Last year, a breach of cloud storage company Snowflake resulted in data stolen from more than 150 companies, with more than $2 million extorted from victims. The attack was carried out by an infostealer, a type of malware that didn’t directly infiltrate Snowflake but instead entered through a client with weak security measures. The growing market for financial data stolen by hackers has made these attacks an escalating threat to financial institutions worldwide.

In a PaymentsJournal podcast, Mike Kosak, Senior Principal Intelligence Analyst at LastPass, and Jennifer Pitt, Senior Analyst in Fraud and Security at Javelin Strategy & Research, looked at the threat that infostealers currently pose to banks. They discussed how infostealers present risks even to third-party vendors, and how organizations can stay one step ahead in protecting their sensitive information.

What Are Infostealers?

Infostealers are a specific type of malware that collects critical information from victims’ computer systems. They primarily target browser-based data, such as credentials, session tokens, and details about software that can be extracted from the operating system and sold to malicious brokers.

Infostealers are generally small, lightweight programs built for speed. They’re designed to execute quickly and then delete themselves. This rapid execution is a key reason why infostealers are so difficult to detect. In 54% of the cases that security service Spycloud examined, the victim had an active antivirus program running on their system.

Infostealers are typically sold by initial access brokers, a subset of the cybercriminal ecosystem focused on gaining entry to systems. This initial access allows other, more specialized groups to take action using the stolen information, including ransomware operations and nation-state threat actors. These brokers are agnostic to the buyer, willing to sell the data to anyone.

FIs Are Especially Vulnerable

Infostealers often target financial institutions, not just because they hold the money, but because they can scrape passwords from customers’ browsers, which frequently include login credentials for financial institutions. This tactic is a way to circumvent many of the fraud and account takeover prevention measures that FIs have in place.

Customers at financial institutions often reuse passwords across multiple accounts, including those at different banks. Many of these financial accounts are linked to other services like email or social media, with the same passwords being used. These reused credentials are especially valuable to infostealers.

These kinds of attacks are not limited to customers; employees have also fallen victim. If multi-factor authentication is not enforced for employees, they often use weak, short passwords or reuse them across multiple systems. Some employees continue to access personal accounts or use personal devices at work.

In recent months, major browsers have implemented strong mitigations, but larger infostealers have been quick to figure out workarounds.

“They’re constantly evolving,” said Kosak.  “It’s a very effective marketplace and a very effective tool. It’s cost effective and it works. That keeps bringing on more of these threat actors, both people who are trying to make money on the initial access broker sites and the developers themselves.”

Infostealers are also targeting session tokens, which can be used to circumvent credentials if the right protections aren’t in place. If criminals get the data fresh enough, most of it ends up available for sale within a day of the of the time that it’s stolen.

The Hidden Risks

The risks to financial institutions from infostealers are broader than they might initially appear. While the primary threat is theft, there is also fraud loss, operational risk, and reputational risk. Once a financial institution starts losing a significant amount of money from this, if it lacks proper protections in place with the media, the reputational risk can be massive.

FIs should also consider their business-to-business connections. Infostealers can target supply chains and third-party vendors just as easily as customers or the business itself. Supply chain vulnerabilities can have second- and third-order effects, impacting customers as much as a direct breach of the institution.

When an organization hires cloud service providers or third-party vendors to protect its data, the original institution remains responsible for vetting that third-party processor. It must ensure the vendor has the proper security protocols in place to deter infostealers.

“The Snowflake data breach happened because they hired a third-party company that didn’t require multi-factor authentication,” said Pitt. “Ultimately, the customer is going to hold the initial institution responsible. They’re going to start leaving banks for somebody else that will actually protect their credentials.”

The Latest in Prevention

Identity and Access Management (IAM) programs can significantly reduce the risk posed by infostealers. An effective IAM strategy includes strict access controls and continuous monitoring to detect and respond to suspicious activity. When only authorized users can access sensitive data, it becomes much harder for threat actors to exploit stolen credentials.

Multi-factor authentication remains absolutely critical, as is requiring customers to use unique and complex passwords for every account. If passkeys are an option, use them as well.

“That’s an absolutely critical next step when we think about how to mitigate this risk in the longer term,” Kosak said. “Passkeys are going to become more and more important. We’re still very early in the adoption cycle on that, but they’re phishing resistant.”

Another important factor for FIs to be aware of is cracked software. People concerned about infostealers should resist the temptation to download and install free software applications.

“If you see something that looks a little off the books, it’s probably going to come with a nasty surprise,” said Kosak. “They direct people to these YouTube links that deliver malware. Stick to known app stores.”

Behavioral detection, including user behavior analytics and device fingerprinting, is emerging as a strong defense against infostealers. They help detect account takeovers, for instance. If an FI detects any anomalous behavior, they can have processes in place to mitigate these risks and cut off the actions as they’re happening.

Polite Paranoia

All financial institutions have annual training requirements that everyone must complete to understand the threat environment. There’s another aspect that can be a bit harder to implement and articulate—the culture side. The core issue is instilling a culture of polite paranoia.

“You’ve got to be willing to raise questions both up and down the chain if you see something that’s suspicious,” said Kosak. “Being willing as a new junior associate to raise your hand and say, ‘hey, this seems suspicious to me, that’s a cultural aspect to an institution.’ Being willing to be challenged if you’re a senior in that institution and say, ‘hey, I’m glad you’re asking that question.’ That’s really powerful too.”

“These threat actors will use fear and intimidation and psychological pressure to get people to act without having the time or feeling like they have the channels to raise questions,” he said. “Polite paranoia takes that away from them.”

The post Infostealers: The Latest Cyberthreat Facing Financial Institutions appeared first on PaymentsJournal.

Across industries and companies—from small businesses to large enterprises—organizations are constantly searching for ways to improve corporate culture and boost employee engagement. However, in large, dispersed companies, providing employees with the personal touch needed to maintain motivation can be particularly challenging.

In a PaymentsJournal podcast, Julie Gu, Vice President of Sales and Marketing, North America, at Prezzee, and Jordan Hirschfield, Director of Prepaid at Javelin Strategy & Research, examined key trends in employee incentive programs, the challenges organizations face, and how customized gift card program can effectively drive engagement.

Don’t Skimp on the RICE

Just as important as understanding what employees bring to the table at work is recognizing who they are as individuals. This is why organizations are increasingly interested in their employees’ hobbies, wellness, and inclusion interests.

As companies explore ways to boost employee engagement, there is an acronym—RICE—they should keep in mind.

