Latest Payments reports and research: Finextra Research

Report

Paving the path from Open Banking to Open Finance in Benelux

Open banking has set the pace for differentiation of the financial services ecosystem, invited new players into the mix, challenged traditional meanings of data, value, personal information and the dynamics of ownership, and blurred the hitherto service sectors of society. This has resulted in greater competition and a proliferation of new services and offerings in payment and aggregation, blending activities across verticals and industries, and creating new ways of interacting. The end user is undoubtedly the winner here but there are nuances still to be played out in terms of the perception of value attributed to personal data, ownership of the customer relationship, and the way in which services will shape the way people live their lives and vice versa. Open banking is en route to open finance and beyond to open data, and in this burgeoning economy where new players, partnerships, aggregated services, platforms, apps and ecosystems are sprouting up, merging and shape-shifting at breakneck speed, it could not be more important to ensure at every turn the resilience, safety and security of each system. The Benelux region, at the heart of Europe and straddling the very seat of European financial regulation, is well positioned as a microcosm of how the new economy is unfolding. This research paper from Finextra, in association with Equinix, is based on several interviews with experts in the open banking space and in Benelux who shared their views and insights on the current response to open banking and the future of open finance and open data. Download your copy of this Finextra white paper, produced in association with Equinix, to learn more.

27 November 2020 466 downloads

Report

The Future of Payments 2020

The Race Against Time for Payments Transformation. In the age of instant payments and with the first Request to Pay services to go live in 2020, the financial services industry needs to prepare for the impact on the European payments landscape and understand how the growth of digital payments technologies will affect the sector. This report looks at how real-time fraud can be addressed - when KYC remains a challenge – and whether initiatives such as TIBER-EU has the potential to strengthen the resilience of the financial system against cybercrime. The requirements for corporate liquidity management are shifting in the age of instant payments, making way for a more collaborative model to dominate. However, with the availability of mobile devices, payments service providers must prioritise providing their customers a slick customer experience. In parallel to this, financial players must understand the challenges of managing risk in an instant world, which is a paradox that correspondent banking faces. This is where adaptable payments architecture and a smooth standards migration can help banks focus on strategy, rather than the day-to-day processes. Problems with operational efficiency can be overcome with leveraging APIs, but a question is posed when considering whether banks are ready for this technology to be customer-facing and if they would allow account access to third parties. Finextra’s The Future of Payments report will explore how new business models, new operating models and new forms of collaboration are the catalyst for the 2020 payments ecosystem, which in turn, will help banks and payments providers to establish a clear strategy for the future. Organisations interviewed in this report: Bank of England, BNP Paribas, Deloitte, Deutsche Bank, Erste Group Bank AG, EY, ING, JPMorgan, Santander, SEB, Standard Chartered, SWIFT. Download your copy of the report below now to find out more.

24 November 2020 570 downloads

Report

The Future of Identity 2020

Technology, Security and Regulation Driving Trends of Tomorrow. Financial institutions must balance speed with security at all points of connection and communication with the customer, but while the incumbent player is known for laboured onboarding, fintech challengers are coming to the fore with slicker processes, more so now than ever before as a result of Covid-19. Identity is integral to mature digital transformation and fulfilling customer needs, especially when mandates such as the General Data Protection Regulation (GDPR) and the Second Payment Services Directive (PSD2) are too limited in their coverage and arguably introduce friction, as evidenced by Strong Customer Authentication (SCA) and Two-Factor-Authentication (2FA). Increased information exchange has also posed the pertinent question: who owns this data, when banks continue to be the trusted providers of identity and history dictates that ID solutions need a commercial edge? In addition to this, do we need to create a truly digital borderless economy? However, we are not at that stage and with verification being the first point of contact for the customer, abandonment rates are up by a staggering 40%. Banks are further along in the digitisation of infrastructure but are slow in ensuring that the same experience is provided across mobile, tablets and desktop computers. Some financial institutions are tackling this with the use of point solutions such as biometrics and analytics to maintain behavioural records, examining how customers hold their mouse, keystrokes and conducting liveness checks. In order to combat sophisticated ID scams, banks must learn how to recognise behaviour. Account takeover fraud and synthetic fraud are both growing abuses of identity and social media connectivity is increasing the number of access points for bad actors. However, banks believe that this problem can be resolved by educating customers about the risks involved with data breaches. What is the right formula? A ‘KYD’ – Know Your Device – approach. Infrastructure must be sophisticated, leveraging artificial intelligence and machine learning; the days of false positives are over. Download your copy of the report below now to find out more.

