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 Sponsored Posts 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. A very few articles on our website are sponsored posts or paid advertorials. These are marked as sponsored posts at the bottom of each post. For avoidance of any doubts and to make it easier for you to differentiate sponsored or non-sponsored articles or links, you may consider all articles on our site or all links to external websites as sponsored . 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.

Real-time payments – mitigating the security risks to capitalise on the opportunities

By Shrey Rastogi, Senior Payments Strategist at Temenos

The payments industry is an increasingly competitive environment, with pressures mounting on incumbent banks to innovate at the same pace as digital, neobanks and new payment players, such as PayPal and AliPay, to meet customer expectations for digital payments services that fit ‘invisibly’ into their convenience-driven lifestyles.

Increasing digitalisation across banking is resulting in skyrocketing payments volumes and a heightened emphasis on real-time payments. New regulations such as Open Banking, instant payments schemes and standards like ISO 20022 migration are accelerating payments transformation and setting deadlines to ensure that banks are adapting their processes and systems for the digital era.

Despite the economic downturn, today’s Covid-19 pandemic is further accelerating digital payments adoption around the globe, as consumers and businesses are rapidly moving from cash and other paper payment instruments. Digital payments are also key to e-commerce which again is growing at fast pace due to lock-down restrictions and social distancing norms in place now.

However, as payments volumes increase, get faster and systems advance, fraudsters are also becoming more sophisticated and banks find themselves faced with a new and more challenging risk environment. Today’s fraudsters don’t only use well-honed techniques, like phishing and social engineering, but also authorised push payment frauds along with organised cyberattacks like Advanced Persistent Threats (APTs) and (distributed) Denial-of-Service (DoS).

Shrey Rastogi
Shrey Rastogi

While it’s true that regulations like GDPR, Strong Customer Authentication (SCA) and Confirmation of Payee aim to reduce payment fraud, prevention truly begins with modern payment solutions that can deliver increased security without adding friction to the customers’ payment journeys.

As such, banks must pursue payments platforms with embedded machine learning and AI, to enable better fraud detection while supporting seamless customer experiences. With payment transaction speeds increasing with instant payments, banks must be able to analyse payment traffic in real-time to detect and stop fraudulent transactions before completion.

There are many technologies that increase payments security, such as encryption, tokenisation, multi-factor authentication and the use of biometrics across the payment life-cycle – from payment initiation to completion. Next-generation payment solutions incorporate these features to deliver payments experiences to customers that are both real-time and secure.

With many banks still relying on legacy payments systems that fall short of customer expectations and cannot cope with modern security challenges, there has never been a better time to adopt modern, real-time payments solutions. For retail customers, the latest technology provides real-time access to funds and a better user experience; for corporates, it can mean better cash flow management and for banks, it supports client acquisition and retention.

These benefits are even more significant and valuable in light of today’s Covid-19 crisis.

With the right real-time payments solution and right software provider, banks can improve security and resilience across their business and support mission-critical digital payments at a time when the global demand has never been so high.