Payment Processing Basics

#Africa bleeds $5B a year not to #corruption or #mismanagement, but just to move money within its own borders. Example: A Kenyan business paying a Ugandan supplier. Instead of Nairobi → Kampala, money goes: Nairobi → USD conversion (1–2%). USD routed via New York/London ($20–50 fee). USD → Ugandan shillings (another 1–2%). By the time a $26,000 invoice is paid, $500–1,000 is gone. Whilst we may be denied visas, our money travels freely through New York. And it’s not just trade: Africa’s #diaspora sends $95B home each year, yet pays the world’s highest remittance costs. -We pay the highest cost for credit. -We pay the highest cost for payments. -We pay the highest cost to send our own money home. It’s not inefficiency. It’s design. The #GlobalFinancialSystem wasn’t built for us. The good news? Solutions exist. #PAPSS (Pan-African Payment and Settlement System) is already live linking 15 central banks, 150 commercial banks, and 14 payment switches, with the capacity to handle $300B in intra-African trade annually. Through PAPSS, that same Kenya–Uganda  transaction could  look very different: -One direct conversion from KES → UGX (0.2–0.5% spread). -Settlement netted via African central banks. -Funds received in hours, not days. Estimated cost: $60–150.  Potential savings: $500–950 on a single $26,000 payment. No detours. Value stays in Africa. The challenge isn’t invention. It’s implementation. One Africa. One market. One #payment system. AI image below*

In the first half of 2024, £571 million was lost to card payment fraud in the UK alone, much of it driven by scams on social media. Fraud has clearly evolved, adopting more modern and sophisticated tactics. In payment, one standard governing how card data is protected, namely how it is stored, processed, and transmitted, is the PCI DSS directives. The Payment Card Industry Data Security Standard was created in 2004 and has been the backbone of payment security for nearly 20 years. This year marks a big shift. Its latest version, PCI DSS v4.0, will become mandatory in March 2025. This is the first major update in over a decade, so worth taking a closer look at the key changes. Overall, PCI DSS v4.0 focuses on critical aspects such as encryption, authentication, network segmentation, and vulnerability testing, ensuring businesses are better equipped to handle the 'modern' security threats that are increasingly sophisticated too. ◾As such one of the key changes is the introduction of a flexible compliance approach. This means merchants can choose security measures that best fit their specific needs and risks. This approach is well-aligned with how businesses today manage their security challenges. In the same way that authentication frameworks are becoming more adaptive to varying levels of risk, other security measures are also evolving to be more context-specific and scalable. ◾Another key update focuses on the Stronger Authentication framework. Multi-factor authentication (MFA) is now mandatory for all accounts accessing sensitive payment systems, including remote administrative access. Specifically, MFA is required for all accounts that interact with the Cardholder Data Environment (CDE). ◾Stronger encryption and better key management are now essential. Businesses must use modern encryption methods instead of outdated ones. They also need to improve how encryption keys are created, shared, and stored to reduce the risk of data breaches and unauthorised access. ◾Given the industry’s shift towards real-time data processing, the latest guidelines also encourage automated monitoring and the use of tools that enable businesses to detect and flag non-compliance in real time. 👉🏽#Paymentexperts any perspectives to share on #pcidss🎙️? --- 𝑾𝒐𝒏𝒅𝒆𝒓 𝒘𝒉𝒐 𝒘𝒆 𝒂𝒓𝒆? 𝑊𝑒 𝑎𝑟𝑒 𝑎 𝑡𝑒𝑎𝑚 𝑜𝑓 𝑃𝑎𝑦𝑚𝑒𝑛𝑡𝑠 𝑆𝑡𝑟𝑎𝑡𝑒𝑔𝑖𝑠𝑡𝑠, 𝑏𝑙𝑒𝑛𝑑𝑖𝑛𝑔 𝑐𝑜𝑟𝑒 𝑡𝑒𝑐ℎ𝑛𝑖𝑐𝑎𝑙, 𝑜𝑝𝑒𝑟𝑎𝑡𝑖𝑜𝑛𝑎𝑙, 𝑎𝑛𝑑 𝑐𝑜𝑚𝑚𝑒𝑟𝑐𝑖𝑎𝑙 𝑒𝑥𝑝𝑒𝑟𝑡𝑖𝑠𝑒 𝑤𝑖𝑡ℎ 𝑎 𝑐𝑟𝑒𝑎𝑡𝑖𝑣𝑒 𝑎𝑝𝑝𝑟𝑜𝑎𝑐ℎ. 𝑊𝑒 𝑎𝑠𝑠𝑖𝑠𝑡 𝑐𝑙𝑖𝑒𝑛𝑡𝑠 𝑡ℎ𝑟𝑜𝑢𝑔ℎ 𝐶𝑜𝑛𝑠𝑢𝑙𝑡𝑖𝑛𝑔, 𝑆𝑡𝑟𝑎𝑡𝑒𝑔𝑦, 𝑅𝑒𝑠𝑒𝑎𝑟𝑐ℎ, 𝑎𝑛𝑑 𝑇ℎ𝑜𝑢𝑔ℎ𝑡 𝐿𝑒𝑎𝑑𝑒𝑟𝑠ℎ𝑖𝑝 𝑝𝑟𝑜𝑗𝑒𝑐𝑡𝑠. 𝑳𝒐𝒐𝒌𝒊𝒏𝒈 𝒇𝒐𝒓 𝒑𝒂𝒚𝒎𝒆𝒏𝒕 𝒍𝒆𝒂𝒓𝒏𝒊𝒏𝒈 𝒓𝒆𝒔𝒐𝒖𝒓𝒄𝒆? ◼️ Sign up to our unique Payment Assets Library here: https://lnkd.in/dVXjGkzB ◼️Follow Paypr.work [ˈpeɪpəwəːk] for more #paymentinfographics #paymentstrategy #payprwork #paymentinsights

