Bottomline research suggests payments modernisation is shifting beyond connectivity towards better use of data, fraud intelligence and orchestration.
Payments modernisation has never stood still. Over the past three decades, the industry has moved through successive waves of change, from network connectivity and standardisation to real-time payments, richer data and increasingly sophisticated fraud controls. Each has brought progress, while changing what financial institutions need from their payments infrastructure.
Today, connectivity remains fundamental. Banks and non-banking financial institutions need reliable access to global and domestic payment networks. But the conversation is increasingly shifting to what happens across and around those connections: how institutions use payment data, improve visibility, identify risk earlier, and manage increasingly complex workflows.
That shift comes through strongly in Bottomline’s The Payments Intelligence Gap report, based on research among more than 300 payments professionals globally. Across ISO 20022, fraud, resilience, cross-border payments and AI, a common theme emerges: the opportunity now is to turn investment in payments infrastructure into better outcomes across the payment lifecycle.
Turning richer data into better outcomes
ISO 20022 provides a good example. Much of the industry’s initial focus has understandably been on migration and technical readiness. The next challenge is using the richer data it provides.
Our research found that 65% of respondents identified structured data quality as the biggest barrier to becoming ISO 20022-enabled. At the same time, 38% identified higher straight-through processing as the most valuable use case over the next 12 to 24 months, followed by more efficient investigations at 29% and fraud and sanctions screening at 24%.
Better standards create an opportunity for better payments, but only if the underlying information is usable. Validating and enriching data earlier can help institutions prevent avoidable exceptions rather than repairing them after a payment has failed. This represents an important evolution in modernisation: moving from processing transactions towards understanding them.
Intelligence across the payment lifecycle
The same principle applies to fraud. As payments become faster, financial institutions have less time to identify suspicious activity and intervene.
Yet 44% of respondents identified mid-transaction fraud detection as the biggest security gap in the payment lifecycle, while 28% selected pre-payment validation and 19% end-to-end visibility.
This points towards a more joined-up approach. Beneficiary verification, transaction monitoring, behavioural intelligence, sanctions controls and investigations all have a role. The opportunity is to make these capabilities work together rather than treating them as individual checkpoints.
Being able to move a payment is essential. Increasingly, understanding that payment, identifying potential issues, and acting at the right point in its journey is where additional value can be created.
From connectivity to orchestration
Financial institutions are also managing more payment schemes, networks, data sources and regulatory requirements. Simply adding another connection every time the landscape changes risks adding to that complexity.
The next stage of modernisation therefore needs to include orchestration: enabling payment data, status information, validation, fraud intelligence and operational workflows to work together more consistently across different networks and rails.
Our research suggests some institutions are already further along this path. We identified a group of “Payment Pioneers”, institutions providing innovative technology and AI integration as part of their services to corporate customers. 50% reported good or excellent agility when integrating new payment solutions, compared with 7% of other financial institutions.
Across the wider research, these institutions also report stronger outcomes in areas including processing speed, compliance automation, fraud detection, operational efficiency and cash visibility. It raises an interesting question: are we reaching a point where innovation across the payment lifecycle is creating a multiplier effect?
Modernisation is becoming a continuous process
After more than 30 years working in payments, one lesson I keep coming back to is that there is rarely a final destination. ISO 20022 will keep evolving. Fraud threats will change. Regulatory expectations will develop, while new technologies and settlement models will emerge.
Perhaps, then, one of the most useful measures of payments modernisation is adaptability. Can an institution respond to change without adding another silo? Can it get more value from the data and infrastructure it already has? Can it introduce new capabilities without creating disproportionate cost and complexity? This puts less emphasis on completing individual technology programmes and more on creating a payments environment that can evolve continuously.
It is also why benchmarking matters. No institution is making this transition in isolation. Understanding where peers are progressing, where common gaps remain and where more innovative institutions are achieving different outcomes can provide valuable context for future investment decisions.
The full Payments Intelligence Gap report explores these themes across ISO 20022, fraud prevention, resilience, connectivity, AI and operational efficiency. The live benchmarking survey also lets financial institutions assess their progress against the wider industry and contribute to the next phase of the research.
Because the next phase of payments modernisation isn’t simply about connecting to more. It’s about creating more value from the connections, data and capabilities financial institutions already have.
