Page 27 - GS231201

CoverStory

must continue to adapt our strategies to counter new types Digitization
of fraud, particularly those involving deepfakes and ad-
vanced phishing schemes," he said. "We're already seeing Pettet maintained that in the chess match between fraud-
this with bogus applications." sters and fraud defenders, it's important for financial ser-
vice stakeholders to stay one move ahead of the bad guys,
Multi-bank relationships especially in the current economic climate, where higher
interest rates and reduced commercial lending are impact-
Kevin Pettet, chief revenue officer, North American bank- ing major profit centers. Digitalization can help reduce
ing for Bottomline Technologies, expects multi-bank rela- manual processes and increase payment monetization,
tionships to become a corporate staple in 2024, following a and migrating check payments to electronic payments
tumultuous year for banking in 2023. can reduce operating costs, create unique experiences and
drive innovation, he advised.
"If you're a commercial banker, the best way to manage
this trend is by owning the primary banking relationship," Seaman emphasized the need for advanced encryption
he said. "Maybe your corporate accounts have multiple and tokenization in a digital-first world, with mass adop-
banks, but they're going to have one primary operating tion of network tokens significantly enhancing payment
account through which they will consolidate the majority security, customer experience and lower interchange
of their services." costs. Since April 2022, Visa's tokenization program has
helped participating merchants reduce interchange fees
To achieve that primary relationship, Pettet said, banks and heighten security, he stated.
will need to offer new revenue streams to business cus-
tomers, similar to credit card interchange models. Banks "These tokens, designed to mask the Primary Account
that enable corporate customers to make payments will Number of a cardholder, not only bolster security but also
solidify primary relationships and increase revenue, he streamline the transaction process," he said. "This inno-
added. vation has led to notable improvements in authorization
rates, with Visa reporting a 2 percent increase for mer-
Pettet further noted that multiple bank relationships can chants utilizing network tokens."
complicate cash flow management. Financial institutions
that provide a holistic view of a business's cash position POS to POI
across all banking relationships, coupled with meaning-
ful forecasting tools, will make finance teams' jobs much John Arato, senior vice president of sales at Pax Technol-
easier and help these banks own the primary relationship, ogy, has seen payments evolve from point of sale to points
he added. of interaction and from uniform hardware populations to
secure, open source, cloud-enabled technologies that us-
Insider threats ers can freely customize.
Insider threats at financial institutions and other corpo- "We should continue to see growth in the use of payment
rations, are also on the rise, Pettet noted, stating that he terminals that utilize the Android operating system," he
expects banks to become more aggressive in detecting said. "Android will provide enormous flexibility for mer-
threats and defending against them. "And I'm not talking chants who want to develop and run unique applications
about insider trading here," he said. "I'm talking about em- on their payment devices including their own POS soft-
ployees who steal money, steal data, manipulate data and ware."
access privileged information."
Looking ahead, Arato expects to see continued interest in
Noting that Insider fraud has accounted for over one-half tap-to-pay solutions among consumers and merchants,
of all bank fraud and embezzlement cases closed by the with more movement toward tap-to-phone, barcode-based
FBI during the past several years, according to The Federal POS solutions and AI usage in payment transactions.
Deposit Insurance Corporation data, Pettet suggested the He advised payments industry stakeholders to embrace
trend began with pandemic-driven hybrid workers, using change, stating, "Don't be afraid to take on new challenges
connected devices at home, and subsequently spread to and offer new products and services that will make your
other use cases. solution unique in the marketplace."

"Insider threats need to be met first with technology that Part 2 of this series will appear in our Jan. 8, 2024, issue
can monitor employee interactions to core banking sys- and will explore additional harbingers of digital transfor-
tems and privileged data usage," he said. "Second, they mation across payments and financial services. Our year-
need to be addressed culturally by educating the work- end wrap-up article will appear in our last issue of 2023.
force about the patterns inherent in insider threats, such
as an employee who suddenly wants access to data or sys-
tems he or she did not previously have. Third, enterprise Dale S. Laszig, senior staff writer at The Green Sheet and founder and
case management solutions need to be deployed that can CEO at DSL Direct LLC, is a payments industry journalist and content
help financial institutions organize, prioritize and man- strategist. Connect with her at dale@dsldirectllc.com, LinkedIn www.
age insider threats in one system." linkedin.com/in/dalelaszig/ and Twitter https://twitter.com/DSLdirect
27