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Payment and Settlement Systems(SWIFT,NEFT and Securities Cycle)

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Savita Marwal
Savita Marwal
BildungWirtschaft & FinanzenBusiness
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PAYMENT & SETTLEMENT SYSTEM BYMihika Baisya (12030141003) Vyshak Reghukumar (12030141036) Savita Marwal (12030141094) Ruchika Sharma (12030141097
INTRODUCTION • DEFINITION- • Payment is the transfer of one form of good, service or financial asset in exchange for another form of good, service or financial asset in proportions that have been previously agreed upon by all parties involved. Payment can be made in the form of funds, assets or services. • Settlement of securities is a business process whereby securities or interests in securities are delivered, usually against ( in simultaneous exchange for) payment of money, to fulfil contractual obligations, such as those arising under securities trades. • Cash Settlement is a method of settling forward contracts or futures contracts by cash rather than by physical delivery of the underlying asset. The parties settle by paying/receiving the loss/gain related to the contract in cash when the contract expires.
NATURE OF SETTLEMENT • Settlement involves the delivery of securities from one party to another Traditional (Physical) Settlement Electronic Settlement • LEGAL SIGNIFICANCE • IMMOBILIZATION & DECENTRALIZATION • DIRECT & INDIRECT HOLDING SYSTEMS
SETTLEMENT ACROSS VARIOUS GEOGRAPHIC LOCATIONS • INDIA Real-Time Gross Settlement National Electronic Funds Transfer Indo-Nepal Remittance Facility • UNITED STATES of AMERICA FedWire
Immediate Payment Service • Immediate Payment Service (IMPS) is an initiative of National Payments Corporation of India (NPCI). • To avail the facility, both the sender and receiver of money needs to be registered for mobile banking service of their respective banks.
Comparison • The key difference between RTGS and NEFT is that while RTGS is on gross settlement basis, NEFT is on net settlement basis. • RTGS facilitates real-time ("push") transfer, while NEFT involves twelve settlements from 8 am to 7 pm on week days and six settlements from 8 am to 1 pm on Saturdays. Customers can access the RTGS facility between 9 am to 4:30 pm on weekdays and 9 am to 1:30 pm on Saturday
FEDWIRE • The Federal Reserve Banks, of the United States, provide the Fedwire Funds Service, a real-time gross settlement system(RTGS) that enables participants to initiate funds transfer that are immediate, final, and irrevocable once processed • The Fedwire Funds Service business day begins at 9:00 p.m. eastern time (ET) on the preceding calendar day and ends at 6:30 p.m. ET, Monday through Friday, excluding designated holidays.
LIFE CYCLE OF SETTLEMENT PROCESS • Clearing Corporation • Clearing Members • Custodians • Clearing Banks • Depositories • Professional Clearing Member
Clearing & Settlement Process
Core processes involved in clearing and settlement • Trade Recording • Trade Confirmation • Determination of Obligation • Pay-in of Funds and Securities • Pay-out of Funds and Securities
DISJOINTED PAYMENT SYSTEMS • CPSS (standard setting body):- It serves as a forum for central banks to monitor and analyse developments in domestic payment, clearing and settlement systems as well as in cross-border and multicurrency settlement schemes.
Interdependencies
CROSS-BORDER PAYMENT CHALLENGES • Based on local laws and practices • Lack of a common global standard and variations between systems • Government regulations are changing how payments are made • Domestic infrastructures are not designed to handle cross-border payments. • Lack of common message standards. • Impact of regulatory requirements
Working of Cross-Border Payments • Often banks do not separate domestic and cross-border payments, blurring the line of demarcation in payment flows. maintain correspondent banking relationships with local banks in important cities of world
Current State – Functional View Standard Bank – Personal and Business Banking – Payments Flow Customer 1 Touch Point Customer Insights and 3 Offerings - Strategy Shared Services 6 Product Team 7 Fraud, Credit and Risk ATM Develop Design Feature Offerings and Service Offerings / Payment Strategy Specification Strategy Design Offerings Features Branch Manage Agreements (Industry) Group Forensic Investigate Internal Staff fraud Execute CRM Activities Perform Credit Checks (customer account) Channel 2 Credit System 4 IT Services Identify Customer Switch Account Payment Orders Phone Banking Set-up Future Dated Payments Respond to/or contact Customer Cash Services accounting d management reporting rules Perform Fraud Checks 9 5 CIB CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Process Payment Order Authenticate Initiate Transaction Channels IT Services Issue Documents & Notifications Prepare for Settlement Exception Handling Data Store Initiate Time Triggered Perform Transaction Reconciliation Reporting and Analytics Monitor and Report on Performance Investigate Irreconcilable Transactions Create corrective Payment Instructions Integrated Processing Centre Centralized & Regional IPCs SLA / OLA Management Receive Transaction Mobile Banking Cash Services 8 Centralized Manage Customer Agreements Payment Engine Client Contact Centre Perform GL Updates (Risk : Suspense Accounts) Shared Services Define ProductSystem Credit Fraud & Risk Teams, Financeand Team, Team maintain Product Product System Channel Net Banking Touch Points Define Internal Controls IPS IPS Cheque Processing and Reconciliation Finance Source transaction data from Channels / RT and Bulk Regional Post Payment (customer account) Origination Service Maintenance and Payments 16
Current State – Functional View Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team IPS Fraud, Credit and Risk Cheque Processing and Reconciliation Finance ATM Develop Offerings Strategy Branch Design Feature and Service Specification Execute CRM Activities Design Offerings Features Manage Agreements (Industry) Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System IT Services Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Receive Transaction Mobile Banking Respond to/or contact Customer Settlements Local + International Integrated Operations Support Rejections Vendor Management (Cheques) Data Store Set-up Future Dated Payments Association Compliance Association Compliance & Merchant Services & Business Services Reconciliations Initiate Time Triggered Issue Documents & Notifications Charge-backs + Debit Card Liaisoning Customer Data Operations Capturing Regional Reporting and Analytics Origination Service Maintenance and Payments 17
Current State – Functional View 01 Customer Touch Points Channel Touch Point ATM Branch Customer Touch Points : An access mechanism by means of which a participant gains access to the use of channels in order to effect, control, manage or monitor payments The main components within the Customer Touch Points are  ATM  Branch  Net Banking  Client Contact Centre  Phone Banking  Mobile Banking Net Banking Client Contact Centre Phone Banking Mobile Banking 18
Current State – Functional View Channel : Definition of Channel here. 02 Channel Channel Manage Customer Agreements Identify Customer Authenticate Initiate Transaction Initiate Time Triggered Issue Documents & Notifications Switch Account Payment Orders Set-up Future Dated Payments The main components within Channels are  Manage Customer Agreements  Identify Customer  Authenticate  Initiate Transaction  Switch Account Payment Orders  Setup Future Dated Payments  Initiate Time Triggered Payments  Issue Documents and Notifications  Receive transaction  Respond to / or Contact Customer Receive Transaction Respond to/or contact Customer 19
Current State – Functional View 03 Offerings / Payment Strategy Offerings/Payment Strategy Develop Offerings Strategy Design Feature and Service Specification Design Offerings Features Customer Insights and Offerings : Perform Strategic planning, policy and methodology development, relationship management, performance management, and design, build and run enablement for customer offerings The main components within Customer Insights and Offerings are  Develop Offerings Strategy  Manage Customer Agreements for Industry  Design Offerings Feature  Design Feature and Service Specification Manage Agreements (Industry) 20
Current State – Functional View 04 IT Services IT Services : Definition of IT Services here. The main components within Payment Services Hub are 1. Process Payment Order IT Services Process Payment Order 1. 2. 3. Data Store Reporting and Analytics Post Payment into Customer Accounts Payment Engine Data Store Reporting and Analytics 21
Current State – Functional View 05 Integrated Processing Centre Association Compliance & Business Services The main components within Centralized IPCs with payment focus are:  Perform Transaction Reconciliation  Prepare for Settlement  Monitor and Report on Performance  Investigate Irreconcilable Transactions  Create Corrective Payment Instructions  SLA / OLA Management  Source Transaction Data Regional Origination Service Integrated Processing Centre : The standard bank Integrated Processing Centre is based on a structure of three strategic areas, specifically: 1. Production processing or the IPC’s ( CPC + RPC) 2. Service management – responsible for facilitating the relationship between the IPC’s & the SBSA business units 3. Continuous improvement and implementation focusing on improving IPC processes and implementing organizational initiatives Maintenance and Payments The main components within Regional IPCs with payment focus are:  Origination  Service  Maintenance and Payments 22
Current State – Functional View 06 Shared Services Product Team Execute CRM Activities Product System (customer account) Product System Fraud, Credit and Risk Group Forensic Investigate Internal Staff fraud Define Internal Controls Perform Credit Checks Perform Fraud Checks (Risk : Suspense Accounts) Fraud System Credit System Shared Services : Definition of Shared Services here. The main components within Product Team with payment focus are:  Execute CRM Activities  Product Systems The main components within Fraud, Credit, Risk and the Group Forensic Team are  Investigate internal staff fraud  Defining Internal Controls  Perform Credit Checks  Perform Fraud Checks The main components within Finance Team are  Perform GL Updates  Define and Maintain Accounting and Management Rules Finance Perform GL Updates Define and maintain accounting and management reporting rules 23
Current State – Functional View 07 IPS IPS Cheque Processing and Reconciliation Other Entities – This involves entities external to PBB: The main components within this Group are  IPS – Cheque Processing and Reconciliation  Cash Services  CIB – Perform Inter-bank Settlement 08 Cash Services Cash Services 09 CIB CIB Perform Inter-bank Settlement 24
Payment Processing Flow Payments Strategy Development Industry Strategy & Relationship Management Activate service functionality Fulfil Transaction Provide Business Intelligence Data to Business Performance Management Process Framework Bring Offerings to Market Sell Offerings Service Offerings Manage Business Performance Plan the Business Design and Build the Business Design Offering Features (payment capabilities) Maintain the Business End-of-Period Processing Reconciliation Exception Handling 25
Payment Processing Flow Payments Strategy Development - Plan the Business Industry Strategy & Relationship Management Activate service functionality Fulfil Transaction Provide Business Intelligence Data to Business Performance Management Process Framework Bring Offerings to Market Sell Offerings Service Offerings Manage Business Performance Plan the Business Design and Build the Business Design Offering Features (payment capabilities) Develop Long-Term PBB Strategy Define the business objectives of P&BB, Customer and Product and translate them into measurable elements of strategy execution Maintain the Business End-of-Period Processing Reconciliation Exception Handling Perform Planning and Budgeting Develop budgets for P&BB business areas and roll up into a consolidated budget. Develop plans to achieve targets and objectives and allocate P&BB resources accordingly 26
Payment Processing Flow Payments Strategy Development - Bring Offerings to Market Industry Strategy & Relationship Management Activate service functionality Fulfil Transaction Provide Business Intelligence Data to Business Performance Management Process Framework Bring Offerings to Market Sell Offerings Service Offerings Manage Business Performance Plan the Business Design and Build the Business Maintain the Business Payment Component Design Offering Features (payment capabilities) Create offerings End-of-Period Processing Reconciliation Exception Handling Promote offerings This process involves conducting a segmentation study to understand This process involves creating customer needs and wants, in order to demand in the market for new and develop offerings supported by an existing financial solutions. appropriate marketing mix strategy. 27
Payment Processing Flow - Bring Offerings to Market Create Offerings Definition: involves conducting a segmentation study to understand customer needs and wants, in order to develop offerings supported by an appropriate marketing mix strategy. Payment component: The Involvement of Payments strategic team to understand the impact of the New product launch and its subsequent servicing at the Payment processing centre based on the rules defined by the Offerings ( Draft version) 28
Payment Processing Flow - Bring Offerings to Market - A. Create Offerings Customer Offerings Strategy and Planning: Define the strategy for the performance of the capabilities within the functional area incl. Pricing, targets, volumes, features & services inclusive of Payment functionalities Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team IPS Fraud, Credit and Risk Cheque Processing and Reconciliation Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System IT Services Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Set-up Future Dated Payments Integrated Operations Support Vendor Management (Cheques) Initiate Time Triggered Issue Documents & Notifications Receive Transaction Mobile Banking Settlements Local + International Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Customer offerings Strategy & Planning Customer Data Operations Regional Reporting and Analytics Origination Customer offerings policies and Methodologies Customer offerings Relationships and Management Inputs:  Key objectives  Business Model  Offering Strategy  Features and Services Strategy including Payment mechanisms Outputs:  Offering Strategy Charge-backs + Debit Card Liaisoning Capturing Respond to/or contact Customer Customer Offerings Strategy & Planning Service Maintenance and Payments Customer offerings Performance management Customer Offerings people Management Customer Offerings design, build and run enablement 29
