“Why not wake up and have an ambitious goal?”
is the question electronic payments software provider ACI poses in
its bid to garner support for a collaborative effort within the
financial services industry to create common definitions of payment
processes.
Upon noticing payment processes are, according
to ACI, a “silo-based mess”, it teamed up with consultancy
firm Aite Group to develop The Payments Maturity Model (PMM)
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By GlobalDataIncreased merger and acquisition activity has
been the result of the global economic crisis and with that comes
increased consolidation. Aite claims banks are migrating towards
‘payment hubs’ to achieve overall cost savings, improve margins,
better manage risk, speed time to market with new
products/services, and support true “markets of one”.
At present however, ACI believes the
software that supports these processes are fractured due to
banks buying different solutions from various vendors in different
geographies.
“If you were to ask five large financial
institutions what processes comprise payments, you would probably
get five different answers,” said Louis Blatt, chief product
officer of ACI Worldwide.
The PMM was unveiled at the SIBOS conference
in Amsterdam last week. Both ACI and Aite Group delivered a call to
action for banks and vendors to help define payment processes and
benchmarks to determine how ‘mature’ an organisation is.
“This is where the hard work starts, it is
going to take a long time to populate the model and figure out
where individual companies are on the road to maturity,” said
Blatt.
Defined business services of the life cycle of
payments for the PMM are split into four parts: initiating,
managing, securing and operating. The areas of focus in the model
include: systems, information, organisations and processes.
According to the PMM report by Aite there are
five stages of the PMM: reliable, scalable, efficient, responsive
and agile. It claims by evolving from one stage to the next a bank
achieves a number of benefits including: lower costs, less risk,
more targeted marketing, better product/service development, and
the opportunity to leverage capacity and liquidity for quicker
processing and better service.
Blatt admits the vision of a collaborative
effort is ambitious and realises the challenges ahead
in enticing competing industry players to get
involved.
“Our customers say that doing payments today
is just too difficult,” Blatt told EPI.
“Even if we are only 20% successful in this
effort it will bring huge economic benefits. I don’t think software
companies are going to hold hands over this and even competitive
banks may have reluctance to share best practices on how to
participate but I think we can get to a complimentary set of
participants that can really define the next generation of
payments.”
Blatt said ACI has the baseline model built
and will look to populate the collaborative website over the next
30 days.
“It is very possible we won’t reach 100
percent but if we could get to 100 banks it would be a tremendous
tool for the industry,” he said.
