Latest / The Payments Shed / Ep. 44 - Live from MPE Berlin: Token on Pay by Bank: Are Merchants Finally Ready?

Transcript

Ep. 44 - Live from MPE Berlin: Token on Pay by Bank: Are Merchants Finally Ready? · The Payments Shed

• 0:03
  Welcome to the Payment Shed podcast live at MPE Berlin 2026.
• 0:07
  We are joined for a conversation this afternoon with Gideon
• 0:10
  Three, General Manager Europe at Token.
• 0:13
  Gideon, thank you for joining us on the podcast today.
• 0:15
  Grant, thanks. It's it's great to be here.
• 0:17
  Having a good time at MPE so far.
• 0:19
  Yes, as I mentioned, I'm already losing my voice, which is.
• 0:23
  Probably a perfect time to come into a podcast for a second now.
• 0:26
  We wanted to talk today a little bit about the the wonderful
• 0:29
  world of open banking, where we're at at the moment.
• 0:30
  Can you tell me around kind of the European landscape at the
• 0:35
  moment? We've got EPI, we've got Weira.
• 0:38
  There's a lot of change going on at the moment in the EU
• 0:40
  landscape. Why are we kind of at this
• 0:42
  melting pot at the moment in Europe?
• 0:45
  I think Europe's at a tipping point at the moment with regard
• 0:48
  to payments. So you have a number of factors
• 0:50
  that are playing a really important role in shaping
• 0:52
  payments. And I'll start with HA payments
• 0:55
  with open banking. Open banking is slowly maturing
• 0:59
  in, in, in, in Europe. I would say the last couple of
• 1:01
  years have been very much about setting up the infrastructure.
• 1:04
  The focus now is on adoption, adoption by consumers and
• 1:07
  adoption by, by, by, by, by merchants.
• 1:11
  So that's one factor. At the same time, there are two
• 1:15
  key themes in, in Europe at the at, at the moment, I'd say them
• 1:19
  both around the, let's call it the term sovereignty and they're
• 1:24
  both in position of sovereignty. You've got the emergence of the
• 1:27
  digital euro and you've got the you've got the launch of Weiro
• 1:31
  through the through the EPI company.
• 1:33
  And the last three years feel like they've kind of jumped open
• 1:37
  banking forward immensely in terms of, you know, it's, it's
• 1:40
  not the new thing anymore, right?
• 1:41
  It's been around for many years. But I just feel like in the last
• 1:43
  two or three years in particular, there's been a huge
• 1:47
  leap forward with VRPS, like you say, with business sovereignty
• 1:50
  play that's going on. We're seeing more adoption with
• 1:52
  merchants around paid by banks sitting alongside cards as a
• 1:55
  complementary payment method. What has happened in the last
• 1:58
  three years to kind of give us this big leap forward?
• 2:02
  Well, I think the one thing is that there has been a wake up
• 2:05
  call with regard to with regard to payments that everything is
• 2:09
  not about card. Card is not the only way that
• 2:11
  payment that that payments, that payments can work.
• 2:15
  And I think both consumers and merchants have realized that
• 2:18
  they are that they are alternatives.
• 2:20
  So I think, I think, I think, you know, that's why I really
• 2:23
  like the I like, I like Weira, I like the EPI because I see it
• 2:26
  has been, it has been a catalyst in the market.
• 2:29
  It has, it has given, it has given, it's, it's given the
• 2:32
  region time to think and to and it's given the region food for
• 2:36
  thought. Maybe there are other ways of
• 2:39
  doing payments more and more and more efficiently.
• 2:42
  I really also think that open banking has matured and has
• 2:44
  become more more mainstream. There were a lot of issues when
• 2:48
  open banking was launched a couple of years ago with regard
• 2:50
  to API quality. Those issues are being
• 2:53
  addressed. There are issues with regards to
• 2:56
  the user experience. The user experience used to be
• 2:59
  atrocious. It's a, it's a lot better now.
• 3:04
  It's a, it's a, it's a, it's a lot easier.
• 3:06
  We are seeing some fantastic solutions out in the market, you
• 3:10
  know where, where merchants are improving the user experience,
• 3:14
  where banks are coming to the to, to to the party as well.
