When payments stop being a cost center

How do you measure the return on investment of a new payment method? This question weighs on the minds of many treasury managers, whose historic role at the centre of all of a company’s payment-related activities has been diluted in recent years. This shift stems partly from pressure by sales and marketing departments, which are often more receptive, if not to innovation itself, then at least to the polished pitches of the payment service providers who target them. On the other hand, the growing technical complexity of payment solutions increasingly requires skills in digital acquisition and customer-journey optimization – areas that are far removed from the traditional remit of the treasurer. 

This intersection of commercial promises, technical complexity and the need for a profitable payment strategy was the focus of presentations by three senior treasury leaders from major brands at the recent AFTE Conference. By comparing their experiences with, and insights, on Buy Now Pay Later (BNPL), the panelists aimed to showcase the value of having a results-oriented expert, treasurer or otherwise, dedicated to turning payments into a lever for sales growth and profitability. 

On stage were three prominent names in French retail: Christian Louboutin, represented by Chloée Daullé, Group Treasurer of this luxury brand that operates in more than 30 countries, with 160 boutiques and a highly active e-commerce business. Thom Group, represented by Jérémy Hugues, Group Treasury Director of this European leader in accessible jewelry, which generates more than €1 billion in revenue per year and is home to brands including Histoire d’Or, Marc Orian, Trésor, Agatha, Stroili in Italy and OroVivo in Germany. Back Market, represented by Laurène Lecomte, Director of Payments and Fraud Prevention at this French refurbished-tech unicorn operating in 17 countries across Europe, the US, Australia and Japan, generating around €3 billion in annual sales. 

Three models, three levels of digital maturity, one shared conviction: that payments are no longer just the inevitable final step in the customer journey, to be controlled for cost. Rather, they are a critical tool to achieve conversion, higher average order value and customer loyalty. 

BNPL: The Three Experts’ Views

At Christian Louboutin, BNPL was initially evaluated through a strict profitability lens. The company’s rule is simple: no new payment method or tool will be deployed without a documented upfront expectation that it will result in a positive ROI. “Providers often promise higher average order value and improved conversion, but we found that BNPL baskets are actually smaller on average than our standard baskets,” noted Chloée Daullé. 

The company’s teams therefore built a framework to systematically assess the reality: before and after comparisons of conversion rates, average order values, total cost (including fees, commissions, etc.), any impacts on fraud, and operational workload. 

“We compare that data to benchmark scenarios to see if the promised gains are actually realized. If the ROI isn’t demonstrated, we either don’t activate the payment method or we restrict it to certain markets,” she continued. 

In a world in which brand image, high order values and risk management are hugely important, BNPL stands out as a textbook case: a potentially interesting payment option, but one that should only be adopted if it proves its worth in reality – not just in sales presentations. 

At Thom Group, BNPL is seen as a trusted partner that has been widely tested in its stores. Customers perceive instalment payments as an option that enables them to buy an expensive piece of jewelry without an immediate major impact on their finances. But from the retailer’s viewpoint, the financial equation must be carefully scrutinized. 

For example, the risk of BNPL cannibalizing a cheaper payment method, rising costs due to poor management of settlement timelines or high default rates could quickly flip the value proposition. Jérémy Hugues highlighted the cost difference between three instalments and four instalments. 

“The financing cost of four instalments is much higher than for three,” he explained. “If customers have the choice, they’ll naturally opt for four. Offering three instalments by default and then presenting four instalments as an option if the basket size increases above a certain threshold makes sense and improves customer satisfaction.” 

This logic illustrates a key belief: “The act of payment is an integral part of the act of sale”. Allowing a customer to buy a slightly more expensive item through financing at no extra cost becomes a way to boost both average order size and customer loyalty. For Thom Group, BNPL is a commercial accelerator, albeit one that is closely monitored by treasury in tight coordination with its commercial teams. 

As an exclusively digital company, Back Market provides another perspective based on data and test-and-learn. For instance, the company has developed a dedicated metric to measure payment-page performance: Successful Checkout Rate (SCR). 

“SCR is the number of people who successfully paid divided by the number who reached the payment page,” explained Laurène Lecomte. “Even someone who closes the tab without trying to pay has a negative impact on the SCR.” 

A/B Testing

To provide more granular analysis, the company breaks down the SCR into two further metrics. The “Click-to-Pay Rate” measures the proportion of customers who click “Pay” once they reach the page, while the “Transformation Rate” is the ratio of successful payments to the total number of customers who clicked “Pay.” 

“When you add BNPL, the Transformation Rate tends to drop because some customers are rejected for credit reasons. But what matters is whether we generated more payment attempts and ultimately more sales, leading to a higher SCR,” she said. 

