The U.S. payments ecosystem is undergoing a rapid transformation. In response to a rising demand for faster, safer, and more intuitive transactions across the board, financial institutions are increasingly looking to modernize their operations in a variety of ways, including through the adoption of real-time payments technology.
As part of our ongoing efforts to better understand how mid-tier banks and credit unions are approaching payments modernization, Volante surveyed payments professionals from 80 financial institutions in the first quarter of 2022 to learn more about the current state of their operations, as well as how they expect to adapt to the evolving ecosystem in the future.
This week and next week we will be sharing data highlights from this report. Part 1 of this series can be viewed here.
Rising Transaction Volume and Fraud Top the List of ACH Processing Challenges
While 68% of respondents reported having no significant issues related to processing ACH transactions, 27% of those who did report challenges cited rising transaction volume, followed by 23% who cited mitigating instances of fraud. The latter of these concerns is particularly notable in the context of last year’s results, in which only 8% of respondents mentioned fraud as a key challenge.
Although the uptick in fraud is largely unsurprising and is likely the result of fraudsters targeting a thriving B2B payments sector, it does indicate a need for institutions to seek further modernization and transact within increasingly secure payment environments. As for solutions, some institutions may be looking to bolster security by migrating into the cloud and supplementing Payment as a Service (PaaS) models with the addition of secure applications. When asked about current modernization initiatives, cloud migration was the second most popular response at 20%, only slightly behind those who mentioned plans to replace or enhance their wire systems (28%).
To get a more in-depth look at the state of payments modernization across US mid-tier institutions, download a complimentary copy of the full report here.