Insights

Payment Service Providers Shift to Fintech, 95% Report Banking Restrictions

Pat Crawley
Pat Crawley
32 Min Read
payment-service-providers-shift-to-fintech,-95%-report-banking-restrictions

Wednesday, 09/10/2024 | 14:47 GMT by Jared Kirui

  • A report by fintech firm Neo indicates that 75% of PSPs are exploring fintech solutions as alternatives to traditional banks.
  • The majority are now relying on fewer banking partners.

Fintech

Payment Service Providers (PSPs) face significant challenges in their relationships with traditional banks. A recent report by fintech firm Neo showed that 95% of PSPs have had their banking accounts closed or restricted, often with little to no explanation. Amid limited banking options, many PSPs are now turning to fintech solutions.

Banking for PSPs

The report presented findings from a survey involving 100 C-suite executives at European PSPs. A concerning 71% of these professionals noted that their accounts were closed without transparency from their banking partners.

Source: Neo

Relying on a small number of banking partners is a risky strategy for many PSPs. Approximately 69% of respondents indicated they depend on three or fewer banks, which heightens their vulnerability. Additionally, only 2% of PSPs reported successfully opening a traditional bank account in less than six months.

The average wait time extends to nearly a year, leaving many PSPs frustrated and seeking alternative solutions. As a result, the research highlighted that over one-third (39%) of PSPs have formed partnerships with one to three Electronic Money Institutions or other PSPs. Nearly half (48%) reportedly maintain relationships with four to five EMIs.

Source: Neo

Besides that, the report identified several problems PSPs encounter when dealing with traditional banks. 44% of respondents are affected by lengthy onboarding processes, while 29% cited incompatibility with crypto exchanges. Additionally, 25% reported the risk of account closures as a significant concern, alongside challenges resulting from outdated banking technologies.

Challenges in Traditional Banking

The difficulties extend to cross-border payments, where 31% of PSPs highlighted limited banking platform capabilities, particularly in real-time processing and multi-currency handling. The discrepancies between regional issues are notable; for example, reconciliation of flows emerged as a top concern in the UK, while limitations in banking platforms troubled many in Italy and France.

In light of these challenges, PSPs are increasingly integrating EMI and PSP solutions into their operations. On average, firms have three EMI/PSPs within their banking ecosystem.

Source: Neo

A significant 75% of PSPs are actively exploring fintech solutions as potential replacements for traditional banks. This trend is particularly pronounced in regions like the UK, where 86% of PSPs are looking to fintech partners for improved service delivery.

When selecting a fintech partner, PSPs prioritize several key factors. The security of funds tops the list at 31%. Speedy onboarding (26%) and low, transparent fees (26%) also play crucial roles in decision-making.

Payment Service Providers (PSPs) face significant challenges in their relationships with traditional banks. A recent report by fintech firm Neo showed that 95% of PSPs have had their banking accounts closed or restricted, often with little to no explanation. Amid limited banking options, many PSPs are now turning to fintech solutions.

Banking for PSPs

The report presented findings from a survey involving 100 C-suite executives at European PSPs. A concerning 71% of these professionals noted that their accounts were closed without transparency from their banking partners.

Source: Neo

Relying on a small number of banking partners is a risky strategy for many PSPs. Approximately 69% of respondents indicated they depend on three or fewer banks, which heightens their vulnerability. Additionally, only 2% of PSPs reported successfully opening a traditional bank account in less than six months.

The average wait time extends to nearly a year, leaving many PSPs frustrated and seeking alternative solutions. As a result, the research highlighted that over one-third (39%) of PSPs have formed partnerships with one to three Electronic Money Institutions or other PSPs. Nearly half (48%) reportedly maintain relationships with four to five EMIs.

Source: Neo

Besides that, the report identified several problems PSPs encounter when dealing with traditional banks. 44% of respondents are affected by lengthy onboarding processes, while 29% cited incompatibility with crypto exchanges. Additionally, 25% reported the risk of account closures as a significant concern, alongside challenges resulting from outdated banking technologies.

Challenges in Traditional Banking

The difficulties extend to cross-border payments, where 31% of PSPs highlighted limited banking platform capabilities, particularly in real-time processing and multi-currency handling. The discrepancies between regional issues are notable; for example, reconciliation of flows emerged as a top concern in the UK, while limitations in banking platforms troubled many in Italy and France.

In light of these challenges, PSPs are increasingly integrating EMI and PSP solutions into their operations. On average, firms have three EMI/PSPs within their banking ecosystem.

Source: Neo

A significant 75% of PSPs are actively exploring fintech solutions as potential replacements for traditional banks. This trend is particularly pronounced in regions like the UK, where 86% of PSPs are looking to fintech partners for improved service delivery.

