Partnering for payment modernisation

Building new partnerships

The payments ecosystem is undergoing a fundamental shift, driven by rapid digital change, evolving customer expectations, and the emergence of AI‑enabled and embedded commerce models. For banks and retailers, payment modernisation is no longer a back‑office exercise, but a strategic priority tied directly to relevance, trust, and growth. Organisations that fail to adapt, risk falling behind as legacy infrastructure struggles to keep pace with new rails, methods, and experiences.

Partnering for payment modernisation explores how leading banks and retailers are responding to this disruption. Based on insights from 1,000 banking and retail executives globally, the report highlights three priorities shaping progress: building strong partner ecosystems, innovating around customer needs, and embedding agility into payment strategies, infrastructure, and operations. Leaders are no longer modernising in isolation — they are collaborating across ecosystems to accelerate innovation, reduce complexity, and unlock new sources of value.

The report serves as a call to action for organisations seeking to unlock the future of payments. By focusing on partnership‑driven modernisation, customer‑led design, and flexible, future‑ready platforms, banks and retailers can move beyond incremental change toward lasting competitive advantage in an increasingly dynamic payments landscape.

Partnering for payment modernisation

How leading banks and retailers are unlocking the future of payments

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Key findings and insights

Executive summary

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What our people have to say

In Singapore, much of the early AI experimentation in payments has focused on agentic wallets and transaction flows. That has been useful learning, but real scalability lies deeper - in core processing and operating models. Today, the tangible impact of AI is being seen in the middle and back office, where reconciliation, processing and clearing are delivering measurable results.

Stablecoins and tokenisation are moving beyond tactical use cases and into infrastructure, forming new payment rails that materially improve settlement, efficiency and programmability. Loyalty programmes, meanwhile, are evolving beyond simple rewards into integrated consumer–merchant ecosystems, reshaping how banks and retailers compete for customers drawing on token technologies.

Anton Ruddenklau

Partner, Head of Financial Services, Global Head of Fintech and Innovation, Financial Services, KPMG International and Head of Payments, Asia Pacific

KPMG in Singapore

Payments have become a front of house growth lever for retailers. Those pulling ahead are partnering across the ecosystem to simplify checkout, enable tokenised and wallet based journeys, and turn richer data into personalisation their customers can feel. Modernisation isn’t about more methods, it’s about orchestrating trusted, low friction experiences that cut abandonment, build loyalty, and create measurable value.

James Wilson

Partner, Technology Consulting, Advisory and Head of Consumer & Retail

KPMG in Singapore

Three key actions for banks and retailers based on the survey

Prioritise partnerships

To keep pace with rapid technological change and shifting customer expectations, banks and retailers must build dynamic ecosystems that bring together partners to accelerate modernisation and create competitive advantage.
Focus on the customer

Leading organisations start by deeply understanding customer needs and expectations, using those insights to rapidly shape and deliver payment options that are simple, relevant, and trusted.
Create agility

As the payment ecosystem continues to evolve, embedding agility into payment strategies, infrastructure, and operations is essential to enable future flexibility, scalability, and ongoing evolution.

Methodology

KPMG International surveyed 500 banks and 500 retailers between the 8 September and 30 October 2025, to assess their progress on payment modernisation, as well as their motivations, objectives, investment expectations and challenges.

Our survey asked respondents to rate their levels of progress against a range of modernisation pillars, and we used their responses to calculate their overall maturity with respondents in the top 20th percentile ranked as ‘leaders’ and those in the bottom 20th percentile ranked as ‘beginners’. In both the banking and retail sectors, the leaders tended to be those with revenues greater than US$10 billion. In the banking sector, neobanks reported the highest proportion of leaders and in the retail sector, it was e-commerce platforms that were most likely to rank as leaders.

Forty percent of retail respondents were based in Asia Pacific, 35 percent in the EMEA region and 25 percent in the Americas. The banking sample represented 36 percent of respondents from the Americas, 34 percent from the EMEA region and 31 percent from Asia Pacific.