The vast majority — 93 percent of financial institutions and 87 percent of retailers — are either currently modernizing their payments infrastructure or are planning to do so (on average, they will begin within the next six to eight months).

Changing customer expectations ranks as the top driver for Fis and retail organizations. FIs are motivated by regulatory requirements and the need to update legacy systems, while retailers are motivated by competitive pressures and cost considerations.

FIs and retailers are allocating significant resources towards modernization. Survey respondents indicated that on average, FIs plan to spend around US$18 million and allocate 36 people to their programs. Retailers expect to spend an average of US$4.1 million and allocate 23 people to their programs.

Respondents (both Fis and retailers) agree that payment modernization will deliver improved customer experiences, faster transaction processing and long-term cost savings. Retailers’ top expected benefit is customer experience improvements, while FIs are primarily anticipating cost savings.

FIs and retailers are concerned about the cost and potential disruption of implementing new payment systems. Retailers are also worried about training staff to manage the transition, while FIs are concerned about the complexities of integrating new platforms across multiple systems.