![]() Push payments are indeed an interesting innovation, which complements the digital wallet strategy in Visa and Mastercard. Note that the push payments work for cross-border transactions. The money is deposited into a Visa account that can be accessed at an ATM or PoS terminal or a digital wallet. Step 4: The issuing bank credits the cardholder’s account and notifies the cardholder. Step 3: The transaction is routed to the receiving institution. Step 2: The acquiring bank creates and submits an OCT (Original Credit Transaction) to the card scheme. It can be a mobile phone or a bank branch etc. Step 1: The merchant initiates the push payment through a digital channel. □ With Visa Direct or Mastercard Send, the push payments enable merchant, corporate, and government disbursements. The merchant pulls money from the cardholder’s account, and the cardholder approves the transaction. □ When we swipe a credit/debit card at a merchant, it is a pull payment, where the money is sent from the cardholder to the merchant. The diagram below shows how the pull and push payments work. ![]() What is the difference between “pull” and “push” payments? #systemdesign #payments #fintech #paymentorchestration □ If you like my FinTech posts, please follow Hua Li and click the □ on my profile to receive updates. □ Over to you: Have you used services from a payment orchestrator? Typical payment orchestrator firms include Spreedly, Payoneer, Ingenico Ppaas and NMI. It also helps with optimizing transaction fee structure as it is acquirer-agnostic. In particular, the payment orchestrator enables smart routing to improve transaction success and sales conversion. Instead of talking to multiple APIs provided by different PSPs (Payment Service Providers), the payment orchestrator provides one API for the merchants to interact with the payments ecosystem. The SaaS products are more specialized in verticals and form an API ecosystem. Payments tech moves towards embedded finance. Efficiency is crucial to their user experience. Merchants deal with payments across geographies and use cases. The diagram below shows a comparison between linear payment and payment orchestration.
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