Focus on Innovation Drives Commercial Banking Growth

Research shows real-time payments and customer strategy leading digital transformation

Call it payments modernization, digital transformation, or even cloud migration. The current innovation agenda is stacked and commercial banking systems are at its center. This research report helps to show how finance leaders are preparing for key industry initiatives, surveying C-level executives, CIOs, and more.

Industry initiatives leaders are focusing on:

• Banking customer acquisition and retention challenges
• ISO 20022 messaging and FedNOW journeys
• Focus areas for growth within the next 12 months
• Plans for open banking strategy
• Preparation for real-time payments

The stakes are high for finance leaders as they survey the balance of 2023. The pandemic’s most dangerous days look to be over and fears now center around the double whammy of inflation and a potential recession. Outside of macro issues, the table is set for change. The FedNow faster payments service will launch in July, bringing increased awareness and usage of the ISO 20022 messaging format. Open banking – which has gained substantial traction in the UK – is starting to see early usage in the US. And as always, banks are expected to get, keep, and grow their customer base at all costs.

So there’s substantial change in the wind. But here’s the problem: Banks don’t seem to be as prepared as they should be with so much at stake. CANAM Research partnered with Bottomline to sense check various issues under the heading of payments modernization, and found concerning evidence that legacy infrastructure combined with a lack of awareness of cloud-based technology could put innovative new payments solutions out of reach for many banks at a time when competition is at a premium.

What follows are the results of that research in four sections: legacy infrastructure, real-time payments, treasury management, and open banking.

With so much at stake, banks are approaching the short-term future of their business with a spirit and intent of innovation, improvement, and partnership. As long as the word “digital” is placed before each of these phrases, they will be able to compete for business and consumer accounts.

Top 3 focuses for commercial bank growth over the next 12 months:

• Payments innovation
• Treasury management update
• Fintech partnership