In e-commerce, every advantage counts. Adopting open banking-enabled payments services, especially Instant A2A Payments—or Pay by Bank and Instant Payments—is no longer just a trend but a crucial lever for success. Indeed, this real-time transfer of funds directly from a consumer’s account to a merchant’s account and vice versa is now more popular than ever. And perhaps the best way to optimise online checkouts in e-commerce.
At the heart of this transformation, API-powered payments enable online merchants to minimise risks from chargebacks and payment defaults, making costs more predictable and potentially lower. At the same time, fraud cases are reduced thanks to APIs and data solutions enabling real-time customer verification and payment. These harmonious technologies mean instant payment services like Brite’s create a seamless shopping experience with a fast checkout, further reducing shopping cart abandonment. These tangible benefits provide a significant competitive advantage for e-commerce merchants that rely on fast shipping or immediate action.
To understand more about open banking and Instant Payment services and how they can further optimise the online checkout experience for consumers, we spoke with our expert Jörg Heilmann, Solution Consultant at Brite Payments. With over eight years of experience at the intersection of e-commerce and fintech, he details what challenges merchants face and how modern payment solutions can reduce costs and specifically promote growth.
Can you define open banking for those who are new to the technology?
Jörg Heilmann, Solution Consultant: Open banking often sounds more complex than it is for consumers or merchants. At its core, it’s about consumers deciding who can use their financial data. They can grant licensed third-party providers (TPPs) – such as Brite Payments – permission to securely access specific account information or initiate payments directly from their account.
The technical basis for this are Application Programming Interfaces (APIs). These are provided by banks and are secured according to the highest banking standards. The legal basis in the EU is the Payment Services Directive 2 (PSD2).
There are essentially two types of services:
Firstly, with the consumer’s consent, Account Information Services (AIS) allows us to check the account balance for a payment.
Secondly, we use Payment Initiation Services (PIS) to initiate real-time transfers. This combination makes Instant A2A Payments (Pay by Bank) so fast and secure – the decisive difference from traditional bank transfers.
Open banking has evolved significantly. In hindsight, what were the most significant challenges at the beginning?
Jörg Heilmann: That’s right. The introduction was a multi-step process. There were three main challenges when the PSD2 directive was implemented in 2018.
Firstly, the EU did not mandate technical standards. This initially led to a patchwork of different APIs across banks and caused technical teething problems.
Secondly, user acceptance was low. Many consumers were unfamiliar with open banking and had security concerns – especially because early versions often still required the manual input of login credentials.
The third and most crucial point is that real-time transfers were not yet widely available. A regular SEPA transfer takes up to three days, which is fundamentally too slow for e-commerce.
Fortunately, these initial difficulties are over. The market has since evolved and found a convincing solution for these hurdles.
For example, the crucial breakthrough for user trust came with Strong Customer Authentication (SCA): Customers are now securely redirected to their familiar banking app instead of entering passwords on a merchant’s website. There, they authorise the payment with Face ID, fingerprint, or PIN – a process that is not only factually secure but also feels that way.
Perhaps the most crucial turning point is immediately ahead: The new EU regulation on Instant Payments (Instant Payments Regulation, or IPR) will, from October 2025, oblige virtually all banks in the Eurozone to offer outgoing real-time transfers and to be reachable for incoming ones — without additional costs. Thus, it cements instant payments as the new, universal standard in European payment traffic.
IPR is a crucial milestone. What does this mean for merchants and consumers at online checkouts?
Jörg Heilmann: The EU intervened because banks’ voluntary introduction of Instant Payments was progressing too slowly. However, a true digital single market needs a uniform payment system that operates in seconds.
IPR, which has been coming into force gradually since January 2025, creates clear and irreversible facts about this. Its three most important pillars are:
Speed and Accessibility: Payments must be credited to the recipient within 10 seconds – around the clock, 365 days a year. Almost all banks in the Eurozone must be reachable for these payments.
