Newsletter: September 2024
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Top 6 Benefits of Centralizing Payment Operations
As financial institutions upgrade their payment systems with modern hubs, many are adopting a modular approach. Many use these modern hubs to integrate new, faster payment systems like RTP and FedNow. At the same time, they still rely on existing systems for ACH and Fedwire. During this transition and coexistence, banks often face more fragmentation and lack a clear view of payment flows and transactions from different channels. A central operations console is essential, regardless of when they decide to fully consolidate their systems. Read more
Finzly Announces Collaboration with Corpay Cross-Border
Our partnership empowers financial institutions with real-time FX rates and access to over 200 international markets for foreign currency international wires on Finzly’s platform. Learn more about our partnership with Corpay Cross-Border Solutions to provide enhanced FX capabilities.
Moving Beyond Instant Payments "receive-only"
Gain insight into the evolving instant payments landscape in the latest article from Tearsheet where Booshan Rengachari , CEO and Founder of Finzly shares his perspective. Rengachari addresses the hurdles banks face in implementing real-time transactions, the potential for new customer-centric services, and the strategic considerations for financial institutions as they navigate the world of instant payments. Read the full article from Tearsheet to learn more.
United Community Partners with Finzly to Expand FX Services
United Community Bank is a prime example of how a community bank is leveraging technology to tap into lucrative FX opportunities while enhancing its international banking services and customer experience. Read more in our latest update.
The SMB Showdown: Are Banks Surrendering Payments and Data to Fintechs?
Last month, we saw a significant shift as banks like Citi, previously focused on other customer segments, began turning their attention to the SMB sector. US Bank has also ramped up its efforts to integrate payments and banking services specifically for small and medium-sized businesses. Beyond lending, payments have become a crucial area where financial institutions are innovating to better cater to SMBs.
The good news is that fintechs haven’t completely filled the gap in the SMB market- at least not in the US. Take Square, for instance, a fintech that's popular with SMBs. In the UK, Square offers instant transfers for a 1% fee, with funds arriving in just 20 minutes, thanks to their use of instant payment rails. However, in the US, Square’s instant transfers still rely on card networks, incurring a 1.75% fee per transfer, plus standard card processing fees ranging from 1.4% to 2.5%. While these features are attractive to SMBs, the associated fees remain a concern.
With nearly 80% of small business employees desiring flexible payment options and a similar percentage of SMBs awaiting their banks to integrate payments with their banking services, there is a significant opportunity for banks in the US. Banks that are not ready to offer instant payment capabilities via RTP and FedNow are risking the chance to fintechs, losing transactions and accounts to platforms like Square, Venmo and Zelle.
On a positive note, the new ISO 20022 messaging standard offers a wealth of data that banks can leverage. This provides an excellent opportunity to deliver valuable analytics, akin to what Square offers - insights into customer spending patterns using the location and purpose code fields of ISO 20022.
For banks, the path forward is clear: focus on these two high-potential areas - payments and data - to position yourself as the premier solution for SMBs. Don’t let this opportunity slip through your fingers.
Interested to learn more about how financial institutions can leverage ISO 20022 to create more valuable services for SMBs? Download our exclusive whitepaper.