This was the central theme that Mike Rigby, Head of UK Cash Management for Barclays, discussed with two corporate treasury and payments executives at a recent event, covering a number of key issues:
In consumer-facing sectors, the payments ecosystem can often revolve around high-volume, low-value transactions, and can include refunds as well as receipts. This makes the importance of a seamless and straightforward payment process paramount. Where these transactions are international, it becomes even more important to be able to support and offer a wide variety of payment methods.
Speed and reliability are also important, both for the business and its customers
So, an understanding of customer behaviour is a key component of a successful payments strategy. For example, if a certain payment card charges a higher fee than other cards, it would be a natural reaction to decline such payment methods. However, an analysis of the payment behaviour of the customer might reveal that users of such cards tend to spend more per transaction than those who use other payment cards. Thus, it might be worth absorbing the additional cost in order to boost revenue.
In the same vein, speed and reliability are also important, both for the business and its customers. A failed payment at checkout (whether online or in-store) runs the risk of lost revenue – this is particularly true in time-sensitive situations, and will affect customer behaviour and, ultimately, the businesses with which they transact.
The corporate treasurer and payment executives agreed that the impact of technology, notably in automation and artificial intelligence, continues to be felt within the payments ecosystem. Such developments have helped remove manual, often last-minute, tasks that risk knock-on effects, and may create wider issues throughout the business. Streamlining and automating payments, both incoming and outgoing, can therefore ensure greater financial stability by improving confidence in cash flow forecasts, while also strengthening reliability and trust in the system. At its most basic, automation can reduce human error and ensure that payments are made in a timely and compliant way that is more resilient to disruptions.
How can payments be structured so that they do not fall foul of sanctions?
Other important developments include AI-driven payment routing, which can be used to optimise transaction success rates by selecting the best payment provider for each transaction in real time. For instance, if a card issued by a particular bank carries low charges, it makes sense for transactions to be routed through that provider.
Regulatory compliance and fraud prevention are never far from the treasurer’s mind – but now there is a real emphasis on just how complex compliance can be when operating payments across multiple jurisdictions. There are the myriad AML requirements, a key consideration when high-volume, high-speed payments are being made, together with know your customer (KYC) checks and other regulations that need to be built into the system. For instance, how can payments be structured so that they do not fall foul of sanctions?
Customer behaviour can vary considerably from one jurisdiction to another, depending on the regulatory environment and payment infrastructure that is available locally
Fraud prevention can be automated, but good communication is very important – this is not just a payments issue; other teams and colleagues need to be closely involved as well. It is as much about change management as it is about technology. There are also issues around how merchant category codes can mistakenly label certain activities as high risk, causing some payments to be automatically rejected – an increase in friction that can lead to a decrease in transactions.
Customer behaviour can vary considerably from one jurisdiction to another, depending on the regulatory environment and payment infrastructure that is available locally. For instance, the introduction of PIX in Brazil and UPI in India have revolutionised real-time payments at the consumer-to-consumer, business-to-consumer and business-to-business levels. It is therefore important for treasurers to keep abreast of such changes and what they can mean for their businesses and their payment methods.
Ultimately, using data to understand customers’ payment journeys and behaviour can pay dividends – a short-term gain of switching off a payment method on cost grounds can lead to a direct impact on transaction volumes. So, a clear understanding of spending patterns can help corporates optimise their payments strategies. And having a payments engine that is effective, efficient and optimised for both incoming and outgoing payments can make a big difference to the top line of a business.
It pays to get payments right.
1. Ensure your payment journey matches your desired customer journey: understanding your customers’ behaviour will guide you to a successful payment strategy. What value do your customers place on speed, convenience, security and cost?
2. Data analysis will inform payments strategies: understanding which payment methods are preferred by your customers will guide you to a successful payments strategy. A deeper dive will reveal why such methods are preferred, which could be a balance between, for example, speed and security
3. Look closely at payment fees, but understand how they relate to successful payment outcomes: if a certain payment method attracts higher fees, analyse spending patterns, as the value of customer payments could be higher
This article is based on a panel discussion with group treasury and payment executives at the ACT Cash Management Conference 2025, sponsored by Barclays.
Barclays Bank PLC is registered in England (Company No. 1026167) with its registered office at 1 Churchill Place, London E14 5HP. Barclays Bank PLC is authorised by the Prudential Regulation Authority, and regulated by the Financial Conduct Authority (Financial Services Register No.122702) and the Prudential Regulation Authority. Barclays is a trading name and trade mark of Barclays PLC and its subsidiaries. Find out about the Financial Services Register.