A guide to A2A payments for merchants: Pros, cons & A2A fraud

The world of payments has transformed dramatically in recent decades with digital wallets, payment apps, and pay-later options. The resulting ecosystem offers plenty of choice for consumers, reduced cart abandonment, and fast payment processing.

Both merchants and PSPs benefit from this revolution – and might have noticed increased coverage of A2A payments in recent months.

In fact, internal Ravelin data we released in the Global Payments Report 2026 saw this type of payment included in the top payment methods of two of the 37 countries examined: A2A payments already are the second most popular payment method in the Netherlands and the third most popular payment method in Germany.

If you’re considering stepping into the vanguard of A2A payments, it’s helpful to know what to expect, how to optimize your payment options, and how to keep fraudsters at bay.

What are A2A payments?

A2A stands for account-to-account payments, a digital payment method in which a buyer pays directly into a merchant’s bank account, bypassing traditional middlemen such as card networks. Using instant or real-time payment rails, the merchant can confirm receipt of funds and complete checkout.

These are also called “pay by bank”, and serve as an alternative to credit cards, debit cards, and other popular payment methods. A2A payments are cross-channel, including mobile payment wallets and apps, Point of Sale (POS), and websites.

They’re also increasing in popularity, with global A2A ecommerce spend projected to hit $936 billion by 2030, according to the WorldPay 2026 Global Payments Report, which also highlights that in 2025, 7% of ecommerce and 4% of POS transactions had a global value attributable to A2A.

A2A-initiated transactions are redirected to a customer's bank account and, once authorized, are routed over real-time payment networks such as Faster Payments. API-initiated A2A payments are handled using Open Banking, which is itself handled by banking rail such as SEPA Instant. After an A2A payment is authorized and cleared, payments are sent directly to a merchant's bank account.

Merchants who use a PSP may also indirectly benefit from A2A payments if the PSP supports account-to-account payments.

Customers can interact with merchants using A2A payments initiated from any device, including mobile apps and QR codes. Standard protocols support customers to switch between an online transaction on a desktop and initiate the payment using a mobile banking app.

What does A2A shopping look like?

A typical user journey for online A2A shopping is:

1. A customer navigates to an online shop and adds a product to their shopping cart.

2. At checkout, the customer is offered the option to pay using an account-to-account method, sometimes called “pay by bank” or similar.

3. The customer selects this option and is presented with a list of banks; they choose their bank.

4. The customer is then redirected to their bank's login page or app.

5. The customer logs in to their bank as usual, using a biometric or other second factor.

6. The payment request is prepopulated. After the customer provides consent, the payment is processed and sent to the merchant.

7. The payment is confirmed, and the merchant dispatches the product or releases the service to the customer.

Why use A2A payments?

A2A payments are performed in real time (or near-real time), can streamline the customer experience, and typically have lower associated costs for merchants.

Financial card transactions are slower because the payment request must be authorized, cleared, and settled via card network intermediaries.

By cutting out the middlemen, merchants can save on network fees if they choose to offer A2A payments.

Tech-savvy consumers, and especially those who buy via their mobile devices, appreciate A2A payments for the smooth buying journey and added convenience. Research from McKinsey, for instance, found that they are increasing in popularity, with digital wallets driving the uptake.

Types of A2A payments

Their speed and reduced friction, along with reduced processing costs, have made A2A payments popular for many types of transactions:

• Business-to-consumer (B2C) A2A payments: A business pays a customer, for example, sending a refund.

• Consumer-to-business (C2B): A consumer buys a product from a business, such as a streaming service subscription or a ticket to a music event.

• Business-to-business (B2B): A business buys a service or product from another business.

• Peer-to-peer (P2P): For casual money exchange between friends and family, for example, when sharing the cost of a restaurant bill.

• Me-to-Me (M2M): An individual or business moves money between their own accounts. For example, from a low-interest to a high-interest account.

• Government-to-person (G2P): Governments are increasingly exploring the use of A2A to handle government payments such as tax refunds and benefits.

How do A2A payments work?

A2A payments are fast because they eliminate the additional steps required to clear a traditional card payment.

The following steps form the basis of a successful A2A payment.

