At Pay360, I moderated a panel on payment data – we’re talking about the information contained within and the meta data surrounding a transaction. While, payment data is becoming central to how businesses operate, there’s a risk of overstating its role.
Steve Bisoffi of Revolut was pretty clear: “No viable, sustainable business can operate without detailed payments data.” At Revolut, payments are monitored continuously across dashboards tracking growth, fraud, disputes and performance. Without that visibility, “you don’t really understand how your business is operating.”
I agree but only up to a point.
Payment data is extremely powerful when it comes to improving payments themselves: acceptance, fraud, routing, cost and customer experience. But it is not, and cannot provide a complete view of the business.
Merchants’ real systems of record sit elsewhere – in CRM, ERP and ePOS systems. That’s where you find SKU-level detail, customer identity, promotions and margin. Payment data, by contrast, tells you where and when a transaction happened, but not what was bought or why.
Much of the discussion on the panel focused on using payment data to drive wider business outcomes. Sophie Wadsworth of BNY (Bank of New York) described how payments have shifted from cost centre to revenue driver, with use cases ranging from cashflow optimisation to reducing churn from failed payments.
But even here, the value of payment data is often indirect. It improves conversion by reducing failure rates. It improves cash visibility. It supports forecasting. It is a helpful complement to core commercial data but of limited value on its own.
Where payment data really is valuable is in fixing payments. And fixing payments can deliver quick improvements to any merchant’s bottom line.
Phil O’Hagan of Sainsbury’s gave a good example. Analysis of re-authorisation behaviour showed customers repeatedly triggering new payment requests when adding small items to their basket. By adjusting tolerance rules, Sainsbury’s reduced friction, cut contact centre calls by around 2.5 million, and saved a lot of money.
This is best practice payments optimisation: small changes, driven by data, delivering outsized operational impact.
The same applies at scale. Mastercard’s John Wheeler said the network was using data to improve acceptance rates and guide acquirers. Tokenisation, he suggested, could reach near 100% globally by 2030, another example of data driving better payment outcomes. Yes, payment data can help merchants decide where to open stores or better understand share of wallet, but these use cases remain relatively niche.
For merchants, the actual challenge is integrating payment data with their systems of record and those of their partners.
David McGuiness of FoodHub highlighted the importance of linking payments with POS data so that “they speak to each other.” Only by combining these datasets do you get a complete picture of the business. He also highlighted the challenge of getting FoodHub’s restaurant partners to take advantage of the intelligence offered.
This integration challenge has important implications for vendors.
First, data is now a core part of the product. PSPs cannot compete on price and acceptance alone. The quality, granularity and accessibility of data are becoming key selection criteria and, merchants tell me, increasingly reasons for churn. A very large merchant (not represented on this panel) told me his acquirer still provides management information via a monthly spreadsheet and invoicing on a pdf.
Second, generic dashboards are no longer enough. As Charles Aji of Collinson noted, fragmented PSP data creates internal friction and “revenue leakage” when issues are spotted too late. Many merchants are responding by building their own data layers, aggregating data across PSPs and enriching it with their own systems. With the adoption of AI coding tools, this is now much easier than it used to be. Charles had expected to buy a payment dashboard from an established vendor but his tech team has done what’s needed at a fraction of the cost.
If merchants like Collinson are building their own data capability, PSPs will find it ever harder to demonstrate the competitive differentiation needed to escape being just a pipe connecting merchants to schemes.
Finally, there is a growing expectation of real-time, actionable data across the ecosystem. Steve Bisoffi called for greater transparency from Visa and Mastercard, particularly around fees and data quality issues. Better data sharing could improve acceptance, reduce fraud and enhance customer experience.
Payment data is increasingly critical to making payments work and increasingly central to how merchants choose their partners. Vendors need to get the basics right, but not oversell the ability of payments data to do more than make payments better.