Axway hosted the Corporate Banking Executive Roundtable in Soho, NYC. We gathered banking executives to explore the forces driving towards real-time corporate banking. For this, we partnered with Patricia Hines who leads the Corporate Banking Practice at Celent, Tom Statnick formerly the CIO of The Clearing House and Citibank; and Jacques Putz, CEO of LUXHUB. Patty, Tom and Jacques presented their observations on how the quest for real-time liquidity, payments and open banking is driving the adoption of emerging technologies in corporate banking. Giving their perspectives of a banking research analyst, CIO of a payments system provider and a CEO of an open banking platform.
Corporate Banking Executive Roundtable: Some topics explored:
*Harnessing enterprise integration to overcome digital challenges with legacy systems
*Exploiting value-added corporate banking services to drive real-time payment adoption
*Leveraging lessons learned from UK Open Banking and EU PSD2 APIs to create new capabilities for corporate clients
*Enabling corporate banking transformation and transparency with emerging technologies
The consensus of the group was that in the U.S., an open banking regulatory mandate is unlikely. Open banking, an API-first approach, is not yet a high priority, but all banks are thinking about it. The adoption rate differs whether you are on the consumer side of the wholesale side of the bank. Retail banking customers expect the same level of digital maturity as they experience in the eCommerce arena.
Market forces are pushing the U.S. banks towards an open banking model. It’s a matter of time before the corporate customer has the same expectation. Corporate treasurers, conducting business with the banks, have their own integration challenges as they most likely have multiple file transfer routes that need to be supported. While open banking is not the law in the U.S.; changes are underway in Canada with the proposal of consumer-directed banking. The rest of the world is embracing open banking. The U.S. banks who take the lead in open banking are better able to compete with the tech giants who are encroaching on the bank’s turf.
One of the keys to driving change is real-time payments. Behind the scenes of real-time payments, is the back-office infrastructure needed to support faster DDA, treasury, forecasting, settlement, etc. It was mentioned that the availability of metadata on the payment is key. If the metadata is rich enough, the manual process of matching invoices to payments or wire transfers to accounts can be automated.
How banks are driving business value with APIs falls into four categories:
*APIs for Internal Integration
*APIs for Client Connectivity
*APIs for Banking as a platform
*APIs for Enabling Innovation
Open banking may not be a government mandate in the U.S. but leading banks who have API initiatives are at the beginning of the journey. Read all about the Open Banking & Open API: The future of financial services in Asia at IDC.
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