Adyen – processed volume, wallet share and unified commerce growth outlook

Adyen to double down on US payment platform market

In the Interview, the specialist said that North America processed volume growth will likely be driven by European and international merchants allocating regional volumes to Adyen. We were told that Adyen’s platform appeal is lower in the US given the lack of fragmentation in the US market. 

However, the specialist said Adyen is “doubling down” on the US market. We heard that Adyen’s COO lives in the US and that the specialist believes Adyen could be more competitive and have more flexibility now it has a US banking licence. However, they also added that the US market is a “very credit-card-heavy society” compared to Europe – making the adoption of different payment systems in the US more challenging. 

We heard that scale domestic merchants in the US receive low rates from incumbent processors. Merchants’ corporate banks usually offer low rates through captive merchant services businesses such as Chase Paymentech, and Adyen is currently up to 3-4 times more expensive than such businesses.  

Meanwhile, the specialist said processing fees are likely to remain under pressure. The specialist said if Adyen wants to remain competitive in the US then it needs to be more astute in payment processing. The company also faces increased competition from smaller, well-funded companies, the specialist said. 

They told us Adyen’s processing fees have reduced by 20 basis points over the past 2-3 years, and the specialist thinks they will continue to fall. They said there is unlikely to be a pricing uplift for unified commerce volumes and that point of sale and e-commerce volumes are typically priced at the same level. 

The specialist concluded by discussing the impact of a recession on Adyen. They said Adyen could be vulnerable if a major merchant responsible for a high amount of process volumes left Adyen. However, they also said this is unlikely. In terms of Adyen’s future business growth, the specialists expects North America to have “double” the growth of Europe for the foreseeable future. 

Click here to access all the human insights in Third Bridge Forum’s “Adyen – Processed volume, wallet share and unified commerce growth outlook” Interview.