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Payments modernization initiatives around the globe have long been a topic of huge interest and are at different stages of implementation in different countries. Time and again, it has proven to be a catalyst for transformation that has fueled innovation. Canada is now completely into this modernization party, driven by the modernization agenda and timeline set by Payments Canada. With this change comes new business opportunities.
Payments modernization has arrived
Recently, IDC published a white paper, sponsored by IBM, outlining the ten hard realities that FIs and payments services providers must overcome to benefit from modernization, and how they can turn these perceived threats into opportunities.
Impact on banks
Businesses are embarking on payments modernization journey on all fronts. Customer demands for frictionless interaction, privacy and speed are undoubtedly the driving force behind most modernization. But modernizing payment systems does much more than just meeting customer demands. It drives banks to launch new services and products that allow innovative collaboration with partners in a complex ecosystem resulting in new revenue streams. Cost savings are possible as operations become more efficient. Data-driven analytics can provide both better performance and a deeper level of risk management and fraud control.
Change in technology and organization required
The road to modernization requires banks to invest in both technology and organizational structure. On that note, IDC’s Global Payments Analyst Rivka Gewirtz Little states investment in operational and technology changes should occur in measured phases through a well-defined timeline. While taking on these challenges may be a big undertaking, it can open the door for financial institutions (FIs) to move past legacy issues, such as siloed teams and on-premise systems towards modern payment platforms.
Tackling the hard realities
Understanding and analyzing the hard realities and approaching them as opportunities, IBM set out more than a year ago to find the answer. In May 2018, IBM launched a new ecosystem to help tackle these realities with IBM Payments Centre – Canada (IPCC), a cloud-based “payments fabric” for modernization and collaboration.
For more insight, you can download and consult the IDC Paper, sponsored by IBM, 10 Hard Realities and Opportunities in Payments Modernization.