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Myron Schwarcz

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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.

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

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.

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Topics: Vendors & Contracts

Impact of Fiserv’s First Data Acquisition

Posted by Myron Schwarcz on Jan 22, 2019 2:36:30 PM

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The payments world woke to a jolt last Wednesday with the news that Fiserv had announced an agreement to acquire First Data in a $22 billion stock transaction, creating a fintech mega-firm. Most of the early coverage focused on the deal’s financial aspects, and on private equity firm KKR coming closer to finally turning the page on its massive 2007 buyout of First Data. However, we’d like to focus on the implications for customers of this new entity - particularly the financial institutions that comprise the bulk of its business.

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How Hitting the $10 Billion Threshold Impacts Vendor Management

Posted by Myron Schwarcz on Nov 27, 2018 9:00:00 AM

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Numeric milestones can be great opportunities to celebrate achievement and build team morale. Asset growth is usually a sign of health and prosperity, and attaining thresholds like $1 billion or $5 billion in assets are certainly momentous occasions for many financial institutions. Reaching $10 billion, however, can bring mixed blessings.

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Topics: Vendors & Contracts

How to Maximize Value in Vendor Relationships

Posted by Myron Schwarcz on Apr 11, 2018 9:00:00 AM

-It's not just about price.-

(Hint: It’s Not Just About Price)

Obviously, every financial institution (FI) wants to get the best possible deal from their service providers. The definition of “best” can vary markedly by FI, however. We’ve found that before entering the vendor contract negotiation process, a cross-functional team is well advised to invest the time to determine what it most wants from the relationship.

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Topics: Vendors & Contracts

Navigating the Complexity of Vendor Contract Negotiation 

Posted by Myron Schwarcz on Jan 24, 2018 9:00:00 AM

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Not that they ever were simple, but there has certainly been a notable uptick in the complexity of legal agreements between financial institutions (FIs) and service providers recently.

The driving factors behind this trend are logical­, with the current regulatory environment requiring more aspects of vendor contract relationships to be formalized. Particularly where service providers have access to customer data or support critical operations, enhanced regulatory scrutiny of third-party obligations creates added motivation for both FIs and vendors to limit their exposure. Documenting each party’s responsibilities in detail may help, but in the event of an issue, the hard truth is that customers will look to their FI for resolution, not a back-office provider whose name they don’t recognize.   

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Topics: Vendors & Contracts

What You Don’t Know About Regulatory Changes Can Help You

Posted by Myron Schwarcz on Dec 14, 2017 10:00:00 AM

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While much of the attention paid to regulatory requirements for financial institutions (FIs) tends to focus on Dodd-Frank and mandates issued by the Consumer Financial Protection Bureau, a notable change of late has been the heightened requirement for vendor management oversight and third-party risk assessments. Although the Bank Service Company Act is hardly new, it has recently become the basis for these types of mandates. Powered by different agencies, the message is essentially the same: When it comes to vendors, the buck stops with the FI. In fact, the FDIC requires that it be notified within 30 days of any new service provider relationship being struck.

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Topics: Vendors & Contracts