Step 1: Initiation

The process to make or take a payment begins by using a Push or Pull mechanism:

• Push payments: The customer (or business in a B2B transaction) initiates the money transfer by “pushing” the funds directly to the recipient, such as a merchant’s bank account.

• Pull payments: The recipient (for example, a merchant) makes a pull request for funds from the payee's bank account. A recurring payment, such as a subscription, is a pull payment.

Both push and pull A2A payments depend on the use of payment rails. A2A-related payment rails include the faster payment networks, such as SEPA in Europe and the UK’s Faster Payment System, as well as Open Banking.

Currently, payment rails are not standardized worldwide, although initiatives such as the European Payments Initiative (EPI) are working to achieve interoperability.

Step 2: Authentication and authorization

The data security and privacy compliance requirements of the payment's jurisdiction enforce specific authentication and authorization policies.

For example, in Europe, A2A payment initiation will require Secure Customer Authentication (SCA) to comply with PSD2 and PSD3.

Pull payments will require consent at this step.

Step 3: Clearing and settlement

The clearing and settlement of payments depend on the rails used and the requirements of A2A payments.

• Instant payments can be enabled using rails such as the UK’s Faster Payment System or Open Banking.

• Clearing houses such as ACH in the USA or SEPA in Europe can be used for A2A; transactions typically take a few hours to a few days to clear.

• Open Banking enables instantaneous funds transfer and is highly secure when implemented correctly.

The benefits of A2A payments

Any merchant that chooses to offer account-to-account payments to its customers can expect benefits that include lower costs, smoother customer journeys, faster transactions and more.

Let’s look at these in more detail:

1. Lower costs

Lowering transaction costs is essential when margins are tight. The lightweight architecture of A2A payments significantly lowers per-transaction costs – especially so combined to card payments.

A2A fees can be as low as 0.35% per transaction, compared with up to 4% for card-based purchases, according to Juniper Research.

2. Faster transactions

The speed of transaction is one of the main benefits of using A2A payments. Depending on the method and rails used, merchants can enjoy instant payment at the time of purchase.

3. Improved customer experience

Customers who use A2A payments typically experience lower friction. Innovations in Open Banking and mobile banking have helped to make the payment process seamless.

4. Lower cart abandonment

In ecommerce, cart abandonment rates can be as high as 72%. Anything that improves customer experience and the purchase process will improve these numbers.

Further innovation within the system, such as QR code-based purchases, also helps reduce cart abandonment.

5. No chargebacks

A2A payments do not use intermediaries and so, once settled, an A2A payment made cannot be subject to a chargeback. A2A helps reduce first-party fraudulent chargebacks – which are on the rise per Ravelin research – 56% of merchants reported an increase over the past year. Though this is appealing to merchants, there could be potential drawbacks for some consumers, which we’ll cover in the next section.

6. Security and compliance

A2A payments utilize existing banking system security, such as biometric authentication and SCA. Open Banking, for example, is based on a secure implementation of the OpenID Connect standard, FAPI.

However, even with all of this security, it’s important to note that A2A fraud can still occur.

Downsides of A2A payments

Nothing is ever perfect. A2A payments have some downsides, including complex integration, standardization issues and bank dependencies:

1. Integration burden

Integration with an A2A payments system depends on the merchant's size and type. Larger enterprise merchants are likely to have developed proprietary mobile apps, with direct integration with an A2A payments scheme such as Open Banking.

Payment apps such as Venmo and Wero, along with Apple, Google and PayPal wallets, have integrated A2A payments, which provide functionality to handle in-store purchases.

Smaller merchants can offer A2A payments through PSPs that handle Open Banking and A2A payments.

However, one of the biggest hurdles to integration is adding the new option to a website's interface and handling the differentiated user journey that comes with using an A2A payment offering.

2. Reliance on banks

Not all banks support A2A payments – and where they do, support may be limited to certain types of transactions, such as P2P.

However, the A2A payments landscape is rapidly advancing and an increasing number of banks are supporting it.

3. Standardization issues

There is currently no global standard for A2A transactions, including no standards for recurring mandates. This impacts any international cross-border transactions, making them more complicated and slower.