“You know I’m Asian, so I never skimp on the rice,” Gu said. “What that means is that ‘R’ is for rewards and ‘I’ for incentives. ‘C’ is for celebrations—and that’s celebrating moments big and small, professional, and personal. Then, there is ‘E’ for engagement, which is making sure you’re forming a daily habit throughout, and that transcends all the aspects.”

Fostering engagement on a daily basis can be difficult in a busy office—and even more so in virtual or hybrid teams.

“We’re very virtual in our organization, so I joined a running group,” Hirschfield said. “I’m a poor runner, but it motivates me to run. Someone just ran a marathon, so it’s a great opportunity to celebrate that. With all these groups, we’re getting updates on coworkers who are having babies or weddings or things that humanize the organization. You don’t want to be an organization that’s robotic.”

Reinforcing the Right Behaviors

This shift toward interest groups is a key engagement trend. While many companies have already implemented enterprise resource groups (ERGs) to foster inclusion, interest groups can be more enjoyable and feel less obligatory than ERGs.

One of the most common types of interest groups is step challenges. However, many organizations are evolving past simple challenges like reaching 10,000 steps in a day. Micro-challenges, such as hitting 500 steps in a day, can be even more impactful.

“The micro-goals are important because that person who hasn’t been participating in an exercise program might be intimidated by 10,000 steps,” Hirschfield said. “I look at myself—I work at home, so I’m not walking from my car to the elevator, which adds a couple hundred steps here or there. Getting to 10,000 steps can be difficult for some people, but when you have attainable goals, they get that feedback and engagement.”

In addition to setting smaller goals, more companies are creating groups around shared experiences. As they organize these activities, organizations should ensure they support interests that positively impact their company.

“The first step is to think about what behaviors are already happening around the organization that you want to reward?” Gu said. “What do you want to continue to validate and celebrate? Who can you showcase as a great example of somebody who’s already living our core values who we can show as an ideal value ambassador? You want to reward those behaviors and make that a daily habit.”

Once organizations recognize existing behaviors, they can begin identifying the activities they want to incentivize. For instance, many employers emphasize mental health and wellness initiatives, as a healthier workforce tends to be happier and more productive.

“Think about which ways you want to reward versus incentivize, and from there,  cascade down to the snackable ways (you) can start, so you can start small,” Gu said. “It shouldn’t feel like this big three-year-long, road-map project that you have to tackle, because that’s where budget constraints and a lot of challenges start to happen.”

Closing the Feedback Loop

As companies refine their employee engagement plans, one of the most important aspects to consider is the employee themselves.

“I have three keywords—feedback, feedback, feedback,” Hirschfield said. “Employees want to feel like they’re being heard. Incentives are going to boost morale—Javelin has a lot of data that proves that—but what also boosts morale is giving employees what they want. That doesn’t mean you need to cater to their every whim of the employee; it means you’re listening to them.”

If employees see that even one program is introduced based on their feedback, it will make them feel that their voice matters and that they belong within the organization.

However, as organizations shift their incentive plans from being employer-driven to employee-driven, it’s important not to overlook the link between the two.

“People leave companies, but they stay for managers,” Gu said. “It’s critical to empower managers when we talk about employee rewards and engagement and incentives. It’s about how do we make sure that employees’ direct support every day is empowered. It makes them feel that they have a sense of community, and that they have this closed feedback loop and can feel heard.”

This community isn’t possible if the manager themselves doesn’t feel equipped with the tools or support needed to reward their teams effectively. One simple, turnkey way to empower managers in driving employee engagement is by enabling them to deliver gift card rewards.

Many companies have adopted this approach using small-denomination gift cards. For example, a manager could send a $5 gift card to recognize a team member for excelling at a task or contributing in a meeting—an appreciation that can have a greater impact than a simple kudos.

“A $5 card when it came from my manager probably feels a lot better than $25 coming from some generic HR inbox or a person who I’ve never met,” Hirschfield said. “The opportunity to make that connection is a huge step. If it’s an HR department that controls these budgets, it may be empowering managers to have access to it and make it easy for them to personally provide those rewards. It’s critical in terms of making that human-to-human connection.”

Beyond Monetary Value

Personalized incentive programs that utilize gift cards are an integral way to create connections and make an employee feel appreciated. Not only are gift cards the most popular gift among recipients, but they can also be tailored to the employee in many ways.

“You can include additional messages so that when I send you that gift card—even though it’s only for $5—the message that I send is that I noticed that you are training for a marathon, so here’s $5 towards your training regime,” Gu said. “It’s not really the monetary value, it’s the fact that you feel heard, seen, noticed and appreciated—and you feel supported for something that’s a big task.”

When giving a gift card, a little extra thought goes a long way. If the employee is training for a marathon, they might appreciate a $5 gift card to Starbucks. However, a gift card to a Dick’s Sporting Goods along with a personal message could have a much stronger impact.

“When you personalize it, you provide that reward or incentive or celebration that speaks to what that employee is doing, so making sure those are choices available to the HR department or the manager who is providing that opportunity, those are key,” Hirschfield said.

A Means to an End

For many organizations, implementing a personalized engagement program that leverages gift cards can be a daunting task. However, companies like Prezzee offer solutions that tailor incentive plans to an organization’s specific needs.

“We make your goals our goals,” Gu said. “Where are you struggling to find engagement or retention? Are you having attrition issues? In terms of employee engagement, we are constantly thinking about it every single day, from our employees to your employees, and we think of the gift card as a delivery vehicle—and a means to an end.”

The post Personalized Gift Cards Are the Cornerstone of Employee Engagement Programs appeared first on PaymentsJournal.

When Academy Bank first considered outsourcing its item processing, it anticipated a challenging and uncertain journey. However, partnering with Fiserv transformed the experience, delivering both anticipated and unexpected benefits—ranging from a streamlined training process to a significant reduction in client impact errors.

In a PaymentsJournal podcast, several members of the Academy team—including CIO Shannon Gilley, Executive Vice President & Director of Deposit Operations  Margaret Bosley, and Item Processing Assistant Manager Dionne Green—discussed the challenges that outsourcing presented and how the new system has changed how they operate. They spoke with Candace Burleson, Implementations Analyst at Fiserv, and James Wester, Co-Head of Payments at Javelin Strategy & Research. 

A Legacy of Problems

As Academy embarked on its outsourcing journey, the bank encountered numerous challenges. The proof team was tasked with monitoring140 branches, overseeing everything from the opening run to the end run. Many branch scanners were nearing the end of their lifespan, and perhaps most concerning, the physical tickets were increasingly contributing to negative client experiences.

“One of the biggest challenges for us was that we were the frontline of support for all of the branches,” said Green. “We had over 140 branches that we were balancing daily, with just eight full-time employees that divided all of those runs. If there were any connectivity issues when the branches were trying to open up their runs or any issues related to the scanner, we were the front line of support.”

