The Payments Data Monetisation Opportunity in Asia

It’s never been more important to understand what corporate clients want from their bank partners. Faced with an increasingly complex operating environment, large corporations are looking to banks for support with a range of different objectives. These differ between organisations, but most come back to two themes: to help reduce costs and increase operational efficiency.

This is nothing new of course. Corporate clients have always pushed their bank partners to provide richer and more valuable services. What is different in today’s market is that the competitive intensity of the market means that clients have far more choices over the providers they can work with. Of greater concern to banks is that many clients are now very open to the idea of forming relationships with new providers in order to access the services they need.

For banks, this increases the urgency to act. Indeed, the question is not whether to invest, but how to adapt in order to deliver the service enhancements that will drive new revenue and protect the existing business. As a result, the concept of data monetisation—using the data assets banks hold to support commercial benefits—is rising up the industry agenda. While many banks already leverage their payments data to support initiatives relating to operational efficiency and enhancing client-facing services, there has been an explosion of interest in this subject in recent months.

To understand the path forward for banks active in Asia, Celent has conducted primary research among 25 financial institutions and 32 large corporate clients across Australia, Hong Kong, India and Singapore. The aim is to highlight the pain points facing corporates and the specific opportunities for banks active in the region. This is the first report in a series, including dedicated reports looking at corporate client needs in Europe and North America.

Our key findings for banks active in Asia include:

• 80% of banks in Asia say that client demand for data-led services is increasing.
• 76% report that they are working on a business case to leverage payments data in support of product and service innovation.
• 78% of corporates report that they would consider moving some or all of their banking business to partners that can bring efficiencies to their business.

Most importantly, analysis of the services that corporates will pay to access highlights a number of revenue opportunities for the industry:

• The areas that the majority of corporate in Asia want their bank partners to address are security, real-time forecasting and support with the challenges of ISO 20022.
• 53% of corporates listed improved security as one of the three service enhancements they would be most willing to pay to receive.
• Virtual accounts are a clear hygiene factor. While willingness to pay for this service is low, as many as 33% would consider moving to a new partner in order to access.

For banks, inaction is not an option. While there are several areas that can bring revenue gains, there is an equally urgent need to invest in order to protect existing client relationships.