“Companies can no longer have all their eggs in one basket,” Paul Simpson, head of equity asset service at Bank of America Merrill Lynch, told delegates – as had been demonstrated by the fact that even some of the world’s largest, most advanced corporations have suffered security breaches. “We’ll have to continue spending money [to address the issue] and the focus will be on uncovering the weakest link in the chain.”
Simpson forecast that information security is set to become the number one challenge. “Expect strong innovation in that space and the entrance of some new players into the industry,” he forecast.
Global corporations operating in more than 10 countries worldwide would develop “multiple contingency plays”, focus more on both the security of information and types of information that they used, and compete increasingly keenly with one another for top talent and individuals with the ability to identify the weakest links in the business model.
Key Corporate Trends
In addition to the increased focus on security, Simpson said that another key corporate trend identified by BofA Merrill is the growing demand for bank-agnostic standards. These are any that provide easier integration, accelerated onboarding , a multibank approach for payments contingency and ‘flawless’ integration.
Innovation is geared toward increasing efficiency through streamlined solutions such as intelligent receivables and digital disbursements. By contrast, the US is still far too reliant on paper-based payments, although the past two years have seen some improvement in the situation.
The concept of peer-to-peer (P2P) payments is being adopted and leveraged by more companies, particularly those in the insurance sector, and the cost is being driven down.
“SWIFT’s Innotribe is interesting as it is commercialising innovation and proving itself nimbler and quicker to respond than the banks,” said Simpson.
Apple Pay’s launch was a prime example of how existing infrastructures could be fully leveraged, he added. “Young people use the smartphone as a source of both interaction and transaction. That means that some infrastructures that have been in place for years will no longer continue to be applicable.”
Taken to its logical conclusion, that could spell the ultimate demise of the traditional bricks-and-mortar bank.
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