BNY Mellon's treasury services business is building a new infrastructure to facilitate tasks tied to corporate payments, such as processing, transaction tracking and pricingparticularly for clients who make payments across borders.
The initiative includes internal technology development and the support of external partners, and will focus on all components of treasury management. The first initiatives will focus on clearing and transaction monitoring.
"It's a start of a journey where we're creating broader services and experiences for our clients. Payment systems are complex in nature and we will look at various parts of end-to-end payments over time," says Saket Sharma, chief information officer for BNY Mellon's treasury services business.
The bank's initial step is expanding the number of countries in which it provides direct settlement. BNY Mellon recently became a member of the Clearing House Automated Payments System (CHAPS), which provides same-day settlement for electronic payments in the United Kingdom.
BNY Mellon has also begun processing Euro-denominated payments at its Frankfurt facility, and Sterling-denominated payment processing will begin later this year through the bank's membership in CHAPS. The bank will then gradually add direct settlement in other nations, Sharma says.
The bank's global clients have traditionally used BNY's U.S. dollar-denominated payments processing service for clearing, and have used other banks to clear payments in other currencies. BNY Mellon's goal is to become a one-stop shop for business payments clearing regardless of the payment's currency or country of origin.
"If a corporate is doing business in different countries, they will be able to settle with one provider," Sharma says.
BNY will build other new payment services over time. Shama characterizes the initiative as an open-ended program to centralize an operating model that provides processing and other services in multiple regions in different currencies and channels such as check, online and mobile payments. The bank's IT department will use custom-built modules to automate and standardize phases of payment processing for use in local offices that service different countries and regions. Other payment services scheduled for upgrade include systems for pricing, charges, delivery of account abstracts, liquidity monitoring and process surveillance.
The bank is using technology from Clear2Pay for processing. BNY Mellon's IT team is developing the other functions internally.
Payment tracking will follow closely behind clearing as the next step to be upgraded, Sharma says, likening the tracking capabilities to Amazon.com's package tracker.
"Users will have the ability to spot real-time payments, combined with analytics to spot where transactions are in processing," Shama says, adding that the process can provide visibility into liquidity and, subsequently, straight through processing.
Other companies such as Bill.com also provide payment tracking, which allows businesses to prioritize other internal and outgoing bill payments based on available funds and due dates. While Bill.com focused on small businesses, BNY Mellon will initially focus on larger payments for businesses of different sizes, then will deploy payment services for smaller transactions, Sharma says.