When selecting a fintech partner, PSPs prioritize several key factors. The security of funds tops the list at 31%. Speedy onboarding (26%) and low, transparent fees (26%) also play crucial roles in decision-making.

Jared Kirui

  • 1301 Articles
  • 15 Followers

Jared is an experienced financial journalist passionate about all things forex and CFDs.

  • 1301 Articles
  • 15 Followers

Finance Magnates Daily Update

Get all the top financial news delivered straight to your inbox. Stay informed, stay ahead.

Keep Reading

More from the Author

FinTech

The Role of PAMM, MAM & Copy Trading in Business Growth Strategies | Webinar

The Role of PAMM, MAM & Copy Trading in Business Growth Strategies | Webinar

The Role of PAMM, MAM & Copy Trading in Business Growth Strategies | Webinar

The Role of PAMM, MAM & Copy Trading in Business Growth Strategies | Webinar

The copy trading market is projected to double in size, growing from $2.2 billion to $4 billion by the end of this decade. In light of this, brokers and financial institutions are increasingly adopting PAMM, MAM, and Copy Trading solutions to scale operations and drive profitability. In this insightful webinar, Sergey Ryzhavin, Product Owner at B2COPY, outlines the advanced features of the B2COPY platform, showcasing how it enhances Copy Trading, PAMM, and MAM performance. Sergey also explores strategies for using these tools to attract new clients, improve customer engagement, and create additional revenue streams. 📣 Stay updated with the latest in finance and trading! Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today: 🔗 LinkedIn: https://www.linkedin.com/company/financemagnates/ 👍 Facebook: https://www.facebook.com/financemagnates/ 📸 Instagram: https://www.instagram.com/financemagnates_official 🐦 X (Twitter): https://twitter.com/financemagnates/ 📡 RSS Feed: https://www.financemagnates.com/feed/ ▶️ Telegram: https://t.me/financemagnatesnews Don’t miss out on our latest videos, interviews, and event coverage. 🔔 Subscribe to our YouTube channel for more!🔔

The copy trading market is projected to double in size, growing from $2.2 billion to $4 billion by the end of this decade. In light of this, brokers and financial institutions are increasingly adopting PAMM, MAM, and Copy Trading solutions to scale operations and drive profitability. In this insightful webinar, Sergey Ryzhavin, Product Owner at B2COPY, outlines the advanced features of the B2COPY platform, showcasing how it enhances Copy Trading, PAMM, and MAM performance. Sergey also explores strategies for using these tools to attract new clients, improve customer engagement, and create additional revenue streams. 📣 Stay updated with the latest in finance and trading! Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today: 🔗 LinkedIn: https://www.linkedin.com/company/financemagnates/ 👍 Facebook: https://www.facebook.com/financemagnates/ 📸 Instagram: https://www.instagram.com/financemagnates_official 🐦 X (Twitter): https://twitter.com/financemagnates/ 📡 RSS Feed: https://www.financemagnates.com/feed/ ▶️ Telegram: https://t.me/financemagnatesnews Don’t miss out on our latest videos, interviews, and event coverage. 🔔 Subscribe to our YouTube channel for more!🔔

The copy trading market is projected to double in size, growing from $2.2 billion to $4 billion by the end of this decade. In light of this, brokers and financial institutions are increasingly adopting PAMM, MAM, and Copy Trading solutions to scale operations and drive profitability. In this insightful webinar, Sergey Ryzhavin, Product Owner at B2COPY, outlines the advanced features of the B2COPY platform, showcasing how it enhances Copy Trading, PAMM, and MAM performance. Sergey also explores strategies for using these tools to attract new clients, improve customer engagement, and create additional revenue streams. 📣 Stay updated with the latest in finance and trading! Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today: 🔗 LinkedIn: https://www.linkedin.com/company/financemagnates/ 👍 Facebook: https://www.facebook.com/financemagnates/ 📸 Instagram: https://www.instagram.com/financemagnates_official 🐦 X (Twitter): https://twitter.com/financemagnates/ 📡 RSS Feed: https://www.financemagnates.com/feed/ ▶️ Telegram: https://t.me/financemagnatesnews Don’t miss out on our latest videos, interviews, and event coverage. 🔔 Subscribe to our YouTube channel for more!🔔

