Nexi Picks Mastercard for European Open Banking Partnership
Nexi has chosen Mastercard to help it support open banking account-based payments throughout Europe.
“Through this partnership, Mastercard Open Banking will facilitate e-commerce payments across Nexi’s gateways serving merchants across Europe,” the companies said in a Monday (March 11) press release.
“Together, Mastercard and Nexi will build an integrated digital payment ecosystem by advancing Mastercard Open Banking-powered solutions that offer secure, seamless payment experiences with more choice for consumers when shopping online.”
As PYMNTS wrote last week, open banking — rather than being housed in closed legacy banking platforms — lets financial institutions (FIs) share customer data with FinTechs, allowing both entities to create modern application programming interfaces (APIs) that can accelerate the transfer of funds between banks, consumers and merchants.
The PYMNTS Intelligence/Trustly study “How Open Banking Can Provide Fast and Easy Consumer Payouts” found that most consumers appreciate this transformation, with a substantial segment of the nearly 2,600 people surveyed for the report saying they prefer the faster payments that open banking helps foster.
A bulk of the respondents said they expect payments processing to be carried out in a timely manner. However, 45% said the current payments process offered by their banks can take up to A week to complete, a turnaround that 40% called “unsatisfactory.”
“Now consider the 5% who are able to complete bank transactions within 60 seconds: 92% of them said such velocity was ‘extremely’ satisfying,” PYMNTS wrote.
“The fact that just 5% of these bank payouts can be completed in about a minute indicates only a small fraction of consumers can now experience instant payments. This suggests the banking industry still has work to do if it hopes to deliver on customer expectations.”
What’s holding the industry back from embracing open banking? In some cases, concerns about fraud, according to additional PYMNTS Intelligence research.
Forty-six percent of FIs said the potential for accelerated fraud outweighs any benefits they see in open banking, according to the PYMNTS Intelligence study “How Fraud Fears Impact FIs’ Adoption of Faster Payment Solutions.”
For FIs that are already experiencing increased levels of fraud, the percentage of open banking skeptics rises to 57%.
“Most FIs — 52% — said consumer demand for increased payment speeds brings with it new fraud vulnerabilities, and they fear open banking will only intensify that risk,” PYMNTS wrote last month. “Although another 28% shared the belief that faster payments mean more risk, they said the various benefits negate the risks.”
The post Nexi Picks Mastercard for European Open Banking Partnership appeared first on PYMNTS.com.