Payment Processing Flow - Bring Offerings to Market - A. Create Offerings Customer Offerings design, build and run enablement: Participate in end to end solution design, build and implementation by providing requirements, determining viability of outputs, conducting user acceptance testing, providing post implementation specialist expertise and sustaining change in the customer offerings Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team IPS Fraud, Credit and Risk Cheque Processing and Reconciliation Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System IT Services Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Integrated Operations Support Vendor Management (Cheques) Initiate Time Triggered Issue Documents & Notifications Receive Transaction Mobile Banking Settlements Local + International Rejections Data Store Set-up Future Dated Payments Association Compliance & Merchant Services Reconciliations Regional Reporting and Analytics Origination Customer offerings policies and Methodologies Customer Data Operations Capturing Respond to/or contact Customer Customer offerings Strategy & Planning Charge-backs + Debit Card Liaisoning Customer offerings Relationships and Management Service Maintenance and Payments Customer offerings Performance management Customer Offerings Strategy & Planning Inputs:  Customer offerings plan  Customer offering build and run time ideas  Functional area solution requirements  Newly built solution Outputs:  Customer offerings solution requirements  Articulated business case for customer offerings  Assessed feasibility of design  Sign-offs on Customer offering solution  Customer offerings system advisory support Customer Offerings people Management Customer Offerings design, build and run enablement 30
Payment Processing Flow Payments Strategy Development - Sell Offerings Industry Strategy & Relationship Management Activate service functionality Fulfil Transaction Provide Business Intelligence Data to Business Performance Management Process Framework Bring Offerings to Market Sell Offerings Service Offerings Manage Business Performance Plan the Business Design and Build the Business Originate Customers Setting up of a verified customer record that will allow the customer to apply for any of the Bank's offerings End-of-Period Processing Reconciliation Exception Handling Originate Offerings Initiation and completion of the offering application with the customer and induction of the customer into the bank and its processes Activate Offerings Payment Component Design Offering Features (payment capabilities) Maintain the Business Providing the customer with enablers and enabling the account. Excludes onboarding as this is a service process 31
Payment Processing Flow - Sell Offerings Activate Offerings Definition : Providing the customer with enablers and enabling the account. Excludes on-boarding as this is a service process Payment Component: This section involves activation of new accounts for 1. Transactional products 2. VAF accounts – includes Payouts 3. Home loan accounts - includes payouts 4. CARDS – Issue of Credit ( Draft version) 32
Payment Processing Flow - Sell Offerings - A. Activate Offerings Enable Account : Once approved, co-ordination of account enablement and provision of enablers to the customer to make the account transactable. Setting up of initial customer authentication and provision of account access enablers to the customer Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team IPS Fraud, Credit and Risk Cheque Processing and Reconciliation Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System IT Services Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Set-up Future Dated Payments Receive Transaction Mobile Banking Integrated Operations Support Vendor Management (Cheques) Initiate Time Triggered Issue Documents & Notifications Charge-backs + Debit Card Liaisoning Customer Data Operations Capturing Regional Reporting and Analytics Origination Respond to/or contact Customer Sell Settlements Local + International Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Create the customer Service Maintenance and Payments Complete offering application Access Channel Inputs:  Customer acceptance of product / service  Customer authentication details  Customer acceptance of product / service Outputs:  Customer authentication records  Account enablers in possession In case of VAF and HL, Payouts are effected into the customer’s account and dealer settlements are carried out Enable Account 33
Payment Processing Flow Payments Strategy Development - Service Offerings Industry Strategy & Relationship Management Activate service functionality Fulfil Transaction Provide Business Intelligence Data to Business Performance Management Process Framework Bring Offerings to Market Sell Offerings Service Offerings Manage Business Performance Plan the Business Design and Build the Business Payment Component Design Offering Features (payment capabilities) Maintain the Business End-of-Period Processing Reconciliation Exception Handling Fulfill Transaction Resolve Complaints Manage Accounts Fulfill Service Fulfil Transaction: Execution of all customer and bank initiated value transactions (e.g., deposit, transfers, withdrawal, standing orders etc) Fulfil Service: Completion of all customer initiated service activities (e.g. query, general assistance etc) Completion of all activities required to resolve one and done and escalated complaints Management of bank initiated account maintenance activities (e.g. collateral maintenance, collateral valuation etc) 34
Payment Processing Flow - Service Offerings Fulfil Transaction Definition : Execution of all customer and bank initiated value transactions (e.g., deposit, transfers, withdrawal, standing orders etc) Payment Component: All transactions processed through the Payment engine ( Real time and Bulk), reconciled through the reconciliation engine and prepared for settlement and Posting. ( Draft version) Fulfil Service Definition : Completion of all customer initiated service activities (e.g. query, general assistance etc) Payment component: All escalated queries from channel relating to (Saswitch) transactions and escalated queries from IPC ( especially refunds) would be handled at the Payment processing centre. ( Draft version) Resolve Complaints Definition : Completion of all activities required to resolve one and done and escalated complaints Manage Accounts Definition : Management of bank initiated account maintenance activities (e.g. collateral maintenance, collateral valuation etc) 35
Payment Processing Flow – Service Offerings - A. Fulfil Transactions Access Channel / Identify Customer : Identification of an SBSA customer or prospect via identification mechanisms. Certify that the mechanism used to initiate the transaction is a valid mechanism Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Initiate Time Triggered Integrated Operations Support Charge-backs + Debit Card Liaisoning Issue Documents & Notifications Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Set-up Future Dated Payments Initiate Scenario 1 : Cheque Deposit at an ATM Access Channel IPS Cheque Processing and Reconciliation Service Channel : ATM Instruction Flow : Us on Us Enabler : Card + Chip Input :  Identification mechanism like name; card number etc  Contacted customer / prospect Output :  Identified customer / Prospect  Validated identification mechanism Maintenance and Payments Process Payment Order Issue Official Docs Post Payment 36
Payment Processing Flow – Service Offerings - A. Fulfil Transactions Authenticate : Mechanism to accurately confirm the identity of the SBSA customer / prospect. Authentication mechanisms are channel specific. Examples include Identity document; passport; signature; security question etc Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Set-up Future Dated Payments Integrated Operations Support Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Initiate Scenario 1 : Cheque Deposit at an ATM Authenticate IPS Cheque Processing and Reconciliation Service Maintenance and Payments Process Payment Order Channel : ATM Instruction Flow : Us on Us Enabler : Card + Chip Authenticate:  Pin / Password  Card Input :  Identified customer / prospect  Authentication mechanism e.g. password; PIN Output :  Authenticated customer / prospect  Unauthenticated customer / Prospect Issue Official Docs Post Payment 37
Payment Processing Flow – Service Offerings - A. Fulfil Transactions Initiate : Initiation and channel fulfilment of a value transaction by a customer or prospect. Customer initiated value transactions include deposits ( Cash or Cheque), Withdrawals ( Cash or Cheque), transfers ( Inter and Intra bank) and change transactions Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Set-up Future Dated Payments Integrated Operations Support Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Initiate Scenario 1 : Cheque Deposit at an ATM Initiate IPS Cheque Processing and Reconciliation Service Maintenance and Payments Process Payment Order Channel : ATM Instruction Flow : Us on Us Enabler : Card + Chip Authenticate:  Pin / Password  Card Input :  Identified customer / prospect  Authenticated customer or prospect  Transaction request Output :  Initiated transaction  Transaction record  Request for transaction authorization Issue Official Docs Post Payment 38
Payment Processing Flow – Service Offerings - A. Fulfil Transactions Process Payment Order: Validate : Fulfill activities required to ensure that the content of the value transaction is “ technically” in order and complies to the SLA’s and customer agreements. Confirming the existence and validity of the destination account Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Set-up Future Dated Payments Integrated Operations Support Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Origination Initiate Scenario 1 : Cheque Deposit at an ATM Channel : ATM Instruction Flow : Us on Us Enabler : Card + Chip Authenticate :  Pin / Password  Card Validate : SBSA Customer Authorize : SBSA Customer Input :  Authorized transaction Output :  Validated Transaction Regional Reporting and Analytics Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Process Payment order IPS Cheque Processing and Reconciliation Service Maintenance and Payments Process Payment order Issue Official Docs Post Payment 39
Payment Processing Flow – Service Offerings - A. Fulfil Transactions Process Payment Order: Enrich : Provide Payment services / information added to a transaction in response to customer / prospect / bank requirements as a service or as a basic processing requirement Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Set-up Future Dated Payments Integrated Operations Support Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Initiate Scenario 1 : Cheque Deposit at an ATM Process Payment order IPS Cheque Processing and Reconciliation Service Maintenance and Payments Process Payment order Channel : ATM Instruction Flow : Us on Us Enabler : Card + Chip Authenticate :  Pin / Password  Card Validate : SBSA Customer Authorize : SBSA Customer Input :  Authorized transaction  Validated Transaction  Customer agreement Output :  Enriched Transaction ( as per customer / prospect / bank requirements) Issue Official Docs Post Payment 40
Payment Processing Flow – Service Offerings - A. Fulfil Transactions Issue Official Docs : Issue physical documents ( e.g. ATM Slips ) and notifications ( e.g. Sms confirmations) associated with value transactions and service activities Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Integrated Operations Support Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Customer Data Operations Capturing Regional Reporting and Analytics Origination Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Set-up Future Dated Payments Issue official docs IPS Cheque Processing and Reconciliation Service Maintenance and Payments Channel : ATM Instruction Flow : Us on Us Enabler : Card + Chip Authenticate :  Pin / Password  Card Validate : SBSA Customer Authorize : SBSA Customer Input :  Identified customer / prospect  Authenticated customer / prospect  Authorized transaction  Request for official docs Output :  Issued official documents  Issued notifications Authenticate Initiate Scenario 1 : Cheque Deposit at an ATM Process Payment Order Issue Official Docs Post Payment 41
Payment Processing Flow – Service Offerings - A. Fulfil Transactions Post Payment: Post the transaction at a customer account level (i.e. Sub-ledger). Apply financial conditions associated with the package i.e. Calculate fees and commission, increment transaction counter etc Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Integrated Operations Support Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Set-up Future Dated Payments Initiate Scenario 1 : Cheque Deposit at an ATM Post payment IPS Cheque Processing and Reconciliation Service Maintenance and Payments Process Payment Order Channel : ATM Instruction Flow : Us on Us Enabler : Card + Chip Authenticate :  Pin / Password  Card Validate : SBSA Customer Authorize : SBSA Customer Post : Account Input :  Accounting rules  Calculated fees  Calculated commission Output :  Account(s) updated Issue Official Docs Post Payment 42
Payment Processing Flow – Service Offerings - A. Fulfil Transactions Access Channel / Identify Customer : Identification of an SBSA customer or prospect via identification mechanisms. Certify that the mechanism used to initiate the transaction is a valid mechanism Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Set-up Future Dated Payments Integrated Operations Support Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Initiate Access Channel IPS Cheque Processing and Reconciliation Service Maintenance and Payments Process Payment Order Channel : Cash centre / Branch Instruction Flow : Us on Us Enabler : paper Input :  Identification mechanism like name; username, card etc  Contacted customer / prospect Output :  Identified customer / Prospect  Validated identification mechanism Issue Official Docs Scenario 2 : Cheque encashment at Branch – SBSA ( Local currency cheque) Post Payment 43
Payment Processing Flow – Service Offerings - A. Fulfil Transactions Authenticate : Mechanism to accurately confirm the identity of the SBSA customer / prospect. Authentication mechanisms are channel specific. Examples include Identity document; passport; signature; security question etc Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team IPS Fraud, Credit and Risk Cheque Processing and Reconciliation Finance ATM Develop Offerings Strategy Branch Design Feature and Service Specification Execute CRM Activities Design Offerings Features Manage Agreements (Industry) Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System IT Services Branch Perform GL Updates (Risk : Suspense Accounts) CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Set-up Future Dated Payments Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Integrated Operations Support Vendor Management (Cheques) Receive Transaction Mobile Banking Settlements Local + International Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Initiate Service Authenticate Channel : Cash Centre / Maintenance and Payments Process Payment Order Instruction Flow : Us on Us Enabler : Paper Authenticate:  Identity doc  Signature Input :  Identified customer / prospect  Authentication mechanism e.g. Identity document; password; PIN; Signature Output :  Authenticated customer / prospect  Unauthenticated customer / Prospect Issue Official Docs Scenario 2 : Cheque encashment at Branch – SBSA ( Local currency cheque) Post Payment 44