The Academy team had a single dedicated resource that was responsible for custom scripting. If there were any issues or incidents with that individual, there was no contingency plan in place.

Balancing was an issue because of all of the manual or physical tickets being run at the branch level. The team had to wait for batches to close at the end of the day and often were forced to double their efforts by handwriting tickets and manually inputting them into the teller system. The manual processes also resulted in errors affecting client accounts.

The branches were saddled with hardware that was near the end of its life and was in bad need of standardization. The different types of printers across the branches resulted in a continual need for additional software or logins.

Increased Efficiencies

Once outsourcing was in place, Academy found several efficiencies on its end. The proof team was reduced by two full-time employees who had been handling keying and balancing proof work. Additionally, Academy had been relying on an external provider for keying assistance when short-staffed, at a cost of $600 to $800 per month. This expense was completely eliminated.

“It was always difficult for us to maintain eight FTEs for this department,” said Green. “When folks get into banking, they expect bankers’ hours. These were not bankers’ hours. Because of the different time zones that we support, our balancers would have to work until 8:00pm and 9:00pm, and sometimes on Saturday.”

The efficiency gains were significant. With fewer client-impact errors at both the branch and operations levels, the time spent correcting those errors dropped to just five to seven person-hours a week.   

Branches were able to shift their focus to sales, while the proof team redirected its efforts toward more critical functions, such as receiving training to identify check deposit fraud.  

 “Our goal,” said Gilley. “is to focus on our clients, making sure that we are working on the products and services that are meaningful to those clients every single day. Moving that technology to our software provider has really freed us up in order to focus on the more important things.”

An Involved Process

Outsourcing can initially seem challenging and expensive. But the costs of keeping everything in-house can often be even higher.

“Don’t underestimate your current costs when you look at everything involved with your in-house process,” said Bosley. “Don’t underestimate those costs, because you are going to see significant savings in areas that maybe you didn’t even expect to.”

At the same time, banks should be transparent with their employees about the process. While it will be a journey, understanding the long-term benefits will make it worthwhile for everyone involved.

The post Inside Outsourced Item Processing: A Client Case Study appeared first on PaymentsJournal.

Many organizations still rely on paper checks, with no immediate plans to phase them out. However, one of the key issues with checks is that criminals favor them as well.

Last year’s AFP Payments Fraud and Control report found that checks are the most frequently targeted payment method for attempted payments fraud—nearly twice as much as ACH transactions.

In a recent PaymentsJournal podcast, U.S. Bank’s Scott Pope, Senior Vice President, Senior Manager of Risk and Compliance; Consumer and Small Business Payments and Mike Watercott, Vice President and Working Capital Consultant, Treasury Management, as well as Jordan Hirschfield, Director of Prepaid at Javelin Strategy & Research, discussed the vulnerabilities of paper-based payments and the advantages of shifting to electronic transactions, particularly through prepaid disbursement options.

An Increasing Liability

Check fraud has been the impetus behind the rising prevalence of mail theft, with criminals robbing postal carriers for arrow keys to access blue mailboxes. Once checks are in their hands, they have numerous ways to either sell the data or manipulate it for fraudulent purposes.

Though these crimes may seem like isolated incidents, check fraud is often carried out by sophisticated criminal networks.

“In many cases, it’s a sophisticated supply chain of bad actors, where the person stealing the checks and posting them for sale on the dark web is just one link in the chain,” Watercott said. “Fraudsters may alter or ‘wash’ stolen checks. Washed checks may also be copied, printed, and sold to third-party fraudsters on the dark web, generating even more fraudulent transactions.”

Beyond fraud or theft, issues with checks don’t always stem from nefarious activities—sometimes mail is simply lost or misdelivered. These vulnerabilities increasingly make paper-based instruments a liability.

“It starts with control,” Pope said. “When a company is using a paper check, once they have signed that check and placed it in the mail, they have lost control of it. In contrast, with electronic payments, including prepaid, the control is always there. If the payment has been misdirected or stolen, there are processes in place to quickly replace it and to end its access to the underlying funds.”

Dramatically Safer

In addition to their vulnerabilities, checks also lack many of the fraud prevention tools that electronic payments provide. With digital transactions, the sender can proactively investigate recipients before ever sending a payment.

For example, the payer can verify whether the account is open and in good standing and whether it is owned by the intended recipient. With prepaid payment methods, additional controls are built into the card activation process.

Though some fraud mitigation tools exist for paper checks, such as positive pay, these processes aren’t as robust as their electronic counterparts. Positive pay verifies checks by matching them against a customer’s issued records. Any discrepancies are flagged as exceptions, requiring the customer to approve or reject payment.

“Just as the check payment process is manual and time consuming, so is the fraud mitigation process,” Watercott said. “You’re sending check issue files to the bank, you’re reviewing and reacting to positive pay exceptions daily, and then you’re reissuing checks. As you move away from checks, you gain opportunities to tap into more proactive risk mitigation before payments even happen.”

In addition, regulatory requirements at both the state and federal levels provide protections for prepaid and electronic transactions that don’t exist with checks.

Once a check clears, the only data typically available in statements or transaction histories is the check number and amount. In contrast, electronic transactions and prepaid cards provide organizations with a wealth of additional details, such as the merchant’s name, terminal ID number, location, and phone number.

Many organizations use this information to identify potential fraudulent transactions. For example, a business owner might recognize the merchant where a transaction took place but not the city in which the purchase occurred.

Once they report a suspicious transaction to their financial institution, the bank is legally obligated to investigate and determine whether the transaction was fraudulent. If fraud is confirmed, the customer  can receive a full refund of the transaction amount.

“Throughout that entire process there is a level of transparency; financial institutions are required to send notices and information to the customer during the process, which adds to the outcome,” Pope said. “From a regulatory and risk management perspective, I clearly see electronic payments and the use of prepaid cards as dramatically safer than checks.”

The Tortoise and the Hare, Reversed

Electronic payments offer enhanced security and controls, along with tangible benefits driven by improved efficiency. Chiefly, they elevate the customer experience—the convenience of credit, debit, and prepaid cards is a key reason these payment methods have outpaced checks.

While consumers will certainly cash a check if they receive one, electronic payments are preferable to paper checks sent by mail, which require a trip to a brick-and-mortar financial institution.

“Electronic payments reduce so much friction in the whole process,” Hirschfield said. “It’s the opposite of the tortoise and the hare. We always hear about how slow and steady wins the race but here, quick wins the race. The tortoise is going to run into roadblocks—be it bad actors or just unforeseen circumstances—that get in the way. You want to be the hare in a payment, the one who is getting there quickly.”