17 November 2020 262 downloads

Report

Digital Transformation Accelerated

A Sibos 2020 Report produced by Finextra in association with Intel. As the global coronavirus pandemic pushed the annual Sibos event into virtual mode for the first time in 2020, it’s not surprising that everyone was keen to talk about how this has changed things in the key areas that the industry gathers to review at this time of year- technology, digitisation, innovation and the future of finance. There was broad consensus that COVID-19 has led to two years’ worth of digital transformation in just two months, as the lockdowns kicked in at the end of March. Financial institutions were affected internally, with a major emptying-out of financial centres and distribution of their IT estates amid rigorous oversight of new workflows, security practices and productivity. But they also had to react to the new expectations and behaviours of retail customers in lockdown and corporates who have themselves had to embrace remote and hybrid working for their financial and supply chain management. As the situation demanded- and continues to demand- flexibility, and economic fears push cost and efficiency to the fore, change resistors within financial services organisations, corporate customers and regulators alike have been forced to become change adopters. 2020 has been far from a positive year for many. But if financial industry and technology people are looking for a silver lining, it could be found in the results of this forced digital transformation. It will be interesting to see how much can be achieved through this accelerated change by this time next year. Download the full report below to find out more.

06 November 2020 710 downloads

Report

Payments Transformation: Immediate, Intelligent and Inclusive

The Finextra Annual Payments Survey Report 2020 in association with Fiserv. The pandemic has changed how we think about payments and the way people move and manage money. Not surprisingly, you see its influence in our payment trends this year. This year's Payments Industry Survey shows a change in focus, from the implementation of large infrastructure changes, such as instant payment systems, ISO 20022 adoption and open banking, to an emphasis on how those changes can drive value for payment users. The payment experience has become the focal point. Understanding how financial institutions can improve the services they deliver is central to the current direction of the payment industry. While COVID-19 has added impetus, the customer-centric, payment-user-first trend has been gaining prominence. Financial institutions are moving the discussion on from the provision of instant payments to focus on how they can bring value to the payment users as they interact. While the move to instant (real time) payments was a key trend identified in previous Fiserv payments surveys, as they become a reality, the attention is moving towards how they can be utilised to address the evolving needs of payment users and support payment users who traditionally use nonelectronic forms of payment. This year, the survey focused on two areas: The role that overlay services have in addressing the needs of payment users. Inclusion of all payment users in electronic payments. Download the report of the results from the recent Finextra Annual Payments Survey 2020, by Finextra & Fiserv, below to learn more.

04 November 2020 1139 downloads

Report

Personalisation-as-a-Service: Harnessing Data in the Banking and Payments Industry

A Finextra Research Impact Study in Association with FICO and Amazon Web Services (AWS). As customers increasingly experience more consistent, personalised treatment from companies across a wide variety of industries, it is natural for them to expect—and require—the same of financial services providers. Consumers do not want disjointed experiences across auto loans, credit cards, and HELOCs any more than they want them when shopping for different categories within the same online retailer. Aside from consistency, 84% of customers revealed that being treated like a person, not a number, is important when winning and retaining business. That’s according to Accenture Global Consumer Pulse Research, which also found that 73% of consumers expect specialised treatment for loyalty and anticipate rewards for past interactions, as well as for sharing their preferences or personal information. However, only 22% believe that customer experiences are tailored effectively by organisations, and 50% fewer consumers perceive their bank as a trusted partner today than in 2018. Thus, there is a significant opportunity for savvy financial services companies who can meet consumer expectations. At the same time, financial institutions that fail to satisfy those standards are in jeopardy, as customers are re-evaluating their choice of financial providers given an increasingly diverse and non-traditional range of alternatives. Ultimately, consumers want financial providers to offer personalised services and integrated offers that address their most relevant needs at the right time, such as when they are buying a car, getting married, purchasing a home, continuing their education, etc. The financial institutions that can anticipate customer needs and deliver service that is personalised and consistent across channels will be well positioned to thrive in the digital age. Download your copy of the Impact Study below to learn more.