Payment Processing Flow – Service Offerings - A. Fulfil Transactions Initiate : Initiation and channel fulfilment of a value transaction by a customer or prospect. Customer initiated value transactions include deposits ( Cash or Cheque), Withdrawals ( Cash or Cheque), transfers ( Inter and Intra bank) and change transactions Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy CV Z Branch Design Feature and Service Specification Execute CRM Activities Design Offerings Features Manage Agreements (Industry) Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Client Contact Centre Identify Customer Authenticate Switch Account Payment Orders CV Z Initiate Transaction Process Payment Order Payment Engine Set-up Future Dated Payments Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Integrated Operations Support Vendor Management (Cheques) Receive Transaction Mobile Banking Settlements Local + International Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Initiate Service Channel : Cash centre / Branch Perform GL Updates (Risk : Suspense Accounts) Credit System Initiate IPS Cheque Processing and Reconciliation Maintenance and Payments Process Payment Order Instruction Flow : Us on Us Enabler : Paper Authenticate:  Identity doc  Signature Input :  Identified customer / prospect  Authenticated customer or prospect  Transaction request Output :  Initiated transaction  Transaction record  Request for transaction authorization Issue Official Docs Scenario 2 : Cheque encashment at Branch – SBSA ( Local currency cheque) Post Payment 45
Payment Processing Flow – Service Offerings - A. Fulfil Transactions Process Payment Order: Validate : Fulfill activities required to ensure that the content of the value transaction is “ technically” in order and complies to the SLA’s and customer agreements. Confirming the existence and validity of the destination account Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy CV Z Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Set-up Future Dated Payments Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Origination Initiate Instruction Flow : Us on Us Enabler : Paper Authenticate :  Identity doc  Signature Validate : SBSA Customer Authorize : SBSA Customer Input :  Authorized transaction Output :  Validated Transaction Regional Reporting and Analytics Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Integrated Operations Support Vendor Management (Cheques) Receive Transaction Mobile Banking Settlements Local + International Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Channel : Cash Centre / Branch Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System Process Payment order IPS Cheque Processing and Reconciliation Service Maintenance and Payments Process Payment order Issue Official Docs Scenario 2 : Cheque encashment at Branch – SBSA ( Local currency cheque) Post Payment 46
Payment Processing Flow – Service Offerings - A. Fulfil Transactions Process Payment Order: Enrich : Provide Payment services / information added to a transaction in response to customer / prospect / bank requirements as a service or as a basic processing requirement Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Set-up Future Dated Payments Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Integrated Operations Support Vendor Management (Cheques) Receive Transaction Mobile Banking Settlements Local + International Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Initiate Service Maintenance and Payments Process Payment order Channel : Cash centre / Branch Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System Process Payment order IPS Cheque Processing and Reconciliation Instruction Flow : Us on Us Enabler : Paper Authenticate :  Identify doc  Signature Validate : SBSA Customer Authorize : SBSA Customer Input :  Authorized transaction  Validated Transaction  Customer agreement Output :  Enriched Transaction ( as per customer / prospect / bank requirements) Issue Official Docs Scenario 2 : Cheque encashment at Branch – SBSA ( Local currency cheque) Post Payment 47
Payment Processing Flow – Service Offerings - A. Fulfil Transactions Issue Official Docs : Issue physical documents ( e.g. ATM Slips ) and notifications ( e.g. Sms confirmations) associated with value transactions and service activities Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Integrated Operations Support Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Customer Data Operations Capturing Regional Reporting and Analytics Origination Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Set-up Future Dated Payments Issue official docs IPS Cheque Processing and Reconciliation Service Maintenance and Payments Channel : Cash centre / Branch Instruction Flow : Us on Us Enabler : Paper Authenticate :  Identity document  Signature Validate : SBSA Customer Authorize : SBSA Customer Input :  Identified customer / prospect  Authenticated customer / prospect  Authorized transaction  Request for official docs Output :  Issued official documents  Issued notifications Authenticate Initiate Process Payment Order Issue Official Docs Scenario 2 : Cheque encashment at Branch – SBSA ( Local currency cheque) Post Payment 48
Payment Processing Flow – Service Offerings - A. Fulfil Transactions Post Payment: Post the transaction at a customer account level (i.e. Sub-ledger). Apply financial conditions associated with the package i.e. Calculate fees and commission, increment transaction counter etc Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Integrated Operations Support Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Set-up Future Dated Payments Initiate Post payment IPS Cheque Processing and Reconciliation Service Maintenance and Payments Process Payment Order Channel : Cash centre / Branch Instruction Flow : Us on Us Enabler : Paper Authenticate :  Identity document  Signature Validate : SBSA Customer Authorize : SBSA Customer Post : Account Input :  Accounting rules  Calculated fees  Calculated commission Output :  Account(s) updated Issue Official Docs Scenario 2 : Cheque encashment at Branch – SBSA ( Local currency cheque) Post Payment 49
Payment Processing Flow – Service Offerings - B. Fulfil Service Identify Customer : Identification of SBSA customer or prospect via identification mechanisms. Identification mechanisms include customer / prospect name, username, card etc. Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System IT Services Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Set-up Future Dated Payments Initiate Time Triggered Issue Documents & Notifications Integrated Operations Support Charge-backs + Debit Card Liaisoning Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Manage Queries Identify Customer IPS Cheque Processing and Reconciliation Service Qualify complaint Channel : CCC, CRC, Branch, Electronic mail Input :  Identification mechanism like name; username, card etc  Contacted customer / prospect Output :  Identified customer / Prospect  Validated identification mechanism Maintenance and Payments Resolve complaint Resolve escalated complaint 50
Payment Processing Flow – Service Offerings - B. Fulfil Service Authenticate : Mechanism to accurately confirm the identity of the SBSA customer / prospect. Authentication mechanisms are channel specific. Examples include Identity document; passport; signature; security question etc Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System IT Services Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Set-up Future Dated Payments Initiate Time Triggered Issue Documents & Notifications Integrated Operations Support Charge-backs + Debit Card Liaisoning Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Manage Queries Authenticate IPS Cheque Processing and Reconciliation Service Qualify complaint Channel : CCC, CRC, Branch, Electronic mail Authenticate:  Pin / Password/ I.D  Card Input :  Identified customer / prospect  Authentication mechanism e.g. Identity document; password; PIN; Signature Output :  Authenticated customer  Unauthenticated customer Maintenance and Payments Resolve complaint Resolve escalated complaint 51
Payment Processing Flow – Service Offerings - B. Fulfil Service Manage Queries : Receipt of Queries and handling. Where necessary, query redirected to the appropriate resolution parties and complex queries escalated. Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Integrated Processing Centre Centralized Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Initiate Time Triggered Issue Documents & Notifications Charge-backs + Debit Card Liaisoning Origination Authenticate Customer Data Operations Regional Reporting and Analytics Manage Queries Input :  Authenticated customer  Account information request  Query ( Including information, assistance or status request) Output : Capturing Respond to/or contact Customer Access Channel/ Identify Customer Integrated Operations Support Vendor Management (Cheques) Receive Transaction Mobile Banking Settlements Local + International Rejections Data Store Set-up Future Dated Payments Association Compliance & Merchant Services Reconciliations  Pin / Password / I.D  Card Perform Inter-bank Settlement Net Banking Process Payment Order Electronic mail CIB Fraud System Manage Customer Agreements Channel : CCC, CRC, Branch, Authenticate: Define and maintain accounting d management reporting rules Perform Fraud Checks IT Services Manage Queries IPS Cheque Processing and Reconciliation Service Qualify complaint Maintenance and Payments  Communicated account information  Resolved customer query  Customer complaint  Recorded (and escalated query)  General information , assistance or status provided Resolve complaint Resolve escalated complaint 52
Payment Processing Flow – Service Offerings - B. Fulfil Service Qualify complaint : Receive and qualify complaints logged by customers. Gather all details pertaining to the complaint. Direct complaints to the specialist area in instances where channel does not have the capability to resolve the complaint Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System IT Services Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Set-up Future Dated Payments Initiate Time Triggered Issue Documents & Notifications Integrated Operations Support Charge-backs + Debit Card Liaisoning Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Manage Queries Qualify complaint IPS Cheque Processing and Reconciliation Service Qualify complaint Maintenance and Payments Channel : CCC, CRC Branch, Electronic mail Authenticate:  Pin / Password/ I.D  Card Input :  Authenticated customer or prospect  Customer complaint  Complaint management guidelines Output :  Complaint record  Qualified complaint  Directed complaint Resolve complaint Resolve escalated complaint 53
Payment Processing Flow – Service Offerings - B. Fulfil Service Resolve complaint : Analysis of customer complaint that have been identified as channel specific. Investigate and resolution of channel specific complaint Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System IT Services Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Set-up Future Dated Payments Initiate Time Triggered Issue Documents & Notifications Integrated Operations Support Origination Manage Queries  Card Input :  unresolved complaint  Complaint management guidelines Output :  Resolved complaint Customer Data Operations Regional Reporting and Analytics Authenticate Channel : CCC, CRC, Branch, Electronic mail Authenticate:  Pin / Password / I.D Charge-backs + Debit Card Liaisoning Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Resolve Complaint IPS Cheque Processing and Reconciliation Service Qualify complaint Maintenance and Payments Resolve complaint Resolve escalated complaint 54
Payment Processing Flow – Service Offerings - B. Fulfil Service Resolve escalated queries : Complaints escalated via the banking channels ( complaints are escalated when channel does not have the capability to resolve the complaint or when customers are dissatisfied with the resolution of the complaint Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System IT Services Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Set-up Future Dated Payments Initiate Time Triggered Issue Documents & Notifications Integrated Operations Support Charge-backs + Debit Card Liaisoning Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Manage Queries Resolve escalated complaint IPS Cheque Processing and Reconciliation Service Qualify complaint Channel : CCC, CRC, Branch, Electronic mail Authenticate:  Pin / Password/ I.D  Card Input :  Directed complaint  Escalated complaint  Complaint management guidelines Output :  Resolved escalated complaint  Unresolved escalated complaint Maintenance and Payments Resolve complaint Resolve escalated complaint 55
Payment Processing Flow – Service Offerings - C. Manage Accounts Initiate: Identify all the periodic triggers on an account and initiate( specific to an operational environment); examples include payment instruments requiring renewal, fees and interest accruals to be posted, future dated payments to be executed Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team IPS Fraud, Credit and Risk Cheque Processing and Reconciliation Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System IT Services Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Process Payment Order Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Set-up Future Dated Payments Receive Transaction Mobile Banking Settlements Local + International Integrated Operations Support Vendor Management (Cheques) Initiate Time Triggered Issue Documents & Notifications Input :  Customer account information Customer Data Operations Regional Reporting and Analytics Origination Document management Output :  Event triggers actioned in the customers account Charge-backs + Debit Card Liaisoning Capturing Respond to/or contact Customer Initiate Association Compliance & Merchant Services Reconciliations Rejections Data Store Phone Banking Channel : Customer / Bank initiated Centralized Manage Customer Agreements Client Contact Centre Initiate Service Maintenance and Payments Collateral Management Debt review and collections 56
Payment Processing Flow – Service Offerings - C. Manage Accounts Document Management: Prepare, generate and supply paper correspondence including account statements for all accounts. This includes conformance to specifications and SLA’s as agreed Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team IPS Fraud, Credit and Risk Cheque Processing and Reconciliation Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System IT Services Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Set-up Future Dated Payments Receive Transaction Mobile Banking Initiate Time Triggered Issue Documents & Notifications Charge-backs + Debit Card Liaisoning Customer Data Operations Capturing Input :  Specification for documents  Information required on documents Output :  Documents produced / Not produced Regional Reporting and Analytics Origination Document management Channel : Customer / Bank initiated Integrated Operations Support Vendor Management (Cheques) Respond to/or contact Customer Initiate Settlements Local + International Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Document Management Service Maintenance and Payments Collateral Management Debt review and Collections 57
