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Where is the Universal Payments Module?

There are several terms to characterise payment systems in the way their architecture is structured. I would like to elaborate a bit on the modular payment systems. How does that work?

A modular payment system is based on one central framework that is able to process different types of payments. The opposite of modular payment systems are silo-based payment systems, where every type of payments is processed by its own infrastructure. Depending on the case the silos can be very narrow! In the past most payment infrastructures were silo-based, because it was easy: every new requirement got a new solution, without considering the existing infrastructure. But payments service providers and banks are more and more convinced to move towards a modular based approach. This increases standardisation and decreases costs of course.

In order to get to that modular approach it is very important to see the synergies between several payment products. The last couple of years smart payments people realised there are more synergies in the payments industry than they thought in the past. However, I still miss an important part of payments...

When one talks about modular based systems in the payments industry many people think of creating one module for many types of credit transfers (national - sepa - international) to be processed on one main architecture. My question is: is a system still modular if we only take credit transfers into account? Didn't we just create silos based on payment products in that case? Or is it because the other payment product are so different that there is not a possibility to combine them into 1 silo?

You definately reduce a lot of costs by simply working on payment products to create modules in your payment infrastructure, but we see more examples of cross-product silos as well.

I have seen documents from the States where credit transfers and checks were processed in one transaction module to save costs. That is one way to approach modular based payment systems, and probably an important one for the United States, where cheque still play a considerable role in the payments landscape.

In Europe you see SEPA modules, as well as credit transfer modules. Clear2Pay goes even a bit further by creating one main module on wich you can connect a SEPA solution (for direct debit AND credit transfer), or international payments solution for example and even an imaged check solution. So many payment products are indeed covered already, but....

What I miss in every story are card transactions. Why would one keep card transactions in a seperate silo instead of combining it in the payments modular based infrastructure?

It seems pretty hard to find more info there. However I do see synergies cards and other payment processing as well. If also cards payments could for example be converted to something more general they could also be put in one payment module.


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