The European Parliament, the European Council, and the European Commission reached a provisional agreement on the new Instant Payments Regulation defined on November 7, 2023. This step marks the end of negotiations on this important regulation, which promotes a fast and efficient way of payment within the European Union and European Economic Area. What does this new agreement entail and what impact does it have? Our Instant Payments expert, Andrey Kim, shares his experiences with us.
Hi Andrey Kim, could you share your experience with Instant Payments?
Instant payments are rapidly becoming a new norm worldwide, and providing Instant Payment services is becoming a “must” for most banks, irrespective of their size and international reach.
However, Instant Payments is not a brand-new topic for the banking industry. I gained my initial experience through involvement in projects such as the UK Faster Payments and SARIE Real-Time Payments in Saudi Arabia some time ago.
That experience and ongoing support from our in-house subject matter experts have empowered me to take on the hybrid role of project manager and business analyst for the SEPA Instant initiative at one of the largest global banks.
From your experiences, what stands out as the most crucial learning?
Reflecting on my experiences, I appreciate that SEPA Instant is a highly standardized payment scheme. At the same time, each Instant Payments customer implementation still is a special case, and there is no one-size-fits-all approach.
The most crucial learning for me is how to make the best sense of an “out-of-the-box” Instant Payments solution by seamlessly connecting and integrating it into a specific bank’s specific infrastructure. Successfully achieving this integration is a technical challenge and a strategic imperative for the project.
The most crucial learning for me is how to make the best sense of an “out-of-the-box” Instant Payments solution by seamlessly connecting and integrating it into a specific bank’s specific infrastructure.
What are the potential pitfalls in implementing Instant Payments?
Implementing Instant Payments is a complex change that poses several challenges. Let’s take, for example, stakeholder management. Are both business and technology stakeholders on the same page and aligned regarding strategy, priorities, and requirements? How do we support 24/7/365 guaranteed availability as a new Instant Payments requirement?
It introduces a technical challenge for underlying systems and impacts business and operations processes, even to a more considerable extent, to revise the complete target operational model.
What advice would you give to other banks looking to implement Instant Payments?
I recommend taking the time to (re) shape your payment strategy, ensuring it fully aligns with sustainable growth objectives. Make a strategic choice to invest in an Instant Payment proposition as the core of your future target platform to enhance your capacity to retain and attract more payment volumes.
Additionally, selecting the right partners is crucial. Opt for those with a proven track record in delivering effective solutions and robust support models.
What lessons have you learned from your Instant Payments implementation experiences?
Maintaining sufficient project capacity and resources is essential throughout various phases. Keep your project governance transparent and try to avoid excessive reporting.
Another insight is that even with a seemingly “plug and play” vendor solution, it is critical not to underestimate the internal efforts required to integrate and make it work seamlessly from end to end.
Even with a seemingly “plug and play” vendor solution, it is critical not to underestimate the internal efforts.
How do you approach a project of this nature?
With the expected mandatory Instant Payment provision in 2024 for banks within the SEPA zone, our focus is helping them make it right first. Within Projective Group, we combine a powerful blend of deep industry knowledge and “know-how” Instant Payment expertise, allowing us to offer strategic advisory services and execution for our clients.
Within Projective Group, we combine a powerful blend of deep industry knowledge and “know-how” Instant Payment expertise, allowing us to offer strategic advisory services and execution for our clients.
Our comprehensive approach begins with building awareness (training and quick scan), followed by analysis and design (requirements & traceability matrix, RFP, vendor selection, business analysis), and then proceeding with implementation (project management and testing) to ensure a thorough and effective Instant Payments execution.
About Projective Group
Established in 2006, Projective Group is a leading Financial Services change specialist.
We are recognised within the industry as a complete solutions provider, partnering with clients in Financial Services to provide resolutions that are both holistic and pragmatic. We have evolved to become a trusted partner for companies that want to thrive and prosper in an ever-changing Financial Services landscape.
