Strategic Payments: Why Smart CFOs Are Rethinking Their Approach in 2025
Payments are no longer a back-office function. In 2025, they are a strategic lever, one that quietly impacts your margins, risk profile, customer experience, and regulatory exposure. For founders and finance leaders, the decision to ‘just use Stripe or Square’ might feel simple but it can come with significant trade-offs.
This article explores the current state of the Australian payments landscape, why the Reserve Bank of Australia (RBA) is watching closely, and the key considerations every CFO should assess when choosing between local and global payment providers.
The RBA and the Real Cost of Payments
Australia’s Reserve Bank is actively reforming the payments system — and for good reason. While consumer payment experience has improved, business costs haven’t followed. Many merchants are still absorbing high processing fees, with limited ability to steer customers to cheaper methods.
Key developments:
Surcharge transparency and reform: The RBA has expressed concern that platforms like Apple Pay, Stripe, and Square bundle fees in ways that obscure true cost. In particular, surcharges on mobile wallets and buy now pay later (BNPL) products are often hidden or non-existent — despite these being higher-cost rails.
Push toward “least-cost routing”: The RBA is pressuring banks and platforms to enable automatic selection of the cheapest transaction pathway — particularly important for debit cards, which often default to Visa/Mastercard rails.
Review of cross-border fees: With more businesses taking international payments, the RBA is increasing scrutiny on FX margins and merchant service fees from global processors.
What this means for business: Many founders unknowingly allow margin leakage to go unchecked — simply because payments were “set and forget.” But with tightening operating margins and a higher cost of capital, these quiet 1–2% hits can compound quickly.
The Illusion of Simplicity: Global Platforms and the Hidden Trade-offs
Solutions like Stripe, Square, Shopify Payments, and PayPal offer speed and convenience — but increasingly lock businesses into high-margin ecosystems. Common traps include:
Bundled rates with little transparency — hiding acquirer vs. scheme vs. platform fees.
Cross-border FX markups — especially for AUD > USD conversions.
No access to least-cost routing — particularly on mobile and card-present transactions.
Slow access to settlements or batch payouts — impacting cash flow.
Platform dependency — making it difficult to switch without breaking checkout or customer experience.
Strategic takeaway: In early-stage or MVP mode, global platforms make sense. But past $1m–$2m in annual revenue, smart CFOs shift from convenience to control — assessing domestic options, standalone acquirers, and payment orchestration layers that decouple UX from fees.
Embedded Finance: Innovation with a Side of Risk
2025 has seen a major uptick in embedded finance — where non-financial businesses integrate payments, lending, or wallet functionality directly into their apps. Examples include:
BNPL integration at checkout (e.g. Zip, Afterpay)
Vertical SaaS platforms bundling payments into software (e.g. practice management tools)
Platforms offering working capital advances via revenue-based lending
These integrations drive revenue and stickiness, but also bring risk:
Regulatory obligations: Offering financial services — even indirectly — may trigger credit licensing or disclosure rules.
Data and privacy: Holding payment credentials, even if tokenized, can trigger PCI DSS and data obligations.
Fee sharing arrangements: Often opaque, they can become difficult to unwind or renegotiate.
What CFOs must ask:
Who owns the merchant record? Us or the software provider?
Do we retain flexibility to replatform?
Are we absorbing any credit or fraud risk?
What’s the true margin net of fees, disputes, and chargebacks?
Domestic vs. International: The 2025 Shift Back to Local
While global platforms still dominate top-of-funnel payments (especially for ecommerce), many Australian businesses are rethinking their provider mix.
Why CFOs are shifting back to domestic providers:
Faster settlements via local banking rails
Support for PayTo and NPP (New Payments Platform)
Lower scheme fees via direct acquirer relationships
Better support for RBA compliance, surcharging, and reporting
Local customer support and dispute handling
Examples of domestic providers gaining ground include:
Fat Zebra: Supporting embedded payments and PayTo
Zai: Offering API-first payments and FX
Tyro: Dominant in POS for health and hospitality
Strategic takeaway: Most businesses will use a hybrid stack. The strategic CFO designs a payment architecture that can evolve — local acquirer + global gateway + custom orchestration, rather than a single “one-size-fits-all” lock-in.
What You Should Be Doing Now
CFOPartners recommends a five-step approach:
Audit your payment costs: Break down your true merchant service fees, by scheme, card type, and provider.
Map your revenue mix: Understand what % of your transactions are domestic vs. international, online vs. POS, mobile vs. desktop.
Quantify margin leakage: Model the cost of convenience (e.g. Square at 1.9% +) vs. custom routing through a local acquirer (<1.2%).
Assess embedded finance exposure: Review where your software platforms or marketplaces are bundling payments — and what risks you’re absorbing.
Design for flexibility: Build a payments stack that supports growth, works across channels, and doesn’t leave you hostage to one provider.
Final Word
Payments are no longer just infrastructure, they’re strategy. From surcharges to scheme fees, from PayTo to platform lock-in, what seems minor in the early days becomes material as you grow.
Smart founders treat payments like any other controllable cost. Strategic CFOs go one step further — using it as a lever to improve margin, speed up cash flow, and reduce risk.
