The way consumers pay is changing, and Pay by Bank is emerging as an appealing choice, ranking as a top three payment method in the UK, Netherlands, Finland, Spain and Germany. A new report, based on research conducted by YouGov and Brite Payments, a leader in instant bank payments and one of Sweden’s leading fintechs, details how payment habits and preferences are evolving. It also shines a light on why Pay by Bank is gaining traction amongst a growing number of consumers. 

The Instant Economy Payment Insights report, based on fieldwork conducted in January 2024 that surveyed more than 8000 consumers across six key European markets, examines emerging trends and payment preferences. The inaugural report reveals a growing appetite for new payment methods that cater to consumer demand for secure, convenient, and instant payments. It highlights similarities and differences across the markets surveyed, which illustrate the diversity of payment behaviours that pose a challenge for businesses that are increasingly international in nature. 

Report Highlights:

• Nearly three-quarters (73%) of all respondents are familiar with Pay by Bank (also known as Account-to-Account or A2A payments) as a payment method, rising to 90 percent in the UK and 97 percent in the Netherlands. 
   
• Pay by Bank is a top three payment method in the UK, Netherlands, Finland, Spain and Germany (based on usage on at least a monthly basis).
   
• More than one-third (36%) of all respondents aged 18-29 already use Pay by Bank either daily or weekly, while 25 percent do so across all age groups. 
   
• Pay by Bank is three times more likely to be used on a daily or weekly basis than Buy Now Pay Later (25% vs 7%).
   
• 42 percent of regular Pay by Bank users opt for the payment method because of speed.
   
• 59 percent of respondents cite security as a primary factor determining their choice of payment method for online purchases – while 54 percent cite ease of use. 
   
• Needing to create an account to complete a payment (22%) and needing to use an app to make a payment (17%) are the most frequently encountered issues with online payment.
   
• More than half of respondents (50.1%) believe waiting more than an hour for a payout (payment from a business to a consumer) is unreasonable.

"Immediacy and convenience are at the core of today’s instant economy, with consumers now expecting real-time interactions across all digital touchpoints and in all facets of their lives,” said Lena Hackelöer, Founder & CEO, Brite Payments. “However, the promise of a true instant economy remains unfulfilled, in part, because it requires an entire ecosystem of digital payment technologies that have struggled to keep up with changing consumer needs.”

Needing to create an account (22%) and needing to use an app (17%) were the most frequently encountered issues when making online payments, according to the report. The prevalence of these issues indicates an opportunity for easy-to-use payment methods that only require consumers’ top-of-mind information. However, despite a clear desire for convenience, security ranks as the most important factor when considering a new payment method (73% of respondents), higher than fees (64%) and ease of use (47%). 

Speed also emerges as a key consideration in consumers’ choice of payment method – more than a third of respondents placed high importance on immediately seeing transactions reflected on their accounts, with this rising to nearly half for the Netherlands (44%) and Spain (46%). Consumers also expect rapid settlement of payments they receive – whether in the form of refunds or payouts – with over half (50.1%) agreeing that it is unreasonable to wait for more than an hour to receive a payment from a business.

“Account-to-account payment methods are not entirely new – in fact, they are well established in many European markets. What is noteworthy is that a new generation of Pay by Bank or A2A solutions based on open banking is emerging, which not only address merchant pain points but also clearly converge with consumer demands for more convenient and secure payments,” concluded Hackelöer.

Brite Payments enables instant account-to-account (A2A) payments and payouts, leveraging Europe’s open banking infrastructure. Brite announced a $60 million fundraise in October 2023 and is expanding its presence in markets across Europe, while investing in its technology stack – most notably Brite Instant Payments Network (Brite IPN), the company’s proprietary network for processing instant payments.