Payment Processing Flow – Service Offerings - C. Manage Accounts Collateral Management: This process refers to obtaining suretyships and collateral items pledged, ceded or bonded to the bank as security to the loan, valuation and re-evaluation of collateral market values, realization and release of surety ships and supporting collateral Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team IPS Fraud, Credit and Risk Cheque Processing and Reconciliation Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System IT Services Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Set-up Future Dated Payments Receive Transaction Mobile Banking Integrated Operations Support Vendor Management (Cheques) Initiate Time Triggered Issue Documents & Notifications Charge-backs + Debit Card Liaisoning Customer Data Operations Capturing Regional Reporting and Analytics Origination Respond to/or contact Customer Initiate Settlements Local + International Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Document management Service Maintenance and Payments Collateral Management Collateral Management Channel : Customer/ Bank initiated Input :  Credit policy, Credit procedure  Trigger for periodic reevaluation Output :  Obtained collateral  Valued and Re-valued collateral  Released collateral  Realized collateral Debt review and Collections 58
Payment Processing Flow – Service Offerings - C. Manage Accounts Debt review and collections : Involves contacting customer in response to a collection prompt, voluntary reviewing and respreading of customer and ensuring the collateral types defined by Basel II are used and weighted accordingly. Also, involves the activities required to manage accounts in collections that are post write - off Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team IPS Fraud, Credit and Risk Cheque Processing and Reconciliation Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System IT Services Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Set-up Future Dated Payments Receive Transaction Mobile Banking Integrated Operations Support Vendor Management (Cheques) Initiate Time Triggered Issue Documents & Notifications Charge-backs + Debit Card Liaisoning Customer Data Operations Capturing Regional Reporting and Analytics Origination Respond to/or contact Customer Initiate Settlements Local + International Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Document management Service Maintenance and Payments Collateral Management Respond to customer Channel : Customer/ Bank initiated Input :  Credit collection prompt  Customer interaction and collection strategy  Account ageing  Written off accounts Output :  Collection feedback  Re-structured accounts  Outstanding payments collected  Maximized recoveries  Minimized losses  Optimized costs Debt review and collections 59
Payment Processing Flow Payments Strategy Development - Design and Build Business Industry Strategy & Relationship Management Activate service functionality Fulfil Transaction Provide Business Intelligence Data to Business Performance Management Process Framework Bring Offerings to Market Sell Offerings Service Offerings Manage Business Performance Plan the Business Design and Build the Business Design Offering Features (payment capabilities) Design the Business Build the Business Perform Strategic Sourcing Maintain the Business Prepare for Settlement Reconciliation Exception Handling Design the P&BB business environment (i.e. people, process and technology) Build the P&BB business environment (i.e. people, process and technology) Establish mutually beneficial agreements with suppliers to enable demand fulfilment and continuously reduce the Total Cost of Ownership (TCO) 60
Payment Processing Flow - Maintain the Business Payments Strategy Development Industry Strategy & Relationship Management Activate service functionality Provide Business Intelligence Data to Business Performance Management Fulfil Transaction Process Framework Bring Offerings to Market Sell Offerings Service Offerings Manage Business Performance Plan the Business Design Offering Features (payment capabilities) Perform Procurement Maintain Physical Infrastructure Fulfil repetitive purchases of consumables, assets and services at the best total cost of ownership for P&BB Maintain physical infrastructure to ensure P&BB’s continued business capability (i.e. buildings, facilities etc) Maintain the Business Prepare for Settlement Reconciliation Exception Handling Manage Workforce Reconciliation Maintain IT Infrastructure Maintain IT infrastructure to ensure P&BB’s continued business capability (i.e. systems etc) Exception Handling Manage Data Manage enterprise data strategy, data quality and data governance for P&BB Settlement Ensure P&BB has the correct staff, with the correct skills and knowledge, who are continually aligned with the P&BB strategy Payment Component Design and Build the Business To Be Defined Manage errors during and after the execution and processing of a payment Systematic matching of Settlement obligation instructions from merchants; agent banks, clearing houses , reserve bank and Card associations 61
Payment Processing Flow - Maintain the Business Prepare for Settlement : Systematic matching of settlement obligation instructions from Merchants; Agent banks; Reserve bank; Clearing house and Card associations Exception Handling Definition : Manage errors during and after the execution and processing of a payment  In process exception  Post process exception 62
Payment Processing Flow - Maintain the Business - A. Reconciliation Reconciliation : Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Group Forensic Investigate Internal Staff fraud Execute CRM Activities Product System (customer account) Perform Credit Checks Product System Channel Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System IT Services Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Identify Customer Authenticate Initiate Transaction Payment Engine Settlements Local + International Switch Account Payment Orders Set-up Future Dated Payments Vendor Management (Cheques) Initiate Time Triggered Receive Transaction Mobile Banking Issue Documents & Notifications Origination Maintain IT Infrastructure  Processed transaction  Files sent from clearing house and internal systems Output :  Reconciled / un reconciled transaction Customer Data Operations Regional Reporting and Analytics Maintain Physical Infrastructure Channel : ATM Instruction Flow : Us on Us Enabler : Card + Chip Input : Charge-backs + Debit Card Liaisoning Capturing Respond to/or contact Customer Perform Procurement Integrated Operations Support Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Process Payment Order Client Contact Centre Reconciliation IPS Cheque Processing and Reconciliation Manage Data Service Manage Workforce Maintenance and Payments Reconciliation Exception handling Prepare for Settlement 63
Payment Processing Flow - Maintain the Business - B. Exception Handling • Exception Handling : The process to manage to manage errors during and after the execution and processing of a payment. There are two types of exception handling • In-process • Post-process • Raise; Clear & Confirm / Monitor Exceptions Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Group Forensic Investigate Internal Staff fraud Execute CRM Activities Product System (customer account) Perform Credit Checks Product System Channel Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System IT Services Centralized Manage Customer Agreements Identify Customer Authenticate Initiate Transaction Payment Engine Settlements Local + International Switch Account Payment Orders Set-up Future Dated Payments Vendor Management (Cheques) Initiate Time Triggered Receive Transaction Mobile Banking Issue Documents & Notifications Origination Maintain IT Infrastructure Output :  Transaction identified / un identified in the Rejections and captured for processing Customer Data Operations Regional Reporting and Analytics Maintain Physical Infrastructure  Charge-backs + Debit Card Liaisoning Capturing Respond to/or contact Customer Perform Procurement Integrated Operations Support Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Process Payment Order Channel : ATM Instruction Flow : Us on Us Enabler : Card + Chip Input : transaction for processing  Rejected transaction Integrated Processing Centre Net Banking Client Contact Centre Exception Handling IPS Cheque Processing and Reconciliation Manage Data Service Manage Workforce Maintenance and Payments Reconciliation Exception handling Prepare for Settlement 64
Payment Processing Flow - Maintain the Business - C. Prepare for Settlement Prepare for Settlement : The process of sending and receiving settlement obligation instructions at a domestic and / or international level and the matching of these to settlement obligation instructions Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Group Forensic Investigate Internal Staff fraud Execute CRM Activities Product System (customer account) Perform Credit Checks Product System Channel Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System IT Services transaction for processing  Rejected transaction Centralized Manage Customer Agreements Identify Customer Authenticate Initiate Transaction Payment Engine Settlements Local + International Switch Account Payment Orders Set-up Future Dated Payments Initiate Time Triggered Issue Documents & Notifications Charge-backs + Debit Card Liaisoning Regional Reporting and Analytics Origination Maintain Physical Infrastructure Customer Data Operations Capturing Respond to/or contact Customer Perform Procurement  Transaction captured for settlement Vendor Management (Cheques) Receive Transaction Mobile Banking Integrated Operations Support Output : Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Process Payment Order Channel : ATM Instruction Flow : Us on Us Enabler : Card + Chip Input :  Integrated Processing Centre Net Banking Client Contact Centre Prepare for Settlement IPS Cheque Processing and Reconciliation Maintain IT Infrastructure Manage Data Service Manage Workforce Maintenance and Payments Reconciliation Exception handling Prepare for Settlement 65
Payment Processing Flow Payments Strategy Development - Manage Business Performance Industry Strategy & Relationship Management Activate service functionality Fulfil Transaction Provide Business Intelligence Data to Business Performance Management Process Framework Bring Offerings to Market Sell Offerings Service Offerings Manage Business Performance Plan the Business Design and Build the Business Payment Component Design Offering Features (payment capabilities) Measure and Report Performance Measure and Monitor Service Providers Maintain the Business End-of-Period Processing Reconciliation Exception Handling Measure and report the performance of P&BB across multiple dimensions (i.e. Offerings, Operations, Channel, IT, Credit, HR, Finance, Risk & Compliance and Business Architecture) Measure, monitor and review operational and service level agreements with internal and external partners 66
Payment Processing Flow - Manage Business Performance Measure and Report Performance Definition : Measure and report the performance of P&BB across multiple dimensions (i.e. Offerings, Operations, Channel, IT, Credit, HR, Finance, Risk & Compliance and Business Architecture) Payments Component: Measurement and reporting of performance on the Payment Processing centre  No. of Exceptions ( Identified and cleared)  No. of Escalated queries handled within SLA  % of Un reconciled transactions ( Volume and Value)  Settlement obligations as per defined SLA ( Draft version) 67
Payment Processing Flow - Manage Business Performance - A. Report Performance Manage Business performance: Gather performance data related to service level agreement / OLA defined and distribute to relevant stakeholders Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System IT Services Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Receive Transaction Mobile Banking Respond to/or contact Customer Association Compliance & Merchant Services Reconciliations Settlements Local + International Integrated Operations Support Rejections Vendor Management (Cheques) Data Store Set-up Future Dated Payments Initiate Time Triggered Issue Documents & Notifications Report on Performance IPS Cheque Processing and Reconciliation Charge-backs + Debit Card Liaisoning Customer Data Operations Capturing Regional Reporting and Analytics Origination Service Maintenance and Payments Channel : All Instruction Flow : Us on Us Them on us Us on them Input :  Performance management measures for functional management of business partners and suppliers Output :  Performance reports  Performance problems and areas of concern identified and communicated to business partners 68
VARIOUS REGULATIONS • LEGAL FRAMEWORK FOR PAYMENT & SETTLEMENT SYSTEMS OF INDIA • The Negotiable Instruments Act, 1881 (N.I. Act) :- legal base for all cheque-based (instrument-based) payment systems in India • Amendment to the Information Technology Act, 2000: make it applicable to N.I. Acthas accorded legal status to the usage of electronic payment systems in Indian banking. • Under the PSS Act, 2007, two Regulations have been made by the Reserve Bank of India, • The Board for Regulation and Supervision of Payment and Settlement Systems Regulation, 2008 :- deals with the constitution of the Board for Regulation and Supervision of Payment and Settlement System (BPSS),The BPSS exercises the powers on behalf of the Reserve Bank, for regulation and supervision of the payment and settlement systems under the PSS Act, 2007. • The Payment and Settlement Systems Regulations, 2008:- matters like form of application for authorization for commencing/ carrying on a payment system and grant of authorization, payment instructions and determination of standards of payment systems, furnishing of returns/documents/other information, furnishing of accounts and balance sheets by system provider etc

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Payment and Settlement Systems(SWIFT,NEFT and Securities Cycle)

  • 1. PAYMENT & SETTLEMENT SYSTEM BYMihika Baisya (12030141003) Vyshak Reghukumar (12030141036) Savita Marwal (12030141094) Ruchika Sharma (12030141097
  • 2. INTRODUCTION • DEFINITION- • Payment is the transfer of one form of good, service or financial asset in exchange for another form of good, service or financial asset in proportions that have been previously agreed upon by all parties involved. Payment can be made in the form of funds, assets or services. • Settlement of securities is a business process whereby securities or interests in securities are delivered, usually against ( in simultaneous exchange for) payment of money, to fulfil contractual obligations, such as those arising under securities trades. • Cash Settlement is a method of settling forward contracts or futures contracts by cash rather than by physical delivery of the underlying asset. The parties settle by paying/receiving the loss/gain related to the contract in cash when the contract expires.
