Research published today by RS2 examines the payment landscape across a number of global markets, and finds that proliferating payment channels and the expectations of consumers and merchants has made payment service processing increasingly complex. Payment fragmentation is now the “new normal”, giving consumers a great deal of choice, and merchants an ever-bigger challenge to deliver seamless services across channels.

The report—Overcoming Fragmentation: The Payments Platform Challenge—looks in-depth at both developing and developed markets, and those with a history of adopting new technology and those who are traditionally laggards. It finds that:

·         Mobile payment technologies have gained momentum in mature markets, and look set to take hold in other markets sooner rather than later

·         Previously separate payment channels are blurring together

·         The changes in these markets are driven both by card schemes and fintechs using digital payments

·         Many countries with a digital economy strategy are creating a legal framework for cash-less B2C and B2B payments

·         There is no single trend—every market is different. This, and the multiple payment methods in use, mean that merchants and the payments industry that supports them, need to position themselves carefully, and be ready to shift when necessary

“What is clear is that this fragmentation of payment methods makes things tricky for both merchants and the payment industry,” said Radi Abd El Haj, CEO and Executive Director, RS2. “It is critical that merchants in these markets have a clear digital strategy in order to meet the needs of their customer. If these merchants are supported by their acquirer and clear strategy supported by flexible payment systems, they can react quickly. If not, they cannot.”

The report concludes that the best way to overcoming fragmentation lies with Open Payment Platforms, integrating POS, mPOS, online and mobile payments together. By connecting the multiple payment services demanded by consumers, it’s possible to enable omni-channel payment acceptance services for cards, IBAN-based bank payments, online wallets, prepaid products, in-app payments, mobile HCE NFC payments in-store and immediate payments—all in real-time.