Another integral aspect of a positive customer experience is the freedom of choice. Supporting a wide array of electronic payment options allows consumers to customize their payment experience to suit their preferences.

Beyond consumer benefits, electronic payments offer powerful advantages for businesses as well. While some businesses have leveraged the float inherent in check transactions, electronic payments provide greater working capital benefits. With a known settlement date and increased transaction visibility, payers can better manage cash flow and financial planning.

“I think of the visibility of checks as like ordering something online but receiving zero shipping tracking,” Watercott said. “If that check is stolen, you might not know about it until you get a call weeks later asking, ‘Where’s my payment?’ Just removing the payment from a check is already a step in the right direction in terms of fraud risk reduction.”

Implementation Considerations

As organizations transition to electronic payments, there are many considerations. First and foremost, they must understand the scope and breadth of the unique rules that govern electronic payments.

For example, there are regulations like the Electronic Fund Transfer Act, also known as Regulation E, which was enacted to protect consumers’ rights in electronic transactions. Additionally, network rules, such as those governing the ACH process, provide protections for both consumers and the organizations using these services. Ensuring compliance with all applicable rules and regulations becomes even more complex when third-party vendors are involved.

However, financial institutions still have strict compliance mandates that remain in place regardless of outsourcing certain tasks to third parties. If a fintech fails to uphold its share of the compliance burden, the bank—not the fintech—will ultimately be held responsible.

“As institutions are transitioning from paper to electronic disbursements, they need to be aware of the organizational structure that they will be involved in,” Pope said. “Are they looking to leverage a fintech as part of this process, and how does that fintech manage their risks associated with partnering with banks? There is a lot to consider, depending on the model that you’re going to be engaging in.”

A Balancing Act

Though the task may be daunting, the benefits of payments modernization make the transformation a necessity. For many organizations, an incremental approach is the best way forward.

“In the grand scheme of things in the industry, there’s no finish line to this,” Hirschfield said. “There’s never going to be a world without fraud—we have to be realistic about that—and there’s never going to be a world without payments. It’s all about continuing to progress so that we are working in a world with less fraud and with increasingly faster payment options.”

However, as organizations transition to faster payments, they can’t fully abandon legacy payment methods.

“Payments is a balancing act,” Watercott said. “You have to be both a master in defense, I call that checks, but also be on the offense by embracing digital payments. The sports cliché that defense wins championships doesn’t always apply to payments. It has to be a balance of embracing innovation, but doing it in a secure, risk-oriented way. Work with your partners towards setting a goal of making check issuance an exception and not the norm.”

The post Beyond Checks: Why Prepaid Cards and Digital Payments Are the Smarter Choice appeared first on PaymentsJournal.

Many businesses are familiar with payments optimization, which focuses on enhancing the outcome of individual transactions. However, the growing field of payments orchestration takes a broader approach. It addresses larger issues, such as deploying the latest payment methods and technologies faster than competitors and improving payment performance at scale. The goal is to deliver the most secure, frictionless customer experiences while also driving profitability.

Orchestration, at its core, provides the foundation for payments optimization to thrive. In a PaymentsJournal podcast, Brady Harris, CEO of IXOPAY, and Don Apgar, Director of the Merchant Payments Practice at Javelin Strategy & Research, spoke about the benefits of payments orchestration, from dynamic routing to enhanced data and analytics.

Like Conducting an Orchestra

Simply put, payments orchestration unifies a merchant’s payment operations, providing a comprehensive view of what’s happening across the entire ecosystem. It allows them to identify where breakdowns are occurring, resolve inefficiencies, and enhance security by leveraging multiple fraud prevention tools, optimizing authentication processes, and ensuring compliance with global security standards.

Large enterprise merchants typically have as many as 20 or more integrations with various payment service providers (PSPs) and acquirers around the world. IXOPAY has had customers with more than 150 to 200 different processors they’re managing behind the scenes, requiring upwards of 150 to 200 full-time employees. Businesses are starting to move away from off-the-shelf orchestration solutions in favor of a global network of payment providers, typically through a third-party orchestration layer.

“Companies in different industries and sizes start to play this game of payments whack-a-mole,” said Apgar. “They start out with a PSP and find there’s something missing—a new payment type or fraud solution. So another integration layer comes into play and eventually you wind up with this massively complex web of integrations.”

The orchestration mindset drives efficiency into this web of integrations, which were originally built to fill gaps in what was once a simple payment process.

“Before I fill another gap, why don’t I take a step back and see what are the universe of payment solutions that I would like to have?” Apgar asked. “How can I put them all together in one basket, even if I need to use multiple providers and do it in an efficient fashion? It’s like conducting an orchestra where all the all the instruments are playing their individual sounds, but come together to form the music.”

 The Promise of Tokenization

IXOPAY started hearing from large global merchants with substantial payment volumes who realized they wanted to own their own data through vaulting solutions. That’s where tokenization comes in. With tokenization, businesses can not only own their data but also leverage it to improve authorization rates and reduce fraud and risk.

“Think about millions of transactions and all of the intelligence that sits at that transactional level—how can you create actionable insights that the business can then synthesize and operationalize back into the business,” said Harris. “When you combine them together in highly configurable, very customizable ways, you are now effectively offering these very large merchants a way to customize and build their own payments infrastructure with out-of-the-box solutions. To me that is next-gen orchestration.”

While tokenization has significantly enhanced data security, it has also reduced visibility into customer data. Tokenization makes it challenging to track customers across different channels and geographies. However, this challenge highlights the importance of orchestration, especially as more enterprise-level merchants explore tokenization strategies that can help unify customer interactions across multiple sales channels.

Another major advantage of payments orchestration is its ability to optimize soft declines, through card lifecycle management tools. In a recurring billing environment, where payments are repeated, cards can expire, or customers may need to replace lost or stolen cards. Even so, the card is still linked to the same name and associated data. Payments orchestration allows entities to refresh this sensitive but important card-level data, resulting in higher authorization rates.

 Making Use of the Data

Data and analytics continue to be a major challenge for many merchants.

“We (work with) a large fashion retailer who said they didn’t have a good data strategy on how their different payment methods are being used,” said Harris. “But payment analysis for that merchant is manual. This leads to all kinds of challenges as to where to grow the business, where to expand geographically, what payment acceptance types they should invest in. It’s hard for them to even build out basic roadmap priorities in a way that helps optimize sales and drive revenue.”

Financial reconciliation of this data presents another hurdle. Merchants managing multiple acquirers in an orchestrated environment must reconcile and understand the fees. Additionally, when it comes to chargebacks, merchants need to determine where a transaction was authorized and ensure it’s properly routed back to the right acquirer.

