Home>Specials>Business>5 Compelling Reasons to Start Modernizing Your Bank’s Payments Platform

5 Compelling Reasons to Start Modernizing Your Bank’s Payments Platform

Bank Payments Platform

Among all the areas covered by the financial services industry, the payment landscape has become one of the quickest to evolve. Scores of individual and corporate clients depend on the digital economy for their payment transactions. An estimate of USD 577 billion is moved through electronic payments every year, and that value is set to grow by a significant amount in the coming decade.

The problem is, most banks still have their eyes on the present. Many are focused on satisfying their corporate clients in the short term and have not gone beyond using the payment processors locked into their core banking systems. But if you’re a decision-maker for your bank’s finance or technology team, consider this a wake-up call to innovate your current payments platform and explore payment processing solutions. Modernizing your current payment infrastructure will allow you to plan for even higher levels of activity on the digital front, as well as keep up with corporate clients’ increasing demand for instant, straight-through payment experiences.

Why is now the best time to start modernizing your bank’s payments platform? Here are the five most compelling reasons to take the leap.

It Will Streamline Your Payment Operations and Make Your Processes More Cost-Efficient

Banks now deal with heightened expectations to process large volumes of payment-related data with sufficient speed and accuracy. This is especially true for banks’ corporate customers, each of whom depends on the efficiency of their payment options to complete business-critical activities. But if your bank doesn’t have the right technological resources to handle this load, payment processes will be even costlier to implement. At the same time, you will deal with the same amount of risk—or even higher risk—of committing grave payment-related errors.

One way to address these operational issues is to start handling your payments from a single universal hub. Look for a technology vendor who can offer you a solution that comes with its own top-of-the-line rules engine and extensive automation capabilities. Soon after you make the upgrade, you’ll notice how much time and money your bank is able to save on payment processes due to enhanced business efficiency.

It Will Boost Your Credibility as Part of the Payment Value Chain

The payment value chain is defined as a system that involves the participation of multiple parties for the completion of a payment. In the context of corporate banking, this value chain comprises payment gateways like PayPal and parties like the Society for Worldwide Interbank Financial Telecommunication (SWIFT) for international payment messaging.

By virtue of the nature of their services, these parties are obligated to run on sophisticated platforms and to undergo constant technological improvements. Their commitment to innovation is integral to safeguarding customers’ trust in their services.

As another critical part of the payment value chain, your bank should put in the same effort to modernize. Take the cue of your partners in the payment value chain and equip your payment platform for full interoperability with these related systems. That way, your corporate clients can associate your banking brand with the same smooth, frictionless payment experiences they attribute to your value chain partners.

It Will Help You Harness the Power of Big Data Analytics

Your bank’s facility at handling payments is not the only thing that will affect its future-readiness. It’s become increasingly apparent that banks with power over big data analytics are the most poised to succeed in the coming years. Decision-makers must be well-versed in the financial trends that govern their corporate clients’ payment experiences, and for that to happen, they need solutions that will allow them to harness the potential of big data.

The analytics capabilities that can be run from your payment hub will help you draw insight on where your highest-value payments are occurring, as well as which industries have the greatest need for payment innovation. With such data insights at your disposal, you will be able to craft a long-term strategy for improving certain aspects of your payment experience and for marketing your banking services to clients from particular sectors.

It Will Give You an Edge in Fulfilling Your Payment Compliance Requirements

Aside from helping you generate revenue from your corporate clients, a modern payments platform will make it easier for you to stay on top of your regulatory requirements. One important example is ISO 20022, a standard that obliges constituent banks to increase the transparency and data-richness of their payments.

You can definitely use your new payment technologies to monitor your regulatory efforts and consolidate your requirements. This will help you achieve full compliance and save you the grief of paying penalties or keeping up with increasingly complex regulatory directives.

It Will Future-Proof Your Bank to Be More Competitive in the Global Digital Economy

Bank Payments Platform

Finally, a modern payments platform will level the playing field between you and your competitors and give you a fighting chance at securing new corporate clients. It may be a challenge for banks to distinguish themselves, but one way that they can do so is through their leverage of payment technologies.

Your payments platform can serve as a means to establish your bank’s technological credibility and its position as a top provider, even amidst stiff competition from other banks, fintechs, and even cryptocurrency exchanges. Sell your payment services on the premise of marrying traditional excellence and familiarity with innovation.

When your corporate clients are able to achieve their business goals through successful payment experiences, your banking brand benefits as well. The rewards of investing in payment modernization include the loyalty of your old clients and the interest of your new ones. Modernize your payments platform today, and become your corporate clients’ provider of choice in the years to come.

Journal Online
A collection of noteworthy information on various topics from the Philippines and the rest of the world.