How Merchants Are Turning Payments Into Strategy

At the 2025 edition of MPE in Berlin, our team at PaymentGenes had the privilege of leading a workshop that sparked one of the most engaged conversations of the event. Together with Okke Mönking, VP of Business Development at Silverflow, our consultancy co-heads Ward Hagenaar and Bas van Donselaar explored how merchants are turning payments into a core strategic capability.

The article below—originally published in MPE Magazine Issue 110—summarises our views, real-life case studies, and practical guidance for merchants navigating this transformation. If you're a merchant, PSP, or fintech leader looking to unlock business value from your payments stack, this is for you.

Payments as a Strategic Capability

By Ward Hagenaar & Bas van Donselaar, PaymentGenes | With Okke Mönking, Silverflow

Over the past decade, we’ve seen payments evolve from a “black box” cost center into a strategic capability. At the same time, we’ve seen a wave of merchants launching payment entities and orchestrating their own PSP infrastructure.

While this transformation may still be in its early stages for many, we believe that more merchants will follow—and that it will impact the roles of PSPs, schemes, acquirers, and processors alike.

So why is this shift happening now?

From outsourcing to ownership

Merchants like Mercedes pay, Spotify, and Transport for London are no longer simply buying payment services off the shelf. Instead, they are:

• Creating their payment entities
  
• Building orchestration layers
  
• Taking direct scheme access (e.g. Visa, Mastercard)
  
• Establishing BIN sponsorship relationships
  
• Owning their merchant/PSP infrastructure

This results in more control, better flexibility, and—crucially—improved margins.

What drives this move?

Several factors are converging:

• Commercial pressure: High transaction volumes mean small percentage gains (e.g. in approval rates or fee optimisation) lead to significant economic value.
  
• Data strategy: By owning more of the stack, merchants can access and activate payment data to improve conversion, reduce fraud, and personalize the experience.
  
• Vendor fatigue: Many large merchants are dependent on PSPs who can’t offer the modularity or responsiveness they need at scale.
  

Merchants now see value in running payments as a product—one that requires tech, analytics, compliance, and operations—because the ROI justifies it.

What does this look like in practice?

Here are three real-world examples:

1. Mercedes pay

Mercedes builds its own connections and payment infrastructure to support multiple business lines and geographies. This provides consistency and a single point of control, critical when running complex, global businesses.

2. Spotify

Spotify uses orchestration to route transactions intelligently, reduce friction, and balance cost vs. conversion across markets. Their internal payments team operates like a product squad—testing, iterating, and optimising every day.

3. Transport for London (TfL)

TfL manages direct relationships with schemes and acquirers, owning the end-to-end payments value chain to reduce third-party dependency and increase cost efficiency. With millions of transactions per day, the business case was clear.

The implications for PSPs & acquirers

PSPs and acquirers must rethink their positioning.

• “One size fits all” is out.
  Large merchants want modularity and flexibility, not bundled solutions.
  
• Co-creation is in.
  Payment providers must be willing to collaborate, provide APIs, and support hybrid models where merchants own part of the stack.
  
• Specialisation creates value.
  Providers that focus on specific parts of the chain (e.g. fraud, routing, data enrichment) will remain relevant as the ecosystem unbundles.

What’s next?

We believe the future of payments is merchant-driven, modular, and intelligence-led.

Merchants will increasingly treat payments as a capability—not just a cost—investing in tech and talent to extract more business value.

This will unlock higher approval rates, lower fees, and faster expansion into new markets and channels.

But it also requires PSPs and partners to evolve. Those that embrace this shift and co-create with their merchant clients will remain indispensable.

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This article was originally published in the MPE Magazine – Issue 110, pages 41–42.