Remove friction! Disintermediation! We’ve been talking about it for years….

It is not always easy to reach a consensus between people from all walks of life, representing diverse interests in the payment industry as those who are meeting in Money20/20 Europe this week in Amsterdam. However, there is a clear unanimous feeling: we’re all happy to be back! We’re happy to be back to human interactions, to fruitful conversations, to productive exchanges, to meeting humans at last!

Money20/20 is a way to hear about the latest trends in the payment industry. Earlier this morning a session with booking.com SVP of Fintech set up the focus on the complexities of payments and how friction in payment interferes with transaction completion. Booking.com sees itself as a crossing point between bookers and hotels. Travelers want to keep maximum flexibility, allow changes and cancellations, and pay at the last minute. At the other end, hotels need to be reassured with the certainty of their revenue, know when payments will come and be sure about their outcome. The more friction in the system, the more risk to lose customers or hotels. To make payment even more complex, Boooking.com deals with cross border transactions, operates in multiple currencies and may have to take payments long before the execution of the transaction.

Booking.com has been working for years with major players in the payment industry to eliminate these frictions. Now, the reservation platform is launching its own internal Fintech with an announced objective to “develop new products to drive efficiency and create potential new revenue streams” for the company. The creation of this payment platform can be seen as a disruption in the world of payments. Financial institutions, and more generally payment industry players, are often not happy to see merchants get into their business. Booking.com already processed 22% of its gross bookings in 2020 on its integrated payment platform, up from 15% in 2019. When data is often considered as the new oil, a merchant like booking.com already possesses way more data about consumers than the traditional payment industry.

Booking.com evolution may pave the way for other giant merchants to try and change their position along the value chain. But along years, we’ve seen many players come into this field saying, “payment is too complex, we will make it simpler” and, at the end of the day, they realized, payment is not only complex but also dependent on many local intricacies even adding to its complexity.

What make the payment ecosystem always fascinating is the diversity of its players … and also their will to evolve along the value chain.