There’s no denying it: Customers want quick — even instant — access to funds that are rightfully theirs, which means payments are moving in and out of businesses at an ever-quickening pace.
But there’s no denying this, either: Even businesses that are eager to meet such demands can’t just flip a switch and make instant or faster payments happen (not to or from consumers, and not to suppliers). They need the technology, a refined process and, most of the time, a helping hand.
In the latest edition of the “PYMNTS Walk to the Elevator” podcast interview series, Karen Webster caught up with two Fiserv payments pros — Tammi Shapiro, vice president, electronic payments product strategy and management; and Deva Annamalai, head of payments strategy solutions consulting — to talk about this shifting demand and how financial services firms can help businesses do better with payments.
In this case, it means supporting the movement of money in and out of businesses, and enabling companies to pick and choose how to do that, with risk management support and without having to worry about ongoing development work.
“There’s a lot of interest in digital payments and faster digital payments,” Shapiro told Webster — and that holds true even in those parts of the corporate world that still rely on paper and analog processes for payments.
“Consumers expect to pay and get paid faster, and in some cases in real time,” she added. “And over the past several years, there’s been a lot of innovation” on that front. Examples of this include not only faster rails, like real-time payments and same-day ACH, but also new business models that take advantage of these, such as real-time payment of wages to gig workers and other employees.
Fiserv also supports multiple payment rails, saving businesses the need to, say, do massive amounts of coding to deal with various payment mechanisms. The technology enables companies to accept and push out funds at various speeds to meet specific client demands and, while the focus and innovation lies in digital payments, it supports the ability to send traditional checks to enable a comprehensive solution.
“It’s a fantastic emerging space,” Annamalai said, adding that use cases for quicker payments change according to the business and industry. That provides opportunities for the providers of payment services and technologies, whether that means better APIs or other services. Fiserv also provides widgets for smaller companies that want to quickly connect to the Fiserv network. After all, payments is an extremely complicated business, he and Shapiro pointed out, and having access to simple tools and technologies enables businesses to focus on their own areas while still meeting consumer demand.
“There’s a tremendous opportunity for growth here, for new payments behaviors,” Annamalai said, using China — from where he had recently returned — as an example of the next frontier in payments.
A Changing Environment
A company such as Fiserv, the two said, is well-positioned to have an edge in shepherding those payments changes and innovations, as they have deep experience enabling payments for both financial institutions and businesses.
Beyond that, the payments data that a company like Fiserv has accumulated over the years goes a long way toward the ongoing work of fraud prevention and consumer authentication — vital tasks as payments get faster and more digital. Fiserv annually monitors 400 million accounts and 30 billion transactions.
“We have a lot of data that informs our risk management practices,” Shapiro said, adding that the company relies on numerous data points and proprietary analytics capabilities to authenticate customers and transactions in real time. That’s not so much a commercial for Fiserv as it is a description of the emerging reality of payments. Data analysis, machine learning and augmented and artificial intelligence are continuously working to spot fraud attempts before they hit, and this is a key value driver for businesses.
But how does one go about measuring the impact of payment innovation — not just faster payments, but also other developments and new products? That can be complicated, too. Shapiro and Annamalai said that ROI is not just a monetary formula. Customer and worker satisfaction – and ultimately retention, for example – can be part of the assessment of innovation, Shapiro said. “It’s not just direct dollars and cents; there are other factors.”
The global practice of payments is undergoing historic changes — most of them sparked by digital technology. The work will only get harder as consumer demands shift and the software becomes more sophisticated, which will present, of course, long-reaching benefits for business and justification for investment in innovation.