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Business Transformation in Action

Joe McKendrick

In Banking, SOA Paves the Way to Consolidated Payment Systems

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In the banking world, centralized payment systems is one of those things on everyone's wish list, but a long way until reality. A new report by Jim Gahagan in American Banker says SOA may be a help here.

The challenge for banks, Gahagan says, is that noncash or electronic payments have been growing at a rapid clip. Plus, the range, scope, and complexity of customer channels has increased, making it difficult to untangle these systems. Centralized payments systems that can support increased volumes as well as business intelligence "can point to new revenue streams and increased cost efficiencies," he points out. "Banks that can effectively view, analyze and act on the data transmitted with each payment message can create custom products and services based on market segmentation and customer use."

This is a role for SOA, along with other approaches such as imaging, and real-time data access offer ways to invest in payment systems that can access existing systems without a lot of ripping and replacing. "Centralized payment services can enhance workflow management and routing, eliminate call center traffic and put an end to manual exception processing," Gahagan says. A typical financial institution could save between $450,000 and $5.6 million, he estimates.

In this blog (formerly known as "SOA in Action"), Joe McKendrick examines how BPM and related business and IT approaches can promote business transformation.

Joe McKendrick

Joe McKendrick is an author and independent analyst who tracks the impact of information technology on management and markets. View more

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