More merchants than ever are utilising the services of more than one acquirer. Dual acquiring isn't anything new, but the rise of orchestration platforms and redefined dynamic routing products has made it easier than ever for merchants to leverage more than one acquirer relationship. This approach allows merchants to diversify their payment processing channels, increasing failover resilience, taking a stronger stance on good relationship management and potentially optimising costs, if deployed in the right way. _______________________________ ➡️ How Dual Acquiring Works 🔹 Merchants integrate with two (or more) acquiring banks or PSPs, either directly or through a payment gateway or orchestration platform. 🔹 Transactions can be routed dynamically based on various factors such as cost, card type, or transaction volume. 🔹 Some merchants use automated systems to select the most cost-effective or reliable acquirer for each transaction in real time. 🔹 A layer beyond this, On-Us transaction selection is a further highly efficient functionality that should be considered by merchants. In an On-Us transaction, the issuing bank and the acquiring bank are the same institution. This enables them to maximise their profits from the transaction and provide pricing at rates lower than standard interchange fees for the end merchant. With an alternate Off-Us transaction (when the issuing and acquiring banks are separate entities), the interchange fee is divided between both banks, which results in lower profits for each and higher pricing for the end merchant. ➡️ Merchant Considerations 🔹 Your setup requires the ability to support multiple acquirer integrations within the payment processing system you roll out. This can be a slightly more complex initial integration, but it will lead to considerable benefits in the long run. Orchestration platforms are also making lighter work of this for merchants. 🔹 Managing settlements and reconciliations across multiple acquirers can add operational complexity. This is why we are seeing more and more 'payments teams' being created within merchant organisations. 🔹 Ensuring compliance with regulations such as PCI-DSS when working with multiple acquirers can be slightly more cumbersome. _______________________________ At Nomupay we understand that as well as being an acquirer in our own right, maintaining a close working relationship with a whole variety of other acquirers globally is the right thing to do for our end merchants. That's why we also lean into a gateway agnostic approach. A merchant will always appreciate the best fit for them being recommended, even if that means relinquishing some share of wallet over the long term. More acquirers need to be thinking this way in 2025. So, if you are a payments provider interested in exploring a partnership with Nomupay, please do drop me a message. 📨

