As described, developing a receivables mass data approach requires many interrelated parts and challenges.
Some banks already have taken the initial step toward realizing a receivables mass data approach. Payments hubs, both payables and receivables, are being deployed by banks to address customer payment-optimization needs. Hubs by definition must use a consistent data schema to facilitate transaction decisions and apply rules engines to perform many of the tasks.
As transaction-processing engines, hubs aren’t designed for data analytics. But they do provide useful elements in developing a payments mass data strategy:
1. Aggregation – It disintermediates the numerous other transaction systems and associated data bases into a single data instance, eliminating the need for multiple new interfaces into a mass data strategy.
2. Consistency – It normalizes data across the other transaction silos into a common data schema.
3. Data quality – The data has been enhanced to meet the primary transaction needs of the customer and it’s of a higher quality going into a mass data strategy.
The investment in hub deployments by major banks becomes the first directional step in realizing a mass data strategy. It provides the ability to reuse investments in hubs for mass data as some of the fundamental and costly efforts required of mass data (i.e., aggregation of the data, normalization and quality) already have been addressed.
Taking the First Step
Historically, Comerica Bank has led in Midwest lending and treasury services to its corporate customer base. Faced with direct competition from larger banks, it is reviewing new approaches to address its customer’s needs. “Our customers’ needs were changing, and our receivables solutions needed to evolve to keep in step with those changing needs. Our clients rely on us as their trusted advisor to help them be successful. In this case, success means helping them manage their receivables data more effectively and efficiently,” said Deb Stevens, vice president/ product manager for Receivables Products.
Comerica has plans to offer a receivables platform centered on a central database (hub) that aggregates, normalizes and synthesizes data for new receivables product development. “We are testing ways to eliminate our customers’ difficulty in dealing with multiple product silos for information. We are seeking to allow for their direct access to enhance data quality, and accelerate the application of the data to their internal systems. Our new receivables approach is now one part of a larger strategy to address customer data across the enterprise and provide us new insights,” according to Stevens.
Lawrence F. Buettner is a senior vice president at Wausau Financial Systems, which provides receivables technology for financial institutions. He has 30 year of experience in financial treasury management, and was an SVP at First Chicago.