Irish paytech firms cash in on disruption
The global payments industry is undergoing unprecedented transformation, driven by rising technology adoption and changing consumer expectations.
A complex global ecosystem, it seamlessly processes an immense volume of business, consumer, point of sale and e-commerce transactions across cash, card, contactless, online and mobile methods. All transactions must be accurately and securely processed and recorded on an increasingly instant basis, all in line with complex financial regulations.
As Paytech: Reinventing Transactions, a new eBook commissioned by Enterprise Ireland, demonstrates, traditional enterprises are being increasingly disrupted, as technology-enabled businesses carve out a completely different payments ecosystem. The result is a proliferation of new opportunities, as banks, long the cornerstone of the payments sector, are both challenged by - and embracing - new paytech options.
The opportunity is gathering pace, with the 2018 World Payments Report predicting a continuous increase in the volume of global non-cash transactions at a rate of 12.7pc between 2016 and 2021.
Irish society is a relatively speedy adopter of cashless payments and a recent government report ranked Ireland 10th of 27 EU member states for the combined use of card payments, credit transfers, and direct debits. Irish businesses compare well too, in terms of offering and using electronic payments. Thanks to a strong cluster of multinational and Irish-owned companies, Ireland has emerged as a centre of innovation in the transformative paytech space.
Leaders in payments, such as First Data, Elavon, Mastercard, Paypal and Citi, have substantial R&D and payment processing operations in Ireland. Irish companies have developed particular strengths in card payments, cross-border payments, account-to-account payments, secure payment authentication, blockchain, and open banking.
For example, dynamic currency conversion (DCC), originated in Kerry in the late Nineties.
Early adopters Fexco, Monex and Continuum have become global leaders in the sector, while continuing to develop innovative new paytech projects around the world.
Fire Financial Services is the first Irish-based payments firm to be authorised as a Payment Initiation Service Provider under PSD2 rules, which are forcing banks to open up their technology platforms to third parties.
Worldnet Payments helps companies who accept card payments globally to ensure their merchant card terminals are compliant and up to date with chip and pin and contactless payments.
Sysnet Global Solutions has a suite of cybersecurity and compliance solutions that help merchants and card acquiring organisations to monitor exposure and reduce the risk of payment card details being stolen.
Sentenial's next generation cloud payments platform securely processes over €42 billion a year as an outsourced provider to many of the world's leading banks. Its Nuapay solution is helping to reinvent what's possible from a modern banking and payment solution.
Transfermate, part of the Taxback Group, uses its global network of local bank accounts to facilitate international payments and allows businesses worldwide to send and receive International payments as though they were domestic, offering a much cheaper and faster alternative to traditional banks.
Prepaid Financial Services (PFS) employs over 160 people and is one of the fastest-growing paytech institutions in Europe.
PiPiT, a Galway-based startup, has devised a secure online payment platform that helps customers spend cash digitally. It enables migrants to use cash to send money and pay bills internationally, securely and at low cost.
AID:Tech enables entitlements such as aid, welfare and donations to be digitised, delivered and tracked using blockchain technology, including the distribution of international aid to refugee camps.
These are just some of the Irish companies that have developed interesting paytech products, which are operating across the world.
Technology giants like Facebook and Google may enter the payment market in the coming years and Ireland's paytech sector is already developing close links to these companies.
Payments are one of the most disrupted sub-segments within the financial services industry. For anyone looking to navigate the world's newly-disrupted payments ecosystem, there is no better guide than one of Ireland's paytech innovators.
Brendan McCormack is a senior fintech development adviser at Enterprise Ireland.
Sunday Indo Business