In this interview, Alvaro Arias, CEO of Tidypay, shares his insights on how the industry is evolving, why traditional bank dominance is changing, and why he believes “the card payment industry is having a smartphone moment.” Read on to discover how innovation is reshaping payments and what’s next for merchants, PSPs (Payment Service Provider), and acquirers.
Q: How do you view the evolution of the payment industry from traditional bank dominance to a market now shaped by PSPs and POS (Point of Sale) providers?
Alvaro Arias: Traditionally, large established players have placed card payment terminals
on merchants’ premises, usually alongside the POS vendor’s solution. These terminals can be expensive, bulky taking counter space and often offer little value beyond card payment acceptance. The merchant has multiple service providers and incurs additional costs,
making it both expensive and a hassle to manage.
However, advancements in technology—particularly the growing availability of Android-based devices as card payment terminals—have enabled POS vendors to develop solutions that address all of the merchant’s needs, including hardware, POS software, and payments. As a result, the POS provider becomes the merchant’s trusted partner.
“The close relationship between merchants and POS vendors has fundamentally changed how payment solutions are distributed.”
Today, it is the POS vendor who plays a critical role in selecting the Payment Service Provider (PSP) they want to partner with, bundling payments into an all-in-one solution for the merchant.
This is where our business model is highly relevant. We assist the POS vendor in packaging a great offer for the merchant while generating a new revenue stream for the POS vendor. By bundling our solution into an all-in-one device, we help create a more seamless experience for merchants.
At the same time, this disruption also presents great opportunities for traditional acquirers and banks to collaborate with PSPs like Tidypay. By partnering with PSPs and POS vendors, banks can reach merchants in volume with stronger, more differentiated offers, ultimately leading to stickier relationships with merchants.
Q: What are some of the most significant changes you’ve observed in merchant expectations regarding payment solutions over the past few years?
Alvaro Arias: With advancements in technology in our personal lives, we have all grown accustomed to seamless user experiences at work as well. It is no different for merchants.
“The card payment industry is having a smartphone moment.”
Simplicity, great UX, modern devices, price transparency, flexibility, and great service are some of the things merchants now expect—and can get today.
The rise of Android-based payment terminals is key to this shift. These devices offer a single-provider solution for all POS services, giving merchants access to the best POS software for their business, a great user interface, seamless payment integration, and additional services like loyalty programs.
“Today, a merchant can have a single provider for all of their POS services, creating convenience through smoother invoicing, better bundling, and more competitive pricing.”
Q: With so many devices now available, from traditional payment terminals to Android-based phones with payment capabilities, what do you see as the biggest drivers behind this technological shift?
Alvaro Arias: The POS vendors and PSPs have developed a new business model that has created opportunities in the industry for new players to come in—particularly hardware providers.
We are witnessing numerous new players in the industry entering Europe with highly
innovative Android-based card payment devices that address various merchant needs. As a result, we are seeing more competition in the market, leading to a wider range of price points and greater diversity in device quality and functionality.
“This is a win for everyone involved, especially the merchants.”
Q: How has the role of PSPs evolved in recent years?
Alvaro Arias: PSPs have played a pivotal role in driving innovation by developing a seamless plug-and-play (or ”bolt-on” as my CPO says) approach to payments, which allows other stakeholders, such as POS vendors, to easily package and offer payment solutions to merchants. This enables POS vendors to concentrate on software development, hardware distribution, and maintaining strong relationships with the merchants.
“The POS vendor does not have to deal with the complexity of payment processing while being able to tap into this revenue stream.”
PSPs have also played a critical role in leveraging and packaging the offer from large and traditional acquirers to the needs of the merchant, particularly in the SMB segment. Banks and traditional acquirers are burdened with corporate processes and legacy systems, making development slow and rigid. PSPs can take their offer and make it more relevant to the SMB segment with more advanced technology, modern API interfaces, faster processes, and more modern solutions such as SoftPOS.
Q: What trends do you anticipate in the next 5 years for the development of POS and payment technology?
Alvaro Arias: With the continued growth of card payment adoption in Europe, technology is evolving rapidly. One of the most significant trends is the shift from ‘chip-and-pin’ to ‘tap-to-glass’. In fact, I believe that by the end of this decade, inserting cards into terminals will no longer be necessary. SoftPOS will be the biggest driver we will see in the card-present environment, enabling mobile devices to serve as convenient and efficient payment terminals.
I am most excited about the all-in-one SoftPOS tablet devices. They will give the merchant everything they need in one device, reducing hardware costs.
“The biggest opportunity lies in POS vendors taking over the entire merchant’s
counter by providing everything the merchant needs in a single device.”
This will also create stronger loyalty, as merchants will have everything they need in a single device, including a large screen, printer, scanner, POS software and payment solutions.
