The Payments Podcast from Bottomline.

Episode Transcript

Welcome to the Payments Podcast. I'm your host, Bottomline Managing Editor, Owen McDonald. 

A brave new world of digital business payments is leaning into concepts like hyper-connectivity, hyper-personalization, AI readiness, and the expansion of SaaS. Together, they're unlocking new opportunities and providing agility and scalability. It's all part of the modernization wave that continues sweeping across banking and B2B payments.

To bring these concepts into sharper focus, it's our great pleasure to welcome Amrita Ghanekar, Senior Director of Client Insights and Innovation at BNY Treasury Services. 

Rita, welcome to the Payments Podcast. 

Rita Ghanekar: 
Thanks so much for having me, Owen. It's a real pleasure to be speaking with you today about the new wave of payment modernization.

I lead client analytics and product strategy, focused on transforming how institutions use data in analytics to drive smarter decisions. And so I'm super excited to be here on this podcast today.

Owen McDonald:
We're delighted that you could be, and we're going to dive straight in, starting with SaaS. 

Our topic today, as you said, is the next wave of payments modernization. SaaS may not exactly feel like a modernization, capital M, to some of us. It's been around for a while, but you and I spoke recently, and I found things you said about the role of SaaS and B2B payments modernization to be quite powerful. Please explain how SaaS models generate differentiation value and revenue for banks in the current payments landscape.

Rita Ghanekar:
So, Owen, SaaS isn't just a delivery model, right? It's a business-shift model, meaning it's making the move from infrastructure to intelligence. And what do I mean by that?

SaaS is not just streamlining banking. It's fundamentally redefining how banks compete. And this goes beyond just upgrading legacy tech. This is truly an enablement to drive that agile innovation, cost efficiency, and hyper-personalization. Those are kind of the three pillars of sustainable differentiation in a very rapidly commoditizing sector.

So, let's unpack that. First is the speed to innovation, right?
Think of SaaS platforms enabling banks to roll out new features, new functionality - not in just in months, it could be in weeks, definitely not years! And this really bypasses that heavy operational lift, so to say, of traditional IT. 

Second, personalization at scale. 
Advanced SaaS analytics and AI unlock that hyper-personalized banking initiatives. And this helps banks truly tap into deep behavioral analytics to tailor offers and experiences. And that we know, is a serious driver of customer loyalty.

Economies of scale. SaaS flips the script from CapEx to OpEx. I think that's huge. It brings up capital for growth and marketing, rapid experimentation, right? That's a big thing. Everybody wants to drive their costs down. And if you think about this, SAS also introduces a kind of always-on compliance and security built in. 

There is some regulatory changes happening. SAS providers are able to deliver that top-tier security and regulatory updates almost automatically. And so, there is that network effect that SAS can enable. I'm going to leave you with some stats. I just read this recently, that Gartner survey suggests that the global SaaS software delivery in 2025 will reach 300 billion. That's a 20% increase year-over-year. That just shows you how rapidly the segment is growing.

That is impressive. Now, you mentioned your expertise in decoding data insights, Rita. In light of that, tell us the key benefits of creating data-sharing ecosystems in banking. How does it enable better contextual intelligence and more?

Rita Ghanekar: 
Great question, Owen. I read this recently, and this quote just stuck with me, right? The future of banking isn't about moving money. It's about understanding money movement, predicting its flow and creating value at every transaction. I think that just sums it up, right? So, when we talk about the key benefits of creating data sharing ecosystems and banking, we're really addressing one of the most transformative trends in the financial sector today. 

To start, data sharing ecosystems, enabled by technologies like open banking and APIs, they're allowing banks and their partners to exchange customer information securely, efficiently and of course, with customers' consent. 

And there's some direct high-value outcomes of this that a bank can see immediately: 

One is the enhanced customer experience. That access to more holistic data, whether it's transaction history, it's external accounts, spending patterns you're letting banks truly innovate and offer those personalized services, products, and also advisory by the way, that's a very important initiative that banks have as they walk through their clients' transformation journeys.

