Neerav Shah, VP International at commercetools
Checkout is where trust is won or lost — and where a brand’s entire commerce infrastructure is put to the test. It’s not just a moment of conversion; it’s a moment of truth. Can you serve global customers? Support new channels? Grow revenue without shrinking your margins? It all shows up in a split second.
And increasingly, that split second comes at a cost. Across the UK, merchants are waking up to the hidden fees embedded in their payment infrastructure — a silent, million-pound burden not levied by HMRC, but by the very platforms designed to help them grow.
Disproportionate fees, limited choice, and missed opportunities
Visa and Mastercard, two of the most dominant payment service providers (PSPs), have dramatically raised processing fees, outpacing inflation by 25% – that’s an extra £170 million a year in avoidable costs. The impact is so stark that Europe’s largest retailers are now urging the European Commission to intervene, citing reduced margins and weakened competitiveness.
Adding to the challenge, many commerce platforms like Shopify and Salesforce lock payments into rigid, bundled systems. Merchants can’t switch providers. They can’t negotiate better rates. They’re stuck paying more for less flexibility. For example, there’s a 2% penalty from Shopify for not using their inbuilt payment solution
At the same time, commerce is getting more complex. Merchants must meet local compliance standards, offer region-specific payment methods, and handle cross-border transactions while keeping fraud and FX costs in check. But rigid systems aren’t built for this. Inflexible platforms slow everything down: innovation, expansion, and customer experience.
According to the Baymard Institute, 10% of online shoppers abandon their carts when their preferred payment method isn’t available. That’s not just a missed opportunity — it’s a hit to both revenue and customer trust.
The root problem: bundled architecture
These aren’t just technical limitations — they’re architectural. Bundled payment systems, where software and payments are tightly coupled, have allowed fees to climb unchecked. Sold as a convenience, these all-in-one setups often come with trade-offs: limited flexibility, opaque pricing, and few incentives for innovation. While they promise fast go-live timelines and an out-of-the-box experience that feels plug-and-play, the same architecture becomes a barrier as merchants scale. What once seemed simple now locks businesses into a global game where the rules were set on day one — leading to higher operational costs and prohibitively expensive switching later.
Switching PSPs becomes a months-long project. Want to test a new payment method in a new region? You’ll need engineers. Trying to optimise by geography or cart value? Good luck.
Composable payments unlock speed, scale, and savings
By unbundling the commerce engine from the payments layer, businesses can plug in local PSPs, optimise routes for cost and performance, and adapt quickly to market shifts — all without replatforming. It’s not just about cutting costs. It’s about gaining strategic flexibility, unlocking growth agility, and delivering customer experience on your own terms.
No more arbitrary 0.25% surcharges. No more paying extra just to scale. Just full control — and the freedom to compose a stack that fits the business, not the other way around.
A composable payments architecture also lets brands move at the speed of market change. Need to test Buy Now, Pay Later in a new region? Add PIX or iDEAL support? Launch a local wallet or bank-pay option? A modular setup can deploy these changes in weeks, not quarters.
This agility directly fuels performance: faster time to market, improved conversion, localised trust, reduced fraud, and optimised routing. Most importantly, it keeps pace with how customers want to pay — wherever they are.
Payments aren’t a line item — they’re a competitive advantage
For too long, payments have been buried in backend systems — treated as a cost center rather than a growth driver. But that mindset no longer holds. In today’s commerce landscape, payments aren’t just a line item. They’re a strategic lever.
Leading brands are acting accordingly. They’re unbundling platforms, building modular payment stacks, and turning infrastructure into a competitive advantage.
Because customers today don’t just prefer local payment methods — they expect them. Anything less risks cart abandonment, lost trust, and stalled global expansion.
In a world where buyers demand instant gratification and borderless experiences, payment processing should be an accelerant — not an obstacle.
