Celent Model Bank 2014, Part 4: Case Studies of Payments Innovation
The vision for Celent’s Model Bank research, now in its seventh year, was to try to answer an apparently simple question: “What would it look like for a financial institution to do everything right with today’s technology?” To answer this question, Celent sought examples of best practices in technology usage. These examples span a five-part report series:
- Part 1: Digital and Omnichannel Banking
- Part 2: Innovation and Emerging Technology
- Part 3: Legacy and Ecosystem Transformation
- Part 4: Payments
- Part 5: Cash Management and Trade
In Part 4, Celent profiles three innovative initiatives:
- Bankgirot: Immediate Payments Initiative
- Barclays: Global Payments Initiative
- UBS: NFC Mobile Authentication
The payments industry is undergoing a seismic shift. The use of cash, cheques, and other paper instruments continues to decline as the industry migrates to electronic payments. Ubiquitous, always-connected smartphones are rapidly reshaping not just payments, but the entire retailing landscape, from how consumers discover products and prices to how they shop and pay.
“Banks have always been at the forefront of providing payment services to their customers. However, much of the change in payments today is driven by outsiders,” says Zil Bareisis, Senior Analyst with Celent’s Banking Group and coauthor of the report. “Banks around the world are being challenged to keep up with innovation while having to manage their aging legacy payments platforms.”
“Payments is a fragmented market, and institutions have to make difficult decisions where to invest,” adds Stephen Greer, Analyst with Celent’s Banking Group and coauthor of the report. “Consumer demand has driven the financial services industry to start adopting modern systems, but existing barriers have slowed progress.”
This report provides an overview of the payments landscape, giving a summary of the state of innovation in the market. Then Celent profiles three innovative projects, and finishes with conclusions that are indicative of broader market shifts.