The new report shows that businesses worldwide are planning to cut their supplier list, with using fewer payment service providers (PSPs) considered to be the main way to reduce operational costs.

According to a recent report “Embedding a Competitive Edge” published by a payment company GoCardless, 66% of businesses in five markets across the UK, US, and Eurozone are looking to consolidate the number of PSPs they use. Another third (34%) of respondents plan to end their relationships with PSPs within the next 12 months.

The top motivaton for cutting the number of payment partners, quoted by 31% of merchants, is to reduce operational costs in a challenging macroeconomic environment.

At the same time, the surveyed businesses are still willing to enter a paid partnership if they see value in PSP offer. One-third of businesses surveyed (34%) say they would be willing to pay more for fraud prevention solutions, while a quarter (25%) would do the same for tools that increase their payment success rates.

Further 31% say they would be willing to pay more for a greater variety of payment methods. This number is rising to 38% in the US, which still lags behind in adopting instant payments.

Among the most valued payment options are account-to-account (A2A) payment methods. Over a third (35%) of merchants want their PSP to offer bank debit, while 27% look for open banking or other bank payment options.

As for the insights from a survey of more than 200 PSPs in the same five markets, 58% of respondents prioritize increasing customer satisfaction and retention over the next 12 months. A large proportion of PSPs (44%) also say they aim to become more competitive.

The vast majority (86%) PSPs are looking to add one or more payment methods within the next 12 months. The most popular method to add is digital wallet (58%), followed by credit or debit card (48%) and bank debit (47%).

The proportion of PSPs that plan to add real-time bank payments, including open banking payments, is 35%. However, in the UK the percentage is much higher – 53% – reflecting the continued growth and regulatory support of open banking in the market.

Among the challenges in adding new payment methods, PSPs typically quote “taking a long time to deliver” (45%), complications faced when integrating or building a new solution (40%), and complexity of managing the new payment method on an ongoing basis (37%).