Facing industry regulations that have reduced fees and revenue, as well as increased competition from alternative banking providers, regional banks and credit unions are getting squeezed from all sides. With fewer resources to meet increased demand, many financial institutions have opted for a strategy focused on cost reduction instead of revenue replacement. But is this the right strategy? What if everything you knew about payments is wrong? What if it is not about cost reduction? If the cardholder is not using your card, they must be using someone else’s. It’s time to engage and fight back.
With the right payment processing solution financial institutions have the opportunity to change this strategy into one that instead cultivates brand loyalty and accesses untapped revenue. But not all solutions are the same. Let’s take a look at three important things to consider when choosing a payment processing solution for your financial institution.
- Payments expertise. When it comes to payment processing, managing multiple vendors has become par for the course for many financial institutions. With a collective payments expertise partner, everything is in one place, making it easier for institutions to manage their entire line of products and services. A partner that owns and maintains their own platform has the advantage of offering solutions that are not one-size-fits-all, adapting to the unique needs of each financial institution instead. Look for a solution that includes end-to-end portfolio management and revenue generation, including card production, issuing, processing and advisory services.
- Built-in, value added services. Today’s “omniconsumers,” who make purchasing decisions using all available channels, are extending their omnichannel preferences to financial institutions as well. With more options than ever, today’s consumers are accustomed to getting what they want, when and how they want it. Today’s consumers want their banking experience to be fast, easy and secure with the latest and greatest technology. Value added services such as mass re-issue of EMV cards, and seamless cardholder conversion can go a long way in maintaining high levels of customer service and satisfaction. When considering potential payment processing solutions, in addition to fast issuance of debit and EMV cards, ask about mobile banking products, critical for meeting consumer demand for personal connections in digital channels.
- Powerful analytics. “Know your customer, know your business.” It’s one thing to verify the identity of your cardholders, but how much do you know about their spending preferences? A financial institution can learn a lot about their cardholders with a payment processing solution that provides visibility into transactions including what cardholders are buying, and the types of cards they are using. Look for a solution that includes detailed data about cardholder transaction history, card usage and merchant preferences, in an easy to use format. When you know how much revenue your card portfolio is making, and the areas with the largest potential for growth, you can make informed decisions and implement targeted marketing and promotional programs that drive revenue.
Choosing a payment processing solution is an important decision. Knowing what to look for and the questions to ask can help you find the best solution for your financial institution.
Bill Hampton is Senior Vice President and General Manager of Financial Institution Services at Vantiv, Inc. (NYSE:VNTV), a leading provider of payment processing services and related technology solutions for merchants and financial institutions of all sizes.
Bill is responsible for all areas of the financial institutions business including directing sales, business development, channel management and relationship management teams for bank and credit union customers. This includes providing learning development, solutions consulting, implementations, campaign management, go-to-market development, sales platform development, customer experience/CRM strategy, and sales analytics.
Bill has more than 20 years of executive management and sales experience in financial services. He spent 15 years working in online and mobile banking with Digital Insight/Intuit. Before joining Digital Insight/Intuit, he served as a Manufacturer’s Representative for Diebold.