Posted  June 21 2022

How to improve the customer experience in online banking payments?

Written by Jerônimo do Valle
When it comes to online payments in Europe, expectations rarely match reality. Today's consumers benefit from a fast-paced digital economy and want routines that can keep up with them. Offering a fast and frictionless experience is the way to win them over, especially in industries where time is everything.
The reality is that quick payments, refunds and withdrawals are priceless differentiators in people's lives. Often, however, actual payment experiences do not live up to this ideal. Cards are still the preferred payment method in countries like Spain, France and Ireland, leaving customers and businesses prone to slow and cumbersome processes. And even other options, such as manual bank transfers, can take days and are error-prone.

In fact, a survey found that 64% of current investors trust platforms that offer instant payments more. And they are not alone. Two-thirds of e-commerce customers consider refund time when making a purchase.


In many industries, providing an instant experience is critical to winning and retaining customers, as late payments can cause huge opportunities to be missed. Data shows that a quarter of European investors missed opportunities because their funds took too long to reach their accounts.

Unfortunately, traditional payment methods often prevent merchants from offering the "perfect experience". With cards, payments can take up to 10 days to settle. Whether consumers are trying to top up an account or get a refund, delays like this can frustrate them and erode their loyalty.


Simplicity is just as important as speed to deliver a great customer experience. An efficient and intuitive payment flow reinforces merchant credibility and builds trust in the brand, which leads to higher conversion rates. However, traditional payment methods often add friction to a process that should be ongoing. When customers pay with cards and manual bank transfers, for example, they have to re-enter their payment details, significantly delaying the process and increasing the risk of errors. And while online card payments now benefit from increased security thanks to the implementation of strong customer authentication (SCA), they need to take extra steps to verify ownership of their accounts. In either scenario, customers are more likely to abandon the transaction.

Instant bank payments remove these barriers. Customers do not need to enter their details to make a payment, saving time and eliminating the risk of human error. SCA is also integrated into instant bank payment flows, making the process simpler for the consumer. Each of these factors reduces friction, making it easier for customers to complete their payments.


At a time when many fintechs continue to deal with fraud, security is paramount. Still, traditional payment methods remain vulnerable. In Europe, fraudulent card transactions were valued at €155 million in 2020. Three-quarters of these losses were a result of card-not-present (CNP) fraud, where scammers use a consumer's card remotely to make a fraudulent payment.

As these numbers suggest, cards are particularly problematic from a security perspective. Customers must share or store details to make a payment, exposing them to fraud if the information is stolen. In such cases, merchants not only suffer from chargebacks, but also reputational damage and loss of consumer trust.

By leveraging the security of open banking, instant bank payments prevent this from happening. Providers typically pre-populate payment details, so unlike cards they are never shared or stored. This ensures that data and privacy are kept safe and secure. You can even ensure that customers verify their identities for every transaction, further reducing the risk of fraud.

Across Europe, instant bank payments are an effective way to create a fast, safe and secure customer experience, streamlining processes and earning customer trust.