“There’s a lot of day-to-day blocking and tackling of data before you even get into analytics,” said Apgar.

Promise for the Future

Next-gen payment orchestration involves a simplified operations layer designed to handle millions of transactions at scale across multiple providers. It also includes a central access point with dynamic routing that can switch in real time between different processors based on sophisticated rules or requirements. Merchants can customize these rule engines to establish how payment transactions are cascaded.

This is also where artificial intelligence comes into play. As merchants add new geographic locations, and layer in different interchange card types and issuer transactions, rules-based routing becomes increasingly complex. An AI agent, however, can account for all the variables that influence routing decisions, moving beyond a static set of hard-coded rules.

“It’s mind-blowing what that’s going to do as we continue to iterate on this idea of dynamic routing,” said Harris. “I don’t know where it’s headed, but holy cow, the future is bright.

“If you’re a mid-market retailer, look at orchestration as a solution,” he said. “There’s a lot of optimization and a lot of business benefits, typically at a much lower cost. That really frees up businesses to focus on what they do well, which is growing revenue and expanding their business.”

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The post Down the Path to Full Payments Orchestration appeared first on PaymentsJournal.

E-commerce giants such as Amazon and Shopify use data to create highly personalized customer experiences. Yet, bill payment remains largely untouched by this transformation, leading to friction, higher costs, and customer frustration. Despite the wealth of payments data available, many organizations fail to leverage it to enhance customer interactions and reduce costs.

This gap presents a major opportunity: by applying data-driven insights, businesses can not only improve the payment experience but also drive efficiency, reduce costs, and boost customer satisfaction.

In a recent PaymentsJournal podcast, PayNearMe’s John Minor, Head of Product and Gustavo Jordao, Product Manager, joined Don Apgar, Director of Merchant Payments at Javelin Strategy & Research, to discuss how payments data can help organizations deliver better payment experiences.

Unlocking the Power of Payments Data

Payments data provides organizations with deeper insights into consumer behavior, extending beyond transaction details. It captures factors such as time of day, device used, and payment method, offering an in-depth understanding of consumer interactions.     

These data points can be synthesized to create a comprehensive view of the customer’s mindset and context during payment, enabling billers to turn transactions into personalized interactions that improve the overall customer experience. 

Beyond improving customer experiences, payments data plays a key role in operational efficiency, helping businesses reduce operational costs. Businesses that embrace automation and data-driven decision-making can streamline processes and lower their total cost of acceptance.

“One of our clients in the lending space was able to save $44,000 a month just by leveraging automation,” added Jordao. “By triggering specific rules based on transaction data, they streamlined payments and significantly cut costs.”

The Importance of Clean Data

Any discussion of data inevitably leads to artificial intelligence (AI). However, success with AI or machine learning depends on clean, structured data.     

“There’s so much buzz about AI, but we put in our 2025 forecast that it’s going to be the second adopters of AI that will really reap the benefits, as opposed to the first movers and early adopters,” Apgar said. “So many companies are rushing to find so many applications for AI that I think it’s too easy to stub your toe, especially in a customer-facing or risk-facing application.”

AI depends on high-quality data. Poor data can lead to unreliable insights. To ensure accuracy, organizations must prioritize data cleanliness, implement strong monitoring systems, and maintain transparency in AI decision-making.

“It’s about understanding the interactions and making sure you’re instrumenting the transactions you rely on to create good datasets,” Jordao said. “That’s one of the key things about AI—making sure that you have a way to trace and audit how it’s being used, because it’s a very complex tool. You should be able to control its application and drive it toward      performance and a better experience for consumers.”

AI and Fraud Prevention

Fraud detection is an area where AI excels, analyzing vast amounts of data to identify anomalies and automate responses—a costly and time-consuming task. Fraudsters are becoming more sophisticated, making it more difficult to flag fraudulent transactions based on isolated data points. 

“Risk is a highly complex interaction—there’s no single red flag for fraud. That’s where machine learning takes the spotlight as a tool to be used,” said Jordao. “One of our gaming clients reduced fraud by 60% just by leveraging AI to analyze transactions in real-time—something that would be impossible to do manually.”

ML models excel at recognizing patterns and triggering automated actions. Unfortunately, few organizations have fully leveraged the power of AI and machine learning to enhance the bill pay experience.

“As it relates to bill payment, generative AI could be used to replace or automate several aspects,” Minor said. “Automated bots could handle outbound and inbound calling, messaging, and communication using generative natural language processing. That could help lower the costs required to collect the payment.”

Enhancing Personalization in Bill Pay

E-commerce has set the standard for data-driven personalization and the bill pay industry must follow-suit. “In e-commerce, data is being used to personalize what you see, how you can pay, and what items belong together, which varies by consumer,” Minor said.

“Those insights are gained by leveraging clean data like past purchases, browser history, and location. Bill pay is no different. Consumers need access to different content and options beyond just completed transactions. They want to complete what they’re there to do at a given point in time.”

For example, a customer logging into their bill pay account may not intend to make a payment immediately. If their bill isn’t due yet, they may be looking for information such as their payoff date or account details. A personalized experience can anticipate this and present relevant options.

Additionally, payment experiences should adapt based on the access point. If a customer pays through a mobile device, the system could suggest payment methods optimized for mobile transactions.

Despite these possibilities, many organizations have not prioritized personalization in bill pay.

“What you see sometimes in bill pay is that organizations haven’t given the process the same amount of focus as they have on the product they’re selling to the consumer,” Minor said. “Unfortunately, they are often using fragmented platforms that aren’t able to ensure the consumer is able to complete the thing that they’re there to do at a given period of time.”

With Data Comes Greater Responsibility

Data offers significant advantages; it is not just an asset—it’s the foundation of growth and innovation. However, the true power lies in how organizations interpret and apply their data. 

Leveraging data gives businesses the ability to better understand customer behaviors, preferences, pain points, and purchase drivers. To maximize value, businesses should seek partners who provide actionable insights that drive measurable results. Clean, structured data not only improves efficiency, but also serves as a springboard for delivering exceptional payment experiences.   

“We’ve heard a lot in the news about payments orchestration,” Apgar said. “That’s been the buzzword in the payments business for the last couple of years. That is also data-driven, but I think the way that we’re talking about using data in this context takes the payment experience to the next level of payment orchestration, not only from the data that is being captured, but the way it’s being applied.”

As AI continues to shape the future of payments, organizations must carefully evaluate potential partners, ensuring AI is used responsibly and critical data remains protected. “With great data comes great responsibility,” Minor said.

