisation comes in. FX payment optimisation is about reducing costs, improving efficiency, and managing currency risk when making international payments. Key strategies for FX payment optimisation include: FX payment optimisation isn’t just about cutting costs – it’s about strategic financial management. By leveraging the right tools, providers, and hedging strategies, businesses can reduce FX costs, improve cash flow efficiency, and minimise risks from currency fluctuations. Get in touch with Brite If you would like to learn more about Brite Payments FX payments and our Merchant FX service, please contact our payment experts by clicking on the form below.
Brite Payments Expands Instant Payments Reach in Germany with OXID eSales
Stockholm – 6 May, 2025 – Brite Payments, a specialist provider of instant payments, today announced a partnership with OXID eSales, one of Germany’s leading providers of E-Commerce shop solutions. The partnership brings the extensive benefits of Brite Instant Payments and Brite Instant Payouts to users of OXID’s shop system through an easy-to-integrate plugin. OXID eSales, through its OXID eShop system, offers e-commerce merchants a scalable and highly customisable shop platform that suits the needs of B2B and B2C businesses across many industries. It supports a wide range of payment solutions that help merchants to customise their checkout and maximise conversion rates. Brite Payments leverages open banking technology to offer fast and convenient payments, eliminating the need for additional registration, manual card data entry, or app downloads. Highly secure, cost-effective payments are facilitated through the Brite Instant Payments Network (Brite IPN). In addition to Brite Instant Payments, OXID’s merchants can also streamline the considerable complexity of e-commerce refunds through Brite Instant Payouts. “With Brite Instant Payments, merchants can expand their checkout with a leading Pay by Bank provider, giving consumers a fast and convenient way to pay,” said Gerd Kasdorf, Head of Sales, OXID eSales. “OXID is committed to making the checkout process as simple and flexible as possible – it’s clear that instant payments fit the bill perfectly.” “OXID is trusted by leading brands as an experienced and innovative provider,” said Lena Hackelöer, Founder & CEO, Brite Payments. “Brite Instant Payments can be easily integrated into existing shops and facilitates a smooth payments experience for consumers. Additionally, merchants benefit from real-time transaction processing, which means predictable cashflow, reduced fraud risk, and lower operational costs.” Research from Brite Payments shows that two-thirds (67%) of Germans are familiar with Pay by Bank, with more than one-third (36%) of 18-29 year-olds already using the payment method either daily or weekly. Furthermore, 4 in 10 Germans are willing to try new forms of online payment, indicating considerable potential in OXID’s largest market. Headquartered in Stockholm, Sweden, Brite has been recognised in Deloitte’s Sweden Technology Fast 50 2024 and Accel’s Fintech 50 EMEA. The instant payments specialist picked up the award for ‘Best Use of Open Banking’ at the 2025 MPE Awards. For more information about Brite Payments visit: britepayments.com For more information about OXID eSales visit: oxid-esales.com or the OXID Solution Hub About Brite Payments Brite Payments is a second-generation fintech based in Stockholm. The instant payments provider leverages open banking technology to process account-to-account (A2A) payments in real time between consumers and online merchants. With Brite, no signup or credit card details are required as consumers authenticate themselves with top-of-mind details using their bank’s usual identification method. Brite is connected to more than 3,800 banks within the EU and its offering is currently available in 27 European markets. About OXID eSales OXID eSales AG, based in Freiburg Germany, is a leading provider of ecommerce solutions, serving major companies such as Lekkerland, Fressnapf, Strenesse, Metabo, Elektro Wandelt and Murrelektronik. Both B2C and B2B online shops value the scalability, modularity and quality of OXID eShop, which is flexible and fully customisable. Merchants benefit from the know-how of over 100 certified OXID solution partners and from ongoing direct contact with the company’s professional support and development teams. OXID eShop has been developed and published as commercial Open Source Software, meaning users benefit from product innovation, high-quality development and dependable, long-term investment security.
What Is a Transaction ID, and How Do You Find It?
Whether you’re buying supplies online, transferring funds, or engaging in financial activities, it’s essential to have a reliable way to track your transactions. That’s where transaction IDs come into play. Transaction IDs are assigned to individual transactions to ensure they can be efficiently identified and tracked. In this article, we’ll cover what a transaction ID is and how it’s used, best practices for managing transaction IDs, and how to find your transaction ID in Brite Payments. What is a transaction ID? A transaction ID (TXID) is a unique identifier assigned to a financial transaction between a customer and a merchant. It helps track and reference specific transactions for record-keeping, dispute resolution, customer support, and more. The transaction ID serves as a reference key to retrieve data on information such as: Transaction IDs usually consist of 12-18 characters, including numbers and letters. How are transaction IDs used? Transaction IDs are most commonly used for tracking, reconciliation, and customer support. Here’s how they’re used for these purposes: Aside from these purposes, transaction IDs are also used for things like payment verification, fraud detection and prevention, auditing and compliance, merchant settlement, and subscription and recurring billing management. Best practices for managing transaction IDs Managing transaction IDs properly is central to ensuring accuracy, security, and efficiency in the transaction process. Here are some best practices for managing transaction IDs: How to find your transaction ID in Brite Payments If you need to track a payment in Brite Payments, you can find the transaction ID (TXID) in three ways: These steps help you quickly verify transactions and resolve any payment issues efficiently. If you would like to find out more information, check out our docs site or get in touch directly. Want to know more about payments with Brite? If you would like to know more about Instant Payments and Instant Payouts, then get in touch with the Brite Payments team. As a next-generation payments provider, Brite is at the forefront of modernising payments processes and merchant services.
