How the Banks are Fighting Back to Win the eCommerce Market

UK Retail Transformation

The UK retail industry is experiencing a massive transformation, as the high street is in decline and online channels are seeing incredible growth. Currently, eCommerce accounts for less than 18% of UK retail sales based on last month’s data from UK statistics office. And with consumer confidence dropping, we will continue to see a move towards online as shoppers seek out the best value deals; the future is the internet with 95% of retail sales expected to be conducted online by 2050.

This realization has hit the board room of major banks around the world that are now making decisions to provide corporate customers with online payment products or divesting their holdings in payment companies. In the last 10 years we have seen the emergence of top tier payment and merchant service companies, first in the USA and then across the rest of the world. In a number of cases, the valuations exceed those of leading banks. Examples of these multi-billion dollar companies include PayPal, Vantiv and Visa in the United States, and Nets, Worldline and Worldpay in Europe.

In Europe, payment providers such as Wirecard and Adyen are no longer niche players, having gathered momentum and closing in on traditional banks. What’s more, these ex-fin tech companies may represent only the tip of the iceberg. Some of the world’s most valuable companies, such as Apple, Tencent and Alibaba derive a substantial proportion of revenue from payments and other related transactions—a proportion that can be expected to continue growing.

Banking eCommerce Payment Solutions

What we are now seeing is the emergence of eCommerce payment solutions from major banks such as Bank of America, BNP, Santander, Barclaycard and JP Morgan. Why would a bank spend billions in acquiring a payment provider when they already have major B2B and B2C companies as corporate accounts? The key is to identify which of the corporate and SME accounts are accepting payments online. TAMI has the technology to map a business name to its website, whether it’s accepting payments online, and who is the payment provider.

In the UK alone we have analyzed over 18,000,000 domains and identify the 400,000 websites which are taking payments online. Here is the current ranking of the most popular payment providers:

PayPal is by far the most popular, and TAMI has identified 2M+ of their customers globally, 233,000 of which are in the UK. While the count of customers is impressive, what’s interesting is who is winning the biggest merchants; this is where banks can shift the balance. As you can see above, Barclaycard is already one of the top 10 payment providers in the UK. We will continue to see more banks winning a higher % of eCommerce merchants with their own payment and finance solutions by targeting their biggest banking customers.

If you are a bank and are interested in identifying which of your customers are taking payments online, please contact us at hello@tami.co.uk and we will be happy to discuss our services with you.