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National payment systems are paving the way for real-time e-commerce and in-store transactions

When introducing new real-time payment rails that support merchants, should existing payment rails be integrated with new ones? Or should they be built from scratch? Micaela Vernmark explores.

Micaela Vernmark / June 11, 2021

Introduction of real-time payments to eCommerce and in-store transactions are promising use-cases for national payment infrastructures. But how do you build a system that fully supports merchants and consumers?

In-store transactions have historically been dominated by cards. However, this payment method was not designed for remote eCommerce transactions. Entering card details for eCommerce purchases is a lengthy and manual task for consumers that not always gives an optimal user experience. This issue is compounded by the fact that the longer a checkout process takes, the higher the risk that a consumer will cancel their purchase.

Goodbye to plastic?

Providing a great customer experience is therefore essential for merchants to attract customers and close more sales. Nowadays, mobile wallets have significantly improved the payment process. They eliminate the need to re-enter personal details when making a purchase and can be used for both eCommerce and in-store purchases.

Mobile wallets are usually either linked to a card or connected to account-to-account payment rails. But the downside of wallets based on cards rails is that they are usually heavily dependent on one of the existing large card schemes.

Introducing domestic card schemes (essentially, physical cards) might no longer the best option moving forward, as there is a clear move towards digital means of payment. Therefore, when introducing new national payment rails, we need to rethink strategies. Is introducing new plastic cards the right way to go or is better to go for instant payment rails that are already digital at its core? This is an equally valid consideration in markets where card networks are not strong.

Successful implementations

In Europe, we are already seeing success stories from new providers that offer instant payments for eCommerce transactions. In Poland, the BLIK mobile app handles over 45 million transactions a month, of which about 35 million are e-commerce – a 200% increase from 2019. Instant transfer via phone using P2P is also growing fast. In the Netherlands, the eCommerce platform IDEAL, uses a single SEPA Credit Transfer (SCT) backed by a real-time payment transfer guarantee to deliver a seamless service. 80% of these payments are authorized using a mobile banking app.

Dual systems

Still, card payments remain extremely popular in many markets. As the two are often connected, the rise of mobile wallets has not diminished the use of card payments. Providing the consumer with the option of using their preferred payment method is therefore imperative and initiatives combining cards with instant payments, such as EPI (European Payments Initiative) show how existing payment rails can be combined with new ones to cater for consumers’ needs.

Overall, apart from it being more convenient to reuse an existing POS system, a complete infrastructure upgrade isn’t viable as it would require huge investments for all participants – banks, merchants and technology providers.

Read also: Do you have what it takes to be and EPI front-runner?

Time to act

The main question is: How can we move ahead and build real-time payment rails that cater to both merchants and consumers?

With ongoing globalization, the domestic payment method should be available and usable by consumers no matter where they are located. To allow consumers to use their mobile wallets when, for example, travelling internationally, interoperability is a must.

Card schemes, such as Mastercard and Visa, provide us with some useful learnings. Their solutions – e.g., Masterpass and Visa Checkout – were different from one another, so merchants had to implement different solutions to cater for them, leading to extra work and costs.

However, standards have now been introduced and systems such as EMV 3DS version 2 and EMV Secure Remote Commerce (Click-to-Pay) have replaced the different checkout experiences. This shows the move of eliminating the need for implementation of multiple solutions and rather going for common standards.

In addition, the foundation for the necessary openness and flexibility of payment schemes has been laid in the ISO 20022 standard, which enables a rich data exchange. National infrastructure can also leverage APIs to enable market participants to offer interactive solutions such as using loyalty bonuses or providing credit offers at purchase, among other things.


When introducing new national payment rails that cater for merchants, consumers and other market participants, it’s essential to consider:

  • Whether existing payment rails should be integrated with new ones (as with EPI) or if new rails should be built independently.
  • Which standards should be used to build the system to ensure interoperability and growth over time.
  • How rails can be designed to enable market participants to easily build new services.

Here at Tietoevry we have analyzed the key factors that make payment infrastructure implementations succesfull. Building a new payment scheme is a complicated task with many considerations and we are ready to help avoid pitfalls and share benchmarks from instant payments schemes from around the world.

Feel free to reach out and let’s develop strategic plans based on your needs and market. We can provide you with all the necessary resources, support and technology to launch new payment rails.

Learn more about Instant Payments Infrastructure

Micaela Vernmark
Tietoevry alumni

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