By 2025 every electronic payment made may be more complicated than it is today. The rules that banks and other payment companies must follow to stop crime will make it more difficult for legitimate transactions to be made. The potential losses to consumers and businesses if the rules are not obeyed could be high. The potential losses to the businesses if the rules are not followed could be high. Consumers may lose money because they will not be able to complete transactions quickly enough. They will have to fill in too much information and they will have to wait too long for it to be processed. The companies that handle payments may lose money because they will have to reject too many transactions to comply with the rules. They will have to reject transactions that consumers and businesses want to make because the information and time required by regulators have not been provided.
How integrated workflows reduce friction
Platforms operating in regulated environments offer useful insight into how this balance is achieved in practice. For example, systems discussed in resources such as secure payment and withdrawal processes at Lottoland demonstrate how transaction handling, identity verification, and compliance checks can be integrated into a single workflow. By embedding KYC requirements, fraud monitoring, and payment processing into the same infrastructure, these platforms are able to maintain both efficiency and oversight without introducing unnecessary friction for users. The model that may be used in an increasing number of consumers fintech applications is shown to the right. Instead of treating compliance checkpoints as “gates”, more modern platforms have moved the controls to be inline with the payment process. This provides a far better user experience while still ensuring that compliance requirements related to identity verification and fraud protection are met.
Regulation is shaping design, not just policy
A significant change introduced by the new PSD2 (revised payment services directive) regulation on Strong Customer Authentication (SCA) has had a massive impact on the way businesses conduct their checkout flow. Adding a two-factor payment authentication to the checkout process introduces an extra stage, but a badly implemented SCA can lead to a drop-off at checkout. The EBA (European Banking Authority) recently released a set of payment guidelines that aim to reduce friction and complexity while still ensuring that sufficient safeguards are in place. In a welcome move, the Payment Systems Regulator is also pushing for compliance to deliver customer benefits, as opposed to just following a checklist. Companies want to build secure systems but aren’t always sure what security means in practice for each feature. Guidances from NIST are some of the standards that can serve as a checklist of technical requirements that teams can apply as they design and build features. Following the standards from NIST for identity and access management ensures that the authentication mechanisms they implement are strong enough to block attackers yet not over-engineered to the point of being impractical for users.
UX as a compliance signal in 2025
From a fintech vantage point, in 2025, the way that payments user experience (UX) is talked about has changed. Security and simplicity are no longer mutually exclusive, and GDPR payment data protection obligations enforce the principle that less is more, which also happens to be better for UX. The adoption of UK Open Banking Implementation Entity standards for consent flows and data has set a new bar here too. Poor UX may increasingly be viewed by regulators as an indicator of potential risk and a badly designed payments process can raise concerns over consent and fairness particularly in the context of ICO regulations concerning online services.
A converging standard
The most clear takeaway from today’s payment systems is that compliance and user experience are not design trade-offs that need to be managed, but rather challenges that need to be solved. Designing systems where these challenges are treated as orthogonal design problems, rather than as conflicting forces, results in designs that are more sustainable and user-friendly
