UK’s A2A Payments Market Continues to Evolve with E-Commerce and P2P Payment Options Becoming More Accessible – Report

The payments landscape has evolved considerably in the past decade, according to an update from Juniper Research.

Juniper Research noted in a report that many payment methods rising to some of the most used solutions across retail, digital commerce, B2B, as well as P2P scenarios.

Recently, Juniper Research pointed out that the design of payments infrastructures, the rise of open banking and the prevalence of digital wallets has really transformed the landscape.

Juniper Research also mentioned that virtual payments have become a standard option for consumers as many economies shift away from the reliance on physical cash.

The research study further noted that the latest results of this are new ways of making digital payments emerging, with digital wallets such as Apple Pay, Google Pay, Alipay, PayPal, and more becoming accepted in a considerable volume of retailers, eCommerce platforms, and other businesses globally.

But the team at Juniper Research clarified that the majority of these payments still go through existing card systems (such as Visa and Mastercard), meaning that retailers still “rely on card-based infrastructure as available payment methods for consumers.”

Juniper Research explained that it defines an A2A payment as below: ‘A2A payments move money directly from one bank account to another bank account, without the need for additional intermediaries or payment instruments, such as cards. A2A payments can cover many use cases, such as P2P (Person-to-Person), P2B (Person-to-Business) or G2P (Government-to-Person).’

Juniper Research further noted that A2A payments are not actually a new development, with bank transfers having been “possible across markets for a number of years.”

The novel aspect of A2A payments comes with recent developments to the payment market; payment digitalization, combined with these payments “becoming safer and quicker, have accelerated adoption.”

Juniper Research also mentioned that instant payments send payments along instant payment rails. As explained in the research report, these payment rails are a platform or network infrastructure that “facilitates digital money transfers.”

The report added that different payment rails operate in different ways, but ultimately provide a service that “transfers payments instantly or nearly instantly.”

Instant payments are often confused with faster payments, which are an electronic payment that, providing both the sender and the recipient “are on the faster payment scheme, can process a payment almost immediately, but can take up to two hours.”

This means that instant payments are a form of faster payments, but not all faster payments are instant payments.

Juniper Research defines an instant payment as: ‘Any payment scheme where funds are capable of being received in 10 seconds or under, outside card networks, and  confirmation of the payment to the parties is available in one minute maximum.’

There are other standout characteristics of instant payments that differentiate them from other payment types.

The most notable is the irreconcilable nature of instant payments.

As instant payments are in the recipient’s bank account within 10 seconds, there is no opportunity for the sender to cancel the payment.

There is also no physical way for the bank to take the money back from the receiver’s account.

This actually means users of instant payments are at greater risk from fraud, as they cannot stop the payment once the transfer has been made. Instant payment schemes do not change the nature of the threat, but make the crime harder to catch or trace.

Instant payments are also noteworthy for the immediacy of the confirmation of payment for both sender and recipient, as well as the use of industry-specific standards in clearance and settlement.

A commonly used standard is ISO 20022, designed for electronic data interchange between FIs (Financial Institutions).

The value of A2A payments in the UK will increase 212% to $235 billion by 2027; up from $102 billion in 2024.

  • A2A payment growth has been facilitated by interest from businesses, as A2A is said to have gained an advantage over other payment methods due to instant settlement and cheaper transaction fees than cards.
  • There are significant differences between A2A and card-based merchant fees, with A2A-based merchant fees as low as 0.35% per transaction, compared to cardbased fees which average 4%. A2A’s availability is currently limited to larger retailers, however this reduction in fees will encourage smaller retailers to invest in A2P payment solutions, and contribute to this substantial growth over the next two years.
  • A2A’s potential for online businesses is developing, but increased adoption is reliant on payment service providers onboarding compatible solutions. A2A vendors must partner with these payment service providers to offer A2A solutions
    for online checkouts and promote its benefits, including fraud mitigation tools and
    instant refunds.
  • A2A is a fringe payment method for in-store purchases in the UK, with solutions not readily available. Whilst businesses clearly benefit from A2A, consumers lack perks offered from credit cards; reducing consideration for the few available A2A offerings.


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