30 October 2020 526 downloads

Report

How to Prevent Payments Fraud amid Global Disruption

Economists predict the disruption caused by the coronavirus pandemic will be felt well into 2021. Banks have been left vulnerable and have to contend with fraudsters who are using Covid-19 as an opportunity to commit financial crime, exploiting consumer fear and the increase in digital payments. Fraud losses need to be anticipated and prevented as banks move from the lockdown to the recovery phase. What must be done to ensure the secure use of alternative payment options? In the age of open banking and real-time payments, funds can be transferred to fraudsters’ accounts immediately and the victim does not notice suspicious movements until it is too late. It is evident that with faster payments methods, the benefits for consumers far outweigh the disadvantages, but hackers will continue to exploit this area. Fraud analysts within a bank must pivot and adapt to working in a new environment to ensure that teams integrate efficiently and decrease human error through a lack of physical communication. Data is a vital tool in a bank’s armoury and must be considered an asset. AI and machine learning can also play a part in fraud and financial crime prevention, consuming disparate unstructured data and creating structured insight and conclusions. Coupled with traditional fraud techniques, banks need to pivot their payments fraud strategy to a tech-driven approach. This research paper by Finextra, in partnership with Feedzai, gathers the views of several experts from Bank of the West, Barclaycard Payments, HSBC, ING, Nationwide and Nordea on how to prevent payments fraud during a pandemic. Download the full report below to find out more.

16 July 2020 635 downloads

Report

Is Request to Pay the System for a World of New Norms?

With faster payments going live in the UK in 2008, one could regard the decade-long recovery from the financial crisis as being a journey towards realtime payments. The last few years has also seen the advent of Open Banking, firstly in the UK and subsequently across Europe and elsewhere. Request-to-pay (RtP) is an example of harnessing Open Banking to serve financial institutions, SMEs and consumers in removing some of the frictions relating to sending and receiving payments for lenders, businesses and individuals. Ahead of its introduction later in 2020, RtP was billed as an integral tool to the transformation of the payments landscape across the world. RtP is being widely promoted in the UK, Europe, the Nordics and the USA, all of which have active industry programmes. This paper will explore the opportunities for lenders, businesses and consumers provided by RtP as well as the hindrances and challenges that would need to be addressed to move to widespread adoption. Download the full report below to find out more.

13 July 2020 973 downloads

Report

Shifting to the New Normal in Card and Digital Payments

It is an interesting time for the cards industry and for issuers there is a similar narrative to that of legacy banks and digital transformation. There have been several drivers of innovation in recent years, very much accelerated by the current pandemic and the various demands and transitions that have been wrought on the entire industry in different ways, as well as on the consumer and client base. What are the key factors for survival as competition increases and regulatory compliance bears down on security measures around customer data and fraud as well as on a looser and more empowered user experience? Utilising new data that can be more easily captured and carried with transactions can inform and shape new services, and better overall understanding of customer behaviour, leading to increased personalisation and an array of added features. As integration into retail commerce platforms and an increased demand for frictionless and invisible payments takes hold, is the physical card becoming obsolete or can issuers create new propositions to retain their position? Competition in the cards industry has evolved from terms such as interest rates and fees, to balance transfer products, to loyalty and rewards and more recently has been diversified by new fintech providers. This research paper by Finextra, produced in association with FIS, is based on several interviews with cards industry experts, to formulate a view on how issuers can compete in the digital world as payments continue to proliferate and fintechs disrupt the status quo. Download the full report below to find out more.

07 July 2020 891 downloads

Report

Instant Payments: Why Covid-19 is Bringing the Roadmap Forward

Business continuity has never been a more valuable asset for financial institutions. Fundamental changes to 'business as usual' as a result of Covid-19 have exposed the need for resilient, reliable, and efficient systems to maintain essential payment services and protect the interests of all ecosystem participants, from consumers to the largest corporations. At the same time, in the lead up to the European Single Market Infrastructure Gateway's (ESMIG) 'big bang' migration at the end of 2021, EU financial institutions are understandably consumed with ensuring that they are appropriately equipped to manage the systemic changes the migration will demand. While ESMIG provides a hard deadline to work towards, every institution bears unique targets and objectives, making the structure and execution of these plans more challenging than ever. In this context, it might seem that the adoption of real-time or instant payments—immediate settlement of account-to-account payments on a 24x7 basis, domestically and cross-border—should reasonably take a back seat to more pressing existential concerns. After all, while the ESMIG migration is mandatory, instant payments are not, and financial institutions could be forgiven for focusing solely on compliance-driven projects at the expense of optional ones. This impact study will outline why the reverse is true: that in fact, the move to instant payments takes on an increased urgency in the coronavirus age. It explores the benefits of instant payments for banks' internal operations as well as their customer value propositions. It also examines shifting approaches to business case development, and the increasing relevance of cloud and as-a-service models for instant payment processing. Find out more by downloading your copy below.