Greater innovation and collaboration. Data sharing fosters that collaborative environment between traditional banks, fintechs, and third-party providers. That's what helps lower barriers to integrating new solutions. It speeds up product development, and it does things that maybe no single player could deliver independently. So that's important.

And the third one is risk management. I think that to me, it's last but probably the most important, is access to richer aggregated data sets empowers banks to better access creditworthiness, detect fraud, respond to changing risk profiles. So, if a suspicious activity is detected at one institution, that collaborative intelligence can quickly be shared and acted upon throughout the ecosystem. And that dramatically improves collective resilience.

So, think about what Swift has done, right? Swift has brought together leading global banks, BNY, Deutsche, HSBC, and others, to pilot AI-driven privacy-preserving data sharing for cross-border fraud detection. By pooling this anonymized data and using a federated learning model, banks can detect fraud patterns industry wide. So, this is kind of an improvement of resiliency for everybody.

About contextual intelligence again, a topic very dear to my heart, being in analytics data-sharing is the foundation of contextual intelligence, right? It's combining data sources through which banks can truly understand not just what a customer is doing, but the why:  What's driving their financial decisions?  What life events are occurring? What the future needs might be for a customer? And this enables a shift from reactive to proactive banking. That's what's key here. So, it's really moving beyond that transactional relationship and moving towards holistic contextual partnerships with clients.

Owen McDonald:
It's a huge shift. I think part of that is hyperconnectivity is crucial to payments modernization. In your view, based on what we've talked about, what role is hyperconnectivity fulfilling in payment processing and risk management for banks, Rita?

Rita Ghanekar:
So, Owen, when we talk about hyper-connectivity in payments, we're not just talking about speed. I mean, that's what comes to mind first, but it's beyond that. What we're talking about is a shift in architecture, in behavior, in accountability, right? Hyper-connectivity means that banks, corporates, payment systems, fintechs, and the wide data platforms are all plugged into each other in real time through APIs, event-driven systems. 

And of course, let's not forget shared protocols like ISO. This sort of connectivity creates that always-on context-aware network where every node can react, respond, make decisions instantly. 

So, what changes? 

For payment processing, it means you're no longer sending out a payment into the void hoping it lands, right? You're initiating a transaction in a connected web that can validate, identify, route through the most efficient corridor, track settlement in real-time, and surface issues before they become breaks or disputes. Think embedded analytics and alerts. Think about getting notified when your payment velocity drops in a particular corridor or receiving a gentle nudge, sometimes not so gentle, when a seasonal shift is detected. And for risk management, hyperconnectivity transforms it from a very post-mortem exercise, if you will, to a predictive one. You're not waiting to detect fraud or operational risk after it hits the books. You're plugged into those data flows that can flag anomalies as they form, even across institutions (because we're connected), geographies or transaction types.

But Owen, I don't want to be all Pollyanna on this topic, especially on the risk one. Because, from a risk perspective, hyperconnectivity does mean two things: One, there is increased risk exposure. The more systems, the more partners are linked, the greater is the risk of cyber-attacks, data breaches, supply chain vulnerabilities. And, you know this is real, particularly as open banking and APIs proliferate. And two, the emergence of connected and interdependent risk. That's real too, because risks are no longer isolated. Whether it's cyber, reputational, market, or operational, all of these risks bleed into each other and they can rapidly propagate across interconnected systems. So again, that focus on resiliency, governance, privacy is of utmost importance. And so, a shift towards that more predictive tech-driven environment, analytics-heavy, contextual intelligence-heavy is very key.

Owen McDonald: I can feel it all coming together, the whole network effect. Taking a wider view, though, how do you see international payment trends influencing U.S. modernization efforts, Rita?

Rita Ghanekar:
Well, international trends are exerting real pressure on the U.S. to modernize. But I think not through regulation, right? It is through client expectations, through competitive asymmetries, through global liquidity shifts. So first, real-time is no longer optional.

