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How the US financial sector is embracing digital transformation in payments

How the US financial sector is embracing digital transformation in payments

During the Temenos Community Forum in Vienna in May this year, Finextra spoke to Phil Barnett, president of the Americas at Temenos, and Charles Kim, executive VP and CFO at Commerce Bank to discuss digital transformation in the US payments industry.

Kim started with Commerce Bank’s experience when embarking on their digital transformation journey, which was spurred on by consumer demand and rising competition. He described Commerce Bank as a “super-community bank” which delivers large bank products in a customer-centric format. Through digital transformation, the bank has been able to deliver at a faster pace and better meet their customers’ needs, he summarised.

Barnett commented that clients such as Commerce Bank help Temenos drive its roadmap, developing capabilities to stay ahead of the needs in the market, including up-and-coming industry initiatives such as FedNow’s instant payments.

“There are two very important things for banks to understand when they are contemplating making big strategic decisions – technology and compliance. Temenos is able to offer clients the choice of how they want to adopt cloud; whether they want to take that leap into SaaS, or take a more incremental approach through a hyper-scaler or hybrid cloud,” remarked Barnett.

Kim added that compliance is very important in the US in particular, and that the bank was able to partner with Temenos to develop Temenos’ US model bank that focuses on people, process, and product to build into their offerings.

Describing their current areas of focus, Kim stated: “We are developing a private banking lending system that will allow us to do more complicated loans and disclose on them in a regulatory fashion in a way that our other systems don’t,” adding that they are also looking to integrate real-time payments to be run on the cloud.

Kim highlighted that when it comes to new trends across banking, the openness and flexibility of the cloud will enable speed, commercial and consumer payments is critical, and that data analytics will allow for more fully-loaded transactions that will enhance customer experience.

Barnett agreed, reinforcing that cloud is creating momentum. He concluded by emphasising that cloud has become mainstream, and Software-as-a-Service is becoming more prevalent because of the increase of cloud adoption. 

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