Costs: An instant transfer must not cost consumers more than a conventional standard transfer. This removes another major hurdle.
Security: An obligation to verify the recipient’s name (IBAN-name check) will be introduced to prevent fraud and erroneous transfers.
This is a revolution for merchants: They receive their money immediately, which massively improves their cash flow. Additionally, the costs for merchants are predictable and lower than those of traditional payment methods simply because of fixed fees and comparatively low integration and process costs.
For consumers, Instant Payments primarily mean convenience and security. According to studies, 85% of European online banking customers use mobile banking apps at least once a month. Consumers are ready. While bank transfers currently have a market share of approximately 8-9% in e-commerce within the German market, we expect a massive boost from this regulation, as it removes the last hurdles regarding speed and trust.
What specific advantages do Brite’s Instant Payments offer merchants in their online checkouts?
Jörg Heilmann: The advantages can be summarised in three points:
Guaranteed accuracy, fewer support requests: With a classic bank transfer (prepayment), typos in the IBAN or an incorrect reference are common for users. This leads to manual search and correction processes and frustrating support inquiries on the merchant side. With a Brite payment, all relevant data—amount, recipient, and reference—are automatically and securely transmitted to the bank via the API. Manual errors are thus technically impossible. Every payment arrives correctly and is immediately assigned to the correct order.
Automatic reconciliation, immediate fulfilment: Building on this, payment reconciliation takes place in real-time. As soon as the consumer authorises the payment, the merchant’s system receives the confirmation, and the order status can be automatically set to “paid.” For merchants, this means: No more manual checking of incoming payments, accounting is relieved, digital goods can be activated immediately, or physical goods can be shipped without delay.
A user experience that converts: Nobody wants to type in a 22-digit IBAN at checkout. This process is cumbersome and one of the main reasons for shopping cart abandonment. Using Brite, consumers remain in a seamless environment at checkout. They are securely redirected to their familiar banking app, authorise the payment in seconds via fingerprint or Face ID, and then return to the merchant’s checkout environment. This is not only more convenient compared to manual transfers, but it demonstrably increases the conversion rate.
Essentially, we relieve the merchant of the three most significant problems with classic bank transfers: The manual effort, the waiting time, and the high abandonment rates at checkout.
In your opinion, why should merchants not delay implementing Instant Payments?
Jörg Heilmann: Four crucial forces are converging right now, which together are creating the perfect window of opportunity:
The market is mature and standardised: From October 2025, the IPR will make Instant Payments a widespread, cost-effective, and secure standard. The infrastructure is in place – it’s tried and tested and works reliably. Instant Payments are no longer an experimental niche technology but the new mainstream in European payment traffic.
Customer expectations have changed: Thanks to banking apps, customers are now accustomed to fast, mobile, and secure processes – and expect the same convenience in e-commerce. A checkout that doesn’t follow the mobile-first principle and doesn’t offer Pay by Bank increasingly appears outdated and leads to shopping cart abandonment.
The ultimate “guest checkout”: Unlike digital wallets like PayPal or BNPL providers like Klarna, Instant Payments require no registration and no new password. Customers pay with their existing bank account. This is a clear advantage for merchants looking to significantly increase conversion rates for new customers and guest orders.
Margin pressure is growing: E-commerce is competitive, and every percentage point counts. Instant Payments bypass the complex – and often expensive – structures of traditional card payments. This generally reduces fees and strengthens the margin directly and sustainably.
In summary: Those who act now will not only secure a cost advantage but also meet consumers’ increased expectations for a fast, secure, and smooth checkout.
Want to learn more about A2A Payments and Pay by Bank for your online checkouts?
Adding Instant Payments to your online checkouts is simple. Contact Brite Payments’ experts today to find out how.
Or if you would like to learn more about how Brite Payments works in an online checkout and the services we provide to optimise the payment flow, dive into Brite Docs and our checkout guidelines section for all things payments.
