Commercial Payments International

Many of you have heard me bang on about customer journeys before. Every issuer talks about customer centricity, but mostly they define the customer journey according to their particular role within a journey, and not the fulfillment of the customer need. Customer journey mapping typically breaks down a journey into micro-journeys that aim to iteratively improve individual customer touch-points with the financial institution. While the intention here may be to develop their customer experience, a collection of touchpoints does not solve the wider customer need.

If we take a step back and consider the customer perspective, you can start to see the wood from the trees. Let’s take business travel as an example.

As business travel begins a slow return, frequent travelers are feeling that urge to get back out on the road. We have almost got nostalgic about those business trips and face to face meetings. What may have faded from our memory is the pain points of administering those trips – from travel approval through to expense approval. We’ve all been there, and we all hate it, and yet we are part of the industry that could improve it.

Ultimately the payment transaction(s) is a small, yet critical, part of ensuring a smooth trip, but for the traveler each trip is never smooth and easy because we still expect them to navigate a fragmented landscape of suppliers, products and channels with very limited or no connectivity and data transfer between them.

And as commercial card transactions become an increasingly ‘invisible’ part of that journey, they become more of a hygiene factor for users. As a result, issuers are at risk of becoming simply part of the payments infrastructure, with little value enhancing possibilities. Not great when the main revenue stream is interchange which is only likely to go in one direction.

I would contend that commercial card issuers now need to think long and hard about what business they are really in. Relying on transactions and the payment experience alone is unlikely to be enough to remain successful in the future.

It is not a coincidence that fintechs offering direct-to-market spend management platforms are springing up all over the place and are often valued more highly than the long-established issuers of commercial cards. They aim to solve a wider range of pain points for customers, both as employees and employers: pre-trip, in-trip and post-trip.

There is also much talk about the emergence of super-apps that create an ecosystem of relevant products and services, as has been hugely successful with the likes of WeChat, Alipay and Grab. Will we see the emergence of a version of super-app that could improve business travel journeys: manage travel approvals, send booking requests to the TMC, display the booked travel itinerary, check that card status is in order and up to date, facilitate virtual card usage in travel, and then process transactional data/ itinerary/ receipts etc. within the spend management platform and/ or push it to an enterprise expense management system? All from one business travel ecosystem.

In theory, a commercial payments provider is well placed to connect the dots across the end to end customer journey since it is the only participant that touches all parts of the value chain. And yet, in practice, few commercial card issuers are challenging the fintechs with spend management, let alone seeking to connect the fragmented business travel landscape.

Perhaps this is because it requires a fundamental change to the portals and apps that banks provide today to their business customers. Meanwhile, the technology platform that issuers offer is its most important asset and pivotal to its future success. It will be the visible face of the product, ultimately replacing the traditional role of the plastic card.

Not only does this mean addressing the spend management needs for SMEs and corporates, but also embracing the data sharing opportunities of the API economy that can truly improve the administration of business trips by creating connected customer journeys. Such connectivity would ensure that the data is available and enhanced in the platform throughout the journey, creating meaningful opportunities to leverage that data commercially.

Of course, it all comes down to your definition of a customer journey. If your financial institution thinks it is about improving existing touchpoints with customers, that is fine, up to a point. I would suggest, however, that taking a customer-centric view would lead to a different, more value-enhancing conclusion. This is where financial institutions can find new opportunities to create value throughout the customer journey of administering a business trip, not just in the payment transaction itself.