The future of payments isn’t just about adding new technology—it’s about creating an experience that is seamless, secure and deeply personalized. True, sustainable innovation requires more than just ‘bolting on’ the latest shiny object; it demands a strategic approach that drives real value.

“Data is behind everything we do. If you’re not thinking about data, you’re already behind. Our job is to democratize it, make it actionable, and help our clients lower their total cost of acceptance,” said Minor. 

The post The Untapped Power of Payments Data in Bill Pay appeared first on PaymentsJournal.

Just as organizations are implementing artificial intelligence and machine learning in novel ways, cybercriminals are continually looking to incorporate AI into their attacks. The disruptive technology allows criminals to find targets more effectively, scale their efforts, and forge better attacks that are increasingly harder to detect.

In a PaymentsJournal podcast, Alex Cox, Director of Threat Intelligence, Mitigation, and Escalation at LastPass, and Jennifer Pitt, Senior Fraud and Security Analyst at Javelin Strategy & Research, discussed the AI-powered methods cybercriminals use, the impacts of AI-related fraud, and the ways that organizations can protect their customers and themselves.

A Big Data Problem

One of the areas where AI excels is in sifting through massive datasets to pinpoint an anomaly. Many organizations use that capability to identify fraudulent activity. On other hand, criminals use that functionality to find their next target.

“Bad guys have a big data problem that AI is helping them address,” Cox said. “For example, there was the MOAB list that came out recently, which is the Mother of All Breaches, and it had billions of username/password pairs. If you think about the magnitude of credentials that are available publicly, the amount of data makes it difficult. The bad guys figured out that if they put these things into language learning models and use AI to help them manage that data, they’re able to pull things out more efficiently and summarize it.”  

Once criminals have parsed large data sets to find their target, AI can also be implemented to make fraud attacks more effective. In the past, phishing attacks were much easier to spot. There may have been incorrect grammar in the email, a logo that wasn’t quite right, or other cues that the communication was fraudulent.

“Enter AI and LLMs, and criminals can go to this LLM and say, ‘Help me craft this phishing e-mail based on this lure,’” Cox said. “It will write it for you in very convincing English language that appears it’s from a native speaker. Once you get past all the technical controls, the final barrier is the person. If the person can look at an email and think it sounds like a person, it’s not a phishing e-mail, and they respond to it, it has made the bad guys that much better.”

A Blended Threat

Another way that cybercriminals are employing AI is to create deepfakes, with the objective of either creating a convincing persona or assuming an existing identity. This ability is just one aspect of the growing AI arsenal available to criminals.

“The combination of these capabilities is significant,” Cox said. “Microsoft has analyzed how some of the bad guys use ChatGPT, and you see them using it the same way that the traditional good guys are using it. They’re summarizing, they’re getting help with coding, and they’re getting ideas on how to improve their attacks. With this blended threat, they are able to use AI to pull information on a target, based on their internet presence, and craft an attack that is potentially able to compromise the target’s machines.”

The powerful technology has led to a decrease in the technical sophistication required to carry out damaging cybercrimes. There has even been a shift toward AI agents, which are fully autonomous fraud engines. It means criminals can lean on artificial intelligence to do much of the heavy technical lift.

“AI is allowing these bad guys to do this en masse,” Pitt said. “We used to see phishing emails where you’d have one single attacker that would have scripts and send out a few phishing emails or a few social engineering attacks. Now it’s all being automated with AI, so it’s thousands of emails, thousands of social engineering attacks, thousands of malware attacks all at once. It’s just easier for them to get that information out there.”

People, Process, Technology

Just as criminals find new ways to implement AI, many financial institutions are searching for ways to combat these attacks. To do so, a three-pronged approach that considers people, process, and technology is required.

On the people side, it means education. Organizations should ensure that their employee base, and potentially their customer base, understands that fraud attacks are now more sophisticated. The end user should understand that they can never fully trust the communications they receive, and they should question unusual asks.

From a process standpoint, organizations should take a zero-trust approach which includes constant authentication.

“We need to look at what we call perpetual KYC,” Pitt said. “In banking, traditional Know Your Customer processes often occur once, typically during onboarding, or on a cyclical basis. We look at the sanctions list, the person’s income, perform their identity verification, and then it’s set aside. Perpetual KYC uses AI to do continuous authentication in the background automatically in real time.”

Integrating AI to combat AI-driven fraud is one of the most powerful technology approaches available to organizations. Fraud and security teams can use artificial intelligence for anomaly detection among large data sets, and they can use it to summarize the gist of a large collection of documents. Organizations can also use AI to make their fraud prevention efforts more effective at a larger scale.

Tracking the Threat Environment

Though there are powerful benefits to adopting the disruptive technology, AI has many well-documented flaws. For instance, the technology is only as good as its data set, and it has been known to produce false or misleading information. These issues have caused some misgivings about AI adoption among many professionals.

“It’s important to use these tools as fraud professionals,” Pitt said. “We may be hesitant to use tools that we think are going to be used by the bad guys. Start using the tools and get familiar with that, if you’re not already as an individual. Tell your organization how AI can be beneficial. Yes, AI is absolutely used by the fraudsters, but if we don’t how to use it for good, we will never, ever beat them.”

For many institutions, another barrier to AI adoption is the organization’s resistance to change.

“I spent about half of my career working for big banks,” Cox said. “Typically, when a new technology comes out, they will ban it and then bring it on board over time in a way that makes sense. I think that AI is moving so fast that that approach is not going to work anymore, because you’re going to be at a disadvantage.”

One benefit for financial institutions is the sheer amount of education that’s available to them about artificial intelligence. AI has dominated the attention of the tech world for over a year, and the disruptive technology has been heavily scrutinized from every angle.

The amount of information available means security and financial professionals have a multitude of training opportunities they can use to educate themselves and their organizations. There is also constant news about the emerging capabilities of AI, and the techniques that cybercriminals use.

“Think about what you do day-to-day,” Cox said. “Think about the work that you have to do at your job and then start thinking: how can AI help me here? It should be clear very quickly that it will be valuable for a lot of different things. Just keep track of the threat environment, understand what’s going on, and that will help you make the right decisions to protect your firm.”

The post AI Has Become an Integral Part of Fraud Prevention—and Fraud Attacks appeared first on PaymentsJournal.

Imagine a world where payments are seamless, customer data is secure, and merchants can easily manage a multitude of payment options while still providing the best customer experience. That’s the goal of unifying payment credentials. Payment tokenization is a crucial technology that is no longer a luxury but a necessity for merchants looking to thrive in today’s digital economy.

In a PaymentsJournal podcast, Sheena Cherian, Director of Product Management at Worldpay, and Don Apgar, Director of Merchant Services at Javelin Strategy & Research, discussed the evolution of payment tokens and highlighted how partnering with a trusted expert can help merchants maximize their full potential.

