The Future of Payments

42 BANKING PERSPECTIVES QUARTER 4 2018 RTP at 1: Corporate One another are driven by the lack of relevance, and 68% say that if a company is perceived as relevant by its customers, it is more likely to be recommended to friends and family. The demand for relevant digital experiences, including real-time payments, has never been stronger. ACI Worldwide noted that 30% of the consumers surveyed as part of a real- time payments study 6 said that they would potentially switch to another financial institution if their current financial institution did not offer access to real-time payments, another example of the impact of delivering relevant experiences. As noted above, the value of relevance is not limited to the speed of the payment but includes how the data can be used to analyze customer/member behavior and deliver contextual financial services experiences. Those experiences can span several points in the customer/member journey, such as a new account opening session, receiving the disbursement of a loan, enabling more efficient delivery of payments to preferred partners, establishing a conversational relationship with a customer/member for payment obligations, and automated responses to requests for information related to payments that may have been submitted. The possibilities are endless if a financial institution has a digital services architecture built for speed and responsiveness. To achieve the aspect of relevance noted above, financial institutions will seek out open platforms developed for real-time engagement, including modern architecture such as microservices that can isolate and orchestrate several complex data management and integration functions. In that example, RTP functionality would be embedded within a microservice designed for real- time payment enablement. With the advent of open APIs and microservices technology, financial institutions have tools at their disposal to become increasingly innovative in designing and developing real-time experiences. KEY TAKEAWAYS: DESIGNING A PATH TO ACTION When discussing the emerging trends of real-time payments, experience development, APIs, microservices, and FinTech competition, the financial institution often replies with a pragmatic “where do we start?” In our opinion, financial institutions can establish a very practical set of steps as a foundation for their RTP journey: • Evaluate the existing digital and legacy systems for faster/RTP readiness. • Review the current level of FinTech disruption through ACH transaction logs. • Identify the critical customer/member journeys that could be enhanced with RTP functionality. • Discuss new product and service enhancements and innovations where RTP can be a component of the offering. • Outline a plan for leveraging the real-time data exchange available through RTP to complement the enterprise data analytics strategy. • Continue to monitor RTP educational opportunities available from TCH and other resources. By following the plan of action, your institution can begin to establish a comprehensive plan for enabling real- time experiences and payments that can create competitive differentiation, enhance retention, and increase profitability. ENDNOTES 1 “Faster Payments Tracker – October 2018.” https://www.pymnts. com/faster-payments/ 2 “Banks on Notice: Fintechs Are Coming for Checking Accounts & Debit Cards,” CBInsights, August 2, 2018. https://www.cbinsights . com/research/fintech-checking-accounts-debit-card-disruption/ 3 “The 2016 and 2017 Surveys of Consumer Payment Choice: Summary Results,” Federal Reserve Bank of Boston. https://www.bostonfed. org/publications/research-data-report/2018/the-2016-and-2017- surveys-of-consumer-payment-choice-summary-results.aspx 4 “Data, Financial, Analytics API Categories See Big Growth,” ProgrammableWeb, May 21, 2018. https://www. programmableweb.com/news/data-financial-analytics-api- categories-see-big-growth/research/2018/05/21 5 “Living Business,” Accenture. https://www.accenture.com/_ acnmedia/Thought-Leadership-Assets/PDF/Accenture-Living- Business-Full-Research-Report.pdf#zoom=50 6 “2018 Global Bill Payments Insight Report,” ACI Worldwide. https://www.aciworldwide.com/lp/payments-insight-2018/bill- pay-new-ways-to-pay The possibilities are endless if a financial institution has a digital services architecture built for speed and responsiveness.