Paycon Payments & Banking Advisory

POS installment feasibility and design for an international card acquirer

Sector: card acquiring · Engagement: feasibility & design + implementation advisory · Status: delivered, client proceeded to implementation.

The brief

An international card acquirer — with its own POS device estate and a proprietary merchant-facing application — was evaluating whether to offer point-of-sale instalment payments (a BNPL-style proposition) to consumers through its existing merchant base. The board wanted a clear go/no-go basis: was the opportunity real, what would it cost, what would it take to deliver, and what did the regulatory landscape look like under the incoming Consumer Credit Directive 2 (CCD2) and adjacent regimes?

What we did

Paycon delivered a written feasibility and design document, scoped as a fixed-fee engagement, covering five interlocking areas.

First, the regulatory landscape: CCD2 and the operational shifts it imposes on consumer-credit-style instalment products at the point of sale, alongside the parallel obligations under existing national consumer credit law and the scheme rules for instalment-marked transactions.

Second, the full ecosystem map: every party that would need to sit at the table to make the proposition work — the acquirer (the client), the issuer side, the card schemes, a banking or lending partner for the credit risk, technology providers for the instalment orchestration and underwriting, and the merchant itself. Each role was mapped to economic flows, regulatory ownership, and dependencies.

Third, the functional and technical outline: end-to-end flow at the terminal, the merchant app, the consumer authentication path, the credit decision touchpoint, the settlement and reconciliation legs, and the dispute handling. Anchored to the acquirer's existing terminal estate and the merchant app already in production, so the design was operationally realistic, not a clean-sheet exercise.

Fourth, three distinct product scenarios, compared head-to-head on business impact (revenue potential, brand control, regulatory burden), cost (build and operating), timeline (time-to-market), and resources (internal capability required):

• Re-sell an existing BNPL provider. A white-label or referral arrangement with an established BNPL operator that holds the credit relationship. Lowest regulatory burden (provider carries the CCD2 obligations), fastest to launch, lowest build cost, lowest internal-resource requirement. Constrained by the partner’s product roadmap, economics, and brand.
• Hybrid build with a banking partner. Co-build with a banking partner taking the regulated credit role; the acquirer owns the merchant-side experience, terminal flow, settlement, and brand. Medium regulatory burden (CCD2 obligations sit with the banking partner), medium time-to-market, higher integration cost, more product control than the re-sell route.
• Full CCD2-compliant build from scratch. The acquirer (with a captive or new lending arm) takes on the regulated credit product itself. Highest regulatory burden under CCD2, longest time-to-market, highest build and operating cost, largest internal-team requirement. Strongest unit economics and product flexibility if executed at scale.

Fifth, a phased implementation plan — what to ship, in what order, on what timeline, with which dependencies — and an annotated partner shortlist for each of the three scenarios, with the trade-offs of each candidate laid out in plain text rather than a marketing matrix.

The outcome

The client selected the BNPL re-sell route — the lowest-risk, fastest path, well matched to the client’s existing merchant base and operating tempo. Paycon then advised through implementation: BNPL-provider discovery and longlist work, the structured selection process, and the commercial negotiation with the chosen partner. The proposition is now operational in the client’s merchant base.

Why this engagement is representative

It is the shape of work Paycon does most often. A serious commercial question that touches regulation, technology, partners, and product simultaneously; a deliverable that is a written document the client can hand to the board, the legal team, and the next vendor without further explanation; a phased plan that the client can act on without the consultant in the room; and a continuation, when the client wants one, into the partner-selection and negotiation phase where most of the actual money gets spent or saved.

If you have a problem in this shape — payments or banking, real and not abstract, where a clear written answer is more useful than a workshop — get in touch. See also our services and how engagements run.