  • 3. NATURE OF SETTLEMENT • Settlement involves the delivery of securities from one party to another Traditional (Physical) Settlement Electronic Settlement • LEGAL SIGNIFICANCE • IMMOBILIZATION & DECENTRALIZATION • DIRECT & INDIRECT HOLDING SYSTEMS
  • 4. SETTLEMENT ACROSS VARIOUS GEOGRAPHIC LOCATIONS • INDIA Real-Time Gross Settlement National Electronic Funds Transfer Indo-Nepal Remittance Facility • UNITED STATES of AMERICA FedWire
  • 5. Immediate Payment Service • Immediate Payment Service (IMPS) is an initiative of National Payments Corporation of India (NPCI). • To avail the facility, both the sender and receiver of money needs to be registered for mobile banking service of their respective banks.
  • 6. Comparison • The key difference between RTGS and NEFT is that while RTGS is on gross settlement basis, NEFT is on net settlement basis. • RTGS facilitates real-time ("push") transfer, while NEFT involves twelve settlements from 8 am to 7 pm on week days and six settlements from 8 am to 1 pm on Saturdays. Customers can access the RTGS facility between 9 am to 4:30 pm on weekdays and 9 am to 1:30 pm on Saturday
  • 7. FEDWIRE • The Federal Reserve Banks, of the United States, provide the Fedwire Funds Service, a real-time gross settlement system(RTGS) that enables participants to initiate funds transfer that are immediate, final, and irrevocable once processed • The Fedwire Funds Service business day begins at 9:00 p.m. eastern time (ET) on the preceding calendar day and ends at 6:30 p.m. ET, Monday through Friday, excluding designated holidays.
  • 8.
  • 9. LIFE CYCLE OF SETTLEMENT PROCESS • Clearing Corporation • Clearing Members • Custodians • Clearing Banks • Depositories • Professional Clearing Member
  • 11. Core processes involved in clearing and settlement • Trade Recording • Trade Confirmation • Determination of Obligation • Pay-in of Funds and Securities • Pay-out of Funds and Securities
  • 12. DISJOINTED PAYMENT SYSTEMS • CPSS (standard setting body):- It serves as a forum for central banks to monitor and analyse developments in domestic payment, clearing and settlement systems as well as in cross-border and multicurrency settlement schemes.
  • 14. CROSS-BORDER PAYMENT CHALLENGES • Based on local laws and practices • Lack of a common global standard and variations between systems • Government regulations are changing how payments are made • Domestic infrastructures are not designed to handle cross-border payments. • Lack of common message standards. • Impact of regulatory requirements
  • 15. Working of Cross-Border Payments • Often banks do not separate domestic and cross-border payments, blurring the line of demarcation in payment flows. maintain correspondent banking relationships with local banks in important cities of world
  • 16. Current State – Functional View Standard Bank – Personal and Business Banking – Payments Flow Customer 1 Touch Point Customer Insights and 3 Offerings - Strategy Shared Services 6 Product Team 7 Fraud, Credit and Risk ATM Develop Design Feature Offerings and Service Offerings / Payment Strategy Specification Strategy Design Offerings Features Branch Manage Agreements (Industry) Group Forensic Investigate Internal Staff fraud Execute CRM Activities Perform Credit Checks (customer account) Channel 2 Credit System 4 IT Services Identify Customer Switch Account Payment Orders Phone Banking Set-up Future Dated Payments Respond to/or contact Customer Cash Services accounting d management reporting rules Perform Fraud Checks 9 5 CIB CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Process Payment Order Authenticate Initiate Transaction Channels IT Services Issue Documents & Notifications Prepare for Settlement Exception Handling Data Store Initiate Time Triggered Perform Transaction Reconciliation Reporting and Analytics Monitor and Report on Performance Investigate Irreconcilable Transactions Create corrective Payment Instructions Integrated Processing Centre Centralized & Regional IPCs SLA / OLA Management Receive Transaction Mobile Banking Cash Services 8 Centralized Manage Customer Agreements Payment Engine Client Contact Centre Perform GL Updates (Risk : Suspense Accounts) Shared Services Define ProductSystem Credit Fraud & Risk Teams, Financeand Team, Team maintain Product Product System Channel Net Banking Touch Points Define Internal Controls IPS IPS Cheque Processing and Reconciliation Finance Source transaction data from Channels / RT and Bulk Regional Post Payment (customer account) Origination Service Maintenance and Payments 16
  • 17. Current State – Functional View Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team IPS Fraud, Credit and Risk Cheque Processing and Reconciliation Finance ATM Develop Offerings Strategy Branch Design Feature and Service Specification Execute CRM Activities Design Offerings Features Manage Agreements (Industry) Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System IT Services Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Receive Transaction Mobile Banking Respond to/or contact Customer Settlements Local + International Integrated Operations Support Rejections Vendor Management (Cheques) Data Store Set-up Future Dated Payments Association Compliance Association Compliance & Merchant Services & Business Services Reconciliations Initiate Time Triggered Issue Documents & Notifications Charge-backs + Debit Card Liaisoning Customer Data Operations Capturing Regional Reporting and Analytics Origination Service Maintenance and Payments 17
  • 18. Current State – Functional View 01 Customer Touch Points Channel Touch Point ATM Branch Customer Touch Points : An access mechanism by means of which a participant gains access to the use of channels in order to effect, control, manage or monitor payments The main components within the Customer Touch Points are  ATM  Branch  Net Banking  Client Contact Centre  Phone Banking  Mobile Banking Net Banking Client Contact Centre Phone Banking Mobile Banking 18
  • 19. Current State – Functional View Channel : Definition of Channel here. 02 Channel Channel Manage Customer Agreements Identify Customer Authenticate Initiate Transaction Initiate Time Triggered Issue Documents & Notifications Switch Account Payment Orders Set-up Future Dated Payments The main components within Channels are  Manage Customer Agreements  Identify Customer  Authenticate  Initiate Transaction  Switch Account Payment Orders  Setup Future Dated Payments  Initiate Time Triggered Payments  Issue Documents and Notifications  Receive transaction  Respond to / or Contact Customer Receive Transaction Respond to/or contact Customer 19
  • 20. Current State – Functional View 03 Offerings / Payment Strategy Offerings/Payment Strategy Develop Offerings Strategy Design Feature and Service Specification Design Offerings Features Customer Insights and Offerings : Perform Strategic planning, policy and methodology development, relationship management, performance management, and design, build and run enablement for customer offerings The main components within Customer Insights and Offerings are  Develop Offerings Strategy  Manage Customer Agreements for Industry  Design Offerings Feature  Design Feature and Service Specification Manage Agreements (Industry) 20
  • 21. Current State – Functional View 04 IT Services IT Services : Definition of IT Services here. The main components within Payment Services Hub are 1. Process Payment Order IT Services Process Payment Order 1. 2. 3. Data Store Reporting and Analytics Post Payment into Customer Accounts Payment Engine Data Store Reporting and Analytics 21
  • 22. Current State – Functional View 05 Integrated Processing Centre Association Compliance & Business Services The main components within Centralized IPCs with payment focus are:  Perform Transaction Reconciliation  Prepare for Settlement  Monitor and Report on Performance  Investigate Irreconcilable Transactions  Create Corrective Payment Instructions  SLA / OLA Management  Source Transaction Data Regional Origination Service Integrated Processing Centre : The standard bank Integrated Processing Centre is based on a structure of three strategic areas, specifically: 1. Production processing or the IPC’s ( CPC + RPC) 2. Service management – responsible for facilitating the relationship between the IPC’s & the SBSA business units 3. Continuous improvement and implementation focusing on improving IPC processes and implementing organizational initiatives Maintenance and Payments The main components within Regional IPCs with payment focus are:  Origination  Service  Maintenance and Payments 22
  • 23. Current State – Functional View 06 Shared Services Product Team Execute CRM Activities Product System (customer account) Product System Fraud, Credit and Risk Group Forensic Investigate Internal Staff fraud Define Internal Controls Perform Credit Checks Perform Fraud Checks (Risk : Suspense Accounts) Fraud System Credit System Shared Services : Definition of Shared Services here. The main components within Product Team with payment focus are:  Execute CRM Activities  Product Systems The main components within Fraud, Credit, Risk and the Group Forensic Team are  Investigate internal staff fraud  Defining Internal Controls  Perform Credit Checks  Perform Fraud Checks The main components within Finance Team are  Perform GL Updates  Define and Maintain Accounting and Management Rules Finance Perform GL Updates Define and maintain accounting and management reporting rules 23
  • 24. Current State – Functional View 07 IPS IPS Cheque Processing and Reconciliation Other Entities – This involves entities external to PBB: The main components within this Group are  IPS – Cheque Processing and Reconciliation  Cash Services  CIB – Perform Inter-bank Settlement 08 Cash Services Cash Services 09 CIB CIB Perform Inter-bank Settlement 24
  • 25. Payment Processing Flow Payments Strategy Development Industry Strategy & Relationship Management Activate service functionality Fulfil Transaction Provide Business Intelligence Data to Business Performance Management Process Framework Bring Offerings to Market Sell Offerings Service Offerings Manage Business Performance Plan the Business Design and Build the Business Design Offering Features (payment capabilities) Maintain the Business End-of-Period Processing Reconciliation Exception Handling 25
  • 26. Payment Processing Flow Payments Strategy Development - Plan the Business Industry Strategy & Relationship Management Activate service functionality Fulfil Transaction Provide Business Intelligence Data to Business Performance Management Process Framework Bring Offerings to Market Sell Offerings Service Offerings Manage Business Performance Plan the Business Design and Build the Business Design Offering Features (payment capabilities) Develop Long-Term PBB Strategy Define the business objectives of P&BB, Customer and Product and translate them into measurable elements of strategy execution Maintain the Business End-of-Period Processing Reconciliation Exception Handling Perform Planning and Budgeting Develop budgets for P&BB business areas and roll up into a consolidated budget. Develop plans to achieve targets and objectives and allocate P&BB resources accordingly 26
  • 27. Payment Processing Flow Payments Strategy Development - Bring Offerings to Market Industry Strategy & Relationship Management Activate service functionality Fulfil Transaction Provide Business Intelligence Data to Business Performance Management Process Framework Bring Offerings to Market Sell Offerings Service Offerings Manage Business Performance Plan the Business Design and Build the Business Maintain the Business Payment Component Design Offering Features (payment capabilities) Create offerings End-of-Period Processing Reconciliation Exception Handling Promote offerings This process involves conducting a segmentation study to understand This process involves creating customer needs and wants, in order to demand in the market for new and develop offerings supported by an existing financial solutions. appropriate marketing mix strategy. 27
  • 28. Payment Processing Flow - Bring Offerings to Market Create Offerings Definition: involves conducting a segmentation study to understand customer needs and wants, in order to develop offerings supported by an appropriate marketing mix strategy. Payment component: The Involvement of Payments strategic team to understand the impact of the New product launch and its subsequent servicing at the Payment processing centre based on the rules defined by the Offerings ( Draft version) 28
  • 29. Payment Processing Flow - Bring Offerings to Market - A. Create Offerings Customer Offerings Strategy and Planning: Define the strategy for the performance of the capabilities within the functional area incl. Pricing, targets, volumes, features & services inclusive of Payment functionalities Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team IPS Fraud, Credit and Risk Cheque Processing and Reconciliation Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System IT Services Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Set-up Future Dated Payments Integrated Operations Support Vendor Management (Cheques) Initiate Time Triggered Issue Documents & Notifications Receive Transaction Mobile Banking Settlements Local + International Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Customer offerings Strategy & Planning Customer Data Operations Regional Reporting and Analytics Origination Customer offerings policies and Methodologies Customer offerings Relationships and Management Inputs:  Key objectives  Business Model  Offering Strategy  Features and Services Strategy including Payment mechanisms Outputs:  Offering Strategy Charge-backs + Debit Card Liaisoning Capturing Respond to/or contact Customer Customer Offerings Strategy & Planning Service Maintenance and Payments Customer offerings Performance management Customer Offerings people Management Customer Offerings design, build and run enablement 29
  • 30. Payment Processing Flow - Bring Offerings to Market - A. Create Offerings Customer Offerings design, build and run enablement: Participate in end to end solution design, build and implementation by providing requirements, determining viability of outputs, conducting user acceptance testing, providing post implementation specialist expertise and sustaining change in the customer offerings Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team IPS Fraud, Credit and Risk Cheque Processing and Reconciliation Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System IT Services Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Integrated Operations Support Vendor Management (Cheques) Initiate Time Triggered Issue Documents & Notifications Receive Transaction Mobile Banking Settlements Local + International Rejections Data Store Set-up Future Dated Payments Association Compliance & Merchant Services Reconciliations Regional Reporting and Analytics Origination Customer offerings policies and Methodologies Customer Data Operations Capturing Respond to/or contact Customer Customer offerings Strategy & Planning Charge-backs + Debit Card Liaisoning Customer offerings Relationships and Management Service Maintenance and Payments Customer offerings Performance management Customer Offerings Strategy & Planning Inputs:  Customer offerings plan  Customer offering build and run time ideas  Functional area solution requirements  Newly built solution Outputs:  Customer offerings solution requirements  Articulated business case for customer offerings  Assessed feasibility of design  Sign-offs on Customer offering solution  Customer offerings system advisory support Customer Offerings people Management Customer Offerings design, build and run enablement 30