However, standards are coming:

The EU’s Instant Payment Regulation aims to standardize A2A payments, mandating that transfers must be completed in under 10 seconds. Note that the regulation also includes a clause that A2A payments are subject to transaction fees equal to standard interchange rates. It also attempts to handle chargeback and dispute processes.

In the UK, the concept of Variable Recurring Payments (VRP) in Open Banking is being expanded from simple inter-bank money movement to handling subscriptions. VRP accounts for 13% of the total Open Banking transactions in the UK.

Continued increase in VRP uptake is likely to lead to adoption by other jurisdictions.

4. Consumer appeal vs bank cards

As the A2A business model is integrally different from bank cards, this payment option is missing some of the features that make cards appealing to consumers. A big part of this is loyalty rewards, which is a primary driver for some consumers to choose credit cards. Although there are technical reasons for this and merchants could offer similar incentives for A2A, the fact remains that shoppers who appreciate rewards are likely to prefer card payments.

5. User acceptance and trust

A2A payments must have both merchant and consumer confidence to succeed. A2A initiatives are focusing on trust and acceptance of A2A. Although merchants will likely welcome the lack of a formal dispute monitoring system, the certainty this provides could serve as a deterrent for certain shoppers.

Before releasing a product, merchants must trust that funds have been received, while consumers must trust that their funds have been sent to the correct account. One such initiative is known as “Certainty of Fate”. As A2A payments are fast, direct, and lack chargeback standards, it is essential to ensure that trusted, real-time payment experiences are baked into A2A subscription payments. Certainty of Fate is proposed as a standard to help consumers and merchants feel confident in A2A payments.

6. Open to latency issues

Some POS scenarios, such as ticket gates and supermarket checkouts, may experience latency issues when using A2A payments.

NFC-based Open Banking wallets are expected to solve latency issues at POS terminals.

Types of A2A payment fraud

A2A payments utilize intrinsically secure rails. However, fraudsters still find several ways to circumvent security. A2A fraud includes authorized push payment fraud (APP), social engineering, account takeover (ATO), and first-party fraud, among others.

The speed of transactions and the lack of chargeback mechanisms create opportunities for bad actors looking to take advantage of A2A.

AI-assisted attacks are increasingly used to manipulate users through novel tactics and techniques, such as deepfakes, to gain account holders’ trust and perpetrate APP fraud.

Authorized push payment fraud (APP) scams

APP fraud involves an individual being manipulated into sending money to a fraudster rather than having a fraudster break into the victim’s account.

For example, a common APP scam involves tricking the victim into believing they are on a phone call with a bank employee. In fact, the employee is a scammer who uses fear, uncertainty and urgency to manipulate the victim into moving funds to an account that they believe is safe, when in fact it is the fraudster's account.

APP scams are among the best-known types of A2A fraud and are expected to cost the United States $14.9 billion by 2028, according to Deloitte.

Social engineering-based A2A fraud

APP scams use social engineering tricks to manipulate people. Social engineering is a powerful way to exploit human behavior for the benefit of fraudsters. AI-assisted social engineering adds a level of sophistication to the process, making it more believable.

In A2A fraud, social engineering is typically used at the point of transaction initiation to trick individuals into believing they are sending money to a legitimate company. The speed of an A2A transaction works in favor of the fraudster, who manipulates behaviors such as fear of missing out (FOMO) or concern over unexpected payments.

The FBI recorded 5,100 complaints related to cybercriminals impersonating financial institutions within the first ten months of 2025. The affected individuals and businesses lost $262 million in the same period.

First-party fraud – false consumer claims

This category describes a customer claiming to their bank that an A2A payment was made without their authorization or is otherwise fraudulent. They can then request their money back, resulting in the merchant incurring not only the product cost but also additional charges.

As A2A payments do not have a system in place to handle chargebacks, the onus falls on the merchant to resolve similar types of disputes, where a customer claims the A2A payment was fraudulent.

Currently, there's no formal dispute resolution mechanism, unlike the established systems with financial cards. The current status quo is that banks resolve A2A disputes between themselves. Banking regulators will become a de facto player in dispute resolution.

The trouble with that is that at the moment, merchants (and consumers) have little oversight into the decision-making process. There is a concern that banks may be biased toward one or the other – the merchant or the consumer. The system is due to be tightened up, and a transparent dispute mechanism devised that serves all fairly.

