Improving client experience in payments

Delivering a positive client experience is becoming increasingly important for payment providers, especially in light of growing competition from challengers. 

SLA breaches, or ineffective management of the fall out of processing issues, can quite understandably rapidly reduce the chance of those impacted trusting the bank with future business or recommending the service to others. 

Historically you were more likely to get divorced than move bank.  The looming advent of portable bank account numbers means customers are much more likely and able to vote with their feet, if they get poor service: one too many negative experiences and they may not hang around much longer to be the bank’s retail customers, institutional or corporate clients to worry about. 

As such, I feel that whilst managing client experience may be primarily around controlling reputational risk, more importantly longer-term it’s essentially about retaining customers and driving profitability.  As the payments business is typically funded by per-transaction fees an expensive-to-manage system that is losing customers is a bad place for any provider to be.

So the real questions in my mind are how can banks better mitigate against SLA breaches taking place to start with?  And when unavoidable slips happen, and let’s be honest, we don’t live in a perfect world so 100% elimination is unlikely, how could they be better managed?

Personally, I think the answer lies in how firms structure their client support models, which unfortunately often seems to be reactive versus proactive.

All to often banks find themselves on a back foot when a client calls up with a question such as ‘Why was my payment late?’  The issue being that the first person aware the payment hasn’t been received, is not the bank that was carefully selected to process the payment, but the potentially irate client now facing problems of their own due to the delay. 

Only at this point does the support model sometimes kick in.  In terms of customer service, the bank has already lost.  If firms want to improve customer service, attract new customers and retain their existing ones, then this needs to change. 

If banks could get to the point where they can better predict problems emerging likely to impact critical SLAs, put in place measures to head of issues off before they develop and if this isn’t possible, at least be able to immediately understand the pain this will cause their customers, this could substantially improve the client experience.  Especially if they could comprehend the client impact before the client even realises anything has happened, so they can provide a pro-active, detailed and accurate response demonstrating the situation is under control.

The biggest problem firms face in figuring out which customers and payments are affected when there is a technical glitch is that they are often not actually monitoring the payments but the systems and processes they go through.  

I’ve spoken to many a tech guy over the years who believes “server up-time” is a business SLA.  It isn’t!  In these days of redundant, resilient infrastructure, it’s a very poor measure of whether a business process is working.  It’s an even worse starting point for figuring out customer impact when that server goes down.

Payment processing environments are often very complex, featuring legacy systems supporting bolted-on new technologies, system duplication and siloed technology all linked together by a maze of possible payment processing paths. Add to this the business complexity of cross-border payments and reduced acceptable payment windows. Firms often monitor these environments by continually assessing operational performance at a technical level on a system-by-system or process-by-process basis, versus monitoring the processes end-to-end at both a technical and business level.

What I mean by this is that they may have in place monitoring that will alert users to system or infrastructure deterioration.  However, they are rarely able to identify which payments have been impacted by an issue or be alerted to problems faced by specific payments or batches of payments in real-time.  Additionally, because of the fragmented approach finding missing payments can be a time-consuming nightmare.

Conversely, SLAs are ultimately all around meeting payment processing times and cut off commitments – not system performance per se.  Overcoming this challenge will take a switch in mindset from just monitoring systems for operational performance to also monitoring in real-time what really counts to clients, and ultimately the business’s bottom line – the payments themselves.

If firms were to track payments as they moved through the end-to-end process, problems could be better managed. For instance operational teams could be alerted to:

• Payments that haven’t arrived at the next expected step in the process indicating they may be stuck
• Those that have entered a common error state known to require manual repair
• Or, payments approaching cut off times, in danger of not getting over the line in time. 

An independent monitoring system can allocate truly unique identifiers for payments, and is able to provide cross-references to identifiers used within the various processing steps.  All of which means the ops teams can figure out what hasn’t completed, where it got stuck and what it’s called in the system where it’s stuck.

Moreover, when there are serious issues with a system, an independent monitoring system knows what was in-flight at the time, and it hasn’t crashed! This can help the system get back on its feet as quickly as possible with minimum disruption.

Also don’t get me wrong it is very important to be able to detect problems occurring at the infrastructure level and identify their location so they can be quickly solved.  However, what I am trying to say is knowing you have network problems or server outages without being able to understand what this means to the overall business process, and to the client’s whose payments you are processing, is pretty limiting.

Banks need solutions that combine the two approaches so they can not only quickly detect and pinpoint the location of emerging issues but also immediately quantify the client impact. 

This proactive approach could enable banks to massively reduce the number of SLA breaches caused by extended processing times and missed cut offs and when a payment will be unavoidably late instead of the client having to notify the bank, it’s the other way around!