Choosing The Best A2A Payments Provider For Your Business
Choosing the best account-to-account payments (or Pay by Bank) provider for your business can be tricky. Like so much in life, not all providers are the same, particularly when it comes to A2A payments. And with so many different options and variations in service, from cross-border reach to the quality of customer support, choosing who to partner with is harder than ever. To gain insights on what to consider when choosing a new Pay by Bank or A2A provider, we spoke with Sven Fredin, VP of Commercial Operations at Brite Payments. Sven is an ideal expert for this topic, as he has been involved in numerous Request for Proposals (RFPs) and is Brite’s go-to expert for addressing these questions. Therefore, here’s what merchants need to keep in mind when selecting the best payments provider for their business. Why is it critical to consider a payment service’s technical aspects when choosing a payments provider? Sven Fredin, VP Commercial Operations: When selecting a payment provider, it’s crucial to consider the technical aspects. All A2A payments providers appear to offer similar products from the outside, but it’s essential to look deeper into each provider’s underlying systems. Some key factors to evaluate include the provider’s uptime and system stability. What technology are they using? How much downtime do they experience per month or year? This information is vital for merchants, as it directly impacts their operations. A merchant cannot afford to collaborate with payment providers that experience frequent downtime. Therefore, the technology stack and the choice of system providers and subcontractors are crucial factors. Additionally, evaluating the entire journey after a merchant signs a contract with an A2A payments provider is essential. Does the provider simply sign the contract and disregard the merchant, or do they offer support throughout the integration process? They must assist with the integration, provide a dedicated team, and ensure the merchant is supported from contract signing to onboarding and going live. How important is finding an A2A payments provider that listens to a merchant’s needs? Sven Fredin: It’s crucial for a merchant to find a reliable partner. At Brite, we view our relationship with merchants as a long term partnership. Communication is key in this partnership. For instance, if you, as a merchant, have feedback regarding product improvements or a specific feature you feel is missing to streamline your operations, you should feel comfortable bringing this up with your payment partner. It’s essential that your payment partner listens and takes action based on your feedback. One of Brite’s key strengths is our commitment towards our merchants, by listening to our merchants feedback and also incorporating this feedback into our continuous product improvements. This helps us establish strong, long-term relationships with our merchants. Unfortunately, many companies cease to care for their merchants once the contract is signed; they simply focus on the revenue they will generate. However, the real work begins after the contract is signed. It’s important to support the merchant throughout the integration process. This means actively listening to their feedback and ensuring the technical integration goes smoothly. At Brite, we pride ourselves on guiding merchants during the integration process and ensuring a seamless transition to the account management team. Our goal is for every merchant to feel heard and supported. What are merchants eager to know about A2A payments and related services? Sven Fredin: We have some common questions from merchants. They often ask about our market coverage and which markets we support in Europe. Additionally, they inquire about the currencies we accept and whether our products and services are available outside Europe. Another important factor is pricing, which can vary depending on the stakeholder involved, such as whether we deal directly with the merchant. However, it’s important to note that merchants should not focus solely on finding the cheapest solutions. Overall, coverage, availability, and price are the key factors that consistently arise in these discussions. What myths about A2A Payments and Pay by Bank do you come across? Sven Fredin: I want to address a few myths surrounding A2A bank payments. First, there’s the belief that these payments are not secure. This is a myth. Many people think logging into their bank account and verifying transactions might be unsafe, but the reality is quite the opposite. We adhere to the highest data security standards and procedures. Another myth is that A2A payments are too complicated for the end user. I can assure you that we have measured conversion rates for both first-time and returning users, and we’ve found that the user journeys are very smooth. The third myth is that A2A payments are too slow for users. This is also false. For instance, the majority of payments we process are settled within seconds in the majority of cases. What cannot be underestimated or forgotten about when choosing a payments partner? Sven Fredin: To expand on what I mentioned earlier, the availability of the payment system is crucial. Ensuring high system stability and maximising uptime—ideally aiming for 100%—is essential. Merchants cannot effectively offer payment methods at checkout if the system experiences frequent downtime or service interruptions. Another vital aspect is customer and merchant support. After you, as a merchant, have signed the contract, it’s vital that you receive continuous support throughout the onboarding journey. You should have a dedicated account manager and always have direct access to a representative from the payment provider, rather than just sending an email to a generic address and hoping for a response. Having a personal contact ensures that you receive the support you deserve. Additionally, regulation is important. Companies like Brite are fully regulated by the Swedish Financial Supervisory Authority (SFSA), which holds us to the highest standards in our business practices. Finally, it is advisable to check for references from similar businesses currently working with the payment provider. Asking for references can serve as a good benchmark for you as a merchant. What should stop you in your tracks and make you take notice? Sven Fredin: If you’re evaluating
How to Significantly Reduce Credit Card Merchant Fees
