Research conducted by Celent on behalf of Icon Solutions and MongoDB has revealed the bank data services that corporates will pay for, and the ones they consider table stakes. Findings show the services that corporate clients would be most willing to pay for are real-time cash balances (84%), enhanced security and fraud prevention (74%) and a single real-time balance dashboard across multiple bank partners (70%). The report also highlights the risk of customer churn as corporates do not expect to pay for services such as virtual accounts and ISO 20022 compliance support and would switch providers to access them.
‘Expectation versus Reality for Payments Data Monetisation’ surveys 217 corporate treasurers and CFOs and 168 senior bank executives globally, providing unique insight into the business challenges facing corporates and their expectations for data-driven services, along with banks’ plans to address emerging customer requirements through payments data monetisation initiatives.
Payments data monetisation is an increasingly key strategic priority for banks, with 38% reporting it as an objective of technology transformation investments. This is being driven by growing margin pressure and competition, evolving customer expectations, and migration to real-time payment infrastructures and ISO 20022.
“Corporate clients are increasingly looking to their bank partners to help them run more efficiently, and this creates a number of opportunities for new revenue-generating services,” explains Kieran Hines, Senior Analyst at Celent. “Greater access to real-time data, including real-time forecasts, are high on the wish lists of clients, alongside enhanced security and analytics-driven tools to support decision making. However this is not the whole story, and there are several services that corporates want to access but are unwilling to pay for – in other words becoming ‘table stakes’. With many corporate clients looking to rationalise their bank relationships, banks should consider investing in new data-led services to both support client retention as much as to drive the top line.”
Toine van Beusekom, Strategy Director, Payments at Icon, comments: “The implications of this report for banks are clear. Inaction is not an option and investment is urgently needed just to retain existing business and relevancy, let alone generate new revenues. But payments data monetisation is not a one-off product initiative, it is a strategy that must span the entire organisation. This means that technology spend and transformation strategies must be directed towards doing the fundamentals extremely well and lowering the cost of delivering standardised, accurate and complete payments data in real-time. By doing this, banks can build the foundations that deliver the flexibility and agility to respond to the evolving needs of corporate clients.”
Ultimately, the report highlights that payments data monetisation is about more than revenue. The real opportunity is to move the relationship with corporate clients away from banking being about the consumption of products, towards acting as true partners for customers. This shift in perception holds the key to long term revenue and margin growth.