How Banks Can Defend Their Place in the Payments Value Chain

Banks can actively compete with large banks and fintechs that have been encroaching on their business.

Banks and credit unions are the hub of consumer and business money management activity for SMB’s. However, the emergence of fintech disruptors, such as Stripe and Square, have changed that landscape and made it considerably more challenging for banks to compete and thrive.

For example, fintechs such as Square have not only intruded on banks payment and treasury management territory, but they have also begun offering their own credit cards or lending services with enticing rates, further eating up banks’ market share. These new entrants are also disrupting the space with new technologies, such as online payment platforms, mobile payment apps, person-to-person (P2P) payments and payday apps, taking even more of the corner of the industry that banks once dominated.

The good news is that banks don’t have to fall victim to these trends. Implementing the right technology with the right partner can give banks the services, speed and agility to offer one-stop banking and payment processing needed to remain competitive and defend their place in the value chain.

How the right partner can help

As a total payment solution provider, NMI provides a suite of powerful payment solutions to banks hoping to compete and establish stickier relationships with small business customers. Some of these solutions are as follows:

1. White Label Solutions

Banks don’t have to refer payment business to a third-party provider. They can opt for a fully-featured turnkey payment solution and gateway able to be branded by a bank, like NMI, allowing small businesses to use the bank’s gateway to process payments. This enhances banks’ customer stickiness, by enabling the bank to provide the payment acceptance solution as their own.

2. Agnostic Gateway

Whereas some POS and payment providers lock merchants into their hardware, NMI is agnostic, giving merchants the freedom to select from thousands of processor and device combinations. With the speed of innovation taking place, NMI helps small businesses avoid getting locked into a single platform. Rather, payments can be easily rerouted to a different provider without any device disruption.

3. Business Intelligence

By processing all payments on a single platform, banks gain the ability to connect and analyze data to produce valuable insights for better, faster decision-making and monetization.

4. Tech Innovation

Small businesses are tech-savvy and demand that their banks offer technology innovations. This will only accelerate in 2021 and beyond. NMI dedicates time and resources to stay ahead of the technological curve, giving banks peace of mind that small business customers won’t feel the need to go outside the bank for anything financial.

5. Cloud-Based Solution

Traditional payment device integration requires a lot of time and development resources. Most SDKs are platform-specific, meaning banks have to build multiple versions of each integration, which leads to longer development cycles, more technical restrictions and more support. A platform-agnostic cloud API makes building EMV and contactless integrations very easy and provides an almost endless amount of choice.

6. Full Payments Enablement

Fintechs, such as Square and Stripe, are making an all-out assault on the services traditional banks have with their small business customers. NMI’s payments solutions arm banks with all of the technology solutions necessary for banks to effectively combat this assault, and provide deeper relationship value to the banks’ customers.

A Change in Mindset

In order for banks to stay competitive in providing services to their valuable small business customers, banks must act now. Change and disruption will only accelerate. Banks’ ability to maintain market share will depend upon their ability to provide the competitive products and services that small business customers expect. NMI’s robust white-label payment solution set arms banks with the technology necessary for them to provide innovative payment solutions to protect their customer base.

If you're looking for a payment gateway that offers all of the above and more, contact NMI.