The Payments Innovation Power Shift

In the latest installment of PYMNTS’ Commander In Chief series, Sukanta Ganguly, CTO of Entryless, provides insight into why payments innovation is not just something that banks and financial institutions push out to the masses but something that both businesses and consumers have just as much of an influence over.

PYMNTS: What does a day in the life of a chief technology officer (CTO) look like?

SG: In an early-stage startup, the CTO starts the day looking at existing products — examining what’s there, where we stand as it fits into the competitive landscape and how the existing team delivers features that the customers want.

A CTO needs to be very customer-focused and customer-driven, so it is important for me to make sure that what we are doing is aligned with where we want to actually be as far as the product and market positioning is concerned. It involves everything from handling issues related to the customers and looking at the current engineering workload to knowing what the development team is building and working with account management in order to make sure all of the dots are aligned properly so that there is a closed loop.

PYMNTS: What is the most difficult part of your job, and why?

SG: The most difficult part of the job is figuring out the benchmark at which you are judging yourself and your company’s output. In a competitive market, you always want to make sure you’re outperforming the competition in the field. When you have less competition or the market is more of an oligopoly, in that scenario, you need to have some way or metric internally that you’re measuring yourself against.

It’s easier for someone to say they are going to complete five things and just stopping everything to focus on those tasks, but at the level of a CTO, it’s not just your five things — it’s probably 70 other tasks that are built on those five. You not only have to monitor and prepare metrics to manage your own time, resources, expenses and consumption, but at the same time, you have to make sure everything else is also working properly. It’s difficult to keep everything in check.

PYMNTS: What do you wish you had more time to do?

SG: Lots of things! I wish my day could allow me five to six hours just focusing on customers and four to six hours focusing completely on the engineering and the technical stuff. As a CTO, the technology will always be there. But it’s also about having the inspiration or motivation to do something to better yourself. So, not only are you outputting better quality, but you’re also growing internally. As a human being, you always have a desire to be better than what you were yesterday. I think the biggest shortcoming is the number of hours you can actually put in. Ten to 12 hours is just not enough.

PYMNTS: What does innovation mean to you?

SG: Innovation is pretty simple, and there’s a pretty simple way to quantify it — it’s something you’ve done that somebody looks at it and says, “Oh wow, I didn’t know that was possible” or “I didn’t know I could ask for those types of things.”

That’s innovation to me.

It doesn’t have to be Einstein coming up with E=MC2. It doesn’t have to be rocket science, and it doesn’t even have to be brand new. But it does have to be that “wow” from the customer, by giving them something they didn’t know they could expect or even know was possible. When the customer says, “I didn’t know this feature could actually work in that manner,” that’s innovation.

PYMNTS: Speaking specifically of the payments and commerce space, what in your opinion has been the most impactful innovation in that realm in the past five years?

SG: First, I’ll talk specifically in terms of payments, and then, I’ll jump into commerce, because I see them as two different tenants in the business world.

The most important and valuable thing that has happened to the payments industry is that it is no longer taboo. For a long time, a lot of people didn’t know what exactly happened concerning payments and what the black box really was. We’d just provide certain documents and information to the payments providers and then wait. It was like waiting outside the doctor’s office for the diagnosis to come back, and then, the doctor tells you exactly how to interpret it.

That has changed, specifically in consumer payments.

Today, the doctor does not have to interpret. Consumers can tell exactly how the payment should be, and then, they expect the businesses or players in the space, who are rendering the services or products, to actually comply. It used to be the other way around, but that has changed significantly. The knowledge has been distributed to where normal people like you and me will sit down and say, “This is exactly what I want.” Payments knowledge has been democratized, which is extremely valuable. The smarter we get, the better questions we ask, and it then pushes the payment providers to actually be intelligent because there is no more sweeping things under the carpet.

In the commerce industry, things have evolved specifically with the digitization of commerce — products and services can easily reach people all over the globe. Commerce became vibrant in the sense that I could actually go online and find a business or person from around the world to reach, communicate and transact with them. That’s fantastic.

What I have not seen happen, and what I believe is the next wave of payments and commerce, is for businesses doing transactions with businesses — whether it’s larger or smaller players. The aspects of the brittle infrastructure that was set probably decades ago is still functioning. It crumbled, but it functions, and that needs innovation. That needs change.

The banks and financial institutions have to wake up and realize it’s not just about the money that is sent and received — it has to do with why and on what basis this transaction was done. It is important to have information and backings that say why this transaction was done and what the business need it fulfills is. That needs to happen for business commerce to become smarter.

PYMNTS: Any recent success stories you would like to share with us?

SG: In the past couple of years, what we have been focusing on here at Entryless is trying to bring the industry to a point of thinking where it’s not just about payments, but it’s also about the information attached to the payments. It’s been a hard job because we are a small company trying to educate people in the financial industry that are multibillion-dollar companies with decades of roots in the financial business system.

For them, it’s an approach they never needed to understand.

But what we are seeing is that there is some realization about this. Institutions are waking up to the fact that, if businesses can understand finance, then as financial institutions, they should no longer remain so close-minded about understanding the business associated with payments. I think businesses and financial institutions have to slowly and steadily start understanding the information that’s associated with a payment.

From a financial institution’s perspective, if I don’t understand what you’re doing and why you’re doing it, it’s kind of hard for me to say that the transaction has different characteristics from any other transaction.

But I think a lot of financial institutions sit under bureaucracies that they have to break, because you just don’t make money by sitting and milking what you’ve been doing for the last decade — it’s just not possible. People are getting smarter, businesses are getting smarter, consumers are getting smarter — they are asking harder questions. You just can’t say you’re not going to answer anymore.

What we have been seeing here at Entryless is that it’s getting easier for banks to understand that this is worthy of discussion and spending their time on now. It’s very exciting, but it’s still a long haul — it’s not going to happen overnight or over a year. But in a few years, you will see more closeness between financial institutions and business institutions talking to each other and understanding each other more.

For stakeholders participating in payment transactions — the sender or the receiver — they must have better services, protection and quality of assurance associated with them.