Developing the Token

Think of tokenization as giving each credit or debit card a secret nickname or surrogate value. Instead of storing a customer’s actual card details on an e-commerce site, merchants can store this surrogate value—a unique string of characters called a token. While this token has no intrinsic value, it acts as a secure placeholder and is mapped back to the underlying card during authorization. Tokenization technology was introduced in the early 2000s with acquirer tokens, sometimes called merchant tokens. These were the first steps but had limitations.

Initially, acquirer tokens were designed to protect cardholder data and fight fraud. Network tokens emerged next, offering more security. Network tokens involve card networks like Visa and Mastercard and add another layer of protection. However, even these tokens are not foolproof. Setting them up involves coordination between several players: the merchant, the customers, and the card issuer.

As retailers began adopting channel-specific strategies and processor-specific tokens, the pursuit of more advanced technology created new hurdles, such as managing multiple tokenization systems and reconciling data across different platforms.

Ideally merchants would tokenize every transaction to create a complete picture of the customer’s shopping journey. While this helps personalize offers and improve overall experience, merchants also need flexibility. They might work with different payment processors (PSPs) or other service providers and tokenization shouldn’t restrict these choices. So how did we get here?

Omnichannel Payments & The Customer Journey

Today’s shoppers expect a seamless experience as they constantly switch between devices and channels. “I could be starting my journey on an iPad, browsing through different products on a retailer’s site, and then pick up where I left off on my mobile device,” said Cherian. “The seamlessness extends to the methods in which I can make a payment.”

While beneficial for customers, this omnichannel journey can create a major headache for merchants: how can they keep track of their customers across various touchpoints? Each device and channel can generate a unique token, making it difficult to recognize the same customer moving between platforms. This can lead to issues like misapplied loyalty points and an increase in friendly fraud.

“Our recent research on omnichannel payment strategies revealed a core issue,” said Apgar. “How do merchants unify these tokens and get a clear view of the customer journey?”

Some merchants are tackling this by building their own token vault—a highly secure, specialized data hub that protects sensitive information—or partnering with specialized vendors. This gives them control over token generation and flexibility with different payment processors (PSPs). But running a private token vault is expensive, even for large businesses. “Your tokens are only useful within your own system,” said Cherian. “If no one else can read them, managing your vault becomes a real burden.”

Vaulting as a Service

For merchants seeking an orchestrated payment environment without the headache of managing their own vault, Vaulting as a Service (VaaS) offers a compelling solution.

“A few larger merchants have included their own token vault as part of a larger orchestration strategy and so by controlling the vault they have ultimate flexibility to link tokens and engage PSPs as needed,” said Apgar. “But running a vault is expensive.”

Worldpay has stepped in to help merchants overcome this challenge.

“Our standalone payment credential platform helps merchants manage, unify and leverage their payment credentials for a variety of use cases,” said Cherian. “We offer our own acquirer tokens, network tokens and life cycle management for both cards and tokens. We’ve intentionally designed our platform to avoid silos. Think of it as a beehive: different honeycombs representing different token types and services work together within the hive, creating a powerful synergy.”

Worldpay’s payment vault acts as a secure central hub of the credential management platform, ensuring sensitive data is segregated and protected from unauthorised access.

While the company has boundless capacity to solve current and future merchant challenges with tokenization, Cherian highlights three methods for deploying payment credentials, managing everything from tokens to other sensitive customer data like Personal Account Number and Personally Identifiable Information. 

The first approach is designed for merchants who want a simple solution. Worldpay’s fully managed service handles everything, providing secure network tokens with no effort required from the merchant.

The second approach is for merchants who require more control. Worldpay offers a SaaS model via API access that enables integration with external systems while leveraging the benefits of its credential platform.

Finally, the third and most comprehensive approach incorporates the idea of a universal token. “Our platform enables merchants to work with multiple acquirers while providing a single, unified view of their customers’ shopping journey across all channels. This is what merchants need,” said Cherian. This approach solves the challenges of security, customer visibility and platform flexibility all at once.

As Cherian explained, it’s important to select a payment service provider with a deep understanding of payment credentials. This expertise, honed through years of experience, experimentation, and research, allows them to effectively navigate complex use cases. Partnering with a PSP who is dedicated to working closely with merchants ensures optimal payment solutions and seamless integration.

The post Unifying Payment Credentials: Simplifying the Complexity of Payment Tokenization for Merchants appeared first on PaymentsJournal.

Many financial institutions are feeling the urgency to make headway on payments modernization and digital transformation initiatives. However, all the factors involved in outsourcing an essential function like item processing might make a migration project seem like a daunting task.

In a recent PaymentsJournal podcast, Candace Burleson, Senior Implementation Analyst at Fiserv, Amina Moyer, SVP of Core Banking Solutions at Community Bank, and James Wester, Co-Head of Payments at Javelin Strategy & Research, discussed the successful item processing migration at Community Bank, the issues it solved, and the opportunities the modernization project created.

An In-House Shop

Prior to the implementation, one of the biggest challenges at Community Bank was staffing. The Item Processing (or Proof) department struggled to retain knowledgeable staff. The roles were often considered entry level, even though the team was a critical component of the financial institution’s daily operations.

“The hours can be demanding, and our Proof and IT teams had many late evenings to ensure the balancing and timeliness of the cash letter getting out the door,” Moyer said. “Our mainframe tasks were extensive, comprised of multiple checklists that were probably no less than three or four pages. That poses significant risks if the teams handling those tasks lacked any expertise or overlooked a step.”

The bank’s IT teams were also responsible for server maintenance and timely software updates, which were crucial to preventing any processing disruptions. Before the migration, Community Bank was a fully in-house shop for all their processing, which is why it chose to first migrate item processing to an outsource environment ahead of its full core system migration.

However, the project still presented challenges because the bank had to maintain daily operations.

“That is a common refrain we hear from financial institutions, that they have a bank to run,” Wester said. “When they look at all the challenges of taking on a project like this, that’s on top of all the stuff that has to be done in terms of running a bank, plus the fact that every bank is different. Everyone has their own challenges, whether it is staffing or the nuances of how they may run their business. It can be a scary thing to undertake.”

Implementing the Migration

Once Community Bank made the decision to migrate item processing—with Fiserv’s aid—the process was accomplished in steps.

“First was discovery,” Burleson said. “We worked collectively as a team, the Community Bank team along with myself. We discussed processes and procedures that they were working on in-house, gathered data which assisted me with the best setups for the institution, both for capture and then the back-end processing approach.”

