The pivotal trends redefining the payments world | Interview with EY Canada

Diana, can you please introduce yourself and your professional background?

I am EY Canada’s payments practice leader with over 18 years of experience in the payments space. As a practice leader, I work with the local and global leadership to help define our Payments strategy.  This strategy informs our go-to-market offerings, our talent recruitment and growth, as well as our alliance partnerships and thought capital development, to list a few of my responsibilities.    

Could you please elaborate on the key trends that are redefining the payments world? 

• The convergence of high value and low value payments onto a single real-time network: With higher limits, greater value-added services such as RtP, Fraud and the interoperability of the networks and message standard (e.g. ISO20022) this convergence is inevitable.  We are already seeing evidence of this with SWIFT and the traditional card networks like Mastercard. 
• Social media companies will be the next channel for payments:  Social media platforms are already putting in place a mechanism to move money across their ecosystem.  For example, some social media platforms allow their content creators to receive payment for specialised content, funds from their followers or patrons and viewership credits that can be redeemed for cash. Given the transactional volumes, it logically follows that these companies will bring in-house payments processing by applying for MSB licenses, while standing up their own payments processing technology and operations.  

Which payments-related trends stand out for you lately?

The payments trend that stands out to me in the near term, is the growth of value-added services (VAS) on real-time payments. VAS such as real-time fraud monitoring and scoring, liquidity management and request to pay, etc., will likely be the next battleground for payments service providers, banks and fintechs. With 43% of Canadians stating that COVID-19 had changed their payment preferences to digital and contactless for the long-term, and 48% paying their bills through online banking or pre-authorised debits (PAD), it’s clear that financial institutions must prioritise the successful execution of their payment modernisation journey to remain competitive.

The economy is facing massive disruptions (inflation, great resignation). When it comes to payments, how are customer needs changing and how can fintechs help? 

Advances in technology, changes in regulations, new competitors and increasing customer demands are transforming financial services and creating a new digital ecosystem. Enabled by technology, it is becoming increasingly easier to bring together the capabilities of the incumbent institutions and the strengths of the fintechs. This will result in financial services at lower cost, higher speed and at a better quality to more consumers. Based on our thorough understanding of the market and customer demand, we believe that a well-functioning fintech ecosystem is built on four core attributes: 

• Talent: The availability of technical, financial services and entrepreneurial talent
• Capital: The availability of financial resources for start-ups and scale-ups
• Policy: Government policy across regulation, tax and sector growth initiatives, including the presence of digital public infrastructure to facilitate financial services innovation
• Demand: End-client demand across consumers, financial institutions and government

How can banks stay relevant as customer preferences and needs change?

About Diana Halder

Diana is a visionary leader with a proven track record of leading transformational change in complex environments. She is an executive with over 18 years in payments, banking, and technology delivery. Her work focuses on strategy design and execution across retail and commercial payment initiatives. Diana has a Bachelor of Commerce from the University of Toronto and believes that payments is a key enabler of digital commerce and financial inclusion. 

EY exists to build a better working world, helping create long-term value for clients and society. Enabled by data and technology, diverse EY teams work across assurance, consulting, law, strategy, tax and transactions in over 150 countries. They ask better questions to identify solutions to complex issues facing our world and help clients grow and transform their businesses.