The copy trading market is projected to double in size, growing from $2.2 billion to $4 billion by the end of this decade. In light of this, brokers and financial institutions are increasingly adopting PAMM, MAM, and Copy Trading solutions to scale operations and drive profitability. In this insightful webinar, Sergey Ryzhavin, Product Owner at B2COPY, outlines the advanced features of the B2COPY platform, showcasing how it enhances Copy Trading, PAMM, and MAM performance. Sergey also explores strategies for using these tools to attract new clients, improve customer engagement, and create additional revenue streams. 📣 Stay updated with the latest in finance and trading! Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today: 🔗 LinkedIn: https://www.linkedin.com/company/financemagnates/ 👍 Facebook: https://www.facebook.com/financemagnates/ 📸 Instagram: https://www.instagram.com/financemagnates_official 🐦 X (Twitter): https://twitter.com/financemagnates/ 📡 RSS Feed: https://www.financemagnates.com/feed/ ▶️ Telegram: https://t.me/financemagnatesnews Don’t miss out on our latest videos, interviews, and event coverage. 🔔 Subscribe to our YouTube channel for more!🔔

More Videos

  • Join us at FMLS:24 to connect with global institutional brokers. Secure your spot today! #fmls24

    Join us at FMLS:24 to connect with global institutional brokers. Secure your spot today! #fmls24

    Join us at FMLS:24 to connect with global institutional brokers. Secure your spot today! #fmls24

    Join us at FMLS:24 to connect with global institutional brokers. Secure your spot today! #fmls24

    Join us at FMLS:24 to connect with global institutional brokers. Secure your spot today! #fmls24

    Join us at FMLS:24 to connect with global institutional brokers. Secure your spot today! #fmls24

  • 🌟 Explore cutting-edge solutions and connect with fintech leaders at FMLS:24!

    🌟 Explore cutting-edge solutions and connect with fintech leaders at FMLS:24!

    🌟 Explore cutting-edge solutions and connect with fintech leaders at FMLS:24!

    🌟 Explore cutting-edge solutions and connect with fintech leaders at FMLS:24!

    🌟 Explore cutting-edge solutions and connect with fintech leaders at FMLS:24!

    🌟 Explore cutting-edge solutions and connect with fintech leaders at FMLS:24!

  • 🤝 Meet industry leaders at the premier event for brokers – FMLS:24. Secure your spot today!

    🤝 Meet industry leaders at the premier event for brokers – FMLS:24. Secure your spot today!

    🤝 Meet industry leaders at the premier event for brokers – FMLS:24. Secure your spot today!

    🤝 Meet industry leaders at the premier event for brokers – FMLS:24. Secure your spot today!

    🤝 Meet industry leaders at the premier event for brokers – FMLS:24. Secure your spot today!

    🤝 Meet industry leaders at the premier event for brokers – FMLS:24. Secure your spot today!

  • Finance Magnates Pacific Summit 2024 | FMPS:24 Highlights

    Finance Magnates Pacific Summit 2024 | FMPS:24 Highlights

    Finance Magnates Pacific Summit 2024 | FMPS:24 Highlights

    Finance Magnates Pacific Summit 2024 | FMPS:24 Highlights

    Finance Magnates Pacific Summit 2024 | FMPS:24 Highlights

    Finance Magnates Pacific Summit 2024 | FMPS:24 Highlights

    Relive the best moments from the Finance Magnates Pacific Summit 2024 with our highlights video! ✨ From action-packed moments, insightful speaker sessions, the exclusive Opening Blitz, and immersive workshops, this video captures the energy and excitement of FMPS:24. Whether you attended or missed out, here’s your chance to experience the top moments that made FMPS:24 unforgettable. 🎬 Watch, share, and join the conversation! Don’t forget to use the hashtags #fmps #fmps24 #FMevents when sharing. Stay tuned for more events. See you next time! 📣 Stay updated with the latest in finance and trading! Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today: 🔗 LinkedIn: https://www.linkedin.com/showcase/financemagnates-events/ 👍 Facebook: https://www.facebook.com/FinanceMagnatesEvents 📸 Instagram: https://www.instagram.com/fmevents_official 🐦 Twitter: https://twitter.com/F_M_events 🎥 TikTok: https://www.tiktok.com/@fmevents_official ▶️ YouTube: https://www.youtube.com/@FinanceMagnates_official Don’t miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!

    Relive the best moments from the Finance Magnates Pacific Summit 2024 with our highlights video! ✨ From action-packed moments, insightful speaker sessions, the exclusive Opening Blitz, and immersive workshops, this video captures the energy and excitement of FMPS:24. Whether you attended or missed out, here’s your chance to experience the top moments that made FMPS:24 unforgettable. 🎬 Watch, share, and join the conversation! Don’t forget to use the hashtags #fmps #fmps24 #FMevents when sharing. Stay tuned for more events. See you next time! 📣 Stay updated with the latest in finance and trading! Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today: 🔗 LinkedIn: https://www.linkedin.com/showcase/financemagnates-events/ 👍 Facebook: https://www.facebook.com/FinanceMagnatesEvents 📸 Instagram: https://www.instagram.com/fmevents_official 🐦 Twitter: https://twitter.com/F_M_events 🎥 TikTok: https://www.tiktok.com/@fmevents_official ▶️ YouTube: https://www.youtube.com/@FinanceMagnates_official Don’t miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!

