The Future is Happening in an Instant

The Future is Happening in an Instant

Patrik Centellini

Head of Business Development Transaction Banking at Tieto

Views 716

The Future is Happening in an Instant

01.05.2017 08:15 am

More than 3.7 billion people now use the internet, 90 percent of them via mobile devices. In fact, we’ve never been more connected than at any time in our history. When connectivity becomes almost a hygiene factor, this cannot but alter expectations around speed and service.

We expect an e-mail to be received within seconds. We expect a meal or taxi ordered to the door to arrive within moments, and online shopping to arrive within days, if not within the hour in some locations. As to their finances, both consumers and corporates are expecting ‘faster money’.

Without further ado

Consumers want to buy rather than pay — and as quickly and conveniently as possible. They want to know that it’s secure and that the seller will be paid on time as agreed. When they want to review their spending, consumers expect the data to be there. Otherwise they just want fuss-free payment.

Corporates want all of this — and more. They want the faster logistics and fraud management that goes with faster payment. They want convenient visibility of funds to optimise working capital, make operational efficiencies and mitigate risk.

Meanwhile governments and regulators are also embracing the concepts of ‘faster money’ and ‘more than payments’. The European Central Bank is expecting at least one instant payment solution in euro to be available in Europe towards the end of 2017. Many other countries around the world are also looking to implement or upgrade an instant, immediate or real-time payment system.

Effective immediately

At Tieto, we believe that instant payment and open access are intertwined. These twin trends reflect the drive towards more connected commerce, client centricity, open banking and the move from banking networks to platforms. Banks need to be able to take advantage of this instant opportunity whilst avoiding the possible threats.

When instant payments and open access becomes widespread, moving funds from A to B will become commoditised. Everyone will have a messaging app with payment integrated, so banks will need to consider how they plan for this future.

Will bank brands and scale be enough to stand up to Big Tech? After all, if the global consumer-facing technology brands have also implemented instant payments, it may not be that difficult for them to take over P2P/P2B services.

How Tieto can help

To keep pace with technological and regulatory changes plus client expectations, banks need the right technology partner. Tieto has established credentials in delivering end-to-end instant payments solutions — everything from front-end apps for P2P/P2B to central interbank infrastructures and back-end payment hubs.

We are currently working with the Kenya Bankers Association, an industry body comprising 45 banks, on building out the first real-time interbank transaction platform in East Africa. This national project supports Kenya’s payments strategy to enhance both interoperability through shared technology infrastructure and financial inclusion.

Meanwhile in our native Finland, we designed and implemented Siirto, the country’s first real-time multi-bank platform for mobile payments. This was PSD2-compliant two years ahead of time and natively built for an open and API-driven age. Now payment solutions can be developed mobile- and digital-first as opposed to an add-on to old legacy infrastructure.

This article originally appeared on perspectives.tieto.com

Latest blogs

Shuvo G. Roy Mphasis

Reboot 1.0: How financial services technology can enable the supply chain to support a post-lockdown boom

Ground control and Captain Tom When veteran Captain Tom Moore decided to walk one hundred laps of his garden before his 100th birthday to raise funds to support NHS heroes battling Covid-19 from the frontline, he never imagined that he would Read more »

Lisa Gutu Salt Edge

Building a PSD2 compliant channel: challenges and opportunities for financial institutions

PSD2 obliges ASPSPs including banks, e-wallets, prepaid cards and other companies that offer payment accounts to provide at least one channel for secure communication with third party providers (TPP). Even neobanks or e-money institutions, including Read more »

Thomas Pintelon Capilever

Credit origination - A lot of innovation on the horizon

While consumer credits are becoming more automated and user-friendly to request, all other credits are often still very manual and labor intensive to originate. In this (relatively long) blog I will try to give a description of the (potentially Read more »

Kelly Kearsley Hourly.io

Time Card Theft is a Big Problem. Here's How to Stop It.

Trust is at the core of every employer-employee relationship. You trust your people to do their jobs, and they trust you to compensate them for their work. Most of the time, it works. However, there's always the person looking to bend the rules or Read more »

Daria Afanasyeva UTP Merchant Services Ltd

Cybersecurity – Online payments are getting more secure

Ever since we've been able to buy anything we need with just a click of a button on our laptops or phones, online sales have been consistently increasing each year. Just last year, the total value of UK retail sales was £394 billion, with an average Read more »

Related Blogs

Alex Malyshev SDK.finance

How to Apply For Electronic Money Institution License and Payment Institution License In Lithuania

As a supplier of core payments and transaction engine software, SDK.finance knows what difficulties our customers face in the process of applying for an Electronic Money Institution License and Payment Institution License In Lithuania. So we decided Read more »

Gemma Doswell Paybase

Paybase Predicts...

What we said in 2018 Read more »

Mark Grainger Engage Hub

Banking on change: what’s next for the financial services sector in 2020?

2019 has been the year of disruption for the Financial Services (FS) sector, largely driven by evolving customer expectations and the influx of new technology. Increasing regulatory requirements, combined with new entrants in the market and shifting Read more »

Tim Hooley Red Hat

Red Hat 2020 Trends: Financial Services x Technology

Whilst we talk about legacy technology as if it is commonplace across industries, it’s a relatively new term within Financial Services. The financial services industry didn’t used to compete by innovating for customers, instead they relied on Read more »

Alan Donnelly Salesforce

Financial Services Trends 2020

The financial services industry is starting to wake up to the idea of ecosystems and partnerships between challengers and traditional banks. In the coming year we will see the discussion evolve from old vs new and see real-world examples of Read more »

Magazine
ALL
Free Newsletter Sign-up
+44 (0) 208 819 32 53 +44 (0) 173 261 71 47
Download Our Mobile App
Financial It Youtube channel