Byline: Maggie Scarborough, Managing Director
(c) 2010 FinServ Strategies. All rights reserved.
It’s a pet peeve I share with several people I know, the idea that a Payments Hub can truly effect business process change within an organization. I believe you need something bigger, Payments Management. So, I am going to split hairs – there is a big difference.
A Payments Hub is Tactical, A Payments Management System is Strategic
There are a number of Payments Hub solutions out there that have a simple set of processes that allow some centralized control of amalgamated payments processing. It is operationally focused, system process-centric – more tactical in nature:
Any payment or format in, any payment or format out (e.g, to the client)
Transformation and normalization on data and messaging layers
Logical routing; business logic for dynamic routing
Interfaces for distribution
A basic data model and management reporting
Administration and Permissions
Anti-Money Laundering, Terror and Fraud
A Hub – Not bad, eh? But Payments Management is Strategic. If you can perform this type of centralized processing, you will further reduce costs, but only to a point. The next step is strategic – to execute better in the market from Risk, Liquidity/Credit, Business, and Market perspectives. So what do you have to add?
Understanding attack vectors and solutions
Learning transaction patterns indicative of fraud
Understanding liquidity flows and solutions and settlement patterns
Knowing when and how your partners and customers are using liquidity
Business Process – Work Flow Centric, Not Simply System Process-Centric
Use f Analytics and work flow to detect payment issues in flight and cure them before they leave
Cure or resolve exceptions between all of the parties in process
Allow customer self service and reconciliation management
Business of Payments
Understanding processing concentrations and flows and normalizing customers and use
Learning where you make money or leak it.
Discovering intersections of customers and counterparties and leverage the relationships for services that are not only end-to-end for the initiator, but also across her business and partners
Enables roles-based reporting and modeling, including process modeling
Stay tuned for more. Is this a realistic vision? We’d love to hear what you think?
–end, please comment
Maggie Scarborough, Managing Director
Maggie@FinServStrategies.com, +1 410.685.2324