2025 will lead the open and instant future of payments. It is the main message from Capgemini’s World Payments Report 2025.

The global payments industry is undergoing a seismic shift as consumers increasingly adopt digital transactions over cash. B2B payments are rapidly digitizing. We expect global B2B non-cash transaction volumes will likely grow by 10.8% year-over-year in 2024, with an 11.4 Compound Annual Growth Rate (CAGR) through 2028. Over survey of 600 treasure executives revealed that inefficient cash management, including poor forecasting and lack of visibility costs business nearly 7% of revenue annually translating in billions of dollars in trapped liquidity. Instant payments and open finance can revolutionize accounts payable and receivable processes, providing real-time cash visibility and driving operational efficiencies.

The shift to 24/7 and 365 processing will require significant operational changes. Concurrently, banks must strengthen fraud prevention and anti-money laundering (AML) measures to mitigate new risks. Many banks are adopting Payments- as- a- Service (PaaS) to accelerate their transformation while leveraging cloud-based, composable functionalities to gain agility and flexibility.

The non –cash transaction boom creates massive opportunity

In 2023, non-cash transaction volumes worldwide reached nearly 1,411 billion. Forecasts indicate transaction growth to around 2, 838 billion by 2028-for 15% compound annual growth (2023-2028). The Asia-Pacific (APAC) is leading the charge with a straggering 17.7% projected annual growth, solidifying its position as the fast growing geography for non-cash transactions.

In 2024, APAC exhibited the high year on year (YoY) growth at 20.4%. Even established regions like Europe and North America are experiencing significant growth. Europe’s non-cash transactions reached 361 billion in 2023, with a 15.5% YoY increase in 2024 and a projected 12% compound annual growth CAGR from 2023 to 2028. North America saw around 237 billion in non-cash transactions, a 6, 4% YoY increase, in 2024 with a projected CAGR of 7.3% from 2023 to 2028. Historically cash reliant Latin America, the Middle East, and Africa are shifting to non-cash. Latin America reached nearly 133 billion in non-cash transactions, a 23.2% YoY growth spike in 2024, with a projected 20.7% CAGR 2023 to 2028. The Middle East and Africa (MEA) reached 34 billion non-cash transactions, a more than 15.2 YoY increase and we expect similar compound growth by 2028.

E-commerce growth is the critical driver. Beyond e-commerce payment executives recognize the significance of expanding instant payments infrastructure to drive non –cash transactions. FinTechs and PayTechs pioneered various overlay services and use cases by harnessing open banking APIs, thereby boosting digital payment instrument adoption.

South Korea, Singapore, Australia and India are leading open finance initiatives in the APAC region. South Korea announced MyData in 2022 to standardize data-sharing mechanisms, including regulator-defined use cases in accounts, payments, and lending. In 2025, full implementation will include rollouts in the healthcare, employment, labor and real estate sectors.

Singapore’s open finance strategy prioritizes market driven growth with the monetary Authority of Singapore has played an essential role in the open banking process. India’s Account Aggregator (AA) system, introduced by reserved bank of India in 2016 and launched in 2021, is making waves. With user concent at its core, this system allows banks, pension funds, insurance provider, and investment firms to pool customer data. This vast trove of diverse information empowers third-party developers to create innovative new financial products and services. In Australia, the Consumer Data Right regulation was introduced in 2017 to give consumers greater access and control over their data.

The European Union is undergoing a significant overhaul of its financial landscape. Payment Services Directive 3 (PSD3) will introduce more stringent and tighten control over access to payment systems and account information. The United States is taking steps toward a more standardized open finance system

The United States is taking steps toward a more standardized open finance system. In late 2018, the US Financial Data Exchange (FDX) developed a free API technical standard on user-permission data-sharing principles to guide the financial services industry to a secure, transparent and consumer –first approach.

After years of market-driven initiatives, the Consumer Financial Protection Bureau founded as part Dodd-Frank Act 2010, is targeting the establishment of rules around the legal data transfer and compliance framework under section 1033 by October 2024.

South America, Brazil leads the open finance initiative in the region, primarily driven by the central bank with an open finance initiative launched in 2020. By 2023, open finance recorded 17.3 million consents from customers to share their personal and banking data between participating financial institutions. In December 2023, the Central Bank of Brazil further simplified the consent renewal process that aims to make data sharing more accessible and convenient for individuals and companies participating in an open financial system.

Only 25% of surveyed customers were delighted with their bank’s personal financial management app

Open finance creates a 360 degree holistic view of client with a financial data pool and embedded APIs that enables personalized financial products and services, fairer credit assessments, and better financial well-being through streamlined management and tailored advice. According to the World Retail Banking Report 2024, only 25% of surveyed customers said they were delighted with their bank’s personal financial management app.

