May The Force (Multiplier) Be With You

First Data’s recently announced partnership with First Tennessee Bank is about a lot more than leveraging the bank channel as a way to reach small businesses.

As First Data Executive Vice President of Global Business Solutions Dan Charron told PYMNTS, while the ability for his company to offer Tennessee’s largest bank its Clover business solutions platform is “a real anchor point,” what’s notable about the partnership from a macro-view is that it affirms First Data’s evolution from “a back-room, back-office processor to a technology solutions company.”

The partnership, as Charron describes it, provides a full complement of solutions to First Tennessee customers, including issuing, access to the STAR Network, a full complement of fraud analytics across all payments types through DefenseEdge and, of course, an integrated suite of small business solutions via Clover.

“We look at financial institutions as a segment that we’re very deep in,” says Charron, “and we go to them with a full enterprise,” in a way that allows both First Tennessee and First Data to be “all in together.”

That reflects a very different way in which FIs have worked with players like First Data in the past.

Historically, FI technology partners have been relegated to point solutions in the back office. More recently, market forces — like smaller branch footprints, a larger proportion of customers making the move to mobile, the emergence of different mobile wallets and the force of omnichannel — have made it more complicated for an FI to manage a collection of suppliers for each of those market-driven point solutions. Finding an enterprise partner helps streamline the complexities of sourcing, vetting and monitoring “best-in-class” suppliers in a highly dynamic market.

That reality, explains Charron, is what he believes compelled First Tennessee to partner with First Data, in what he acknowledges is “a different type of partnership” than what’s been seen in the past.

In addition to its traditional efficiencies on the acquiring and processing side, First Data’s evolution from processing solution to enterprise technology platform has been focused on strategically developing an innate understanding of the changing POS, mobile commerce, wallets in new networks and the on-demand economy at large that now allows the company to be a partner to First Tennessee “on both sides of that continuum,” Charron tells PYMNTS.

This holistic approach — managing through that customer-facing and internally focused continuum — is what the company calls “One First Data.” It’s an approach that Charron says allows a company like First Tennessee to, through its partnership with First Data, manage the “dizzying array of technologies” facing the company and deliver them to its customers in a way that best suits it.

Specifically as it relates to Clover, Charron notes that while First Tennessee has had longstanding relationships with small business customers, they were primarily on the banking side. Now, however, “they can expand them out to many different solutions.”

He explains that First Tennessee’s decision to team with First Data — a “pretty progressive” decision for a financial institution with such an entrenched history and deep relationships — was a strategic one more than it was a sourcing one. “They were as much interested in where the world's going and how they see it,” says Charron, “and what are we doing to invest in technology to help them provide that to their customers.”

The partnership with First Tennessee is not the first evidence of the “One First Data” enterprise in action. Charron says that there are a number of relationships with retailers and other FIs that recognize the value of partnering with a technology company with the bandwidth and scale that can support them as their needs evolve.

Something that Charron notes is particularly important to a small business and the FI looking to further deepen the relationship that it already has with its banker. “If the FI can cover the gamut of buyer behaviors — be it related to hardware, software, banking relationship, functionality, applications, et al. — [it takes] a relationship that’s already deep with their customer and [makes] it even deeper.”

In putting a cap on the conversation, Charron uses a military term to describe First Data’s relationship with First Tennessee. It’s a “force multiplier” for the institution: “We have the ability to really extend what First Tennessee can do for their customers.”

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The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.