• 3:18
  And I think from that perspective, it is easier for,
• 3:21
  it is easier for, for, for, for consumers.
• 3:24
  I think they also a number of use cases where open banking for
• 3:30
  instance really plays, plays to and these are coming to fruition
• 3:34
  now. As well, when we talk about the
• 3:36
  sovereignty play, the reality of actually getting so many
• 3:40
  countries within the European market to work together as a
• 3:42
  collective, do you think that's going to be a bit of a journey
• 3:45
  that we have to go on? Or do you think we've already
• 3:47
  worked towards this point that that sovereignty could be a very
• 3:50
  real thing in the European market?
• 3:51
  So I, I don't think, I don't think we need all the countries
• 3:55
  to work together. I mean, I, I don't believe, I'll
• 3:58
  be very honest with you, I don't believe we need a solution such
• 4:01
  as a Digital Europe. I don't believe that is a
• 4:03
  solution that we're looking for. What we, what we need is we need
• 4:06
  solutions that make sense for merchants and it makes sense
• 4:09
  most of all for consumers that make that make the consumer
• 4:12
  payments journey easier. Standardization through PSD 2
• 4:18
  and open banking I think has contributed towards that.
• 4:21
  Do we all need to sit around the table and come up with a single
• 4:24
  solution? I'm not sure if that's, if
• 4:26
  that's the solution. I, I, I think what we do need is
• 4:28
  I think we do need standards that we that, that, that, that,
• 4:32
  that we work towards Standards that allow, again, consumers to
• 4:37
  have a, to, to, to have a single look and feel and a single
• 4:42
  journey throughout the payments process.
• 4:44
  Yeah. Fairpoint and Open banking could
• 4:47
  be said to have had a slightly slow start to life, but the the
• 4:53
  acceleration point now and this kind of jump forward that we
• 4:57
  talked about previously in the conversation, do we feel like
• 5:00
  the market pressure is growing around open banking and that's
• 5:03
  why there's kind of this this big push happening with with
• 5:05
  things again like VRPS, you know?
• 5:08
  I think it's when I say market push, you know, I'd say I think
• 5:11
  there's more market demand. I always go back to, to, to, to
• 5:15
  merchants because I think merchants themselves, and here
• 5:18
  we are at merchants payment ecosystem, you know, merchants
• 5:21
  themselves are realizing that there are other alternatives.
• 5:23
  Merchants have got demand. Merchants have got demands for
• 5:26
  instant payment. They don't want to, they don't
• 5:29
  want to waste to, to settle. Merchants would like to payless.
• 5:34
  Merchants would like more, more secure payment solutions.
• 5:38
  And I think those factors have driven, have, have, have, have
• 5:41
  driven, have driven the demand for open banking at least from a
• 5:45
  from, from a merchant side. And if you take that merchant
• 5:48
  side and put it alongside a consumer side, that comes to my
• 5:50
  next question. I wanted to ask you which was
• 5:51
  wallets specifically and how important wallets linked to open
• 5:57
  banking payments are going to be for the future?
• 5:58
  Absolutely important. I mean, I, you know, and it's
• 6:01
  something which I think has not been addressed by anyone really,
• 6:04
  really effectively. But putting open banking
• 6:07
  capabilities within a wallet will also increase the increase,
• 6:11
  the increase the uptake. I always go back to the thing
• 6:14
  about what what what a consumer wants, but I'll tell you
• 6:17
  honestly what a a consumer doesn't care about payments.
• 6:19
  I think it's something we as payment nerds get totally stuck
• 6:23
  in this, that people care about payments other than than us.
• 6:26
  No one does we. Obsess over it.
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  We obsess, we're totally obsessed over it.
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  The consumer. The consumer would like to pay
• 6:33
  for goods. He doesn't care what rails it
• 6:37
  runs after, as long as it's secure, it's instant and it's
• 6:40
  easy. And yeah, I think that's, that's
• 6:45
  where and that's why I think it's not it's, you know, you
• 6:48
  know, if, if, if and I'm looking at HA payments or open bank
• 6:51
  payments, if we address those three issues and we make, we
• 6:54
  make the payment. But how close are we to a
• 6:56
  universal wallet I. Don't think we are to a
• 6:59
  universal wallet. I think they what's, what's
• 7:01
  interesting in the European perspective is the, is the, the,
• 7:04
  the, the European ID that is going to be that is the, the,
• 7:08
  the, the European digital ID. There is a huge opportunity for
• 7:13
  a, let's call it for a vehicle. And I think that could be a
• 7:17
  great opportunity for, for open banking.