  • 31. Payment Processing Flow Payments Strategy Development - Sell Offerings Industry Strategy & Relationship Management Activate service functionality Fulfil Transaction Provide Business Intelligence Data to Business Performance Management Process Framework Bring Offerings to Market Sell Offerings Service Offerings Manage Business Performance Plan the Business Design and Build the Business Originate Customers Setting up of a verified customer record that will allow the customer to apply for any of the Bank's offerings End-of-Period Processing Reconciliation Exception Handling Originate Offerings Initiation and completion of the offering application with the customer and induction of the customer into the bank and its processes Activate Offerings Payment Component Design Offering Features (payment capabilities) Maintain the Business Providing the customer with enablers and enabling the account. Excludes onboarding as this is a service process 31
  • 32. Payment Processing Flow - Sell Offerings Activate Offerings Definition : Providing the customer with enablers and enabling the account. Excludes on-boarding as this is a service process Payment Component: This section involves activation of new accounts for 1. Transactional products 2. VAF accounts – includes Payouts 3. Home loan accounts - includes payouts 4. CARDS – Issue of Credit ( Draft version) 32
  • 33. Payment Processing Flow - Sell Offerings - A. Activate Offerings Enable Account : Once approved, co-ordination of account enablement and provision of enablers to the customer to make the account transactable. Setting up of initial customer authentication and provision of account access enablers to the customer Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team IPS Fraud, Credit and Risk Cheque Processing and Reconciliation Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System IT Services Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Set-up Future Dated Payments Receive Transaction Mobile Banking Integrated Operations Support Vendor Management (Cheques) Initiate Time Triggered Issue Documents & Notifications Charge-backs + Debit Card Liaisoning Customer Data Operations Capturing Regional Reporting and Analytics Origination Respond to/or contact Customer Sell Settlements Local + International Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Create the customer Service Maintenance and Payments Complete offering application Access Channel Inputs:  Customer acceptance of product / service  Customer authentication details  Customer acceptance of product / service Outputs:  Customer authentication records  Account enablers in possession In case of VAF and HL, Payouts are effected into the customer’s account and dealer settlements are carried out Enable Account 33
  • 34. Payment Processing Flow Payments Strategy Development - Service Offerings Industry Strategy & Relationship Management Activate service functionality Fulfil Transaction Provide Business Intelligence Data to Business Performance Management Process Framework Bring Offerings to Market Sell Offerings Service Offerings Manage Business Performance Plan the Business Design and Build the Business Payment Component Design Offering Features (payment capabilities) Maintain the Business End-of-Period Processing Reconciliation Exception Handling Fulfill Transaction Resolve Complaints Manage Accounts Fulfill Service Fulfil Transaction: Execution of all customer and bank initiated value transactions (e.g., deposit, transfers, withdrawal, standing orders etc) Fulfil Service: Completion of all customer initiated service activities (e.g. query, general assistance etc) Completion of all activities required to resolve one and done and escalated complaints Management of bank initiated account maintenance activities (e.g. collateral maintenance, collateral valuation etc) 34
  • 35. Payment Processing Flow - Service Offerings Fulfil Transaction Definition : Execution of all customer and bank initiated value transactions (e.g., deposit, transfers, withdrawal, standing orders etc) Payment Component: All transactions processed through the Payment engine ( Real time and Bulk), reconciled through the reconciliation engine and prepared for settlement and Posting. ( Draft version) Fulfil Service Definition : Completion of all customer initiated service activities (e.g. query, general assistance etc) Payment component: All escalated queries from channel relating to (Saswitch) transactions and escalated queries from IPC ( especially refunds) would be handled at the Payment processing centre. ( Draft version) Resolve Complaints Definition : Completion of all activities required to resolve one and done and escalated complaints Manage Accounts Definition : Management of bank initiated account maintenance activities (e.g. collateral maintenance, collateral valuation etc) 35
  • 36. Payment Processing Flow – Service Offerings - A. Fulfil Transactions Access Channel / Identify Customer : Identification of an SBSA customer or prospect via identification mechanisms. Certify that the mechanism used to initiate the transaction is a valid mechanism Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Initiate Time Triggered Integrated Operations Support Charge-backs + Debit Card Liaisoning Issue Documents & Notifications Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Set-up Future Dated Payments Initiate Scenario 1 : Cheque Deposit at an ATM Access Channel IPS Cheque Processing and Reconciliation Service Channel : ATM Instruction Flow : Us on Us Enabler : Card + Chip Input :  Identification mechanism like name; card number etc  Contacted customer / prospect Output :  Identified customer / Prospect  Validated identification mechanism Maintenance and Payments Process Payment Order Issue Official Docs Post Payment 36
  • 37. Payment Processing Flow – Service Offerings - A. Fulfil Transactions Authenticate : Mechanism to accurately confirm the identity of the SBSA customer / prospect. Authentication mechanisms are channel specific. Examples include Identity document; passport; signature; security question etc Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Set-up Future Dated Payments Integrated Operations Support Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Initiate Scenario 1 : Cheque Deposit at an ATM Authenticate IPS Cheque Processing and Reconciliation Service Maintenance and Payments Process Payment Order Channel : ATM Instruction Flow : Us on Us Enabler : Card + Chip Authenticate:  Pin / Password  Card Input :  Identified customer / prospect  Authentication mechanism e.g. password; PIN Output :  Authenticated customer / prospect  Unauthenticated customer / Prospect Issue Official Docs Post Payment 37
  • 38. Payment Processing Flow – Service Offerings - A. Fulfil Transactions Initiate : Initiation and channel fulfilment of a value transaction by a customer or prospect. Customer initiated value transactions include deposits ( Cash or Cheque), Withdrawals ( Cash or Cheque), transfers ( Inter and Intra bank) and change transactions Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Set-up Future Dated Payments Integrated Operations Support Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Initiate Scenario 1 : Cheque Deposit at an ATM Initiate IPS Cheque Processing and Reconciliation Service Maintenance and Payments Process Payment Order Channel : ATM Instruction Flow : Us on Us Enabler : Card + Chip Authenticate:  Pin / Password  Card Input :  Identified customer / prospect  Authenticated customer or prospect  Transaction request Output :  Initiated transaction  Transaction record  Request for transaction authorization Issue Official Docs Post Payment 38
  • 39. Payment Processing Flow – Service Offerings - A. Fulfil Transactions Process Payment Order: Validate : Fulfill activities required to ensure that the content of the value transaction is “ technically” in order and complies to the SLA’s and customer agreements. Confirming the existence and validity of the destination account Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Set-up Future Dated Payments Integrated Operations Support Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Origination Initiate Scenario 1 : Cheque Deposit at an ATM Channel : ATM Instruction Flow : Us on Us Enabler : Card + Chip Authenticate :  Pin / Password  Card Validate : SBSA Customer Authorize : SBSA Customer Input :  Authorized transaction Output :  Validated Transaction Regional Reporting and Analytics Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Process Payment order IPS Cheque Processing and Reconciliation Service Maintenance and Payments Process Payment order Issue Official Docs Post Payment 39
  • 40. Payment Processing Flow – Service Offerings - A. Fulfil Transactions Process Payment Order: Enrich : Provide Payment services / information added to a transaction in response to customer / prospect / bank requirements as a service or as a basic processing requirement Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Set-up Future Dated Payments Integrated Operations Support Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Initiate Scenario 1 : Cheque Deposit at an ATM Process Payment order IPS Cheque Processing and Reconciliation Service Maintenance and Payments Process Payment order Channel : ATM Instruction Flow : Us on Us Enabler : Card + Chip Authenticate :  Pin / Password  Card Validate : SBSA Customer Authorize : SBSA Customer Input :  Authorized transaction  Validated Transaction  Customer agreement Output :  Enriched Transaction ( as per customer / prospect / bank requirements) Issue Official Docs Post Payment 40
  • 41. Payment Processing Flow – Service Offerings - A. Fulfil Transactions Issue Official Docs : Issue physical documents ( e.g. ATM Slips ) and notifications ( e.g. Sms confirmations) associated with value transactions and service activities Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Integrated Operations Support Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Customer Data Operations Capturing Regional Reporting and Analytics Origination Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Set-up Future Dated Payments Issue official docs IPS Cheque Processing and Reconciliation Service Maintenance and Payments Channel : ATM Instruction Flow : Us on Us Enabler : Card + Chip Authenticate :  Pin / Password  Card Validate : SBSA Customer Authorize : SBSA Customer Input :  Identified customer / prospect  Authenticated customer / prospect  Authorized transaction  Request for official docs Output :  Issued official documents  Issued notifications Authenticate Initiate Scenario 1 : Cheque Deposit at an ATM Process Payment Order Issue Official Docs Post Payment 41
  • 42. Payment Processing Flow – Service Offerings - A. Fulfil Transactions Post Payment: Post the transaction at a customer account level (i.e. Sub-ledger). Apply financial conditions associated with the package i.e. Calculate fees and commission, increment transaction counter etc Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Integrated Operations Support Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Set-up Future Dated Payments Initiate Scenario 1 : Cheque Deposit at an ATM Post payment IPS Cheque Processing and Reconciliation Service Maintenance and Payments Process Payment Order Channel : ATM Instruction Flow : Us on Us Enabler : Card + Chip Authenticate :  Pin / Password  Card Validate : SBSA Customer Authorize : SBSA Customer Post : Account Input :  Accounting rules  Calculated fees  Calculated commission Output :  Account(s) updated Issue Official Docs Post Payment 42
  • 43. Payment Processing Flow – Service Offerings - A. Fulfil Transactions Access Channel / Identify Customer : Identification of an SBSA customer or prospect via identification mechanisms. Certify that the mechanism used to initiate the transaction is a valid mechanism Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Set-up Future Dated Payments Integrated Operations Support Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Initiate Access Channel IPS Cheque Processing and Reconciliation Service Maintenance and Payments Process Payment Order Channel : Cash centre / Branch Instruction Flow : Us on Us Enabler : paper Input :  Identification mechanism like name; username, card etc  Contacted customer / prospect Output :  Identified customer / Prospect  Validated identification mechanism Issue Official Docs Scenario 2 : Cheque encashment at Branch – SBSA ( Local currency cheque) Post Payment 43
  • 44. Payment Processing Flow – Service Offerings - A. Fulfil Transactions Authenticate : Mechanism to accurately confirm the identity of the SBSA customer / prospect. Authentication mechanisms are channel specific. Examples include Identity document; passport; signature; security question etc Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team IPS Fraud, Credit and Risk Cheque Processing and Reconciliation Finance ATM Develop Offerings Strategy Branch Design Feature and Service Specification Execute CRM Activities Design Offerings Features Manage Agreements (Industry) Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System IT Services Branch Perform GL Updates (Risk : Suspense Accounts) CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Set-up Future Dated Payments Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Integrated Operations Support Vendor Management (Cheques) Receive Transaction Mobile Banking Settlements Local + International Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Initiate Service Authenticate Channel : Cash Centre / Maintenance and Payments Process Payment Order Instruction Flow : Us on Us Enabler : Paper Authenticate:  Identity doc  Signature Input :  Identified customer / prospect  Authentication mechanism e.g. Identity document; password; PIN; Signature Output :  Authenticated customer / prospect  Unauthenticated customer / Prospect Issue Official Docs Scenario 2 : Cheque encashment at Branch – SBSA ( Local currency cheque) Post Payment 44
  • 45. Payment Processing Flow – Service Offerings - A. Fulfil Transactions Initiate : Initiation and channel fulfilment of a value transaction by a customer or prospect. Customer initiated value transactions include deposits ( Cash or Cheque), Withdrawals ( Cash or Cheque), transfers ( Inter and Intra bank) and change transactions Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy CV Z Branch Design Feature and Service Specification Execute CRM Activities Design Offerings Features Manage Agreements (Industry) Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Client Contact Centre Identify Customer Authenticate Switch Account Payment Orders CV Z Initiate Transaction Process Payment Order Payment Engine Set-up Future Dated Payments Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Integrated Operations Support Vendor Management (Cheques) Receive Transaction Mobile Banking Settlements Local + International Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Initiate Service Channel : Cash centre / Branch Perform GL Updates (Risk : Suspense Accounts) Credit System Initiate IPS Cheque Processing and Reconciliation Maintenance and Payments Process Payment Order Instruction Flow : Us on Us Enabler : Paper Authenticate:  Identity doc  Signature Input :  Identified customer / prospect  Authenticated customer or prospect  Transaction request Output :  Initiated transaction  Transaction record  Request for transaction authorization Issue Official Docs Scenario 2 : Cheque encashment at Branch – SBSA ( Local currency cheque) Post Payment 45
