A guide to Adyen's banking licence

A few weeks ago, we announced our European banking licence. This is an important step for us; it lets us settle funds faster without relying on external banks. Which means an overall improvement of our service levels.

This comes at an interesting time when the finance industry is getting a big old shake-up. Money 20/20 was abuzz with the implications of PSD2, which is expected to make considerable waves across the whole landscape.

There is a definite shift underway. Banks are moving into ecommerce, ecommerce players are becoming banks. The lines between sectors are blurring, and it is becoming easier for companies to diversify into new areas. We expect to see a lot more businesses announcing financial services in the future.

We sat down with Dagmar van Ravenswaay Claasen, Director of Regulatory Affairs at Adyen to find out why we have a banking licence, and what it means for our customers.

"We want our customers to get the best results for every payment. And the only way to be sure of this is to manage the flow end-to-end. This includes the multi-channel gateway,risk management, processing and acquiring – as well settlement.

We've made huge strides in becoming a global acquirer. This lets our customers connect directly to the card schemes, giving them in-depth insights into each payment, which in turn lets them optimise the process. This has proved hugely successful and on average, our customers can expect to generate additional income of 1.4% as a result.

This was great. But we were still reliant on banks when it came to the final step in the process, which is the settlement. This puts our customers at the mercy of outdated, legacy infrastructures in order to get their money.

With a banking licence, we can take care of this final stage, which provides faster settlement times, more automation and greater stability. So it made sense to take this next step – essentially closing the loop on our end-to-end payments platform.

This is unique in the B2B payments space, and we are very excited to see how it will improve payment processing for our customers.

It also lays important foundations for the future. We want to make it easy for our customers to keep pace with a rapidly changing landscape. And today, things are changing faster than ever. In the EU, for example, you have PSD2, as well as many changes related to marketplace regulation. 

This investment in our core infrastructure means we are in a better position to help our customers stay one step ahead – now, and well into the future."

"PSD2 will encourage lots of new initiatives that will compete with banks. From what I saw at Money 20/20, banks expect to work side-by-side with Fintech. But we see again and again that they are lacking the basic infrastructure. PSD2 will force them to shake things up.

As things become increasingly mixed up, I expect regulations will need an overhaul. 

In the future, it would be great to see regulation by specific functionality rather than sector. This will allow for much greater fluidity and lower entry barriers to innovation.

The ultimate monopoly is becoming dismantled. This opens up a whole world of opportunity, and we are just at the beginning. It is incredibly exciting!"