March 2026 Payments Round-Up

March saw continued momentum across the UK payments landscape, with Open Banking growth, renewed focus on service resilience, increased cost scrutiny and early signs of further sector consolidation. Across all of this, one theme remained consistent: payment performance is becoming a commercial priority, not a back-office function.

Below is Payment Lynk's March summary of the developments shaping the payments landscape.

Open Banking Continues to Gain Traction

Account-to-account payment volumes continued to grow in March, particularly in eCommerce and invoice-led sectors where transaction values make the cost differential more commercially significant. For eligible transactions, Open Banking offers lower processing costs, faster settlement and reduced chargeback exposure.

It is worth noting that Open Banking works best as a complement to cards rather than a replacement. Cards remain dominant in retail and hospitality, where customer familiarity and speed of checkout are critical. The commercial case for Open Banking grows when applied selectively, aligned to transaction type and customer behaviour.

Uptime and Resilience Back in Focus

Disruptions to payment services in March reinforced a message that many businesses have not yet fully acted on: downtime costs revenue. A payment system that is unavailable — even briefly — loses transactions that are rarely recovered.

More businesses are now exploring multi-provider strategies and failover configurations. True resilience is not simply having a backup contract. It requires tested technical integration, commercially viable secondary routing and regular review of failover processes. The shift towards resilience as a strategic priority is clear, and businesses with single-provider dependency face the most exposure.

Cost Pressures Driving Payment Reviews

Global economic pressures, including ongoing instability linked to the Ukraine conflict and the Middle East, are tightening margins across UK sectors. In this environment, businesses are reviewing all costs, including payment processing, to identify opportunities to reduce unnecessary spend and protect profitability.

Payment costs are rarely static. Scheme fees, acquirer margins and FX charges can all increase gradually without triggering a formal review. For businesses that have not reviewed payment pricing in the past twelve months, now is a practical moment to assess whether current arrangements remain competitive.

Consolidation Across the Payments Sector

Larger payment providers continued to expand through acquisition and broader product portfolios in March. Consolidation of this kind can drive innovation and create more integrated commercial offerings, but it also increases complexity.

For businesses, the practical challenge is choosing solutions based on commercial fit rather than brand scale. A larger provider is not automatically the right provider. Sector expertise, pricing structure and service quality remain the more relevant criteria when reviewing payment arrangements.

AI and Payments

AI continues to attract significant attention in the payments sector, particularly in fraud detection, payment routing and optimisation. Where AI is applied well, it can improve accuracy, reduce false declines and help businesses make faster, more informed decisions.

That said, outcomes vary. Businesses should focus on measurable value rather than trend-led adoption. The right question is not whether a provider uses AI, but what difference it makes to acceptance rates, fraud performance and cost.

Fraud and Security Remain Key Concerns

Fraud prevention remains a priority, but the challenge is finding the right balance. Overly strict fraud controls reduce acceptance rates, reject genuine customers at checkout and can quietly erode revenue. A declined legitimate transaction is a lost sale.

Modern fraud tools, including risk-based authentication and dynamic 3D Secure, allow businesses to apply additional checks where they are genuinely needed without creating unnecessary friction for lower-risk transactions. Getting this balance right has a direct impact on conversion and customer experience.

Terminals and Infrastructure Modernisation

Legacy payment terminals continue to present commercial and operational risk. Older hardware often lacks support for modern payment methods, updates more slowly and can create friction at the point of sale.

The shift towards faster, more reliable and integrated terminal solutions is accelerating. Modern hardware supports contactless, mobile wallets and app-based payment flows, and integrates more cleanly with business management and reporting systems. For businesses still running legacy infrastructure, the case for modernisation is increasingly practical rather than optional.

Final Thoughts

Payment performance directly affects revenue, cost, cashflow and resilience. March reinforced that these are not technical concerns to be left to providers — they are commercial considerations that warrant regular review.

Businesses that actively assess their payment infrastructure, aligned to commercial objectives, are better positioned to protect margin, reduce risk and support growth.

Payment Lynk offers independent, no obligation payment reviews. Visit paymentlynk.co.uk to learn more.