11 June 2020 639 downloads

Report

The Future of Blockchain 2020

Where DLT is taking effect in financial services and what the future holds. Recent years have seen explosions in interest around blockchain technology, from Bitcoin’s price peaking at nearly $20,000 in December 2017, to the proliferation of initial coin offerings (ICOs) in 2018. In general, interest has been propelled more through hype than expectation. Distributed ledger technology (DLT) has presented many compelling use cases that would make financial services processes easier, quicker, cheaper and more transparent. This has been demonstrated already by numerous major banks who have launched projects in areas such as identity, settlement and foreign exchange. In this report, Finextra Research explores this and other use cases for DLT in conjunction with experts from the financial services industry, and examines what needs to happen for the technology’s potentials to be fulfilled. Download your copy of the report now.

11 May 2020 995 downloads

Report

How to Adopt SWIFT gpi by the 2020 Deadline - Build, Buy, Outsource or Collaborate?

The need for speed, certainty, and seamless integration in cross-border payments is becoming increasingly apparent. SWIFT’s Global Payment Initiative, more commonly known as gpi, is fast becoming the standard for global funds transfers. The need for speed, certainty, and seamless integration in cross-border payments is driven by user expectations of instant services, the digitalisation of traditional payment services, and the streamlining of financial supply chains by banks and corporates. For SWIFT’s community, payment confirmations represent the next piece in the puzzle in the path towards creating a seamless, cross-border payments experience for every financial institution and corporate member, and each of their customers. Financial institutions must position and prepare themselves to adopt the requirement on schedule or run the risk of sending non-compliant cross-border payments - if such transactions can be sent at all. For firms seeking to keep pace with the cross-border payments evolution, banks and corporates alike are faced with the challenge of identifying and adopting an effective strategy to adopt SWIFT gpi. The question firms must answer, as they juggle the real-world pressures of cost, competition and cumbersome legacy systems, is whether it is best to build, buy, outsource or collaborate. Find out more by downloading your copy below.

08 April 2020 693 downloads

Report

Underpinning Innovation with Real-Time Payments

Real-Time Payments growth is just the beginning. Real-time payments systems are proliferating around the world, with higher values and volumes together with greater cross-border connectivity. The industry is tasked with designing and creating the market infrastructure that supports this growth, and is increasingly turning to hybrid multicloud deployments to deliver a new wave of innovation that can take place within all manner of systems, from fraud detection through to liquidity management and accounting software. Increased collaboration and global standards underpin the upward trajectory of digital transformation in a rapidly changing financial ecosystem. Download the full white paper below to find out more.

31 March 2020 903 downloads

Report

The Irish Banking Ecosystem, Interconnection and the Speed of Change

Irish banks are operating in a rapidly changing market and must embrace new technologies and business models to keep pace and to stay ahead of energetic new entrants. But the same banks should accept that they cannot make this transformation alone and have to seek out new partners if they are to succeed or even survive in a new marketplace. The current trends towards open banking services, increasingly digitised products, and the appetite for real-time payments is playing out globally. In Ireland, where fintechs and big tech both reside in increasing numbers,the trend is especially acute. Many banks are adopting a cloud-based strategy to cope with new processing demands and to extract value from the increasing amounts of data, constantly generated from a myriad of remote devices. ‘Fast, agile and secure’ is the order of the day in order to join up the dots in the emerging ecosystem and be a frontrunner in the development of dynamic new products and services. The question is, can banks do it alone and what are the key ingredients for a successful partnership? Download the full white paper to find out more.

16 March 2020 413 downloads

Report

The Information Advantage: Driving Opportunities and Mitigating Risk in a Hyper-Connected World

What's next for business in this world of digital services and data? Collaboration, interoperability and a trusted network in which to operate came to the fore as the key factors to support business growth and financial services transformation during a recent roundtable, held under Chatham House Rule. The roundtable was hosted by Finextra, in association with OpenText, and brought together payments and industry stakeholders to discuss the pertinent issues and drivers around digital and operational transformation. The themes have percolated and resonated in follow-up discussions since. Delegates discussed the pressing challenges as well as opportunities, and how to solve them in order to improve the landscape for commerce. Download the full report to find out more.

09 March 2020 417 downloads