Last month, Flagship published an article describing the surge of interest in B2B mobility & fuel payments, specifically within the fleet management and related card-issuing domains.
While innovation permeates payment issuance and related value-added services, payment acceptance innovation adoption is still relatively nascent in mobility and fuel despite new entrants and emerging technologies.

This lack of innovation is not due to a lack of demand, but rather the fact that mobility and fuel merchants are still encumbered by legacy technology and infrastructure that is difficult (and expensive) to simply replace.

Flagship has observed an uptick in demand for innovation across mobility & fuel payments acceptance that major brands, OEMs, payment service providers (PSPs), and merchant acquirers must be prepared to address, or else risk being left behind in a large payments/fintech revenue pool.

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General Commentary & Highlights

Mobility & Fuel Payment Acceptance Use Cases & Payment Methods

• Mobility & fuel payment acceptance spans a variety of use cases for both residential (consumer) and commercial (business) customers
• Merchants are challenged by the multiplication of use cases and payment methods, driven by customer demands and internal business needs (e.g., fraud mitigation and geo expansion)
  Today, merchants commonly deploy point solutions to enable multiple use cases and payment methods, primarily to avoid disrupting current state processes

U.S. Mobility & Fuel Payment Acceptance Volume1 & Growth Tailwinds 

• More than $600 billion in payment acceptance volume in the U.S. comes from mobility & fuel payment acceptance use cases
• Fuel & convenience retail represents more than 80% of mobility & fuel payment acceptance volume
• Several tailwinds (examples listed to the left) are increasing digital payments penetration and, therefore, the payments/fintech revenue pool across use cases
• Similar growth tailwinds persist in other regions including the UK, EU, LATAM, and APAC
  Fintech M&A in APAC Accelerating  Through Q2 2024

Mobility & Fuel Payment Acceptance Complexities

• Mobility & fuel merchants are trying to enable seamless, omnichannel experiences across multiple use cases and payment methods
• It is common for current-state payments infrastructure to inhibit merchants from enabling such experiences organically (i.e., designing the experience with existing capabilities and vendors is challenging)
• Factor in the data demands of B2B mobility and fuel payments (as described in our previous article HERE) and merchants are actively looking for solutions to solve these various challenges/complexities

Mobility & Fuel Payment Acceptance Landscape

• Mobility & fuel payment acceptance technology is a crowded and competitive market that continues to innovate
• Industry participants are evolving to solve merchant pain points, with many converging across domains (e.g., fuel brands and OEMs becoming more like payment service providers)
• Regardless of use case, all industry participants should have a forward-looking payments strategy