The next phase of the process was development. Fiserv and Community Bank professionals worked on coding collectively. They identified the items that they would capture daily and the expectations for the receipt of files from item processing.

Then came testing, which began internally on the Fiserv side and then was piloted at Community Bank. There was continuous testing to ensure that both parties were receiving the correct data on a timely basis. The final phase was the go-live and support process.

“On go-live week, we monitored all incoming and outgoing files, outgoing meaning cash, letters, files back to the bank,” Burleson said. “We were able to exclude a lot of things that they were doing internally, and it was a good teamwork effort.”

In-house to Outsource

One of the immediate impacts of outsourcing item processing was that it alleviated many of the staffing issues Community Bank faced when employees retired or moved on to other opportunities.

The bank was also able to initiate cross-training within their operations team, which turned out to be a significant advantage. Cross-training brought fresh perspectives to the table, which identified opportunities for process improvements and efficiencies.

The additional training not only increased the depth of knowledge within the institution’s teams, but it also helped employees recognize their value to the organization. The staff was more aligned with the bank’s broader goals because they had time to stop and see where they were on the bank’s road map, when previously they were too bogged down with day-to-day tasks.

“I’d also say our client experience improved,” Moyer said. “In addition to migrating item processing, we introduced front counter teller capture at our branches, which reduces errors. In the past, those types of errors that were occurring at the teller line posed both a financial and reputational risk to our bank. The teller capture solution came as a benefit through migrating and implementing the item processing solution.”

A Team Effort

Within the banking industry, front office projects often take precedence. However, the middle and back-office touch so many aspects of a financial institution’s operations that updating these functions can have a dramatic impact. Still, the work involved in modernizing those aspects of the business has made many banks hesitant to take on such a demanding task.

“For financial institutions, this is a shining example that these processes are difficult, but they can be done,” Wester said. “If you are looking at manual processes, paper-based processes, it’s beyond the point where these things need to be taken care of. So much of what we’re looking at in financial services—from a technology standpoint—depends on a completely digital middle and back office.”

These manual day-to-day tasks can not only mire down a bank’s operations, but they also create operational risks when there are errors and delays. However, a staff that understands these functions can be instrumental in a successful migration.  

“The collaboration was key, in addition to having teams that are intimately familiar with the day-to-day and the whole experience here,” Moyer said. “The strength of the teams on both sides is what contributed to the success of this migration. It just gave a comfort level to the team when they were trying to unwind years of these manual tasks and relating them to what today is going to look like.”

The post Item Processing Migration Success: A Client Case Study appeared first on PaymentsJournal.

For more than 15 years, PayNearMe has helped billers optimize the payment experience. In a PaymentsJournal podcast, John Minor, PayNearMe’s Chief Product Officer, joined Brian Riley, Co-Head of Payments at Javelin Strategy & Research, to discuss how poor payment experiences contribute to rising operational costs and drive up the total cost of acceptance.

Lowering the Total Cost of Acceptance

Many billers struggle with outdated technology that offers limited payment options and delivers subpar user experiences. This often results in increased exceptions such as higher call volumes, chargebacks, and manual interventions—all of which drive up operational costs.  

“Payment exceptions are on the rise which really drive up the cost of acceptance,” said Minor. According to Minor, an exception is anything that causes a payment to fail, be delayed, or not happen at all. These exceptions require manual intervention and extra resources such as service calls or ACH returns, which ultimately increase expenses.

“Taking a good payment is easy; the complexity lies in managing exceptions,” he said.

Workflow automation plays a critical role in minimizing exceptions and reducing operational overhead. One of the most common payment exceptions—ACH returns—can take days to process due to the delayed nature of the network. Without the right workflows in place, managing these returns can become costly and inefficient. Minor pointed out that implementing automated workflows to process exceptions efficiently, reduce manual intervention, and provide consumers with the right payment options helps businesses minimize costs and improve overall payment efficiency.

Reliability is Fundamental

Platform reliability is paramount to a business’ success. Reliability means ensuring every payment is processed smoothly from start to finish—every time. “If you can’t take the payment, nothing else matters,” said Minor. “Clients have told us that failed payments keep them up at night. Reliability is fundamental, and we’ve built our platform to deliver consistent performance.”

Riley agreed, adding “Ensuring transactions go through without issues is critical.”

Convenience for Consumers and Businesses

Consumers expect payments to be as seamless and effortless as shopping on Amazon or ordering an Uber. By focusing on convenience and ease of use, billers can enhance customer satisfaction while reducing internal efficiencies 

A platform that consolidates all preferred payment methods helps businesses stay ahead of evolving trends. PayNearMe enables clients to accept payments via traditional methods as well as alternative options such as Apple Pay, PayPal, Venmo, Cash App Pay, and cash.

“Businesses really need a unified solution that evolves with new payment trends,” Minor stated. “With our platform, they don’t have to worry about development costs every time a new payment type emerges.”

Driving Down Costs with Self-Service

Self-service is a key factor in reducing the total cost of acceptance. Businesses are turning to self-service solutions for efficiency, while consumers increasingly expect the convenience they provide. The indirect costs of payment acceptance, such as employee time spent assisting with transactions, add up quickly when self-service options are lacking.

“We’ve worked with several clients to increase self-service rates and seen places where it improved as much as 40%,” said Minor. With PayNearMe’s Smart Link™ technology, clients have significantly increased self-service adoption—reducing manual support needs while enhancing the customer experience.

Self-service empowers consumers to complete essential tasks—such as making a payment, setting up autopay, or checking due dates without customer service assistance. This streamlines the payment journey and eliminates unnecessary operational costs.

On the business side, self-service provides real-time visibility into payment workflows, access to critical data, and the ability to take action within the platform without needing direct support. By democratizing access to insights and automating routine tasks, self-service capabilities can reduce overhead, enhance efficiency, and ultimately lower the total cost of acceptance.

Three Key Takeaways: What to Expect from a Modern Payments Partner

According to Minor, businesses evaluating a payments platform should focus on three key factors for long-term success and cost reduction:

1. Stability and reliability: A consistently stable and secure platform ensures payments are processed without disruptions. 

1. Optimized payment experience: A modern platform enables communication with consumers where they are, leverages data to deliver personalized interactions, and actively manages the end-to-end payment experience to reduce costs.

1. Effective exception management: The right partner proactively identifies and prevents exceptions, uses data-driven insights to minimize them, and implements tools to help reduce manual intervention costs.

By prioritizing these factors, businesses can enhance payment experiences, improve operational efficiency, and significantly reduce the total cost of acceptance.

The post The True Costs of Poor Payment Experiences (And How Modern Technology Can Help) appeared first on PaymentsJournal.