Payments hubs address the last remaining efficiency frontier available to the payments industry: shared services.
As of September 2008, only five publicly announced payments hubs projects were under way globally in an environment populated by tens of thousands of institutions.
Ongoing payments convergence and downward pressure on revenues make payments hubs more attractive — and more viable — than ever before.
Although integration across and between payments silos is the goal of an effective payments hub project, silos exist for a reason: Redundant functionality may be reduced, but legitimate business needs might prevent it from ever being eliminated.
Deploying a payments hub to address a well-understood pain point provides valuable insight on time lines, improvements, and success criteria, which institutions can use to inform subsequent projects.
Institutions that do not invest in improving their payments capabilities risk being left behind by their competitors once global market conditions improve.
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