Summary

The payments industry is in the midst of a revolution, with new companies, technologies and business models popping up at a steady rate.

The sector is broad, encompassing the entire point-of-sale ecosystem for electronic payments, "consumer-not-present" transactions and cash payments, and the boundaries between different types of provider are blurring.

With such a high risk and complex environment, it’s no surprise that PE investors are inclined to avoid the sector altogether. However, to do so would be a big mistake. In this Executive Insights, L.E.K.'s Diogo Silva and Dominic Miles explain the five key trends driving opportunities – and complexity – for investors, and identify the payment business models that they believe offer the most attractive opportunities:

  1. Payment Solutions Providers
  2. Business Service Providers for Small Merchants
  3. Specialist Value-Added Service Providers

With deep experience and competitive advantage over strategic players, PE investors are positioned to do deals in the payments space that others simply cannot do. Now is the time to use their competitive advantage to embrace the opportunities available in this fast-moving industry.

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