The majority, or 73%, of European banks plan to change their payment system delivery model and infrastructure in the next three to five years to improve competitiveness and respond to changing consumer habits, according to a study by information technology (IT) company Tietoevry.
More than half, or 52%, of the surveyed credit institutions predict that within the next two years, they will transfer part of their payment systems to a software delivery model such as “SaaS” (“Software as a Service”).
In addition, every fifth (21%) bank claims that they plan to outsource their payment systems within the next three to five years, thus the majority or 73% of credit institutions expect to change their payment systems and delivery model in the foreseeable future.
Valdis Janovs, head of the “Tietoevry” payments, instant payments and cards unit, states that approximately 60% of the identified banks already use partial outsourcing services. Looking at the perspective of the next ten years, representatives of “Tietoevry” believe that in the payment industry local data centers of banks will co-exist with public and private cloud services. At the same time, it is predicted that more and more specialized solutions for the needs of bank payments will appear on public cloud service platforms.
Janov emphasizes that European banks are demonstrably moving from strengthening branch networks to developing digital services. In his view, the industry is also feeling pressure from big tech, non-bank financial players and other market players, as well as end-user expectations. That’s why banks are looking for innovative and efficient solutions, for example for managing cards and accounts, processing payments or preventing fraud risks.
The study, in which representatives from 65 European banks were surveyed, was carried out in May and June 2022 in cooperation with the company “Payments Cards and Mobile”.
Tietoevry is a digital services and software products company. The main office of the company is in Finland. Tietoevry has almost 24,000 employees worldwide. The company serves customers in more than 90 countries. The annual turnover of the company is approximately three billion euros, and its shares are listed on the “Nasdaq” stock exchanges in Helsinki and Stockholm, as well as “Oslo Børs”.
“Tieto Latvia” SIA, owned by “Tietoevry”, worked with a turnover of 54.561 million euros in 2021, which is 9.6% more than a year earlier, while the company’s profit decreased by 35.3% and was 4.634 million euros. “Tieto Latvia” was registered in April 1994, and its share capital is 442,000 euros. The company belongs to the Finnish “Tietoevry”.
