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Instant payments - a giant leap forward for the account-to-account payments and eCommerce industry

Merchants are constantly looking for online payment solutions that help them lower cash-on-delivery costs, increase liquidity, and retain more profit.

Account-to-account payments through open banking help them meet these needs and even more when they are executed instantly, at any time of the day or night, right at the checkout in their online store.

Unlike the online payment methods we know today, which rely on debit or credit cards or bank transfers, open banking payment - also known as account-to-account payment - allows anyone with a bank account to initiate payments fast and secure digital rights from the online store (web or mobile app) or any eCommerce platform in which it is located.

Open banking technology makes it possible to initiate online payment between two bank accounts, from any website, application, or electronic document, and for the first time brings diversity to the options we have for online payment, along with maximizing security. By giving consumers the choice to pay without exposing their confidential data on third-party sites or applications - personal data, card number, CCV code - account-to-account payment stands out as the safest online payment method for purchasing products and services.

The payment process is 100% digitized and simple: after adding items to the shopping cart, buyers choose to pay right from their bank account with the account-to-account payment. Thus, it initiates the payment, selects the bank in the payment window, and then authorizes the payment after authenticating in the selected bank using the user and password or biometric methods.

By choosing the account-to-account payment button in an online store:

  • buyers choose to send money from their bank account directly to the merchant without worrying about the risk of fraud

  • the money goes directly to the merchant's account improving the merchant's cash flow

  • and the merchant knows the payment status at all times without requiring further proof of payment.

Account-to-account payments in EURO become instant in all countries of the European Union (EU) and the European Economic Area (EEA) according to the agreement between the European Parliament and the Council of Europe on November 7, 2023. In Romania, payments in EURO, but also RON, will follow the same natural trend.

Instant execution of account-to-account payments is a beneficial evolution for the eCommerce industry and a payment solution expected by merchants who have long wanted a fast, easy, and middleman-free payment process.

The most important benefits of instant account-to-account payments are:
  • execution speed: the money reaches the merchant's account, from the buyer's account, in a maximum of 10 seconds

  • 24/7 availability: instant payments are executed non-stop, regardless of the banking day.

  • improved cash flow: merchants receive the money instantly with each sale and no longer have to wait days for payments to be settled by payment processors whose role disappears from open banking payments

  • any fees, where they still apply, will not exceed current payment fees as we know them today

  • competitive advantage: merchants that offer account-to-account payment at checkout will stand out from those that only offer traditional payment methods, not taking into account customers' increased need for security when paying online, as well as card-less, expired, or unavailability payment

SmartPay and instant payments

SmartPay is the first direct payment method between bank accounts, developed by Smart Fintech, authorized by the National Bank of Romania, and integrated with the eCommerce sector, as well as in other areas. This solution allows payments to be initiated directly from the interface of online stores, from the buyer's bank account directly to the merchant's account, without SmartPay ever holding the transferred amounts and ensuring, in collaboration with partner banks, a high degree of security for online transactions between accounts.

Image describing an instant open banking payment in eCommerce.

SmartPay facilitates instant payment as local banks offer it in their portfolio of open banking functionality, and where possible by rerouting buyer-initiated payments to a merchant account opened at the same bank.

If your business sells products or services online, test paying with SmartPay via Open Banking now to see how easy it is for your customers to pay you online directly from their bank account to your business account to ensure the liquidity you need, under the security conditions accepted by them.

Alice Anghelea, revenue growth Smart Fintech

Author: Alice Anghelea, Revenue Growth Smart Fintech

Follow us here to learn more about how the most cost-effective online payment method can help your store.


This article (Ro version) is available also on the GPeC community blog. Access it here.


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