The Capgemini Research Institute’s world payments report 2025 refers to an industry set to be reimagined with account-to-account or A2A payments challenging the dominance of traditional payment cards.
More than one-third of the European payment executives surveyed for the report expect A2A payments to significantly offset card transaction growth across Europe by 2027.
According to Mathieu Altwegg, Head of Product at Visa for the UK & Ireland, there are three main issues that need to be addressed in order to maximise customer adoption of A2A payments, the first of which is delivering a consistent user experience.
“We then need to create a level of trust so consumers understand that the solution is safe,” he says. “Finally, we need a strong element of consumer protection, which typically articulates itself as a formal resolution process for managing disputes.”
Visa recently announced the launch of Visa A2A to address these issues and bring consumer control and protection to account-to-account payments. The service will introduce a formal dispute resolution process and use biometrics to add new levels of security.
Altwegg acknowledges that the payment rails have to be secure if consumers are to adopt them at scale and notes that the payment industry has deployed advanced artificial intelligence fraud detection models to help identify potential fraudsters and scams happening in real-time.
“It is also important to onboard the right players and have appropriate requirements in order for beneficiaries to participate,” he says. “The best way to fight fraud is to layer different fraud detection solutions, one of which is ensuring that you know who is participating on your network.”
Altwegg explains that the first two use cases Visa is looking to support with Visa A2A are bill payment and subscription, which are typically recurring payments.
“Businesses are increasingly adopting subscription-based models to drive consumer engagement and loyalty,” he says. “Complementing variable recurring payments with the right user experience puts the customer in control, for example by allowing them to set payment limits or making it easy to cancel mandates.”
Utilita Energy is one of the companies that have signed up to Visa A2A, which is expected to go live early next year. By combining Visa’s experience in developing and operating payments systems at scale with its technology partner, Procode, the utility company expects to be able to bring new services to its customers more quickly.
“This is about offering our customers more choice on how they pay their bills, in a way that is flexible, secure and provides more control,” explains Ian Burgess, Chief Technology Officer. “We are very excited to be working with Visa on an industry-led solution to unlock the full potential of open banking and A2A payments in the UK, in particular variable recurring payments.”
Variable recurring payments – and particularly commercial variable recurring payments – are poised to play a crucial role in advancing A2A payments in the UK according to Todd Clyde, CEO of Token.io.
“Key factors influencing their widespread availability are still being determined, with the Payment Systems Regulator expected to publish updated proposals this autumn, but demand from merchants and payment providers is undeniable,” he says.
Variable recurring payments are also a viable option for monthly bills and subscriptions. Some of these payments are made by card-on-file (continuous authority) and so would also drive the growth of A2A payments.
It is important to onboard the right players and have appropriate requirements in order for beneficiaries to participate.
Mathieu Altwegg, Head of Product, Visa
“However, recurring payments that are currently paid by direct debit or standing order are already A2A transactions over BACS or Faster Payments and so switching to variable recurring payments would not in itself drive the growth of A2A payments,” observes Andrew Ducker, Senior Payments Consultant at Icon Solutions.
International money transfer company OA Pay has been using A2A payment for more than two years explains Chief Technology Officer, Graham Allathan.
“This was driven by our goal not only to optimise costs but also provide customers with diverse payment options across multiple corridors using a robust and scalable API-based infrastructure,” he says.
The company had to enhance its infrastructure by integrating approximately 50% more API endpoints to enable and support the open banking framework. But Allathan says 40% of his customers now use open banking and that once a customer switches they continue to use it, leading to a gradual rise in the average transaction size.
The Capgemini Research Institute’s report states that regulations have played a crucial role in driving innovation and ensuring consumer protection and that as a result, the payments ecosystem is more connected, harmonised, efficient and secure than ever before.
However, it also acknowledges that progress towards open banking is limited by differences in regulatory frameworks and market initiatives with issues including non-standardised APIs, limited control over data use, and a lack of incentives to share data with third parties.
Australia, Brazil, India and Singapore are identified as the countries leading initiatives to make data more accessible and convenient for individuals and companies.
A new report from Juniper Research notes that slow adoption of open banking is especially notable in markets that have not enabled legislation for the open sharing of data and information between financial institutions and open banking players.
A key question for proponents of A2A payments is the extent to which interoperability of real-time payment systems across different countries – and a global standard for A2A payments – are realistic objectives.
“In Europe, we have the infrastructure to build pan-European A2A payment schemes thanks to the open banking framework that is regulated by PSD2, which should be further improved upon by PSD3,” says Lena Hackelöer, Founder and CEO Brite Payments. “The framework provides a strong foundation for interoperability across European borders, although achieving this at a global scale is a much more complex challenge.”
