Unleashing the potential of Payments as a Service (PaaS)

20 / 06 / 2023

As a key transformative approach to outsourcing that facilitates both digitalisation and innovation, Payments as a Service (PaaS), offers numerous benefits. By leveraging PaaS, financial institutions can streamline their payment operations, enhance customer experiences, and unlock new growth opportunities.

Businesswoman working on a project in a tablet at the office close to the window

During the EBAday 2023 panel discussion: ‘Payments processing – from commodity to business opportunity?’ Sheri Brandon, CMO Financial Services from Worldline and other expert panelists across the payments industry explored the benefits of PaaS for larger and smaller PSPs institutions and the catalysts driving the shift towards PaaS in the industry. The panel also delved into the related challenges they faced by financial institutions, discussing strategies to pave the way to a successful PaaS approach.

The complexity of Payments as a Service

Implementing PaaS requires a shift in strategy, as institutions must adapt to cloud-based solutions. The panelists touched upon changes that arise from a shift in strategy, such as the offering of providers but also more use of ready made systems; fully standardised systems that are implemented quickly. Integration with legacy systems poses a challenge that requires comprehensive planning, indicating the complexity of such migrations. Furthermore, the rapidly evolving payments market, driven by innovation and the demand for instant payments, digitally-savvy end users, and artificial intelligence among others, indicates a need for technology partners to be flexible and able to ensure a fast time to market.

Navigating the PaaS landscape

During the session, the panelists discussed ways for financial institutions to succeed with PaaS, with the the conclusion being that institutions should define their core competencies and identify areas that can be outsourced to become as relevant as possible for their customers. They should leverage PaaS to address the challenges of instant payments and cloud migration simultaneously. Choosing a reliable partner reduces complexity, and a partner approach with the provider ensures a future-proof solution. Building and sharing internal knowledge efficiently is crucial to effectively navigate the PaaS landscape.

Hurdles to overcome

The advent of instant payments brings significant changes to B2B payments. All parties across the value chain need to prepare for this shift, including banks, processors and corporate entities. Adjusting systems to enable instant reconciliation, 24/7 operations, and real-time data insights is essential. Instant payments offer significant benefits in return, such as improved cash flow management, reduced counterparty risk, cost savings, and real-time data insights to name just a few.

PaaS as a powerful solution

Payments as a Service (PaaS) presents a powerful solution for banks and financial institutions seeking to modernise their payment systems. While challenges exist in terms of strategy shifts, legacy system integration, and the rapidly evolving payments landscape, successful adoption of PaaS brings numerous benefits. By adopting a clear strategic course of action, institutions can unlock the potential of PaaS. 

Panel session 'Payments processing - from commodity to business opportunity
Panel session 'Payments processing ...' PaaS on screen

Jörg Richter

Manager Marketing and Stakeholder Relations, Worldline Financial Services
Joerg Richter is Manager of Marketing and Stakeholder Relations at Worldline, demonstrating his passion for the dynamic nature of the payments industry for over a decade. His work is fuelled by his admiration for the dedicated professionals who drive the industry's constant evolution. Previously, Joerg worked as marketing and communications manager for Landesbank Hessen-Thueringen, Bertelsmann, and eToys. Furthering his commitment to industry advancement, Joerg actively participates in prominent international organizations, such as EBA and NACHA.