12 December 2017
Silvia Mensdorff

Silvia Mensdorff

Silvia Mensdorff - ACI Worldwide

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Disruption in Retail Banking

Growth in internet and mobile technologies has transformed many industries and economies. The market forces and competitive landscape has completely changed in many sectors. iTunes has fundamentally changed music industry, Amazon has driven most big brick and mortar book sellers out of business, Expedia is one of the worlds' biggest travel company….. the list goes on. Internet and mobile technologies are big disrupters for most industries. What started (and tapered a bit!) with the dot com boom of 2000 has become a lethal threat to most business models today. Powered by mass adoption in mobiles phones, proliferation of smart phones and cheaper band-width, internet and mobile technology have changed many industries. The banking industry in has been dominated by a handful of big global or regional banks for 100s of years. While the credit crisis has shaken this industry, the core market forces for the industry have not changed. Will Innovation in Internet and Mobile technologies disrupt retail banking? Will there be 5 new names in global top 10 retail banks in 2020?

Don’t Break the Bank: Building for the New Payments Ecosystem

19 September 2017  |  6020 views  |  1

A question we find ourselves asking is how can we deliver on customer experience in a digital payments era? This blog looks to discover that answer!

Scalability, availability, and reliability - these are the crucial foundations of payments systems. Without these, we cannot layer additional functionality onto the core services. This is crucial in the New Payments Ecosystem, where the customer expects seamless, fast, and effective payments integrated into the buying experience, not to mention the ability to make a payment anytime, anywhere—that it “just happens”, securely. The customer sees the value in the overall experience; how quick and easy is it to buy those sunglasses, pay that bill, or tap into the train? And in a rapidly diversifying payments ecosystem, the latest question is; how easy is it for me to manage all my payments?  

The Internet of Paying Things 

Developments such as the Internet of Things (IoT) and PSD2’s request to pay mean that managing ongoing authorisations for Payment Service Providers or ‘things’ to action payments on your behalf is fast becoming  reality for the consumer. This expansion of the initiation of a payment is now a significant driver for payments players to deliver an enhanced end-user payment experience. 87% of global retail banks cite reducing payment friction as “the most important product-level priority,” with an even higher percentage of banks in Asia (90%) focusing in on this strategy. 

It’s not just about enabling those new payment or messaging types; it’s about preparing for the inevitable digital payments explosion. In an IoT era, there will be more payment-enabled devices, and more of those devices will be making micro payments. These two factors combined will serve to boost non-cash payment volumes even further. Payments providers need to be able to scale to the Internet of Paying Things. 

Customer Experience Without Compromise 

But how can we achieve an end-user payment experience worthy of the New Payments Ecosystem without breaking the proverbial bank at its foundations? A large part of the answer lies in augmenting existing infrastructure; investing and preparing your business for the new fast, open ecosystem without compromising on those foundations, or security. Banks say improving infrastructures (93%), and security (88%) are key drivers behind their additional payments investment. It’s critical to understand that scalability, availability and reliability, and security underpin every new payments experience. As the industry looks to develop new services to delight customers, it cannot disappoint on the basics.  

Don’t break the Bank, Don’t Break the Payments Chain!  

 

TagsPaymentsInnovation

Comments: (1)

Susan Hall
Susan Hall - ING NV - amsterdam | 03 October, 2017, 22:08

The question is whether people really appreciate the availability, reliability & security of the current payments industry – there is a disconnect between expectations (well of course the payment will get there) and the implications of getting it there. Will banks have the time & space to grow into this new payments experience or will they be pushed aside by new entrants, leaving “old” banks providing the rails & the “new” players making the revenue? Interesting times.

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Latest posts from Silvia

Don’t Break the Bank: Building for the New Payments Ecosystem

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job title Director Transaction Banking Solutions
location Gouda
member since 2014
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