Blog· 8min June 7, 2021
A while back I wrote about the slow pace of payment modernisation (https://www.linkedin.com/pulse/payments-users-needs-evolving-payment-processing-hasnt-mark-staunton/). I wrote this as a retail banking customer, comparing my direct experiences of the payments journey. I’m not a heavy payments user – a few direct debits per month, a few transfers, and cards for most purchases – but I do see the gaps in the user experience.
Imagine though for a moment that you are responsible for tens of thousands of payments and receipts per day, in multiple currencies across many countries. You still want the same outcomes – transparency, speed, low cost – but the implications of not getting these amplify exponentially. Have you enough funds in the right currency on the right account? Have you over-bought foreign currency and the rate has now gone against you? Did your supplier receive payment and release the goods?
As a corporate treasurer you rely heavily on your banks. You likely have more than one, maybe even multiple banks for each currency. So you spend time and effort integrating to each bank, adapting to their reporting formats, their online interfaces, the processing timelines. You may have been convinced ISO20022 would give you consistency; you may have even flirted with banking solutions adapted for corporates.
But do you know much about the technology your banks use? And should you care?
Frankly, yes you should! The ability for banks to provide you the outcomes you need to run your business is directly enhanced or constrained by the underlying infrastructure. How is this? It comes down to two things: cost and simplicity. With high run-the-bank costs for legacy tech, investment in the customer interface is drastically limited.
Few banks have the scale and technology focus to provide a full end-to-end process which meets all industry change needs while delighting their customers. And with disparate platforms between banks, sometimes even between branches of the same bank, there is little consistency in the customer experience, which puts a lot more of the effort on you to adapt to them.
The flip side of this is what modern payments technology can do. Focused technology providers can reduce the back-end overhead for banks, with services that are always up to date, provide a lower operational cost, insulate the banks from industry change and ensure a consistent processing experience across geographies – all of these free up banks to focus on the outcomes you require.
And this is on top of all the benefits the latest fully cloud native technology provides over old on-premise infrastructure; no planned maintenance outages, improved resilience and disaster recovery across multiple locations and dynamic scalability to handle unpredictable volumes in an ever changing market.
So next time you speak to your bank, ask them about their tech. Their response will give you an indication if they can really deliver what you need to run your business.
Mark Staunton is a Head of Customer Success at Form3. In the past 15 years Mark has gained valuable insight into the challenges of legacy payment processing on both the buy and sell side through working in cash management, settlement and reconciliations operations and payments product management at Goldman Sachs, J.P. Morgan Chase, Close Brothers and HSBC.”