The evolution of payment methods is reshaping the way we pay, but how do merchants handle this constant change on a global scale? The past few years have seen an explosion in alternative payment methods (APMs) available to consumers, driven by rapid advancements in technology, growing consumer expectations for seamless experiences, and increased awareness of data privacy. With a myriad of options like digital wallets, cryptocurrencies, and mobile payment apps, consumers now expect the flexibility to choose how they pay. For large merchants, managing such a diverse ecosystem of payment methods can seem overwhelming. However, there are strategies to ensure a smooth integration and management of these options, ultimately providing the best customer experience: Partner with a reliable payment orchestration provider: A well-established payment orchestration platform can handle hundreds of APMs on a global scale, providing merchants with a unified platform for easy management, reduced operational complexity, and region-specific security features. Prioritize popular APMs: Focus on integrating the most widely-used APMs in your target market, while also keeping an eye on emerging trends to stay ahead of the competition. Optimize user experience: Seamless integration of APMs into your existing checkout process is crucial. Design user interfaces that cater to various preferences and devices, ensuring a frictionless payment experience for all customers. Prioritize security and compliance: As you adopt new payment methods, be vigilant about maintaining strict security standards and staying compliant with relevant regulations to protect your business and customers. Stay agile and adaptable: The payments landscape will continue to evolve. Be prepared to iterate on your payment processes and adopt new technologies as they emerge to stay relevant and competitive. By proactively managing the integration of alternative payment methods, large merchants can unlock new opportunities, provide better customer experiences, and stay ahead in the rapidly changing world of commerce. Source Ali Ahmed #payments #fintech #digitalwallets

The  #SEPA Verification Of Payee (VOP) is out. And it’s fundamental in advancing Europe’s payment ecosystem in two main directions: 1) combat fraud and 2) instant payments. Let’s take a look. What is it? It’s a set of rules, practices, and standards to achieve interoperability for the provision and operation of verifying Payment Account Numbers and Names within SEPA. Why is it needed? Fraud is payments’ number one problem. As instant  #payments become the new norm, being able to confirm a payee’s identity before making a transaction is crucial. Why now? It’s part of the EU’s Instant Payments Regulation, adopted by the European Parliament in March 2024.  Hence a prerequisite for the roll-out of  #instantpayments. What was announced exactly? The European Payments Council (EPC) has published – after a 3-month consultation - on October 10th the VOP rulebook and on October 31st the VoP specifications. Types of transactions: —    SEPA Credit Transfer (SCT) —    SEPA Instant Credit Transfer (SCT Inst) Use Cases: 1.     Payee IBAN and name verification 2.     Additional verification of a payee unambiguous identification code (e.g. VAT number, Legal Entity Identifier, social security code) Roles: 1.     The Requester – a natural or a legal person that initiates a Payment Account-based Payment. The payer. 2.     The Payment Counterparty – a natural or a legal person that holds a payment account at a PSP based in SEPA. It is the party that receives the payment (the payee). 3.     The Requesting PSP – the PSP of the Requester. The Requesting PSP may also be the Requester. 4.     The Responding PSP – the PSP of the Payment Counterparty. The Responding PSP may also be the Payment Counterparty. 5.     Routing and/or Verification Mechanisms (RVMs) – mechanism to route VOP Requests and related VOP Responses, to Responding PSPs and Requesting PSPs respectively. 6.     The EPC Directory Service (EDS) – a central directory that stores and maintains all required operational data about Participants. Clarifications: —    The VOP scheme is neither a payment means nor a payment instrument but essentially a messaging functionality that allows the payer to verify certain data about a payee (though it cannot be relied upon to identify a private or a legal person). —    The service should be provided instantly. —    PSPs are not liable for the execution of a transaction to an unintended payee provided they correctly perform VOP. Consequences if they don’t: 1) refund obligation 2) penalties. Opinions: my own, Source: European Payments Council

