In Depth

Thriving In The “Openness” Of Payments

Open versus Closed is a debate that has raged for as long as technology has existed. PAY.ON has a point of view on this debate, particularly as it relates to how technology can be used to expand payments’ reach. Are you convinced?   

As consumers continue to explore the use of new methods and channels to spend their money, the related technology has quickly transformed the business world. Purchasing groceries on a mobile device or paying rent online are now everyday occurrences, creating a marketplace where payment providers can deliver attractive and inventive solutions to consumers. From contactless payments to biometric authentication, innovation in commerce is closely tied to payment technology, business models and trusted partnerships.

But staying relevant in the future of payments may require businesses to not only embrace the principles of Openness, but also learn to leverage them into customer satisfaction and financial success. The white paper, published by PAY.ON aims to provide stakeholders in the payments industry with the knowledge and tools necessary to better understand and prepare an Open environment. By focusing on a strategy of being accessible, flexible and transparent, PAY.ON believes that companies may have an opportunity to take advantage of the value Openness can add to their businesses, while also witnessing the benefits brought to all participants.



According to PAY.ON, the future of payments is Open payments. But what defines an Open payment and what does it mean for the industry players looking to provide them?

Openness has three fundamental elements: accessibility, flexibility and transparency.

“Companies are accessible when they have easy sign-up processes, open and modern technical interfaces, global and local capabilities, and effectively balance security with convenience. Flexible businesses offer services that are modular, open to various technologies, multicultural, and adaptable for uptake by partners. To be transparent, payment providers must offer clear terms, utilize feedback loops and communities, and follow Open standards that stimulate interoperability and competition,” the white paper explained.

The future of an Openness-driven payments marketplace will be shaped by many factors, including free-flowing global competition, data access and transparency, universal interoperability and frictionless payments, PAY.ON believes.

They contend that Open platforms will fuel effortless payments, where consumers can easily authenticate their identities and payments themselves will flow seamlessly with broader commercial interactions. Geographic markets will no longer be a significant competitive factor, instead natural advantages like strategy, scale and specialization will drive globalized competition. The diminished barriers presented by an Open marketplace can increase the demand for global service providers, while providing a more even playing field for merchants throughout the global market. Transparency across payments ecosystems is also important for Openness, as data will be more widely available, allowing both customers and merchants to better assess risks associated with payment-related decisions.

While adopting an Open business approach is not a simple process, the white paper argues that as the payments industry continues its evolution from semi-open to open, embracing this concept is necessary to sustaining value for clients in a complex and competitive environment.



Openness, they describe, is a “prevailing force of change,” and while the concept is said to be sweeping across all business industries, the ongoing advancement within the payments industry puts it in a unique position to benefit from the shift.

When the three Openness attributes – accessibility, flexibility and transparency – are adapted successfully to the three dimensions of payments – technology, the business model and trust – the elements of Open payments services are created. The white paper cites many examples of businesses both within and outside of the payments ecosystem that have seen success in striking a balance of the resources needed to offer an environment where Open payments can flourish.

“Implementing these elements of Open payments will take dedicated, comprehensive effort across an organization. But it will be worth it, because companies that are Open will be more competitive, now and into the future,” the white paper said.

The Spanish banking group BBVA is identified as an example of a European bank taking significant steps toward Openness. BBVA experiments with technological Openness through a number of forums, including its online developers center and app marketplace, with an aim for users to build upon its open technology and data where possible. The company also encourages innovation through its commitment to invest $100 million in startups seeking to revolutionize financial services.

PAY.ON highlights Salesforce’s Open business models as an example of how open creates value through sharing certain assets with other companies, like its CRM solution being leveraged with third-party add-ons, allowing others to cater to their customers in unique ways. The company’s technical infrastructure is also shared with community partners and offers a platform to help service other parts of its clients’ businesses.

They also believe that the Visa Ready and Visa HCE programs showcase Open models of trust, where initiatives both strive to provide standards for implementing trust in the marketplace. Visa Ready is an optional accreditation program for new mPOS solutions, allowing them to add the support of a trusted brand to their platform by receiving testing and certification through Visa. The company’s host card emulation (HCE) program, which securely enables the interaction between a mobile device and a payment terminal, allows merchants to customize their own wallet solutions by designing and implementing a specialized cloud-based payments product.



There are many reasons why Openness matters, but, according to PAY.ON, the impact and implications alone constitute a need for actors in the payments industry to pay attention.

Through Openness, PAY.ON believes that payments can take on the attributes of being materially independent, with the ability to be completely embedded in a variety of technical solutions. Companies like Uber and Amazon have drastically decreased the efforts needed for customers to send payments, thus accelerating the invisible payments trend. With an Open approach to payments, providers and servicers will have the ability to utilize invisible payments to continue reducing friction and supporting more efficient checkout processes.

But those are not the only ways Open payments have the potential to change the marketplace. PAY.ON points to a need for Openness in order to support the globalization of payments, while also utilizing payments successfully across multiple channels and platforms.

“Payment providers must be ready to adapt to an ever-changing market and Open businesses are inherently flexible. Yet Open payments offer more than the ability to evolve to a changing market. With them, payment providers will have convenient and secure services for consumers, provide significant offerings through extensive partnerships, and make substantial gains from joining the revolution early. Payment providers that hesitate will become isolated and lack worthwhile services, slowly fading away,” the paper said.


To learn more about the key findings discovered by PAY.ON, download the full white paper by clicking the button below.

Download Here Orange





The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

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