Hello and welcome from Microsoft’s worldwide financial services group. In this blog, I will share my thoughts and insights into the payments industry, and the challenges banks face in renewing their core platforms. Many people ask me, “why the interest in payments systems?” Quite honestly, it’s an easy answer: payments make the world go around. In mature and emerging economies, every business transaction results in a transfer of value, or a payment, somewhere.
The Payments Value Chain
As countries and markets move from cash and cheque based payment systems to electronic debits and credits, the payments value chain becomes longer and more complex. Think about how many processing steps and applications are involved to deliver a payment from your bank in Scotland to your great aunt in Australia. Speedy, reliable and secure processing is expected, yet the value chain includes different regulatory requirements in each country, different data formats for communicating with clearing systems, and a myriad of internal processes and controls within each bank. Any failure of system or process along the chain can cause customer service and reputational issues. Now imagine managing that process for corporate treasuries that move billions of dollars around the world every day. I think would be fair to say that the stakes are pretty high!
Certainly the past 12 months have been tough times in financial services, but as technology solutions become more cost effective to develop and deploy, there is a chance to innovate for competitive edge as the global economy recovers. Every area of a bank is under pressure to increase revenues but also to reduce processing costs, and the payments organization is no exception. As corporate treasurers continue to enhance their financial supply chain and maximize use of working capital, banks must continue to offer top class services to remain competitive, yet still find a way to retain control and develop efficiencies. To meet these challenges requires a strategic response. Microsoft payments solution areas, delivered through our community of partners, are well suited to address each of these challenges, and so I encourage you to read more about how we can be of benefit to your business.
I look forward to reading your comments, and to an ongoing dialogue.