Forget one size fits all, local payment methods are the new consumer favorites in markets round the world Local Eats Global, as global card schemes lose ground to local favorites like digital wallets A2A, carrier billing and BNPL in Ecommerce These are some findings from a The 2024 Global Ecommerce Report which analyses data from 37 major markets, highlighting global, regional and country specific trends. Key Findings ▸ Local payment methods will reach 58% of all ecommerce transaction value globally by 2028, reflecting a major shift within the ecommerce payments market. ▸ By 2028, almost 37% of all individuals globally will actively use local payment methods, reflecting massive growth and expansion of the ecommerce market across the world. ▸ Card values will decline to 20% of transaction value by 2028, from 31% in 2023, reflecting a major shift as the ecommerce market expands. ▸ BNPL is steadily growing its share of ecommerce values, from 4% in 2023 to 5% in 2028, reflecting steady progress outside of key, already highly saturated markets, such as Australia, Germany and Sweden. ▸ A2A payments are seeing strong growth, from 8% of ecommerce spend in 2023 to 16% in 2028, a dramatic increase, reflecting major shifts in this market. Why Going Global Needs Local Payment Solutions As someone who knows payments, I'll explain why understanding local preferences matters for success worldwide. Thinking Globally, Acting Locally: ▸ One-size-fits-all no longer works: Countries have very different ways to pay. If you ignore this, you'll lose sales. ▸ Welcome local favorites: Give your customers the payment methods they like. This shows respect for their choices and helps build trust. ▸ Give a variety of payment options: People enjoy choices when shopping online! In some places, folks use several ways to pay. Don't stick to just one. ▸ Make the user experience smooth: Cost might not be the main factor. An easy and familiar way to pay is crucial to get more sales. Keep in mind, a global outlook means changing how you do things in each market. When you cater to local payment likes, you'll open up a whole new world of chances. Source: Boku (Link in comments) #DigitalPayments #Fintech #Payments #Ecommerce #Cards

Agentic payments has at least 10 different protocols. Here's what each one does. They're not all solving the same problem. That's why there are so many. T hree different jobs get lumped together: - Agents buying from merchants for consumers - Agents paying invoices for businesses and - Agents paying each other for compute and data at machine speed. The map sorts them by what layer of the stack they sit on. --- Agent communication (how agents talk to each other) - MCP: Anthropic's standard for agents to connect to tools and data - A2A: Google's standard for agents to communicate with other agents --- Agent trust (should I believe this agent?) - Visa TAP: lets merchants verify an agent is trusted and carrying real payment credentials - ERC-8004: on-chain registry for agent identity, reputation, and validation --- Mandate collection (what is this agent authorized to do?) - AP2: Google's framework for humans to delegate payment authority to agents --- Transaction coordination (what are we paying for?) - ACP: OpenAI and Stripe's standard for carts and payment tokens. Live in ChatGPT with Etsy, Instacart - UCP: Google and Shopify's framework, where merchants publish manifests agents can discover and negotiate with - MPP: Tempo and Stripe's protocol for agent-to-agent or HTTP payments over cards, stablecoins, and Lightning - x402: Coinbase and Cloudflare's. Agent hits a gated resource, gets a stablecoin payment prompt - AXTP: early-stage protocol for agents to pay for MCP servers --- Transaction authentication (is this payment legitimate?) - VIC: Visa Intelligent Commerce. Secure card-like tokens for agents on the Visa network - MAP: Mastercard Agent Pay. Same idea, Mastercard network - Stablecoins: card-like guarantees plus programmability, no universal standard yet --- Two patterns stand out. A Google stack is quietly emerging. A2A then AP2 then UCP is a coherent end-to-end flow for both commerce and non-commerce payments. Google has shipped internet standards before. Agent-native payments are the sleeper. HTTP 402 was reserved in 1997 for "Payment Required" and never implemented. Agents are finally forcing the issue. MPP and x402 are small today. In a decade they could be the majority of all payments. Standards will compete. Some will die. But software that can discover, negotiate, and pay for resources on its own is coming regardless of which protocol wins. At least now you have a map.

The payments stack is quietly being rebuilt — and the latest move from Visa shows how fast that transformation is accelerating. Visa Intelligent Authorization is a new capability on the Visa Acceptance Platform that allows acquirers to modernize payment processing through a single API integration, capable of processing transactions across multiple card networks. On the surface, this looks like an infrastructure upgrade. But the implications for the payments ecosystem are far bigger. 1️⃣ Payments infrastructure is becoming “API-first.” Instead of banks or acquirers building and maintaining their own authorization stacks, they can plug into modular infrastructure through a single API. This significantly reduces the cost and complexity of modernization. 2️⃣ Orchestration is becoming the new battleground. As payment flows become more complex — with wallets, A2A, stablecoins and AI-driven commerce entering the mix — the ability to intelligently route and authorize transactions across networks will be a key differentiator. 3️⃣ Lower barriers for ecosystem innovation. Fintechs, PSPs and software platforms can integrate once and access multiple payment rails, accelerating innovation for merchants and enabling new commerce experiences without rebuilding core infrastructure. 4️⃣ Networks are evolving into platforms. Moves like this reinforce a broader trend: payment networks are no longer just processing transactions — they are becoming programmable infrastructure layers that others build on. For those of us working in payments, this shift is fascinating. The industry is moving from “card networks” to “payments platforms.” And when infrastructure becomes programmable, the real innovation happens at the edges — where fintechs, merchants, developers and partners build the next generation of commerce experiences. Exciting times ahead for the ecosystem! #payments #fintech #apis #digitalpayments #innovation https://lnkd.in/gXkpYQ2i