Open finance and strategic partnerships can revolutionize financial management to small-to-mid-sized businesses. In the UK, HSBC recognized the opportunity to bolster its financial advisory role by leveraging clients’ transaction data. However, the bank needed to consolidate this data into a centralized platform to provide comprehensive financial insights and deliver customer value.

The bank partnered with Strands- a FinTech with expertise in open finance, machine learning, and AI- to integrate external accounting data into Kinetic, its app-only digital bank for small businesses. The powerful Strands’BMF platform enables Kinetic to provide automated onboarding, in app overdrafts, controllable debit cards, and financial management tools. A key feature is a powerful transaction categorization engine aligned with the UK’s tax office, simplifying client financial tracking. Kinetic now offers international payment capabilities for small business owners, allowing them to send and receive payments from over 200 countries within a daily limit.

Only 17% of banks are piloting and launching open finance products

The pan-European instant payments scheme, SEPA Instant Credit Transfer was launched in 2017. As of Q1 2024, 17.3% of all SEPA credit transfers were instant. However, despite SEPA harmonization efforts, the European payments landscape remains fragmented. In 2023 nearly 30 retail payment systems were active in the Eurozone. The EU launched the Instant Payment Regulation in 2024 to drive European instant payment availabllity, standardization and interoperability, fair pricing and enhanced security features.

How Pix became a verb: Instant payments take off in Brazil

The Central Bank pf Brazil created and lanched Pix in November 2020, requiring banks to integrate their accounts with the system, Pix is available 24 hours daily, including non-business days and free for individual use. In 2024, 75% of the population, 153 million people and 15 million companies use it. Pix is a global success story, with 42 billion transactions valued at 3.5 trillion USD in 2023. No transaction size limit makes Pix ideal for everyone from individuals to large corporations. Large banks with over 500 000 accounts had to join Pix. Brazil leads the world in open finance, with over 42 million consents and 1.5 billion API calls weekly. Incentives like discounts and free shipping from e-commerce firms encourage Pix usage over cash and cards. This benefits retailers with a higher conversion rate of 90% with Pix vs 70% for credit cards and 30% for debit cards, along with lower costs and faster cash flow.

52% оf executives say, customer facing instant payments as top priority.

From just banks to connected marketplaces, all prepare to tap the instant opportunity

Digital wallets are experiencing explosive growth. A2A schemes must resolve security and reward challenges to disrupt card franchises. Europe gets a wallet makeover: EPI launches Wero. In Q3 2024, the European Payments Initiative launched Wero, a mobile wallet and instant money transfer solution. It allows users to send and receive money instantly using phone numbers, QR codes, email addresses. After Wero’s Germany debut, EPI plans to launch in Belgium and France in 2024 followed by the Netherlands in 2025-with eventual cross-European expansion. It could create a level playing field for European banks against BigTech wallets such as Apple Pay and Google Pay. In addition, Wero can potentially consolidate the fragmented European payment landscape under a single brand whereas today, European countries and regions have various payment methods and systems.

Taking a page from Europes EPI initiative, a consortium of seven US banks joined forces with Zelle operator Early Warning Services to launch Paze, a card-based digital wallet aimed at countering BigTech and FinTech dominance in the USA.

Unraveling corporate payment complexibilities for real –time treasury capability

80% of treasury executives said their firms rely on manual and paper-driven AP/AR processes.It is not easy to identify and address overdue payments without a clear data trail. Over 10% of surveyed executives said their organization’s AR processes are highly automated and 25% said AP processes are highly automated. Strategic vision helps banks switch from stop-gap tactical adjustments to long-term transaction flexibility.

In the open and instant future of payments, banks have three critical imperatives for success.

• Gear up for the payments transition: Open finance, a key driver of innovation, unlocks a world of possibilities. Instant payments on the other hand, redefine customer expectations for speed and convenience. Embrace both while driving synergies, build the business case to fund the investment and turn it in ongoing positive revenue.

• Elevate the transformation journey: Change is inevitable, and agility is paramount. Cloud-based, composable platform offer the flexibility and scalability needed to bridge capability gaps and ensure institutions can adapt to the evolving landscape and retain the right to win.

• Unleash new value streams: Fragmentation hinders progress. By breaking down silos and combining the power of open finance and instant payments, financial institutions can craft innovative and adaptive cross-product, multi-rail value propositions that deliver a superior experience for their customers.

By embracing these imperatives, banks and PSPs can position themselves at the forefront of the open and instant payments revolution. This proactive approach will ensure that they are well-equipped to navigate the changing landscape and deliver future secure, efficient and customer-centric payments.