Significantly reducing credit card merchant fees is becoming increasingly critical. Indeed, it’s fair to say that the rise of e-commerce and online transactions is rapidly changing how customers pay. Today, customers rely on various payment methods to pay for the goods and services they need, a far cry from the first emergence of e-commerce all those years ago. Sadly, this cultural shift has had the knock-on effect of making e-commerce merchants increasingly reliant on unscrupulous providers to facilitate the many payment options their customers are clamouring for. Indeed, in some cases, payment providers have begun actively taking advantage of merchants, charging high transaction fees, providing limited customer service, freezing accounts, or restricting chargebacks or suspected fraud – all of which can eat into merchants’ hard-fought profits. In some cases, monopolising the payment processing sector has led some providers to engage in price gouging and overcharging merchants for the sake of extra profits. According to a recent report by the British Retail Consortium, the total amount paid by retailers to banks and card schemes rose by over 25% in 2024, at an extra cost of £380 million! So, are there alternatives for merchants who want to circumvent these extra costs? This article explores how merchants can reduce their card transaction fees and safeguard their profits. It also explains how account-to-account payments and Pay by Bank could be the best payment option for businesses. Read on to learn more… Disadvantages of card payments Today, e-commerce card-based transactions often come loaded with costly transaction fees for merchants, which can significantly eat into their profits. Some common card fees include: At a time when overhead costs are higher than ever due to the ongoing cost-of-living crisis, businesses have been forced to achieve more with fewer resources. Similarly, the fees can also impact customers’ spending habits, as they may be disincentivised from making larger purchases because of the hidden fees that they are forced to contend with. That said, there are a few tactics out there that can help merchants avoid these issues. 3 Ways to lower credit card merchant fees 1. Negotiate with credit card processors The first thing to remember is this: credit card processors don’t want to lose the business they will receive from merchants whose customers rely on them. Card processors will want to encourage an open and equitable relationship that benefits both parties. They won’t want merchants to jump ship and opt only for alternatives to credit cards. With this in mind, and assuming that their business is booming, merchants should have a frank discussion about the fees they are being charged and negotiate to get a fairer price. You can convince your processor to reduce your rates if you conduct more transactions each month. 2. Address verification services Merchants can also use address verification services to reduce costly credit card fees. These services involve third parties integrated into the credit card payment journey. These third parties verify cardholders’ billing information with issuers and then reward merchants using these systems by charging them lower interchange rates. 3. Stay alert to new and better regulations Some markets are more regulated to prevent merchants from being exploited by credit card processors. Moving to target customers in these areas or switching a business to be registered in these places is another method that can help merchants reduce their fees. For example, merchants operating in the United States are currently subject to far more fees from credit card processors than their European counterparts, thanks to the European Union’s Interchange Cap. The EU’s antitrust legislation sets interchange fees for consumer debit cards to 0.2 % and consumer credit cards to 0.3 %, meaning merchants operating there keep significantly more profits than Americans. However, even in the EU, the numerous regulations governing these fees can be overwhelmingly complex, and moving an e-commerce business to a whole new country isn’t always a practical option for merchants. Embracing A2A Payments and Open Banking as an alternative With all of the above in mind, payments that use open banking infrastructure can be viewed as a far more viable alternative for merchants who want to lower the processing fees set by card networks. What Makes Instant A2A Payments Different Open banking and instant A2A payments are currently the best and most innovative forms of payment technology available to consumers and merchants alike. We’ve previously addressed the fact that they can grant merchants the infrastructure needed to provide customers with secure, real-time payments that completely bypass traditional card networks and digital wallets (such as PayPal), which either rely upon intermediaries for each step in the payment journey, dragging out the process or unhelpfully keep escalating fees. On the other hand, instant A2A payments powered by Open Banking can either occur directly or via API networks, reducing the burden placed on e-commerce merchants. A2A payments are facilitated through a regulated infrastructure that allows banks, payment providers, and consumers to communicate directly and securely via APIs. This secure system also means these payments are extremely secure, protecting merchants from fraud or cashback, which often burden credit card payments. Creating a payments safety net Pay by Bank and A2A payments also have the advantage of forming a valuable safety net for merchants who might be wholly reliant on card providers. In the event of an outage or a technical failure, merchants who exclusively offer only card-based transactions will be unable to process card payments. This, in turn, will cause significant financial losses to the brand in question unless they have access to a suitable backup. Open Banking-powered A2A payments can act as this backup, minimising lost revenue in the event of an unforeseeable breakdown on the processor’s side. Improving the customer experience (CX) for payments Switching to Open Banking-powered solutions also improves the customer experience. It offers consumers fast and seamless instant payments without the redundant processes associated with credit card payments. However, merchants should not attempt to completely replace all of their card payments with A2A, as this might alienate customers who prefer
RFP Guide – How to Find the Perfect Payments Provider
