Finance Monthly - October 2021

59 Finance Monthly. F i nanc i a l Innov a t i on & F i nTech Few industries in Europe have seen as rap- id and fully-fledged changes as payments in the past few years. The introduction of the second iteration of the Payment Services Di- rective — better known as PSD2 — in the EU has paved the way for the Open Banking rev- olution, while the impacts of Brexit and the coronavirus pandemic have driven massive changes to the lives of many people across the continent. Organisations have had to rethink their entire business models, new players have sprung up seemingly from nowhere, and consumer behaviour has completely changed. Of course, more transactions are now taking place online and the use of cash is dwindling. But while digital payments are dominating the ecosystem in regions such as the Nor- dics and the UK, there are some key mar- kets in Europe where there is still a way to go. Both Spain and Germany, for instance, still have fairly low rates of card usage and digital payment adoption with cash still used in around 40% of in-person transactions in Spain, rising to 44% in Germany, according to figures from PCM. However, while these statistics suggest that digital payments still have a long way to go in these markets, it could also indicate that a boom is set to happen. Indeed, the growth seen in the Spanish e-commerce sector, for example, and Germany’s creation of a common standard for open Application Pro- gramming Interfaces (APIs) through the Ber- lin Group suggest that further revolutionary changes could be just around the corner. Kriya Patel, CEO of Transact Payments, ex- plores the massive untapped potential of the Spanish and German markets, highlight- ing the opportunities for innovative incum- bents and agile new players.