After a number of years of steady activity, we are now seeing increasing numbers of financial institutions starting to migrate their legacy payment systems.

It seems to be a number of factors have come together, which means that organizations around the world who have perhaps been delaying the inevitable, are starting to move forward. One key driver is, of course, banks’ long budget cycles, what have delayed many IT teams from upgrading out-of-date technology before now. The other pressure that I hear all the time is the desperate need to consolidate systems – banks, especially some of the bigger ones, are sometimes carrying dozens of different payment systems, and they simply can’t carry on like that.

Once they have made the decision to move, the choice of which direction isn’t easy for any bank. Ultimately, the individual/s making the choice of new system will be the ones accountable if they make the wrong decision, and it won’t be a cheap mistake! So the process is inevitably long and complex.

One of the factors throughout all the project that we see is the need for proven, on-the-ground experience. Banks prefer to work with organizations who know their specific market needs, and so, from a vendor perspective, it is always easier to get new customers in a market in which we have existing customers – the more banks in one market using a solution, the more likely it is that another bank will also select it.

It also comes down to the people – all payment systems, no matter how established, will require a degree of customization to meet a bank’s individual requirements, and the success of that part of the project comes down to the people who are doing the work.

 As we move into 2012 I expect that this trend of more and more banks upgrading their payment systems will continue. I wonder who will end up being left behind.