Back Market’s A/B tests produced a striking result: removing a BNPL option reduces overall conversion. Different customer segments prefer different BNPL providers, so getting rid of one closes the door on a proportion of potential buyers, even if the overall offer looks similar on paper. In a highly competitive marketplace, the variety and quality of BNPL options becomes an important differentiating factor. 

Organizing Payments Internally

Beyond BNPL, a broader question is: who within a company determines its payment strategy? Who is best placed to find the right mix between commercial promises, brand implications, fraud risks, operational impacts and ROI? 

Back Market adopted a strong stance early on by creating a Payments & Fraud department even before it structured its Finance organization. This team, which reports to Finance, acts as a true “business owner” in relation to product and technology. 

“Payments and fraud are so strategic that we put in place a team dedicated to these areas very early on,” explained Laurène Lecomte. This team works with “dedicated Product counterparts and dedicated Tech teams – about 30 people”, while “the accounting team is always involved and makes an essential contribution.” 

Thom Group’s set-up is more traditional, with treasury playing a central coordinating role. “Treasury acts as the safeguard and coordinator to ensure an overall, balanced view,” said Jérémy Hugues. He noted that in many organizations, operational leadership of payments is shifting toward digital departments or the Chief Digital Officer. But there are still some non-negotiable principles: “Treasury must be involved – or involve and assert itself – in all discussions about payment methods, and it must lead any RFP or decision to activate a new payment method.” 

At Christian Louboutin, treasury acts as a pivot between commerce, IT and finance. It coordinates the firm’s e-commerce and retail teams, manages the selection and relationships with payment service providers and banks, and directly oversees fraud-risk management and related tools. 

hree Examples of Winning Strategies

BNPL is just one illustration of how payments can act as a driver of commercial success. With this in mind, each speaker highlighted a recent payments success for their company beyond instalments. 

Back Market showcased its project to orchestrate payments. By putting multiple acquirers in competition with each other, fine-tuning transaction-routing rules and making the most of local specificities, the platform has significantly increased acceptance rates. By directing certain cards to domestic acquirers belonging to the same group as the issuing bank, Back Market gained “nearly ten percentage points of conversion in some segments”, generating “several million euros in additional revenue”. For Back Market, payments are clearly a growth engine in their own right. 

Thom Group’s SoftPOS project demonstrated a direct link between payments and revenue. In a jewelry network that comes under considerable pressure during peak periods, processing transactions quickly is critical. Turning smartphones and mobile devices into full checkout points has helped reduce queues and cut down on lost sales. 

“The project enabled an average of 20% of sales to be processed via this channel during peak periods, with peaks above 50% in some stores,” explained Jérémy Hugues. It “prevented lost sales and justified the cost of deploying the technology through direct increases in revenue.” 

At Christian Louboutin, preventing fraud has become a real driver of performance. Previously it relied on a standard scoring tool and was faced with a high volume of manual reviews – around 15–20% of transactions – and an excessive rejection rate. This compelled the company to transform its approach, implementing a machine-learning-based system using an enriched dataset. 

“The percentage of transactions we had to review manually was cut in half, rejections dropped sharply and tools to support decision-making considerably streamlined our processes,” explained Chloée Daullé. The result was a marked increase in the acceptance rate, reduced processing time and an increased focus on high-value customers, “all while maintaining stable fraud levels.” 

With this, the discussion turned to the topic of fraud. For Jérémy Hugues, the goal is not “zero fraud”, which is unrealistic, but finding the right balance. 

“Zero fraud is not necessarily optimal fraud management,” he said. A zero chargeback rate may reflect excessive blocking of legitimate transactions, silently destroying revenue in the process. Analysis must drill down into the reasons a payment is rejected (payment service provider, issuer, internal rules) and the authentication journey, particularly 3D Secure. 

“Too much 3DS means less frictionless flow, and therefore lower acceptance,” he added. Fraud management becomes “a balancing act between the level of fraud and the acceptance rate”, which must be jointly managed by treasury and business teams including commerce, digital and customer service. 

At Back Market, Laurène Lecomte has observed the rise of what she calls “commercial fraud”: abuse of return policies, refund fraud and “commercial chargebacks.” “Customers exploit what is an inherent uncertainty in marketplaces: who’s right – the seller or the buyer?” she noted. “Fraudsters adapt, and commercial chargebacks have moved to the front line.” The company’s response has involved strengthening its refund processes and using AI to detect recurring patterns and abnormal behavior. 

Throughout the discussions, one point stood out clearly: payments are no longer merely a cost center. From BNPL to payment orchestration, SoftPOS, conversion KPIs and nuanced fraud management, payments have become a strategic field in their own right. The one condition is that an expert – a treasurer, payments director or a hybrid of the two – must take clear ownership of the topic in question and have an unerring focus on turning each benefit promised by a payment method into measurable value for the company.