At EBAday 2024 in Lisbon, industry experts gathered to discuss new innovations and promising opportunities for the future of banking in Europe.
During the panel titled ‘The Instant Payments (r)evolution,’ participants included Simon Eacott, head of payments at NatWest; Ingo Faulhaber, division manager of account payments at Worldline; Wim Grosemans, global head of product management for payments and receivables at BNP Paribas; Hays Littlejohn, CEO of EBA Clearing; and Amelia Ruiz Heras, senior director of global solution consulting payments at Finastra. They delved into the evolving landscape of instant payments in Europe.
Eacott noted that it was expected for the audience to identify fraud, Know Your Customer (KYC), and Anti Money Laundering (AML) as the primary obstacles to instant payments adoption. Faulhaber anticipated that infrastructure and technology would be seen as larger challenges but emphasized that the journey toward widespread adoption is ongoing. He stated, “We would love to see more transactions, but it is critical to prioritize user experience, as users remain hesitant to engage with these transactions.”
Littlejohn highlighted the readiness of banks to implement instant payments infrastructure, urging attention to the entire ecosystem. “Infrastructure is one piece of the puzzle; we must focus on the complete end-to-end process,” he said.
Grosemans underscored the need for collaboration among banks, emphasizing the importance of continuous dialogue to effectively implement KYC measures and enhance the customer journey.
Eacott pointed out the UK’s struggles with fraud prevention, explaining the gaps in the regulatory framework. “While we’ve established protective measures for consumers after fraud occurs — including reimbursement schemes — preventing fraud is paramount. Utilizing data will be crucial for leveraging artificial intelligence and identifying trends that support instant payments infrastructure. This needs urgent attention from the industry,” he stated.
Heras remarked on the balance necessary for instant payments: “At times, instant payments become excessively frictionless. Banks may need to reintroduce some friction to help end-users appreciate the transfer of money that takes place.”
In another session, ‘New regulations – new opportunities?’, panelists Antoine Cuypers, director of strategic alliances at Intix; Karthik Jagannathan, head of presales and payment solutions at valantic FSA; Katja Lehr, managing director of EMEA payments and commerce solutions at JP Morgan Payments; and Julie Timpson, head of high-value and international payments at Barclays, discussed legislative developments from European regulators.
Jagannathan highlighted that some European regulations, such as ISO20022, are more industry-driven than central bank mandates but are vital for enhancing payment efficiency. “We need regulations because they help us catch up with market realities,” he commented.
Lehr emphasized that consumer protection should be the core focus of regulatory efforts. In light of the European geopolitical landscape, she raised questions about maintaining cross-border payments amidst potential sanctions.
Timpson noted the challenge for global banks to navigate a complex regulatory environment while keeping pace with compliance demands. Cuypers emphasized the importance of managing diverse datasets to simplify compliance.
In the panel ‘Reassessing priorities in liquidity management,’ experts Vivek Chikballapur, head of EMEA liquidity and account specialists at JP Morgan Payments; Jorge Filipe Nunes, head of liquidity and funding at Banco BPI; Justin Silsbury, lead product manager at Infosys Finacle; and Varun Yadav, director of product and global cash management at BNY, evaluated how the liquidity management ecosystem has been influenced by current global events.
Chikballapur stressed the importance of strategic decision-making and preparedness, suggesting that organizations should develop robust stress-testing frameworks to navigate uncertainties. Nunes highlighted that trust is foundational in liquidity management, advocating for strong partnerships with clients.
Silsbury discussed the potential of AI and machine learning in processing vast amounts of data, enhancing cash flow forecasting and capital optimization. Yadav pointed out the significance of precise customer segmentation to inform better decision-making.
As the market remains volatile due to geopolitical risks, Silsbury noted that lenders are responding by becoming more risk-averse, necessitating a proactive approach to liquidity management. Yadav reiterated the need to innovate across both operational and back-office functions to maintain competitiveness.