The Bottom Line

Dissecting the TSYS/Global Payments Deal

Posted by Myron Schwarcz on Jun 11, 2019 9:40:18 AM

SRM - TSYS Global Payments

When we weighed in on FIS’ March acquisition of Worldpay, I predicted that a TSYS/Global Payments combination might be in the cards. Two months later, a “merger of equals” announcement between those leading players has me wishing I had spent a bit more time in Vegas.

The payment processing landscape has shifted dramatically in the past four months, with four of the major acquirer/processors making moves this year (Fiserv kicked off the action by joining forces with First Data in January). Traditional payments providers are pursuing greater scale and a broader suite of services in their quest to achieve profitable growth and stave off competition from fintechs entering the market with disruptive models.

Read More

Topics: Contract Management, Payments Core Processing, TSYS, Global Payments

Open Banking: Two Continents, Two Agendas

Posted by Simon Rose on May 19, 2019 9:00:00 AM

Open Banking

In a recent blog post, we outlined the lessons learned in the year since the UK’s Open Banking regulation took effect. The Open Banking concept is hardly confined to Great Britain, however. Countries as geographically and culturally diverse as Singapore, Australia, Holland and Canada have also embarked on similar endeavours to alter the dynamics of their financial services sectors – thus also altering other interconnected sectors.

Although it’s difficult to envision a similar top-down mandate in the United States, there is growing evidence that many of Open Banking’s features will become part of the American landscape through other means. Yet, depending on where you look, commentators cannot agree on the impact of Open Banking’s introduction in the U.S., whether it be success, failure, positive or negative.

Read More

Topics: Strategic Sourcing, Payments, Innovation, Open Banking, Fintech

Venmo v. Zelle: Who’s Winning the P2P War? And Who Cares?

Posted by Ginger Schmeltzer on May 12, 2019 9:00:00 AM

Venmo v. Zelle: Who’s Winning the P2P War? And Who Cares?

One of the most closely watched contests in consumer banking is the battle for P2P supremacy between Zelle and Venmo. Zelle is touted as the bank-friendly alternative, owing to its status as an offering of Early Warning, itself owned by a consortium of the largest U.S. banks. Zelle has reported eye-popping growth figures, stemming from the embrace by its market-leading owner banks and surpassing Venmo volumes by most measures.

Venmo, on the other hand, remains the app of choice for the coveted Millennial and Generation Z cohorts. Zelle has yet to attain the “verb” status of its rival (“I’ll Venmo you…”), which has managed to hold onto its cachet as few consumers realize Venmo is now owned by the not-as-cool-as-it-once-was PayPal.

Read More

Topics: P2P, Venmo, Zelle, Payments

Planning Your Digital Transformation Journey

Posted by Michael Carter on May 5, 2019 9:00:00 AM

planning your digital transformation journey

In case you haven’t heard, the digital channel is essential to your financial institution’s future success and perhaps to its very survival. While this point is broadly accepted in concept, an alarming number of banks and credit unions have yet to take concrete steps toward aligning their omnichannel model with customer trends.

In many cases, this inaction is a product of fear. Digital transformation is a daunting undertaking and it can be hard to know where to begin, especially with other priorities competing for bandwidth. As is the case with fitness programs, however, the most important starting point is often to simply begin moving.

Read More

Topics: Technology

Three Things We’ve Learned from the UK in Year One of Open Banking

Posted by Simon Rose on Apr 15, 2019 11:15:00 AM

iStock-1033851708

January marked the one-year anniversary of the Open Banking regulation coming into effect in the UK, making this a good time to step back and assess its progress, or lack thereof. For the uninitiated, Open Banking is seen by financial regulators as a means to spur fintech innovation and foster increased competition in the UK banking market. Its underlying premise is that transactional data is the property of the account holder, and if the consumer or business elects to share such data with a third party, the bank must facilitate its efficient transfer, securely.

Read More

Topics: Technology

Responding to the FDIC’s Letter to Avoid Vendor Contract Gaps

Posted by Michael Carter on Apr 9, 2019 9:00:00 AM

FDIC Letter (1)

A letter from the Federal Deposit Insurance Corp. (FDIC) issued Tuesday, April 2, contained a warning that caught the attention of many financial institutions and their vendors. Specifically, the FDIC stated that it had encountered a number of situations where banks were not sufficiently controlling the risk associated with their supplier relationships.

Read More

Topics: Technology, Vendors & Contracts

Digital Walk to Starbucks: Mobile Banking & Payments Change Everything

Posted by Ginger Schmeltzer on Mar 31, 2019 9:00:00 AM

iStock-911294484

We all know intellectually that the mobile phone has revolutionized Americans’ daily lives. The changes have accumulated so gradually, however, that sometimes taking a step back is necessary to appreciate the enormity of the shift.

For one thing, the “phone” portion of the “mobile phone” is clearly on borrowed time. The voice capabilities of these devices in our pockets have already become a quaint afterthought. It’s been over a decade since texts surpassed audio calls as the main driver of cellular network traffic. Add streaming and apps to the mix and you’ve got an entirely different value proposition than the “portable” communications handsets once tethered to automobiles.

Read More

Topics: Technology

Rapid Response: FIS Acquires Worldpay

Posted by Myron Schwarcz on Mar 25, 2019 10:00:00 AM

FIS Worldpay (003)

It seems like only yesterday that the payments world was upended by news of Fiserv’s $22 billion acquisition of First Data. Actually, it was two months ago almost to the day.  We weighed in at the time on the deal’s implications for financial institutions, and speculation quickly turned to how Fiserv’s key competitor FIS might react.

Read More

Topics: Vendors & Contracts

Will Emotional Ties to Cash Be Overcome by Convenience of Card Payments?

Posted by Simon Rose on Mar 19, 2019 11:49:41 AM

iStock-1132495612

Our colleagues at SRM Europe in London recently shared with us how fewer people are using cash to pay for goods and service and discussed what critics of a cashless society are saying. In Great Britain, and perhaps the rest of the world, cash holds a unique bond with consumers that may be hard to give up.

Read More

Topics: Technology

Unmasking the Blind Spots in Vendor Negotiations

Posted by John Fuller on Mar 10, 2019 10:00:00 AM

iStock-488578217

In our experience, saying “no changes, here’s my signature” is a classic blunder.  Why? Because contract renewals or extensions with service providers can be deceptively simple. For example, if a bank or credit union exec is satisfied with their current relationship and the rep approaches them with a modest rate reduction, it looks like an “easy win.” The department head saves on the run rate and avoids a batch of administrative and analysis headaches, while still arriving at the desired endgame.

Read More

Topics: Vendors & Contracts