Africa quietly processed 64 billion instant payment transactions worth nearly 2 trillion dollars in 2024. That is not a fintech headline. That is economic infrastructure hiding in plain sight. This week on the Unlocking Africa Podcast, I sat down with Sabine F. Mensah, Deputy CEO of AfricaNenda Foundation and co-author of the State of Inclusive Instant Payment Systems in Africa 2025 report, one of the most comprehensive studies ever produced on Africa’s real time payments ecosystem. What stood out most in this conversation was how clearly it reframed payments, not as a niche fintech topic, but as core economic infrastructure driving trade, productivity, and inclusion. As Sabine explained… “Digital payments mean more people are accessing and using digital payments and leveraging them to contribute to productive activities that can drive the economy.” Drawing on insights from 31 countries, we explored why Nigeria has emerged as Africa’s first fully mature instant payment system, and why this success was not accidental. In Sabine’s words… “It is not just about speed. It is about who is included and how systems are designed from day one.” We discussed: • Why scale alone does not guarantee inclusion • How interoperability transforms SME cash flow and liquidity • Why instant payments are foundational to AfCFTA success • How real time settlement changes growth outcomes for African businesses • Why trust, consumer protection, and recourse mechanisms matter as much as infrastructure One line that stayed with me throughout the episode… “There is no trade without payment. Digital payments are as important as ports and customs.” And a reminder that inclusion is deeply human... “It is not just one consumer with a bad experience. It is my family, my village, my community.” This episode is essential listening for policymakers, investors, founders, and anyone serious about doing business in Africa. Payment systems are no longer background infrastructure. They are central to growth. ⬇️ Listen now, link in the comments below ⬇️ #AfCFTA #DigitalPublicInfrastructure #PaymentsInfrastructure #AfricaTrade #InclusiveGrowth #Podcast

Africa’s Cross-Border Payments Are at a Turning Point — But Can Digital Fix the “Last Mile”? Africa’s $200+ billion* annual cross-border payments market is growing fast, but cost, speed, and transparency gaps still hold it back. Citi’s latest research shows that digital rails — from ISO 20022 to regional schemes like PAPSS — could change the game. The question: will the ecosystem move together, or build new silos? ⸻ THEMES • Speed & Transparency Are Now Baseline Expectations — Swift GPI and ISO 20022 adoption are giving banks and corporates package-tracking-style visibility on payments. • Regulators Are Raising the Stakes — Multiple central banks are piloting instant cross-border settlement models to reduce reliance on USD/EUR corridors. • Fintechs Are Closing Merchant Gaps — Players like Yoco are targeting SMEs with POS, e-commerce, and reconciliation tools to smooth the last mile. VARIATIONS • PAPSS in West Africa enables real-time settlement in local currencies — but adoption remains uneven. • Southern Africa still leans on legacy correspondent models, with higher friction and cost. • BRICS Pay pilots could bypass traditional rails entirely, but risk fragmentation if not interoperable. IMPLICATIONS • Banks risk losing corporate flows to fintechs if they don’t match speed and user experience. • Regional rails will only succeed if they integrate seamlessly with global systems. • Digital assets (stablecoins, CBDCs) offer potential cost savings but will stall without clear regulatory alignment. WHAT’S NEXT The future hinges on ecosystem orchestration, not just tech. To truly modernise, Africa’s cross-border payments must combine: 1. Common data standards (ISO 20022 end-to-end) 2. Interoperable domestic and regional scheme 3. Regulatory frameworks that enable innovation without silos ⸻ The real disruptor isn’t a single new rail — it’s multi-rail intelligence that routes payments dynamically for cost, speed, and compliance, in real time. Opinions: my own. Source: Citi, “Cross-Border Payments in Africa” #payments #africa #iso20022 #digitalpayments