By: Jane Hennessy, Head of External Alliances
I was pleased to attend the recent WesPay Payments Symposium in Henderson, NV. There was a record turnout and a well-organized program of interesting speakers. What follows are some musings from the sessions I attended.
Not surprisingly, Same Day ACH was a major topic of interest. There was a lead-off panel discussion and a subsequent roundtable that drew in a crowd. One of my key takeaways was the statement that risk is exacerbated if you’re moving money faster, so it is critical to have good due diligence. Financial institutions will need to decide which customers they will offer Same Day ACH to — or not. It is important to insure you have proper business risk intelligence to uncover hidden risk and identify, on an ongoing basis, any adverse changes to business customers.
At the end of the first day, I attended three roundtable sessions on Third-Party Payment Processors (TPPPs) and Third-Party Senders (TPSs). The roundtables were akin to speed dating though each only lasted 15 minutes. Some good discussion ensued in each one. Attendees felt that often their sales teams don’t actually know if business customers are TPPPs or TPSs, and feel that their sales people need to be trained to properly identify those customers. Also, it was felt that the regulators were confused. Attendees expressed concern that they would get different interpretations depending on which regulatory body was involved as well as which individuals. There are definitely many shades of gray on this topic. Some best practices discussed were 1) doing at least semi-annual reviews of the TPPPs/TPSs to detect any adverse business changes and 2) making sure you have strong, detailed agreements with those customers. Everyone recognized the need to Know Your Customer (KYC) as well as Know Your Customers’ Customers (KYCC). While this is a challenging proposition, there are solutions designed to address these challenges and provide the transparency needed to manage TPPP/TPS relationships.
G2 Web Services offers such tools. Our solutions can assist commercial banks and their partners in the payments value chain predict potential fraud and proactively determine if business customers are posing an unacceptable level of risk. Download our white paper to learn how business customer intelligence can help you.