At the helm of this digital disruption are fintech startups. Unlike large and bureaucratic financial institutions, startups are agile and able to quickly adapt to new trends. This can range from shifts in business and consumer preferences through to the latest technological innovations relevant to the payments sector. 

Of these trends, the centralisation of global payment solutions is having an enduring impact on the wider financial system, particularly within the e-commerce space. And while Authorised Payment Institutions (APIs) like Nucleus365 are offering sophisticated payment systems for merchants, legacy card systems are beginning to feel the strain. This is most notably on display with online retail transactions.  

So what then are the benefits of centralised global payment solutions and why should merchants take note? 

Lower FX risks and improved currency management 

At Nucleus365, one of the most common challenges we see merchants facing is the effective management of transactions in local payments. Traditionally, merchants would use several local bank accounts to facilitate transactions in local currencies, leading to higher FX rates and the need to manage various transaction charges. It also adds to the complexity and resources needed to facilitate payments. 

A centralised payment system overcomes these hurdles, meaning that small and mid-cap merchants can streamline payments through one platform, no matter the market or jurisdiction. It means merchants can leverage technology to take on tedious, time-consuming tasks and focus more on their scale-up strategy.

Secure payment processes 

The internationalisation of payments has added an extra degree of complexity when it comes to facilitating transactions. Old systems are simply not equipped to manage such transactions while maintaining the same level of security. 

A Global Payments Survey by ACI Worldwide found that 20% of merchants experienced theft of payment data, including instances of fraud. Not having a centralised system in place can only exacerbate the risk exposure of transactions. 

Working with an API like Nucleus365, heightened security protocols can be embedded into a centralised payment system, putting the measures in place so that all parties are effectively protected from any potential risks. At the same time, centralised payment systems also give merchants peace of mind knowing that they have regulatory compliance. 

Embracing the new age of payments 

A 451 Research Analysis revealed that retailers lost approximately $16 billion in sales over a 12-month period when legitimate online orders were flagged as being fraudulent and declined. The same research showed that retailers lost out on $20 billion because they couldn’t offer customers their preferred form of payment. 

This is a significant point. With fintech permanently changing our global payments system, merchants cannot solely rely on legacy processes. They have to also consider new forms, including digital wallets and bank transfers. Fintech startups like Nucleus365 can offer merchants the guidance and support needed to understand how they can embrace new digital payment solutions. 

With centralised payment systems, it’s less of a question of if but when for merchants. The globalisation of the international economy will only heighten the volume of transactions taking place. As such, merchants need to start embracing centralised payments systems as part of their growth strategy for the coming years.