New payments outlook: Where do banks fit in?

Banking Exchange asked a number of analysts their opinions of what banks need to do to not only cope with the rapidly changing payments environment, but figure out how to best participate. In Part One last week, we offered the views of four bank experts. Below are the thoughts of six more. Not surprisingly the views are not unanimous, except on one point: payments system change is not something you can ignore.

Catherine Graeber, vice president and principal analyst, Forrester Research-"We don't see consumers clamoring for a new way to pay for things...There still is low consumer awareness around the mobile wallet. A business case certainly hasn't been proven. What's in the wallet still takes a lot of thought. We're easily two-plus years away from it really becoming mainstream. It's fine for the big guys with deep pockets. For the smaller guys, it's looking for partnerships, looking to their online and mobile providers, certainly asking them, ‘What are you doing to eventually enable me to be able to offer this when wallets come to fruition and customers really want them?'

"Then, it's just keeping an eye on the marketplace, of what's really happening, and being smart about the evolution, what tests are working and what tests aren't. But it's nothing they need to jump into quickly. For community banks, it's going to be all about partnerships, through their vendor or through some third-party firm."

Bret Skousen, excutive vice president, marketing and public relations strategic partnerships, MoneyDesktop-"Payment systems is just one example that disintermediation is happening between the customer and the bank. You have so many companies like Google, Apple, Wal-Mart, and American Express Bluebird. They [banks] need to team up with some of the best technology companies that are doing this, that are being innovative, that are tying in with their existing systems. Sometimes in the financial industry we have blinders on, that that's not going to happen to us. But there are solutions out there, people who are well down the road that they can just team up with, and then still become the hub of what needs to happen."

Robb Gaynor, chief product officer, Malauzai-"There will be multiple wallets. There are companies around now able to make payments with the mobile device. But there is never going to be a single solution. That means the banks will provide the ability to do mobile payments in their mobile apps. We're saying to banks that they are going to have a mobile wallet in their app, so they'd better make sure they do that when the time comes."

Matthew Friend, managing director, North America, Accenture Payment Services-"There's the prepayment piece. There's the payments piece. There's the post payment piece. Banks need to turn the equation upside down and become more engaged, in 2013, in the prepayment and post-payment activity so they can leverage their customer relationships and leverage their market position against some of those other providers that are trying to move in."

Bob Gibson, vice president for Branch Operations, Cummins Allison-"Each bank needs to carefully review each of these new payment systems and make sure that there is a business case for them making it available. The progressive banks that have set out to do so have moved a significant portion of transactions away from the branches. Given that there are so many different ways to do it, each of these banks need to approach that as a unique proposition."

Sam Kilmer, vice president for Market Development, Harland Financial Services-"We tell our clients, be aware of the threats of the emerging nonbanking service providers. Understand what the value is of new types of payments capabilities, as their customers demand to do more electronic billing and electronic payments."