80 percent of banks expect real-time payments and open banking to drive transformation over time

 The study, “2018 Global Payments Insight Survey: Retail Banking,” was conducted by ACI Worldwide and Ovum.

The benchmark, comprised of responses from executives across financial institutions, merchants and billing organizations such as consumer finance and insurance, also showed that the emphasis on real-time payments has doubled from 31% to 62% within a 12-month span.

The explosion of activity in real-time payments and open banking has made payments transformation a key strategic initiative for many institutions globally. Although driven primarily by regulatory mandates in Europe, open banking has taken off in North America due to market competition. For banks, the message is clear; customers prefer real-time payments, whether it’s through a mobile app, or through traditional banking services.

Other findings from the study include:

Open Banking

• Banks reporting a clear strategy for developing APIs increased by 47 percent within one year

• European banks led at 92%, followed by 86% in Asia, and 82% in the Americas

• Over 70% (73) of banks were willing to open up their APIs to third party developers

• At 79%, European banks had the most proactive mindset, followed by Asia at 74%, and the Americas at 66%; interestingly, 70% of banks in the U.S. plan to encourage the use of their APIs

Real-time payments

• Banks that now expect real-time payments to drive revenue growth increased by 60% in one year

• The number of banks currently investing in real-time payments solutions doubled in a year, with 28% planning to make future investments

• Real-time payments drive a new wave of real-time payment hub investment for 43% of respondents

Online payment capabilities

• Holding steady at 68% globally are banks that currently or recently invested in this area, with many enhancing support for third-party wallet offerings and tokenization

• Payment Cards

• Real-time is becoming a reality with nearly 80% (78) of banks and almost 70% (68) of merchants globally stating that the combination of immediate payments and open banking will drive a decline in the importance of payment cards

Security/Compliance

• As banks prepare for the new payments ecosystem, they’re looking to balance security and compliance alongside innovation

• Security is a chief area of concern around open banking, increasing in Europe by 29%, and Asia by 16% between 2017 and 2018. However, banks in the Americas with security concerns declined by 25%.

Read the full report here. 

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