Businesses in the UK are increasingly seeking cost-effective and secure payment methods, according to a recent report by open banking infrastructure provider Yapily.
The study highlights merchants’ dissatisfaction with high transaction fees and the current chargeback model, which many consider unfair.
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Yapily’s report sheds light on the growing demand for alternatives to traditional card payments.
The survey, conducted by YouGov for Yapily, involved over 2,000 UK consumers and 250 merchants.
It found that 98% of businesses value lower transaction fees, and 41% want chargebacks removed entirely.
Additionally, 77% of merchants express concerns over transaction fees, while 68% worry about fraud risks and 54% about data breaches.
Two-fifths of businesses believe the chargeback process favours consumers too much, with 49% wishing for a more efficient process. Meanwhile, consumers prioritise security and convenience, especially for low-value purchases, with 49% favouring ease of use for purchases under £20 and 44% prioritising security for purchases around £100.
The report highlights that 58% of consumers would try new payment methods if they offered lower fraud risk. Although open banking is seen as a solution with lower fees and higher security, cards remain the preferred method due to familiarity. Yapily’s recommendations aim to drive open banking adoption and create a fairer financial system.
Yapily’s recommendations include aligning the ecosystem on open banking’s value propositions, developing a consumer protection model without chargebacks, and introducing an open banking trustmark.
Yapily founder and CEO Stefano Vaccino said, “Open banking has the potential to enrich people’s payment experiences beyond other payment methods.”
Yapily VP for product strategy, innovation and policy Nicole Green added, “Businesses are telling us they need lower costs and better security – which is what open banking offers.
“Now the challenge is finding the tipping point that drives behavioural change among consumers, encouraging them to make the switch at the checkout.
“Rolling out new features like cVRP faster and creating a clear, trusted brand complete with an industry trustmark for open banking payments will encourage adoption.”
Yapily is an open banking infrastructure platform in Europe, connecting customers to thousands of banks. The company has raised $69.4m in funding and continues to expand across Europe.
“UK merchants seek alternatives to costly payments: Yapily report” was originally created and published by Electronic Payments International, a GlobalData owned brand.
