Payment data analytics is presenting significant opportunities for banks to drive additional revenues and enhance their value proposition.
Banks are exploring numerous ways to generate real value from their payment data,
Payments data analytics
with card-linked offerings and personal finance management (PFM) services leading the way, according to a report from Efma and Kurt Salmon, Payment innovation: Maximizing the potential of payment analytics.
The report identifies four opportunities for issuing banks to take advantage of their data and provide businesses and individuals with value-added services: leveraging data to improve internal processes; selling raw data; providing PFM services; and delivering merchant-oriented offerings. Adoption levels across these areas vary considerably at present. For example, card-linked offerings and PFM are already mature, while raw data monetisation has not taken off.
“Banks are having to adapt their offerings and identify new sources of revenue to compensate for shortfalls in their established business models,” says Patrick Desmarès, Efma’s CEO. “While many banks recognise the commercial potential of their payment data, they still need to figure out how they can take advantage of it effectively. PFM tools are proving a popular way to use payment data to add value to customers, meanwhile options such as selling raw data to other businesses continue to be approached with extreme caution. The fact is that many initiatives are underway, but we are still yet to see how banks can really maximise the potential of their data.”
“This is an area where an increasing numbers of data analytics specialists are already competing to tap into the value of payment data,” adds Pierre de Brabois, senior manager at Kurt Salmon. “In order to truly succeed, banks must consider whether they should go it alone or whether they should work with other banks or data specialists.”
This is the first report to come from the Efma Payment Innovation Think Tank – a forum, which was formed in early 2014, for senior executives from major European banks to meet and exchange information and ideas. The report covers the four meetings that focused on how financial institutions can better understand and use payment transactions data.
Download payment data analytics report here.
Payment data analytics is presenting significant opportunities for banks to drive additional revenues and enhance their value proposition
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