As financial institutions begin the process of evaluating their payment businesses and contemplate how to build out a payment services architecture, they should consider the following guidance:

Look at not just operational efficiencies, but revenue enhancement.

Operational efficiencies are an obvious benefit of next generation payment platforms. By removing silos and combining common processes, banks can eliminate redundancies in hardware, software and resources. But banks should also recognize that updating their payment infrastructure can lead to new revenue opportunities as well. That should help those same institutions when they look at building a business case for replacing their current payment systems.

Take a step-by-step approach.

Take a step-by-step approach. Most solutions offered by vendors allow banks the ability to build a comprehensive solution through incremental steps. It is not a “rip-and-replace” solution, but allows financial institutions the ability to transform their payment infrastructure in a modular fashion. Usually that process begins with high-value or trade finance payments, where speed of settlement is especially important and volume is low, and expands over time to include other payment types as budgets and resources become available.

Find partners with an understanding of payment products and analytics services.

There are many vendors offering next-generation payment solutions. Many of these vendors have product offerings that have developed to address a particular payment type or line of business within an FI. For instance, a vendor may have developed a highly specialized solution for high value payments or trade settlement that is now being expanded to cover other payment types. While these solutions may meet the minimum criteria of a next-gen solution, they may lack some vital components. It is important for financial institutions to find partners who can provide a full range of services to deliver on the promise of a payment system that fully builds on the promise of next generation technology, including analytics as a core, integrated part of the solution.