Nearly nine of 10 bankers admit their bank does not have a formal payments strategy. Of those, only 46% have plans to develop a formal payments strategy. Furthermore, 36% of respondents characterize their bank’s approach to payments strategy as “fast follower,” while 54% said their bank takes a “wait and see” approach. Only 3% consider their bank a “first mover/experimenter.”
The startling findings come from the American Bankers Association first-time payments survey of 200 banks.
Also, the survey found responsibility for setting payments strategy varies greatly among institutions. At many banks (35%) the chief financial officer or the chief operating officer is responsible for setting the payments strategy. Only 7% have an enterprise-level payments officer and 14% have a payments committee.
Thirty percent of respondents indicated that their bank has partnered with a fintech company. The survey also found that more than 40% of banks offer same-day payment processing and mobile person-to-person payments. Only a small minority offer e-wallet capabilities.
According to the survey, the greatest impediments banks face to implementing their payments strategies are their reliance on a third-party core system provider, technical integration issues and limited resources.
Respondents agreed that the top challenge when competing in payments today is data security and privacy. Identity theft and data breaches are ranked as the highest threat to payments security.