Banking, FinTech Combo drives growth in EU payments

If there has ever been a time when traditional banks have felt the intense pressure to abandon old infrastructure and embrace digital innovation, it has been in the wake of the pandemic, as consumers ‘and sellers’ desire for seamless, faster and innovative solutions provided newer, more modern FinTech companies a competitive advantage in the payment market.

For Spanish banking giant Banco Santander, the eurozone’s second-largest bank in terms of market value, averting competition from technology companies and keeping pace with the rapidly evolving payment landscape led to the creation of PagoNxt, a dedicated FinTech unit that serves as the backbone of the bank’s business payment architecture. 2020.

See also: Santander accelerates digital movement, changes corporate structure

As PagoNxt CEO Javier San Félix told PYMNTS in an interview, there are important benefits to being an “established player from the banking system, while giving a FinTech touch to how we do things.”

Related: Santander Bank launches Santander eLockBox to consolidate digital payments

This combination is critical today, he added, especially as sellers’ expectations have evolved in recent years, and they are increasingly looking for seamless, frictionless solutions to increase sales and payment acceptance.

PagoNxt meets this need by offering them a wide range of payment methods, from global solutions such as Mastercard, Visa or American Express straight “to the very local ones in different geographies,” San Félix noted, pointing to immediate payment solutions such as Spain’s Bizum and Poland. Look like two of the 45 alternative payment methods they offer customers across markets.

Since its launch, the FinTech company has grown by over 140%, generating a total revenue of € 162 million ($ 163.3 million) in the first quarter of 2021.

Read more: Santander’s BNPL product Zinia is expanded to the Netherlands

Crypto is here to stay

Emerging, innovative technologies such as blockchain and cryptocurrency are gaining ground quickly, San Félix said, especially as traders in emerging markets with high currency volatility begin to accept payments in digital currency or stable currencies.

See also: Market Crash Tester Crypto’s Survival of the Fittest

And despite the ongoing cryptocurrency market crash, he was of the opinion that virtual currencies are here to stay, and there is more reason why companies that want to be relevant payment players will “need [invest in] better understanding of how it affects our business and accommodating the solutions that will become more mainstream. ”

Related: Santander: “Celebrity-approved” crypto fraud in the UK can be doubled

However, due to the increased scrutiny and controversy surrounding the emerging market, he continued to warn against “going faster than regulation and the market itself.”

Instead, PagoNxt will closely monitor how regulation and proposals in the market develop to determine the right time to fully integrate that option into their solution, he explained.

The UK’s market relevance remains high after Brexit

Based on Santander’s strong presence in Europe, San Félix said it now has “the opportunity to serve other European markets beyond the Santander franchise,” following several recent acquisitions, including a 30% stake in US-based Atempo Growth earlier this year.

Read more: Santander acquires a 30% stake in Atempo Growth to finance technical startups

One of these core markets is the United Kingdom, he added, adding that despite the regulatory and economic complexities brought about by Brexit, he still had a strong belief in the strength and importance of the British market.

“It is a very competitive market and one that often sets the standard for how other markets should function. So for us to have global reach, we need to be able to compete and be relevant at the UK level, ”explained San Félix, formerly Head of Retail and Commercial Bank and Deputy CEO of Santander UK.

See also: Santander, billionaire Salinas expresses interest in acquiring Citibanamex

He further noted that international trade, especially the need to support UK companies trading globally, will continue to gain a foothold in the future as the UK continues to navigate business with the rest of Europe after Brexit. And these companies can count on PagoNxt to provide the necessary support.

“International trade is going to be even more relevant for UK companies, and we believe our solutions will have a good echo in the market,” said San Félix.

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