Payments Issues Facing Small to Mid-sized Financial Institutions
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Overview: Financial institutions with less than $5 billion in assets are constantly facing pressure from larger institutions and peer competitors. Currently, payment channel changes are also adding to that pressure. Although small and mid-sized institutions were among the first to adopt image processing and check safekeeping, the lead in image product deployment now belongs to their larger competitors. To safeguard and cultivate deposit relationships, small and mid-sized financial institutions must formulate payment channel strategies that address image inclearings, remote deposit and branch truncation.
Defending market share and retaining commercial customers depends on making the right decisions at the right time. Though paper-based presentment is approaching its sunset, the landscape is not all dark. In fact, reports on the success of remote deposit capture suggest it is the dawn of considerable opportunity for banks of all sizes. There are also banking and consumer trends on the horizon that will shed light on additional ways for small to mid-sized institutions to cultivate more business.
Optimizing payment channel transformation will help to differentiate small and mid-sized financial institutions and fortify them against the loss of business. This paper provides insight into the electronic/image payment changes that financial institutions should be adopting now and which ones can wait.