Over the last decade, payment acquirers have made leaps and bounds in FinTech innovation — for instance, major players like PayPal, Intuit, Stripe, and Square have completely reinvented the acceptance process.
Meanwhile, payment issuers and retailers are mired in legacy systems that are preventing many transactions from becoming the seamless experience they should be in 2017 – writes John Mitchell an expert in the payments industry at Episode Six.
This lack of new technology threatens the ability for payment product providers to deliver what customers expect in the digital age. And until they adopt new technology, issuers are effectively playing a losing game of catch-up.
What’s Wrong with Business as Usual?
Banks and blockbuster retailers continue to utilize core processing technology invented in a bygone era to issue payments. While this has historically worked well, standard core technology has three major flaws that are slowing down issuers’ progress as the rest of the payment industry advances:
- It’s dated – Many banks and retailers are operating with core technology that is anywhere from ten to thirty years old. These systems were put in place before smart phones, chip cards, mobile wallets, and even direct P2P payments came into play. They were designed during a time when stripe cards, paper checks, and cash were king. As a result, their systems aren’t equipped to seamlessly handle new forms of payment technology.