  • 46. Payment Processing Flow – Service Offerings - A. Fulfil Transactions Process Payment Order: Validate : Fulfill activities required to ensure that the content of the value transaction is “ technically” in order and complies to the SLA’s and customer agreements. Confirming the existence and validity of the destination account Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy CV Z Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Set-up Future Dated Payments Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Origination Initiate Instruction Flow : Us on Us Enabler : Paper Authenticate :  Identity doc  Signature Validate : SBSA Customer Authorize : SBSA Customer Input :  Authorized transaction Output :  Validated Transaction Regional Reporting and Analytics Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Integrated Operations Support Vendor Management (Cheques) Receive Transaction Mobile Banking Settlements Local + International Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Channel : Cash Centre / Branch Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System Process Payment order IPS Cheque Processing and Reconciliation Service Maintenance and Payments Process Payment order Issue Official Docs Scenario 2 : Cheque encashment at Branch – SBSA ( Local currency cheque) Post Payment 46
  • 47. Payment Processing Flow – Service Offerings - A. Fulfil Transactions Process Payment Order: Enrich : Provide Payment services / information added to a transaction in response to customer / prospect / bank requirements as a service or as a basic processing requirement Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Set-up Future Dated Payments Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Integrated Operations Support Vendor Management (Cheques) Receive Transaction Mobile Banking Settlements Local + International Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Initiate Service Maintenance and Payments Process Payment order Channel : Cash centre / Branch Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System Process Payment order IPS Cheque Processing and Reconciliation Instruction Flow : Us on Us Enabler : Paper Authenticate :  Identify doc  Signature Validate : SBSA Customer Authorize : SBSA Customer Input :  Authorized transaction  Validated Transaction  Customer agreement Output :  Enriched Transaction ( as per customer / prospect / bank requirements) Issue Official Docs Scenario 2 : Cheque encashment at Branch – SBSA ( Local currency cheque) Post Payment 47
  • 48. Payment Processing Flow – Service Offerings - A. Fulfil Transactions Issue Official Docs : Issue physical documents ( e.g. ATM Slips ) and notifications ( e.g. Sms confirmations) associated with value transactions and service activities Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Integrated Operations Support Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Customer Data Operations Capturing Regional Reporting and Analytics Origination Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Set-up Future Dated Payments Issue official docs IPS Cheque Processing and Reconciliation Service Maintenance and Payments Channel : Cash centre / Branch Instruction Flow : Us on Us Enabler : Paper Authenticate :  Identity document  Signature Validate : SBSA Customer Authorize : SBSA Customer Input :  Identified customer / prospect  Authenticated customer / prospect  Authorized transaction  Request for official docs Output :  Issued official documents  Issued notifications Authenticate Initiate Process Payment Order Issue Official Docs Scenario 2 : Cheque encashment at Branch – SBSA ( Local currency cheque) Post Payment 48
  • 49. Payment Processing Flow – Service Offerings - A. Fulfil Transactions Post Payment: Post the transaction at a customer account level (i.e. Sub-ledger). Apply financial conditions associated with the package i.e. Calculate fees and commission, increment transaction counter etc Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks Credit System IT Services CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Integrated Operations Support Charge-backs + Debit Card Liaisoning Initiate Time Triggered Issue Documents & Notifications Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Set-up Future Dated Payments Initiate Post payment IPS Cheque Processing and Reconciliation Service Maintenance and Payments Process Payment Order Channel : Cash centre / Branch Instruction Flow : Us on Us Enabler : Paper Authenticate :  Identity document  Signature Validate : SBSA Customer Authorize : SBSA Customer Post : Account Input :  Accounting rules  Calculated fees  Calculated commission Output :  Account(s) updated Issue Official Docs Scenario 2 : Cheque encashment at Branch – SBSA ( Local currency cheque) Post Payment 49
  • 50. Payment Processing Flow – Service Offerings - B. Fulfil Service Identify Customer : Identification of SBSA customer or prospect via identification mechanisms. Identification mechanisms include customer / prospect name, username, card etc. Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System IT Services Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Set-up Future Dated Payments Initiate Time Triggered Issue Documents & Notifications Integrated Operations Support Charge-backs + Debit Card Liaisoning Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Manage Queries Identify Customer IPS Cheque Processing and Reconciliation Service Qualify complaint Channel : CCC, CRC, Branch, Electronic mail Input :  Identification mechanism like name; username, card etc  Contacted customer / prospect Output :  Identified customer / Prospect  Validated identification mechanism Maintenance and Payments Resolve complaint Resolve escalated complaint 50
  • 51. Payment Processing Flow – Service Offerings - B. Fulfil Service Authenticate : Mechanism to accurately confirm the identity of the SBSA customer / prospect. Authentication mechanisms are channel specific. Examples include Identity document; passport; signature; security question etc Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System IT Services Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Set-up Future Dated Payments Initiate Time Triggered Issue Documents & Notifications Integrated Operations Support Charge-backs + Debit Card Liaisoning Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Manage Queries Authenticate IPS Cheque Processing and Reconciliation Service Qualify complaint Channel : CCC, CRC, Branch, Electronic mail Authenticate:  Pin / Password/ I.D  Card Input :  Identified customer / prospect  Authentication mechanism e.g. Identity document; password; PIN; Signature Output :  Authenticated customer  Unauthenticated customer Maintenance and Payments Resolve complaint Resolve escalated complaint 51
  • 52. Payment Processing Flow – Service Offerings - B. Fulfil Service Manage Queries : Receipt of Queries and handling. Where necessary, query redirected to the appropriate resolution parties and complex queries escalated. Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Integrated Processing Centre Centralized Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Initiate Time Triggered Issue Documents & Notifications Charge-backs + Debit Card Liaisoning Origination Authenticate Customer Data Operations Regional Reporting and Analytics Manage Queries Input :  Authenticated customer  Account information request  Query ( Including information, assistance or status request) Output : Capturing Respond to/or contact Customer Access Channel/ Identify Customer Integrated Operations Support Vendor Management (Cheques) Receive Transaction Mobile Banking Settlements Local + International Rejections Data Store Set-up Future Dated Payments Association Compliance & Merchant Services Reconciliations  Pin / Password / I.D  Card Perform Inter-bank Settlement Net Banking Process Payment Order Electronic mail CIB Fraud System Manage Customer Agreements Channel : CCC, CRC, Branch, Authenticate: Define and maintain accounting d management reporting rules Perform Fraud Checks IT Services Manage Queries IPS Cheque Processing and Reconciliation Service Qualify complaint Maintenance and Payments  Communicated account information  Resolved customer query  Customer complaint  Recorded (and escalated query)  General information , assistance or status provided Resolve complaint Resolve escalated complaint 52
  • 53. Payment Processing Flow – Service Offerings - B. Fulfil Service Qualify complaint : Receive and qualify complaints logged by customers. Gather all details pertaining to the complaint. Direct complaints to the specialist area in instances where channel does not have the capability to resolve the complaint Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System IT Services Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Set-up Future Dated Payments Initiate Time Triggered Issue Documents & Notifications Integrated Operations Support Charge-backs + Debit Card Liaisoning Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Manage Queries Qualify complaint IPS Cheque Processing and Reconciliation Service Qualify complaint Maintenance and Payments Channel : CCC, CRC Branch, Electronic mail Authenticate:  Pin / Password/ I.D  Card Input :  Authenticated customer or prospect  Customer complaint  Complaint management guidelines Output :  Complaint record  Qualified complaint  Directed complaint Resolve complaint Resolve escalated complaint 53
  • 54. Payment Processing Flow – Service Offerings - B. Fulfil Service Resolve complaint : Analysis of customer complaint that have been identified as channel specific. Investigate and resolution of channel specific complaint Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System IT Services Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Set-up Future Dated Payments Initiate Time Triggered Issue Documents & Notifications Integrated Operations Support Origination Manage Queries  Card Input :  unresolved complaint  Complaint management guidelines Output :  Resolved complaint Customer Data Operations Regional Reporting and Analytics Authenticate Channel : CCC, CRC, Branch, Electronic mail Authenticate:  Pin / Password / I.D Charge-backs + Debit Card Liaisoning Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Resolve Complaint IPS Cheque Processing and Reconciliation Service Qualify complaint Maintenance and Payments Resolve complaint Resolve escalated complaint 54
  • 55. Payment Processing Flow – Service Offerings - B. Fulfil Service Resolve escalated queries : Complaints escalated via the banking channels ( complaints are escalated when channel does not have the capability to resolve the complaint or when customers are dissatisfied with the resolution of the complaint Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System IT Services Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Set-up Future Dated Payments Initiate Time Triggered Issue Documents & Notifications Integrated Operations Support Charge-backs + Debit Card Liaisoning Regional Reporting and Analytics Origination Authenticate Customer Data Operations Capturing Respond to/or contact Customer Access Channel/ Identify Customer Settlements Local + International Vendor Management (Cheques) Receive Transaction Mobile Banking Association Compliance & Merchant Services Reconciliations Rejections Data Store Manage Queries Resolve escalated complaint IPS Cheque Processing and Reconciliation Service Qualify complaint Channel : CCC, CRC, Branch, Electronic mail Authenticate:  Pin / Password/ I.D  Card Input :  Directed complaint  Escalated complaint  Complaint management guidelines Output :  Resolved escalated complaint  Unresolved escalated complaint Maintenance and Payments Resolve complaint Resolve escalated complaint 55
  • 56. Payment Processing Flow – Service Offerings - C. Manage Accounts Initiate: Identify all the periodic triggers on an account and initiate( specific to an operational environment); examples include payment instruments requiring renewal, fees and interest accruals to be posted, future dated payments to be executed Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team IPS Fraud, Credit and Risk Cheque Processing and Reconciliation Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System IT Services Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Process Payment Order Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Set-up Future Dated Payments Receive Transaction Mobile Banking Settlements Local + International Integrated Operations Support Vendor Management (Cheques) Initiate Time Triggered Issue Documents & Notifications Input :  Customer account information Customer Data Operations Regional Reporting and Analytics Origination Document management Output :  Event triggers actioned in the customers account Charge-backs + Debit Card Liaisoning Capturing Respond to/or contact Customer Initiate Association Compliance & Merchant Services Reconciliations Rejections Data Store Phone Banking Channel : Customer / Bank initiated Centralized Manage Customer Agreements Client Contact Centre Initiate Service Maintenance and Payments Collateral Management Debt review and collections 56
  • 57. Payment Processing Flow – Service Offerings - C. Manage Accounts Document Management: Prepare, generate and supply paper correspondence including account statements for all accounts. This includes conformance to specifications and SLA’s as agreed Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team IPS Fraud, Credit and Risk Cheque Processing and Reconciliation Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System IT Services Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Set-up Future Dated Payments Receive Transaction Mobile Banking Initiate Time Triggered Issue Documents & Notifications Charge-backs + Debit Card Liaisoning Customer Data Operations Capturing Input :  Specification for documents  Information required on documents Output :  Documents produced / Not produced Regional Reporting and Analytics Origination Document management Channel : Customer / Bank initiated Integrated Operations Support Vendor Management (Cheques) Respond to/or contact Customer Initiate Settlements Local + International Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Document Management Service Maintenance and Payments Collateral Management Debt review and Collections 57
