Unlocking finance transformation: payment trends to watch in 2025

Real-time payments will continue to reshape the financial landscape in 2025, as will investment in fraud prevention measures to support the shift to instant settlement.

Real-time payments will continue to reshape the financial landscape in 2025

Behind the scenes, the transition to the financial messaging format ISO 20022 continues, introducing new mandatory data requirements for payment instructions.

ISO 20022 and other technological advances open the door to significant finance and payment transformation, but many corporates lack a vision of what can be achieved.

In this article, I reflect on some of these trends and what we can expect for corporate payments and finance in 2025.

Instant payments and fraud prevention

The shift to real-time payments will continue to dominate the payments agenda in 2025, with new instant payment rails continuing to come online. In the EU, the Instant Payments Regulation (IPR) requires all Account Servicing Payment Service Providers (ASPSPs) offering standard SEPA credit transfers to be capable of receiving SEPA instant credit transfers by January 2025 and sending them by October 2025.

There are myriad benefits of real-time payments, including receiving payments faster (if not quite “real-time”) and improved cash flow for businesses. However, they also carry risks. By their very nature, instant payments are irrevocable, heightening their appeal to fraudsters.

In the rush to move to instant payments, the industry must ensure that it is not introducing new systemic risks. Traditionally, that gap between submitting a payment instruction and settlement has provided a layer of protection to businesses, as there is scope to rectify errors or cancel payments. Without that delay, additional fraud prevention measures and other steps to boost confidence in payment systems are essential.

Growth in account name checking services

While reimbursement is important for boosting confidence in the financial system, it does not prevent fraud nor protect larger businesses. Account name checking services, such as the UK’s Confirmation of Payee (CoP), the EU’s Verification of Payee (VoP), or those being rolled out in Australia and New Zealand, are critical tools to help reduce errors and fraud.

The deployment of VoP checks for SEPA Instant Credit Transfers in the EU, a requirement of the IPR, will be a key focus for many EU ASPSPs over the coming months given the tight deadline of October 2025 for implementation. For comparison, the UK’s CoP service took seven years to roll out, including preparations ahead of its launch in 2020.

One upside of the EU’s VoP is that it looks more scalable, with bulk payments incorporated into the specifications. This is not currently the case for the UK’s CoP scheme, which is a constraint on its effectiveness for businesses. As such, large corporates are looking to implement account name checking services that have this capability in-house.

Technology investment trends

Much continues to be made of the potential role of generative artificial intelligence (AI) in business, including finance. Big technology companies are investing heavily in AI agent technology to enable humans to focus on more value-added work.

Undoubtedly, over time, we will see the emergence of AI agents to support accounts teams and offer pre-packaged solutions for specific tasks, such as accounts payable, or in helping companies determine the most efficient way to make payments. However, generative AI is not an immediate technology priority for most finance teams. Instead, their focus is on payment automation, moving to the cloud and implementing account name checking services.

AI is, however, proving its worth in the fight against fraud, thanks to its ability to spot patterns that are not readily apparent to humans. Yet, it is a double-edged sword, and as research from Deloitte shows, generative AI can be deployed to create sophisticated frauds and scams, such as deepfake videos and audio of trusted individuals making payment requests.

ISO 20022 mandatory data requirements

One trend that should be getting more attention is the introduction of new mandatory data requirements for certain payments following the implementation of the ISO 20022 financial messaging format, which allows much more detailed data to be attached to payment messages.

In the UK, the Bank of England has stipulated that from May 2025, financial institutions must include Purpose of Payment (PoP) codes and Legal Entity Identifiers (LEIs) in all CHAPS transactions, while PoP codes will be required for all property transactions. From November 2025, hybrid addresses with at least the town name and country in structured form should be used; from November 2026, any payments with fully unstructured addresses will be rejected.

The technical nature of ISO 20022 and its protracted rollout means these changes have flown under the radar outside financial services and legal firms, but it will eventually have implications for all corporates. Companies will need to review the payment systems they use, determine how they collect the relevant data and understand how their banks need to receive payment messages in the new format.

Finance transformation opportunities

ISO 20022, together with other technological advances, paves the way for finance and payment transformation. However, few corporates have a vision for finance and payment processes five to ten years from now.

The UK’s National Payments Vision published in November 2024 will help to bring some much-needed clarity in setting out a strategy for UK payment systems. The newly formed Payments Vision Delivery Committee will be overseeing this direction, taking a more practical approach to modernising the payments infrastructure and shifting the focus to where an immediate impact can be made, such as upgrading the existing Faster Payments system and implementing ISO 20022.  This more pragmatic approach should deliver real value to the payment ecosystem, though it must equally maintain the stability that stakeholders depend on.

For businesses, technology developments will lead to faster digitisation of corporate payments, while enriched payment data, thanks to ISO 20022, will transform reconciliation processes, providing better cash visibility and enhancing strategic decision-making.

Preparing for 2025

As we move into 2025, the continued shift to real-time payments will necessitate an increased focus on fraud prevention, with checks such as VoP and CoP proving increasingly critical tools. The practicalities of the ISO 20022 transition will also come to the fore as deadlines for new mandatory data requirements hit. ISO 20022 and other technological advances offer substantial scope for finance transformation. Now is an ideal time for finance leaders to review and rethink longstanding processes and investigate the opportunity for greater payment automation, facilitating better cash visibility and enhanced decision-making.