Executive Conversations is a HousingWire web series that profiles powerful people in the financial industry, highlighting the operations and the people that make this sector tick. In the latest installment, we sit down with Jason O’Brien, senior vice president of payments at SWBC, to discuss the importance of an omnichannel payment strategy.

Q. At SWBC, what trend are you seeing in payment options?

jason o brienA. We’ve been major players in the payments industry for well over two decades, and more than ever, we are seeing consumer experience and the demand for self-service solutions causing significant growth in online and mobile payments. Particularly, in the last year, we’ve seen self-service channels are growing at about three times the rate of “agent-led” calls. There are a few contributing factors that are driving financial institutions to invest more in their self-serve payment offerings:

Demand: Consumers expect this degree of self-service capabilities and they’re more vocal about their frustrations when an institution doesn’t make self-service payments available.

Technology: Advances in self-service channels are making it easier to meet operational and risk requirements of financial institutions.

Affordability: Card-brand costs, specifically the recent cap Interchange Rates made by Visa, are making cards far more affordable for larger debt payments.

Q. How has SWBC utilized the omnichannel payment trend for the financial industry?

A. As a third-party payment processor, we work hard and invest heavily in technology to ensure our clients have a solution that is effective for all the channels that their customers would use to make a payment to their account. Account holders expect frictionless transactions within and between the accounts at their financial institutions. We enable institutions to offer such services without having to worry about sizable capital expenditures or managing the necessary systems to power such transactions.

Q. What is the difference with online payment options and omnichannel payments?

A. Online payment options are a subset of omnichannel payments and may have distinct requirements compared to the other payment channels.

Omnichannel is a comprehensive and intentional strategy to support payments across the board as the critical customer service touch-points at a financial institution, including online. Omnichannel ensures that there is a plan to support customers for in-person, phone (live or IVR), mobile, desktop, and more; the plan will ensure that business requirements (i.e. risk controls and operational capabilities) are built into each channel. This allows omnichannel support, even if 100% functional parity cannot be attained because of external factors.

One factor that should be consistent across all channels is the acceptance of card-sourced funds. Consumers are far more likely to have their debit card with them than they are to have ACH account and routing numbers. We’re seeing the costs of card payments in our niche space dropping significantly and becoming more affordable—which is a great benefit to both institutions and their borrowers.  

Q. What does it look like to integrate this payment strategy for a financial institution?

A. There are two approaches an institution can take:

  1. The Infection Approach: The leader of a division or department decides they need a single channel solution for their organization but recognizes the need for an enterprise omnichannel solution. This leader, understanding the prioritization complexities a cross-functional deployment (marketing, other call centers, digital, etc.), could deploy a point-solution specifically for their division.

As such, the division leader would work with our implementation staff to deploy the division’s solution, but would be empowered with the understanding that our solution can easily be expanded to additional channels as the financial institution’s cross-functioning teams have capacity to integrate additional channels. The division leader’s success with her own payment channel is often a very powerful influence to other divisions and helps grow support for omnichannel solution from other division leaders.

This approach may have a longer duration overall, but it allows for more granular resource planning, allowing divisions to tackle projects already in-flight.

  1. Top Down Leadership Directive: C-level decision makers give the directive to implement an omnichannel solution. In this case, our implementation team would organize a project for an enterprise wide deployment and would lead the institution through the sequence of events and deliverables that will result in an efficient deployment across the organization.

This approach will result in a shorter duration as the deployment manpower will be made available all at once for a focused initiative.

Q. What are ways financial institutions can drive consumers to utilize omnichannel payments?

A. Communication is certainly key. Customers need to be informed early and often that options are available to them, how they can use them, and ultimately, how they will benefit from using them—i.e. save time, avoid late fees with prompt payments, etc. Websites, newsletters, social media, in-app messaging, IVR messaging, and team-member scripting are all important components of distributing this information.

A couple of other key considerations institutions should keep in mind when developing or expanding their omnichannel payments capabilities include features and fees.

Features: While an omnichannel strategy may require having different features available through each channel, it is important for institutions to offer as many features as possible.

Leverage Fees to Drive Strategies: By evaluating the need for payments solutions, financial institutions may find opportunities to offer fee-free solutions within one or more channels of their strategy. If a strategic channel is struggling to grow users, then discounting fees or waiving fees for the channel may help. Conversely, increasing fees for some of the more expensive channels (i.e. live calls) can also help sway utilization.