  • 58. Payment Processing Flow – Service Offerings - C. Manage Accounts Collateral Management: This process refers to obtaining suretyships and collateral items pledged, ceded or bonded to the bank as security to the loan, valuation and re-evaluation of collateral market values, realization and release of surety ships and supporting collateral Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team IPS Fraud, Credit and Risk Cheque Processing and Reconciliation Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System IT Services Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Set-up Future Dated Payments Receive Transaction Mobile Banking Integrated Operations Support Vendor Management (Cheques) Initiate Time Triggered Issue Documents & Notifications Charge-backs + Debit Card Liaisoning Customer Data Operations Capturing Regional Reporting and Analytics Origination Respond to/or contact Customer Initiate Settlements Local + International Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Document management Service Maintenance and Payments Collateral Management Collateral Management Channel : Customer/ Bank initiated Input :  Credit policy, Credit procedure  Trigger for periodic reevaluation Output :  Obtained collateral  Valued and Re-valued collateral  Released collateral  Realized collateral Debt review and Collections 58
  • 59. Payment Processing Flow – Service Offerings - C. Manage Accounts Debt review and collections : Involves contacting customer in response to a collection prompt, voluntary reviewing and respreading of customer and ensuring the collateral types defined by Basel II are used and weighted accordingly. Also, involves the activities required to manage accounts in collections that are post write - off Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team IPS Fraud, Credit and Risk Cheque Processing and Reconciliation Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System IT Services Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Set-up Future Dated Payments Receive Transaction Mobile Banking Integrated Operations Support Vendor Management (Cheques) Initiate Time Triggered Issue Documents & Notifications Charge-backs + Debit Card Liaisoning Customer Data Operations Capturing Regional Reporting and Analytics Origination Respond to/or contact Customer Initiate Settlements Local + International Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Document management Service Maintenance and Payments Collateral Management Respond to customer Channel : Customer/ Bank initiated Input :  Credit collection prompt  Customer interaction and collection strategy  Account ageing  Written off accounts Output :  Collection feedback  Re-structured accounts  Outstanding payments collected  Maximized recoveries  Minimized losses  Optimized costs Debt review and collections 59
  • 60. Payment Processing Flow Payments Strategy Development - Design and Build Business Industry Strategy & Relationship Management Activate service functionality Fulfil Transaction Provide Business Intelligence Data to Business Performance Management Process Framework Bring Offerings to Market Sell Offerings Service Offerings Manage Business Performance Plan the Business Design and Build the Business Design Offering Features (payment capabilities) Design the Business Build the Business Perform Strategic Sourcing Maintain the Business Prepare for Settlement Reconciliation Exception Handling Design the P&BB business environment (i.e. people, process and technology) Build the P&BB business environment (i.e. people, process and technology) Establish mutually beneficial agreements with suppliers to enable demand fulfilment and continuously reduce the Total Cost of Ownership (TCO) 60
  • 61. Payment Processing Flow - Maintain the Business Payments Strategy Development Industry Strategy & Relationship Management Activate service functionality Provide Business Intelligence Data to Business Performance Management Fulfil Transaction Process Framework Bring Offerings to Market Sell Offerings Service Offerings Manage Business Performance Plan the Business Design Offering Features (payment capabilities) Perform Procurement Maintain Physical Infrastructure Fulfil repetitive purchases of consumables, assets and services at the best total cost of ownership for P&BB Maintain physical infrastructure to ensure P&BB’s continued business capability (i.e. buildings, facilities etc) Maintain the Business Prepare for Settlement Reconciliation Exception Handling Manage Workforce Reconciliation Maintain IT Infrastructure Maintain IT infrastructure to ensure P&BB’s continued business capability (i.e. systems etc) Exception Handling Manage Data Manage enterprise data strategy, data quality and data governance for P&BB Settlement Ensure P&BB has the correct staff, with the correct skills and knowledge, who are continually aligned with the P&BB strategy Payment Component Design and Build the Business To Be Defined Manage errors during and after the execution and processing of a payment Systematic matching of Settlement obligation instructions from merchants; agent banks, clearing houses , reserve bank and Card associations 61
  • 62. Payment Processing Flow - Maintain the Business Prepare for Settlement : Systematic matching of settlement obligation instructions from Merchants; Agent banks; Reserve bank; Clearing house and Card associations Exception Handling Definition : Manage errors during and after the execution and processing of a payment  In process exception  Post process exception 62
  • 63. Payment Processing Flow - Maintain the Business - A. Reconciliation Reconciliation : Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Group Forensic Investigate Internal Staff fraud Execute CRM Activities Product System (customer account) Perform Credit Checks Product System Channel Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System IT Services Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Identify Customer Authenticate Initiate Transaction Payment Engine Settlements Local + International Switch Account Payment Orders Set-up Future Dated Payments Vendor Management (Cheques) Initiate Time Triggered Receive Transaction Mobile Banking Issue Documents & Notifications Origination Maintain IT Infrastructure  Processed transaction  Files sent from clearing house and internal systems Output :  Reconciled / un reconciled transaction Customer Data Operations Regional Reporting and Analytics Maintain Physical Infrastructure Channel : ATM Instruction Flow : Us on Us Enabler : Card + Chip Input : Charge-backs + Debit Card Liaisoning Capturing Respond to/or contact Customer Perform Procurement Integrated Operations Support Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Process Payment Order Client Contact Centre Reconciliation IPS Cheque Processing and Reconciliation Manage Data Service Manage Workforce Maintenance and Payments Reconciliation Exception handling Prepare for Settlement 63
  • 64. Payment Processing Flow - Maintain the Business - B. Exception Handling • Exception Handling : The process to manage to manage errors during and after the execution and processing of a payment. There are two types of exception handling • In-process • Post-process • Raise; Clear & Confirm / Monitor Exceptions Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Group Forensic Investigate Internal Staff fraud Execute CRM Activities Product System (customer account) Perform Credit Checks Product System Channel Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System IT Services Centralized Manage Customer Agreements Identify Customer Authenticate Initiate Transaction Payment Engine Settlements Local + International Switch Account Payment Orders Set-up Future Dated Payments Vendor Management (Cheques) Initiate Time Triggered Receive Transaction Mobile Banking Issue Documents & Notifications Origination Maintain IT Infrastructure Output :  Transaction identified / un identified in the Rejections and captured for processing Customer Data Operations Regional Reporting and Analytics Maintain Physical Infrastructure  Charge-backs + Debit Card Liaisoning Capturing Respond to/or contact Customer Perform Procurement Integrated Operations Support Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Process Payment Order Channel : ATM Instruction Flow : Us on Us Enabler : Card + Chip Input : transaction for processing  Rejected transaction Integrated Processing Centre Net Banking Client Contact Centre Exception Handling IPS Cheque Processing and Reconciliation Manage Data Service Manage Workforce Maintenance and Payments Reconciliation Exception handling Prepare for Settlement 64
  • 65. Payment Processing Flow - Maintain the Business - C. Prepare for Settlement Prepare for Settlement : The process of sending and receiving settlement obligation instructions at a domestic and / or international level and the matching of these to settlement obligation instructions Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Group Forensic Investigate Internal Staff fraud Execute CRM Activities Product System (customer account) Perform Credit Checks Product System Channel Credit System Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System IT Services transaction for processing  Rejected transaction Centralized Manage Customer Agreements Identify Customer Authenticate Initiate Transaction Payment Engine Settlements Local + International Switch Account Payment Orders Set-up Future Dated Payments Initiate Time Triggered Issue Documents & Notifications Charge-backs + Debit Card Liaisoning Regional Reporting and Analytics Origination Maintain Physical Infrastructure Customer Data Operations Capturing Respond to/or contact Customer Perform Procurement  Transaction captured for settlement Vendor Management (Cheques) Receive Transaction Mobile Banking Integrated Operations Support Output : Rejections Data Store Phone Banking Association Compliance & Merchant Services Reconciliations Process Payment Order Channel : ATM Instruction Flow : Us on Us Enabler : Card + Chip Input :  Integrated Processing Centre Net Banking Client Contact Centre Prepare for Settlement IPS Cheque Processing and Reconciliation Maintain IT Infrastructure Manage Data Service Manage Workforce Maintenance and Payments Reconciliation Exception handling Prepare for Settlement 65
  • 66. Payment Processing Flow Payments Strategy Development - Manage Business Performance Industry Strategy & Relationship Management Activate service functionality Fulfil Transaction Provide Business Intelligence Data to Business Performance Management Process Framework Bring Offerings to Market Sell Offerings Service Offerings Manage Business Performance Plan the Business Design and Build the Business Payment Component Design Offering Features (payment capabilities) Measure and Report Performance Measure and Monitor Service Providers Maintain the Business End-of-Period Processing Reconciliation Exception Handling Measure and report the performance of P&BB across multiple dimensions (i.e. Offerings, Operations, Channel, IT, Credit, HR, Finance, Risk & Compliance and Business Architecture) Measure, monitor and review operational and service level agreements with internal and external partners 66
  • 67. Payment Processing Flow - Manage Business Performance Measure and Report Performance Definition : Measure and report the performance of P&BB across multiple dimensions (i.e. Offerings, Operations, Channel, IT, Credit, HR, Finance, Risk & Compliance and Business Architecture) Payments Component: Measurement and reporting of performance on the Payment Processing centre  No. of Exceptions ( Identified and cleared)  No. of Escalated queries handled within SLA  % of Un reconciled transactions ( Volume and Value)  Settlement obligations as per defined SLA ( Draft version) 67
  • 68. Payment Processing Flow - Manage Business Performance - A. Report Performance Manage Business performance: Gather performance data related to service level agreement / OLA defined and distribute to relevant stakeholders Channel Touch Point Standard Bank – Personal and Business Banking – Payments Flow Offerings/Payment Strategy [Blue Print As-Is 2010] Shared Services Product Team Fraud, Credit and Risk Finance ATM Develop Offerings Strategy Branch Design Offerings Features Design Feature and Service Specification Manage Agreements (Industry) Execute CRM Activities Product System (customer account) Product System Channel Group Forensic Investigate Internal Staff fraud Perform Credit Checks Credit System IT Services Define Internal Controls Perform GL Updates (Risk : Suspense Accounts) Cash Services Define and maintain accounting d management reporting rules Perform Fraud Checks CIB Perform Inter-bank Settlement Fraud System Integrated Processing Centre Net Banking Centralized Manage Customer Agreements Process Payment Order Client Contact Centre Identify Customer Authenticate Initiate Transaction Payment Engine Switch Account Payment Orders Phone Banking Receive Transaction Mobile Banking Respond to/or contact Customer Association Compliance & Merchant Services Reconciliations Settlements Local + International Integrated Operations Support Rejections Vendor Management (Cheques) Data Store Set-up Future Dated Payments Initiate Time Triggered Issue Documents & Notifications Report on Performance IPS Cheque Processing and Reconciliation Charge-backs + Debit Card Liaisoning Customer Data Operations Capturing Regional Reporting and Analytics Origination Service Maintenance and Payments Channel : All Instruction Flow : Us on Us Them on us Us on them Input :  Performance management measures for functional management of business partners and suppliers Output :  Performance reports  Performance problems and areas of concern identified and communicated to business partners 68
  • 69. VARIOUS REGULATIONS • LEGAL FRAMEWORK FOR PAYMENT & SETTLEMENT SYSTEMS OF INDIA • The Negotiable Instruments Act, 1881 (N.I. Act) :- legal base for all cheque-based (instrument-based) payment systems in India • Amendment to the Information Technology Act, 2000: make it applicable to N.I. Acthas accorded legal status to the usage of electronic payment systems in Indian banking. • Under the PSS Act, 2007, two Regulations have been made by the Reserve Bank of India, • The Board for Regulation and Supervision of Payment and Settlement Systems Regulation, 2008 :- deals with the constitution of the Board for Regulation and Supervision of Payment and Settlement System (BPSS),The BPSS exercises the powers on behalf of the Reserve Bank, for regulation and supervision of the payment and settlement systems under the PSS Act, 2007. • The Payment and Settlement Systems Regulations, 2008:- matters like form of application for authorization for commencing/ carrying on a payment system and grant of authorization, payment instructions and determination of standards of payment systems, furnishing of returns/documents/other information, furnishing of accounts and balance sheets by system provider etc

Hinweis der Redaktion

  1. Most of the world’s major banks maintain correspondent banking relationships with local banks in each of the important foreign cities of the world.
  2. -> Amendment to the Information Technology Act, 2000: make it applicable to N.I. Acthas accorded legal status to the usage of electronic payment systems in Indian banking.the electronic payment systems like ECS, EFT, NDS, RTGS, etc. work on the basis of a series of bi-lateral agreements made specifically for each one of them which are of contractual nature between the participant and the manager of the systems.