SHARE:

As the European banking landscape transforms to digital payments and services, banks are under pressure to deliver higher margins and better customer service, pushed by new competitors including non-bank financial institutions (NBFIs), fintechs, Big Tech players and digital start-up banks.

In response to these challenges, banks are now looking to outsource parts of their payments business, with processing, fraud management, account management and card management all popular choices. Almost three-quarters of banks in this survey intend to use SaaS or another outsourcing model for some part of their card functions in the next three to five years.

The need to deliver greater operational efficiency is a key driver for outsourcing, followed by better platform functionality and flexibility and the capacity to reduce cost. Banks have a realistic and practical attitude to how much cost can be shifted from capital expenditure (CapEx) to operational expenditure (OpEx). However, banks recognise they lack practical experience in managing service level agreements (SLAs) and believe that it could take several years before their internal processes are optimised to enable efficient outsourcing.

These results underline the need for banks to work with trusted, knowledgeable partners as they develop their approaches to outsourcing and migrate more of their card and payments businesses to outsourced platform and service providers.

Find out more. Download the Report now.