Globally, if you look at what's happening, over 80 countries have real-time payment systems in production. With India's UPI, Brazil's PIX processing, billions of instant transactions getting settled at near-zero cost.
The U.S., by contrast, is playing catch-up (and nicely) with FedNow and RTP, though it's an early adoption. But here's the twist: U.S. multinationals operating in these regions are now asking why their domestic operations can't have that same speed, that same transparency, the 24x7 capabilities. So, I think that demand is now bleeding into domestic treasury and, you know, the B2B corridors.

Second, the rise of cross-border interoperability standards like ISO. That's definitely forcing alignment, and that's a great thing. So, whether it's a Swiss global push, or regional schemes like SEPA, India's UP, we're seeing that convergence on very rich structured data. And so, what that means for U.S. banks and corporates is the need to shift from just moving money to managing, again, those contextualized flows. Payments are becoming, if they haven't already, very data-rich assets for every bank.

Third, again, this is not about the crypto hype, so let me make that very clear. But if you think about the CBDC world, right, central bank digital currencies and tokenized deposits, they are being tested globally. It's all about programmable money infrastructure. That's happening globally.

It's going to happen here [in the U.S]. And then finally I love this, right client expectations and every client, every individual, those expectations have gone global. Whether it's an e-commerce seller in Vietnam or the U.S. insurer handling claims in, I don't know, Brazil, frictionless payments are now table stakes. And what that means is embedded FX, instant disbursements, transparency, traceability, all those things that we have talked about that traditionally are hard to do within just the, you know, the domestic corridors.

And so yes, international trends are not just influencing U.S. payment modernization, they're actually accelerating it, defining those benchmarks. And so, if you think about the success, it's not really thinking about modernization as compliance, but we can start to see it as a competitive reinvention.

Owen McDonald: Okay. Last question, Rita. Talk about the shifts in mindset required for banks to fully leverage real-time processing and hyper-personalization. And why are these capabilities so important, Rita?

Rita Ghanekar:
Wow, Owen, do we have the next 24 hours to talk about this?

Owen McDonald: We have a few minutes. Yeah.

Rita Ghanekar:
All right, let me try! So, to fully adopt real-time, you know, and hyper-personalization capabilities, right Banks need a fundamental shift from being product-centric to being truly customer-centric. And this requires rethinking processes, retraining staff, sometimes overhauling business models to place those customer needs and behaviors and preferences at the core of every service offering.

For decades, banks have operated in batch cycles, periodic updates, kind of the one-size-fits-all offering. But in a world where a customer can stream a show, get a food delivery, receive a mortgage pre-approval, all within minutes, sometimes concurrently, that model simply doesn't cut it.

So, if you ask me, the shift is required. It's happening in two ways, right? First, the shift is from control to collaboration. What I mean by that is banks must move from guarding their data in silos to really orchestrating it in real-time across systems, across channels, even across their partners. Hyper-personalization demands integrated ecosystems. Real-time isn't just faster plumbing. It's about enabling that contextual intelligence at the moment of need.

Second, we're moving from segmentation to individuality. It's no longer about marketing to a certain segment like Gen Z's or SME's as a group. It's about knowing that this particular customer right now is traveling, their payroll hit early, they may need an instant FX conversion or a credit line top-up. It's kind of that, you know, that contextual intelligence in real time, that requires machine learning, streaming data, and I think most critically, a cultural shift towards trusting algorithmic decisioning at the edge.

So bottom line? The mindset shift is from reactive banking to predictive partnership. Real-time and personalizations aren't tech projects. They are the new identity for banks. One that's built on trust, immediacy and relevance, all delivered not at the speed of light but at the speed of life. That's what I think I know that was a little poetic but that's the mindset!

Owen McDonald Yes, I have no problem with a little poetry and an answer! Thanks, Rita. 

Will business payments modernization ever be finished? Possibly not. However, banks are certainly taking payments to new places in faster, more secure ways. Our thanks to a terrific guest, Amrita Ghanekar, Senior Director of Client Insights and Innovation at BNY Treasury Services. To our audience, the smartest people in B2B payments, thanks for listening. Hit subscribe. Catch us again on your favorite podcast platforms, including Apple, Spotify, iHeartRadio, and YouTube. Bye for now.