The widespread adoption of ISO 20022 as the underlying message standards for most, if not all, A2A payment schemes around the world will ease some of the technical burden, but there are bigger obstacles – including political barriers – which mean such interoperability will be challenging agrees Rob Hudson, Head of International Banking and Payments at FIS.
Progress is being made toward regional standardisation, which could serve as the foundation for global A2A interoperability in the future according to Oriol Tintore, Co-Founder and Co-CEO of Belvo.
“For instance, Brazil’s Pix system and Europe’s SEPA network have laid the groundwork for cross-border payments by standardising A2A payment processes within their regions,” he says. “In Latin America, while systems like SPEI in Mexico and Pix have been successful within their respective countries, they operate under different regulatory frameworks and technical standards, making cross-border A2A payments more challenging.”
Pratiksha Pathak, Head of Payments Services at RedCompass Labs is more optimistic, suggesting that global movement towards real-time payments in the form of initiatives such as FedNow, SEPA Instant, UPI and Faster Payment shows that countries are keen to implement more efficient payment solutions.
“On the technology side, open APIs and cloud-based systems are making it easier to connect different payment systems, allowing real-time, cross-border payments,” she says. “Major developments in global standards, such as ISO 20022, are signalling that interoperability is a top priority with all of the G20 pushing for better cross-border payments.”
The [Payment Services Directive] framework provides a strong foundation for interoperability across European borders, although achieving this at a global scale is a much more complex challenge.
Lena Hackelöer, Founder and CEO, Brite Payments
Interoperability is already happening in Southeast Asia where A2A payment schemes are jointly developing cross-border capabilities between PayNow (Singapore), PromptPay (Thailand) and DuitNow (Malaysia), for example, observes Adam Lee, Chief Product Officer at Boku. “It is still early but evidence suggests this is absolutely realistic,” he says.
However, Michael Seaman, CEO of Swipesum says that the US population will only adopt A2A when it is convenient for them in their everyday lives – and for that to happen, A2A payments must be available in the software they use for transactions, which will only come after bank adoption.
“Only about 10% of banks have adopted FedNow and I’m guessing it would have to be above 80% for us to experience this payment method in our daily lives,” he adds.
Canada is moving toward an open banking framework, while Brazil has launched an open banking initiative with regulatory backing. But concerns around data sharing and misconceptions about open banking being complex or risky have slowed adoption in many markets.
While UK consumers may already be using the account aggregation feature of their mobile banking app or have been credit checked for a loan using open banking to get reference data, Hudson recognises that consumer awareness needs to rise.
“Regulation in the form of PSD2 is helping to create more competition in the market, as is the requirement for Apple to open up the NFC component in its phones for usage by actors other than Apple itself,” he says. “This kind of regulatory intervention can aide long-term adoption through competition.”
Regulatory compliance remains a challenge, especially in countries with evolving financial systems. “Nonetheless, companies are addressing these challenges by offering compliant, easy-to-use platforms that help businesses navigate local regulations and build consumer trust through secure and transparent A2A payment options,” says Tintore.
Lee suggests that support from central banks is a key factor in encouraging wider use of open banking schemes targeting B2C payments as they need to ensure the user experience is simple, the process is demonstrably secure, and the pricing to merchants is persuasive.
“A second factor is the degree to which incumbent payment methods are already entrenched into consumer/merchant habits,” he adds. “For instance, if merchants insist on the anonymity of cash or consumers insist on the loyalty rewards of credit cards, even a more convenient alternative will face resistance.”
There are third-party tools that have pre-built the infrastructure for A2A, RTP and FedNow payments, significantly cutting down on engineering costs. The problem is that without bank adoption, not all customers can access them.
“I have seen other fintech platforms that offer ‘free’ A2A payments,” warns Seaman. “However, since there isn’t bank adoption users have to pay by card – which the fintech has significantly marked up. These fintechs are truly high-rate merchant service providers promising A2A payments that don’t work yet.”
In the UK, the Competition and Markets Authority has already announced full compliance of the open banking roadmap by the CMA-9 group of banks. Providers of open banking services, also known as third-party providers, must also be authorised or registered with the Financial Conduct Authority to provide payment or account initiation.
“Ongoing work is required for consumer protections for any new type of payment service under the open banking umbrella though,” says Ducker. “Open banking already has a disputes mechanism as part of its framework, but each subsequent new payment service will bring potentially new angles to consider.”
Financial institutions and fintechs need to educate customers on secure transaction practices, such as verifying the recipient’s details before authorising payments and being cautious of unsolicited communications, suggests Pathak.