• 7:19
  It could also be a great opportunity for payments
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  generally. But I think once, once, once
• 7:24
  once the European digital ID becomes ubiquitous, the consumer
• 7:28
  again wouldn't care, doesn't, doesn't doesn't care what rails
• 7:31
  there or what, what rails anything is is is is is
• 7:34
  happening on in the. Background and variable
• 7:35
  recurring payments or VR PS are invariably a big follow on to
• 7:41
  this when you think about recurring card payments and
• 7:43
  direct debit. If we take the UK market example
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  there the RPS again are looking like they're finally at the
• 7:49
  precipice of of getting towards a mainstream solution.
• 7:52
  How important is that for open banking?
• 7:54
  Very, very so, so, so, so variable recurring payments is
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  probably the one of the most important milestones in the
• 8:01
  rollout of, of open banking is probably one of the most
• 8:03
  important things we will see in the, in the next year.
• 8:07
  I believe. What I find very interesting is
• 8:10
  that the topic of variable recurring payments is in fact
• 8:13
  driven by the banks. There are premium APIs in the
• 8:18
  market. Again, you know, you know, we
• 8:21
  know we ourselves have joined in Germany, JIRA API.
• 8:24
  JIRA API is, is, is going to be pushing variable recurring
• 8:27
  payments because this is where the banks see a, a need.
• 8:31
  This is where the banks are, banks are definitely behind,
• 8:34
  behind the product. There's a demand for it.
• 8:38
  What I like about this in, in the case of variable recurring
• 8:41
  payments, it's not going against your traditional car schemes.
• 8:44
  It's going, it's, it's, it's, it's up against another archaic
• 8:48
  payment payments mechanism, which is called direct debits.
• 8:51
  And it's saying, let's take direct debits, which is always
• 8:53
  something which has been in the control of the merchants and
• 8:55
  take that control and, and put it in the hands of the consumer,
• 8:59
  you know, and, and, and, and make the consumer's life easier.
• 9:04
  Take out the forms and and and having to go through massive
• 9:08
  exercises each time you want to change your banking details.
• 9:12
  Past the journeys, easy to sign up processes, all that sort of
• 9:15
  good stuff. We're obviously at MPs.
• 9:17
  It'll be remiss of us not to talk about why this is such an
• 9:20
  important event for Token every year.
• 9:23
  Why do you guys come here and, and is it, you know, that
• 9:25
  accessibility to merchants, is that one of the big appeals for
• 9:28
  you guys? From a token perspective, it's
• 9:31
  good to hear what merchants are saying.
• 9:34
  Our token model is not a direct to merchant model.
• 9:36
  We work with PSPS. It's so for us, it's an
• 9:40
  important for us engaging with PSPS, engaging with our clients,
• 9:45
  engaging with our prospects. But it's also critical to
• 9:48
  actually hear what merchants are saying and what's important for
• 9:53
  for merchants in the payment. Process and what they're saying
• 9:55
  is shaping, then your discussions with the PSPS off
• 9:57
  the back of it. So we have a final segment.
• 9:59
  We ask all of our guests at the end of every interview that we
• 10:02
  have. We have a a segment called the
• 10:03
  Shelf of Shame where we ask you to nominate something from
• 10:05
  payments or fintech, a payments ick, if you will, that you could
• 10:09
  banish forever. What would you nominate?
• 10:11
  The complexity, I would say the, the, the, the, the, the
• 10:15
  complexity. Let's stop being such nerds
• 10:18
  about it. Simplified.
• 10:23
  Yeah, the consumer doesn't care. I think that was a great call
• 10:25
  out. Well, thanks for joining us on
• 10:26
  the famous show today and enjoy the rest of your event, Gillian.
• 10:29
  Thank you very much, Grant.