Editorial & Advertiser Disclosure Global Banking And Finance Review is an independent publisher which offers News, information, Analysis, Opinion, Press Releases, Reviews, Research reports covering various economies, industries, products, services and companies. The content available on globalbankingandfinance.com is sourced by a mixture of different methods which is not limited to content produced and supplied by various staff writers, journalists, freelancers, individuals, organizations, companies, PR agencies etc. The information available on this website is purely for educational and informational purposes only. We cannot guarantee the accuracy or applicability of any of the information provided at globalbankingandfinance.com with respect to your individual or personal circumstances. Please seek professional advice from a qualified professional before making any financial decisions. Globalbankingandfinance.com also links to various third party websites and we cannot guarantee the accuracy or applicability of the information provided by third party websites.
Links from various articles on our site to third party websites are a mixture of non-sponsored links and sponsored links. Only a very small fraction of the links which point to external websites are affiliate links. Some of the links which you may click on our website may link to various products and services from our partners who may compensate us if you buy a service or product or fill a form or install an app. This will not incur additional cost to you. For avoidance of any doubts and to make it easier, you may consider any links to external websites as sponsored links. Please note that some of the services or products which we talk about carry a high level of risk and may not be suitable for everyone. These may be complex services or products and we request the readers to consider this purely from an educational standpoint. The information provided on this website is general in nature. Global Banking & Finance Review expressly disclaims any liability without any limitation which may arise directly or indirectly from the use of such information.

BANKS MAY BE ONTO A WINNER IF THEY CAN FOCUS ON THE INNOVATION ASPECTS OF PSD2 AT LEAST AS MUCH AS THE COMPLIANCE

October 5th marks 100 days before the deadline for PSD2 implementation, and there is plenty to make banks shudder: mandatory access by third parties, faster resolution times and reduced or eliminated fees that add either cost or pressure on margins, all in a climate where returns on capital are already at a premium.

However, those banks that can grit their teeth and see the bigger picture may find a wealth of prospects. Graham Lloyd, Industry Principal of Financial Services at Pegasystems, recommends four key points to consider for banks looking to swiftly turn the looming PSD2 deadline into an opportunity:

  • Data sharing was always coming – We already surrender our contact details and complete surveys for small incentives. How much more attractive is it to trade it for something more tangible, such as cheaper transactions or better rates? Far better for a bank to become a proactive player and prime mover with influence on the ‘market’. PSD2 provides the momentum for moving to such a position. Done properly, it could both create an attractive proposition in its own right and strike a blow against Fintechs.
  • Faster resolution times are about service efficiency – It’s no use to the customer if a bank has one standard in compliance and another elsewhere: it’s all part of the same service. By choosing to invest in an overall level of process efficiency and service effectiveness, banks can leverage a budget they have to provide anyway to set a competitive, consistent standard across the whole customer journey.
  • New forms of revenue can be seized – There is likely to be a sizeable revenue opportunity for a bank positioning itself as the ‘destination of choice’ for PISPs (Payment Initiation Service Providers). These new players will gravitate towards the banks offering a higher service standard and the least hassle, as the effects will flow through to the PISPs’ own customers and their expectations of security, certainty and convenience. Banks stand to recapture not only some of their own lost transactions, but also some which have flowed out of their competitors.
  • Rapid response to the unexpected is key –As with all regulation, the unstated issue is what’s coming next in the pipeline, be it PSD3 or some other impactful directive. Beyond scenario planning, responding to the unexpected is all about the ability to change processes and technology rapidly and with minimal disruption.They must regularly redefine what it means to ‘promise’ and ‘deliver’, not just generating rich insights, but selecting the right recommendation and next best action within time and budget constraints. Also, operating models and IT should be quickly and painlessly changeable from a single point.

The best-rated technology can do all of these things, often paying for itself within cycle.