    Relive the best moments from the Finance Magnates Pacific Summit 2024 with our highlights video! ✨ From action-packed moments, insightful speaker sessions, the exclusive Opening Blitz, and immersive workshops, this video captures the energy and excitement of FMPS:24. Whether you attended or missed out, here’s your chance to experience the top moments that made FMPS:24 unforgettable. 🎬 Watch, share, and join the conversation! Don’t forget to use the hashtags #fmps #fmps24 #FMevents when sharing. Stay tuned for more events. See you next time! 📣 Stay updated with the latest in finance and trading! Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today: 🔗 LinkedIn: https://www.linkedin.com/showcase/financemagnates-events/ 👍 Facebook: https://www.facebook.com/FinanceMagnatesEvents 📸 Instagram: https://www.instagram.com/fmevents_official 🐦 Twitter: https://twitter.com/F_M_events 🎥 TikTok: https://www.tiktok.com/@fmevents_official ▶️ YouTube: https://www.youtube.com/@FinanceMagnates_official Don’t miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!

    Relive the best moments from the Finance Magnates Pacific Summit 2024 with our highlights video! ✨ From action-packed moments, insightful speaker sessions, the exclusive Opening Blitz, and immersive workshops, this video captures the energy and excitement of FMPS:24. Whether you attended or missed out, here’s your chance to experience the top moments that made FMPS:24 unforgettable. 🎬 Watch, share, and join the conversation! Don’t forget to use the hashtags #fmps #fmps24 #FMevents when sharing. Stay tuned for more events. See you next time! 📣 Stay updated with the latest in finance and trading! Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today: 🔗 LinkedIn: https://www.linkedin.com/showcase/financemagnates-events/ 👍 Facebook: https://www.facebook.com/FinanceMagnatesEvents 📸 Instagram: https://www.instagram.com/fmevents_official 🐦 Twitter: https://twitter.com/F_M_events 🎥 TikTok: https://www.tiktok.com/@fmevents_official ▶️ YouTube: https://www.youtube.com/@FinanceMagnates_official Don’t miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!

    Relive the best moments from the Finance Magnates Pacific Summit 2024 with our highlights video! ✨ From action-packed moments, insightful speaker sessions, the exclusive Opening Blitz, and immersive workshops, this video captures the energy and excitement of FMPS:24. Whether you attended or missed out, here’s your chance to experience the top moments that made FMPS:24 unforgettable. 🎬 Watch, share, and join the conversation! Don’t forget to use the hashtags #fmps #fmps24 #FMevents when sharing. Stay tuned for more events. See you next time! 📣 Stay updated with the latest in finance and trading! Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today: 🔗 LinkedIn: https://www.linkedin.com/showcase/financemagnates-events/ 👍 Facebook: https://www.facebook.com/FinanceMagnatesEvents 📸 Instagram: https://www.instagram.com/fmevents_official 🐦 Twitter: https://twitter.com/F_M_events 🎥 TikTok: https://www.tiktok.com/@fmevents_official ▶️ YouTube: https://www.youtube.com/@FinanceMagnates_official Don’t miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!

    Relive the best moments from the Finance Magnates Pacific Summit 2024 with our highlights video! ✨ From action-packed moments, insightful speaker sessions, the exclusive Opening Blitz, and immersive workshops, this video captures the energy and excitement of FMPS:24. Whether you attended or missed out, here’s your chance to experience the top moments that made FMPS:24 unforgettable. 🎬 Watch, share, and join the conversation! Don’t forget to use the hashtags #fmps #fmps24 #FMevents when sharing. Stay tuned for more events. See you next time! 📣 Stay updated with the latest in finance and trading! Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today: 🔗 LinkedIn: https://www.linkedin.com/showcase/financemagnates-events/ 👍 Facebook: https://www.facebook.com/FinanceMagnatesEvents 📸 Instagram: https://www.instagram.com/fmevents_official 🐦 Twitter: https://twitter.com/F_M_events 🎥 TikTok: https://www.tiktok.com/@fmevents_official ▶️ YouTube: https://www.youtube.com/@FinanceMagnates_official Don’t miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!

You Might Also Like

Stripe and FreedomPay Collaborate for Enterprise Solutions over 1,000 POS Systems

Revolut Pursues Banking License in Colombia Following Mexico Approval

Cybersecurity Accounts for 63% of Fintech Growth, Study Finds

Revolut Urges Meta to Compensate Fraud Victims on Its Social Media Platforms: Report

eToro UK's 2023 Net Income Drops 15% as Trading Commissions Decline

TAGGED:
Share This Article
Leave a comment

New Releases

- Advertisement -
Ad image

Trending Stories