As the global payments landscape continues to evolve, it is clear that non-cash transactions are taking center stage. The World Payments Report 2026 indicates that the volume of these transactions has surged over tenfold in less than 20 years. "This strong momentum is both global and relentless," said the report's authors, emphasizing the rapid acceleration of non-cash transaction growth in every major region.
The findings of this report underscore the mounting pressure traditional banks face from agile PayTech companies and other platform players that are redefining merchant payment services. These competitors are providing omnichannel, scalable payment solutions that not only integrate seamlessly into merchant operations but also offer rapid onboarding and improved analytics.
Drawing insights from a comprehensive survey involving 2,600 merchants along with over 420 additional surveys and in-depth interviews with senior payments executives from banks and PayTechs, the report spans 15 countries across the Americas, Europe, and Asia-Pacific. This diverse input helps paint a picture of an industry in flux.
Interestingly, despite the rise of PayTechs, the report reveals that banks still have a relevant role to play. "When it comes to preferred providers for financial services, 66% of merchants continue to trust traditional banks over PayTechs," the report stated. This statistic highlights the opportunity for banks to reclaim their share of the merchant payment services market.
Experts recommend several strategies for banks seeking to catch up to their more agile competitors. According to the report, banks should focus on scaling through the provision of best-in-class, vertically integrated services. "A robust ecosystem of tailored offerings will help merchants to run smarter, leaner, and faster," said Capgemini’s team.
Moreover, developing digital capabilities that align with their business strategy is critical. "Banks need to ensure their technology stack is agile and scalable, and they must refocus with clarity to compete effectively in their chosen markets," the report advised.
Amid these recommendations, the report notes the importance for banks to utilize their inherent advantages in trust, technology, and data. "Seamless onboarding can become a key differentiator, and effective payment orchestration can dynamically route transactions for improved conversion rates," it elaborated.
As the digital payment landscape continues to expand, the evolving expectations of merchants are at the forefront. The report articulates that "merchants are evolving fast to meet rising consumer expectations and the growing complexity of digital commerce." Such evolution is particularly evident among small businesses, which prioritize secure, omnichannel payment solutions and rapid checkout processes. Conversely, mid-sized and larger merchants are more focused on the need for efficiency, personalization, and integrated systems.
Despite these rising expectations, banks are currently falling short in their service offerings. "Slow onboarding, unreliable infrastructure, and insufficient fraud protection are eroding trust among merchants, particularly in small to mid-sized enterprises," highlighted the report. As traditional banks fail to keep pace, many merchants are migrating to PayTech alternatives that promise better support tailored to their specific needs.
However, those banks that successfully harness the freemium model and tailor their offerings could turn the tide. According to the report, "merchants today expect more comprehensive services beyond basic payment capabilities. From fraud detection to instant settlements and working capital loans, there is a demand for value-added services that enhance efficiency and customer engagement."
As varying priorities dictate the pace of this change, many merchants are even willing to pay premiums for tools that ensure operational security and customer satisfaction.
Ultimately, the report concludes that the cornerstone for success in servicing merchants lies in constructing a robust digital foundation. "With modular infrastructure, intuitive interfaces, plug-and-play APIs, and embedded workflows, banks can maintain agility, respond efficiently to market demands, and provide seamless experiences across channels," the authors emphasized.
In this rapidly changing financial landscape, banks that can adapt and innovate will not only survive but potentially thrive in the digital payments economy moving forward.