ATO of shopper accounts

Account takeover (ATO) is a common form of fraud that uses various tactics, including stolen credentials and SIM swapping.

Shopper accounts: In an ATO attack, a fraudster can take control of a legitimate account, including those on mobile devices. Once a fraudster has control of a retail account, any payment mechanisms configured using the account will be open to exploitation. Mobile-based accounts can be used to circumvent two-factor authentication (2FA) by intercepting codes intended to secure transactions.

Bank accounts: There is, of course, also the risk that a bad actor will take over the bank account of a consumer and get hold of their funds. Once you have control of a victim’s bank account, you could use A2A with impunity.

Supplier accounts: In an online marketplace – for example, food delivery – criminals can take over the accounts of legitimate suppliers in order to defraud the marketplace platform and redirect payouts to their account.

On the positive side, continuous A2A monitoring by banks and merchants could identify unusual or repeated transactions and be used as a signal of potential fraud.

Invoice fraud

Faster payments, such as account-to-account methods, lend themselves well to invoice fraud and other business-to-business fraud.

Invoice fraud involves a scammer intercepting a legitimate invoice and changing the details, or sending a fake one to a merchant for payment by impersonating a supply chain member.

If A2A doesn’t have chargebacks, does this mean there’s no fraud?

Unfortunately not. The lack of a chargeback provision does not protect A2A from fraud.

Fraudsters can exploit the speed and lack of chargeback standards of A2A payments by tricking the victim into sending funds to the fraudster's bank account by impersonating legitimate merchants. Account takeovers also exploit the lack of a chargeback facility in A2A payments. Attackers will hijack legitimate retail accounts and initiate product purchases.

To stop A2A fraud at scale, merchants will need to put their data to work. Rich data sources can be used by a graph database link analysis solution that utilizes machine learning to identify unusual behavioral patterns to flag ATO and other fraud events.

Graph analysis uses email addresses, telephone numbers, payment card IDs, device fingerprinting and more data points to build a profile of potential fraudulent activity. The use of machine learning ensures that fraud is caught even in ultra-fast payments such as A2A.

Do A2A payments cause shopping friction?

In short, not necessarily. When deployed correctly, A2A can even remove some of the friction commonly associated with an online shopping journey.

Merchants may worry that redirection to a mobile bank app for payment will cause friction and could even result in shopping cart abandonment, but, in fact, PSD3 and the Wero/iDEAL transition in the Netherlands have streamlined the user experience.

Many commercial markets are making A2A a "top of wallet" preference. Merchants who fail to offer it risk missing out. A2A payments are designed to work seamlessly, even when moving from a computer to a mobile device to complete a transaction.

How should merchants deal with high-risk A2A transactions?

A2A prides itself on low friction. However, some transactions or customers may be high risk.

A2A transaction fees are significantly lower than card network fees. If a customer is high risk, then it is a good idea to introduce friction to verify they are legitimate.

Robust, AI-native fraud detection estimates the level of risk a customer poses and returns a recommendation along with a calculation of how likely they are to be a fraudster (which is usually a score out of 100).

Depending on the merchant’s risk appetite and overall strategy, a recommendation may be labeled as “review” – in which case, additional checks can be introduced to ensure the customer is who they say they are. This can be, for instance, extended identity verification.

Conversely, if a customer or transaction is identified as low- or no-risk, you can save 1–3% on card scheme fees by routing through A2A, provided the customer wishes to use this option.

Summing up

A2A payments offer merchants the opportunity to reduce transaction costs while receiving funds instantly or at speed. However, the customer experience must be seamless, while the trust factor in connecting to a bank during the payment process may be offputting to some.

Internal Ravelin data and recent reports indicate increasing customer acceptance – and, as with any payment method, A2A will attract fraudsters who exploit its features. In A2A's case, the speed of transactions creates opportunities for bad actors.

Scams that involve social engineering can circumvent most attempts to mitigate fraud. Instead, a more proactive defense must be chosen. Fast transactions require fast and intelligent responsiveness. Sophisticated, scalable and real-time fraud detection is key.

A2A payments have too many benefits not to become a de facto payment method. Merchants can take full advantage of this paradigm in payment technology by being proactive about their defenses.