Payments Infrastructure & Innovation: Are regulations helping or hurting the industry?

Posted by Modo on Dec 12, 2019 4:14:17 PM


Modo CEO, Bruce Parker, joined payments experts from RPGC Group, GoCardless, and Raypd at Money20/20 Vegas to discuss payments infrastructure and innovation for ecommerce merchants. One of the hot topics was the impact of regulation on the industry. Watch the video above to catch Bruce’s view on the subject, or read the write up below. 

In the Forrester State of Retail Payments Report, 78% of merchants said regulatory & policy changes will impact their payment processes over the next 18-24 months. So we know you’re thinking about regulations, how should you frame your thoughts? You love to hate them. But are they really hurting the industry? Are regulators overstepping their bounds by creating these rules, or is the industry benefiting from the requirements?

Let’s look to Europe where many regulations are being imposed on financial institutions and enterprises like PSD2. They have been inundated with regulations, but it could be argued that the European financial institutions are much more innovative because of the required changes. Rene Pelegero threw the payments industry in the United States under the bus when he stated “I personally believe that European banks are probably more competitive and more innovative than American banks. On the other hand, here in the US, an environment where we’ve had very little regulation, we still have banks and card processors running systems from the 1980s and they are loath to change any of it. And so they are certainly the ones that are dragging their feet towards innovation.” 

Bruce Parker jumped into say “Yeah, I think the regulations are absolutely perfect. Because, you can’t run a 40 year old tandem system after you try and make it GDPR compliant, you try and make it PCI compliant, you try and figure out how to do 3DS2.” Companies running on mainframes, tandems, etc are putting a lot of faith in old systems and a shrinking workforce of people able to maintain those systems.  “[Regulations] are coming in and are causing us to have to relook at things we haven’t changed for a very very long time (for good reason) and now it’s time to change. And it’s time to change in part because regulators make it impossible to keep what you have.” adds Bruce. 

How do you think about regulations? Do you see it as a burden, or as an opportunity to innovate? 

If you need help managing and maintaining your payment operations, reach out to the #paymentsgeeks at Modo at

Topics: bruce parker, money2020, payments infrastructure, regulations, payments innovation