Priority for 99% of Banks in EMEA Region Over the Next Year: Modernizing Payment Systems, According to Volante Report
In the rapidly evolving payments landscape of the EMEA region, a strong, near-universal commitment to modernizing and transforming payment infrastructure is becoming apparent. According to Volante Technologies' latest report, **99% of EMEA banks plan to implement new payment solutions within the next year**, with over half aiming to do so within the next six months [1].
### Key Drivers for Payment Modernization
The push towards modernization is fueled by various factors. Cloud adoption, for instance, is gaining momentum, with over half (58%) of banks in EMEA adopting hybrid cloud strategies that combine on-premises and cloud environments [1]. This approach aims to improve scalability and resilience, making it easier to handle real-time processing demands and enable agility.
Regulatory compliance is another significant driver. Evolving regulations such as PSD2 and Strong Customer Authentication (SCA) in the EU necessitate upgrades to meet security and compliance standards [2].
Customer experience is also a key focus, with a clear emphasis on providing seamless, real-time payment services, including instant payments, which are gaining traction due to their convenience and speed [2][3].
Legacy system limitations and the need to reduce technical debt and improve operational efficiency are also driving modernization efforts [1][3]. Payment hubs and intelligent routing are increasingly viewed as "mission control" centers that optimize for cost, speed, and reliability, thereby enhancing customer loyalty and operational control [3].
Collaborative projects like the European Payments Initiative (EPI) aim to unify and simplify the fragmented European payments landscape [2][5].
### Key Concerns for Banks
Despite the drive towards modernization, banks face several challenges. Security and fraud prevention remain top priorities, with payment solutions needing to protect sensitive customer data while ensuring seamless experiences, given the rising cybersecurity threats and regulatory scrutiny [4].
Integration and interoperability are also concerns, with banks seeking modernization solutions that integrate well with existing infrastructure without necessitating a costly, immediate total overhaul [3]. Many are adopting phased approaches to modernization, tackling components step-by-step.
Customer trust and usability are critical for sustaining trust in new payment platforms, requiring solutions to be user-friendly and backed by strong customer support [4].
Investment costs are another concern, with banks planning to spend an average of around $1.42 million per bank on payments modernization [1]. Balancing modernization expenses with return on investment and sustainable growth is a key consideration.
In conclusion, payment modernization in EMEA banks is driven by digital transformation imperatives, with a focus on cloud adoption, real-time payments, regulatory compliance, and enhancing customer experiences, while addressing concerns of security, integration complexity, and cost management [1][2][3][4][5]. As Vijay Oddiraju, Co-founder and CEO, notes, 2025 is a crucial year for regulatory deadlines such as SEPA Instant Payments and SWIFT ISO 20022. Banks are being cautious about their selection of vendors and tech partners due to the size of modernization budgets, with the right partners being those who can help modernize payments while lowering risk, improving ROI, and helping them onboard new clients quickly.
[1] Volante Technologies. (2021). The Big Survey 2021: The State of Payments Modernization in Europe. [2] European Central Bank. (2021). Instant Payments in the Eurozone: The Next Step in Retail Payments. [3] European Payments Council. (2021). SEPA Instant Credit Transfers: Frequently Asked Questions. [4] European Banking Authority. (2020). Guidelines on Strong Customer Authentication and Common and Secure Communication under PSD2. [5] European Payments Initiative. (2021). European Payments Initiative.
- Ffnews.com could report on how technology is revolutionizing the finance and business sectors, focusing, for instance, on the increasing adoption of hybrid cloud strategies by EMEA banks to improve scalability, resilience, and agility in their payment systems.
- As banks in the EMEA region commit to modernizing and transforming their payment infrastructure, they might leverage business and finance strategies to manage investment costs associated with this modernization process, while focusing on innovative technology solutions that ensure security, streamline integration, and boost customer experience.
