At our recent Digital Innovation Summit we hosted a workstream on digital payments in conjunction with KPMG, with a particular focus on understanding and addressing the needs of merchants. Two key sessions, "Let's debate the future of open banking," and "Acceptance: What do retailers really want from digital innovation?" provided valuable insights into the aspirations and challenges faced by merchants in today's rapidly changing payments landscape.

On the open banking panel we heard from the two regulators, FCA and PSR, about their plans for the future entity for open banking, and facilitating the development of a commercial framework. Lloyds Banking Group and Token gave a rounded view on next steps to achieving open banking growth, including development of commercial variable recurring payments as a test case.

On the retailer panel, we heard from Aron Gelbard, founder of online flower retailer Bloom & Wild, on their 10-year growth from start up to scale up with multiple European holdings, and how digital payments had formed an integral part of their customer experience. Max Roberts from Stripe echoed this, "Merchants don't want to build their own payments stack; they want easy-to-access infrastructure that enables them to do what they do best: meeting the needs of their customers."

Alison Hutchinson, CEO of the charity Pennies, described how their own journey as a round-up charity had evolved over the previous decade, changing from primarily cash round-up, to contactless, to working with hundreds of different payment technology providers, all to give the customer the same experience. Oliver Steeley from M&S then considered their anticipated use of open banking, primarily as a means of fast and seamless refunds in the first instance, and then building out wider functionality. The panel ended by considering the exciting potential of AI to improve customer interactions, making payments more intuitive and convenient.

Finally, we had an innovation showcase from Superpayments, a fintech implementing a loyalty card approach to open banking, with cashback to customers and a promise of charging no fees to retailers. It was great to see an evolving implementation of open banking, and the audience was lively in interrogating them on the sustainability of their business model.

The payments workstream underscored the importance of prioritising merchants' needs in the development and adoption of digital payment solutions. While the industry is ripe for disruption, merchants are eager for solutions that streamline their operations, reduce costs, and enhance customer satisfaction.