Identifying and solving key aspects of global payments friction via the 2022 Global Payment Survey
End-to-End is Linear – The Real World is Connected
Connected’ digital wallets enable inbound and outbound payment processes to incorporate aggregation functionality as well as connecting peers, facilitating multi-currency, multi-source and multi-payment use cases.
Moving money from one place to another is a linear process, so it’s relatively easy to master incoming and outgoing payments. However, the ‘end in mind’ for most B2B customers extends well beyond simply moving money from Account A to Account B. In our last post, we covered the true nature of that in the context of all the ancillary processes needed to make an end-to-end solution truly valuable to a customer.
However, since the real world is an interconnected web of relationships and digital transformation has only served to underscore those interconnections, perhaps even thinking in terms of end-to-end payments processes is a bit too linear.
In today’s economy business models are proliferating, influencers are being monetized and all forms of B2B, B2C, B2B2C and peer-to-peer platforms have emerged, while payment processes that align with these new ‘connected’ relationship models are often lagging. If relationships are networked, then payment processes must follow suit to support these business models and relationship use cases.
Digital wallets emerged to move payments online, streamlining business processes, eliminating currency boundaries and lowering fees for both payers and payees. In many ways, the disruptive effects of this are still in the early stages although the use of digital wallets has become mainstream.
The ‘connected’ wallet then takes the digital wallet premise to the next level enabling inbound and outbound payment processes to incorporate aggregation functionality as well as connecting peers. Connected wallets enable incoming payments to be reported by partner as well as by source, facilitating multi-currency, multi-source and multi-payment use cases.
As new relationship models emerge to connect individuals and companies, connected wallets enable new models of aggregation. Developers can architect payment flows that readily support complex business payment workflows across geopolitical and traditional currency boundaries. Processes and workflows can be easily adapted to enable these business and relationship management models. As the need to integrate these modern business models and the complexity of global business grows, the need for intelligent payment platforms to architect more feature rich digital wallets will compound.
While the end result of a vast majority of payment transactions is to move money from one entity’s bank account to another’s bank account, ‘end-to-end’ if you will, the much richer data and relationship insight that new software is empowering is not well served by traditional financial institutions. Hence the rise of all forms of fin-tech solutions.
Ultimately, ACH to ACH transfers require a ‘bank ‘ at each end. By definition, however, their functionality is restrictive and limited. The ability to make payments both secure and intelligent, however, requires much more than banks can offer. And they need to be delivered at far lower costs.
We’re continuously expanding our payment capabilities and APIs to enable an ever-broadening range of use cases leveraging our Intelligent Payments Architecture and Connect Digital Wallets..
How do you want to integrate your payments in the real ‘connected’ world, now and in the future?
We’d love to help.