The PAYTECH Book

Can Operational Agility Grow Payments in the New Online Platform Marketplaces?

By Anna Tsyupko

CEO, Paybase

The importance of stringent regulation and compliance is arguably more crucial in payments than in any other industry. Of course, that is how it should be. Compliance equates to an agreed set of standards being followed to ensure as much protection as possible for both customers and businesses. Without that level of protection, people would be unable to put their faith in non-cash payments. Quite simply, financial services rely on trust, and that trust is achieved through a strong set of rules which prevent payments from being manipulated, misdirected or mismanaged.

There is, however, a downside to such tight regulation surrounding payments. Regulation can, at times, act as an inhibitor to innovation – stifling creativity and creating obstacles for businesses attempting to get to market. For many modern businesses, it is not necessarily the risk associated with their offerings which is the problem, but having unique needs that are not being served by current payment solutions and regulatory frameworks. This means that, in many cases, the more innovative their offering, the more difficult it is for them to build their business.

Online marketplaces, gig/sharing economy platforms, cryptocurrency exchanges and FinTechs are examples of relatively new businesses with particular payment challenges. These businesses often require a different approach to due diligence, risk management, ...