PAYMENT

Swiss banks manage over 2.4 billion payment transactions annually, requiring robust infrastructure, continuous monitoring, and strict compliance to international standards. Payment Process Outsourcing (PPO) is increasingly adopted as a practical solution, allowing banks to optimize operations, reduce costs, and maintain high service standards. The Swiss Interbank Clearing (SIC) system, operational since 1987, underpins the country’s sophisticated infrastructure, which has recently been enhanced with the launch of SIC Instant Payments. This system processes a significant portion of retail transactions in real-time, driving the need for advanced solutions to address technical integration, resource constraints, and compliance challenges.

PPO enables banks to outsource payment operations to specialized providers, focusing on transaction automation, fraud prevention, compliance management, and security. The benefits include:

• improved efficiency
• standardization
• reduced operational costs

Banks must also ensure strong risk management frameworks to protect data security and manage vendor relationships effectively.

A robust risk assessment framework is essential for banks to successfully adopt PPO. When outsourcing key functions, banks must carefully evaluate potential risks. Strong internal governance and effective stakeholder management help safeguard against cyber threats and other IT-related risks.

This framework emphasizes three key areas:

1. Data Security: Adhering to strict protocols for storing and categorizing critical data.
2. Vendor Management: Conducting thorough evaluations of service providers and establishing strong contractual agreements.
3. Compliance Monitoring: Maintaining regular oversight and reporting to ensure regulatory compliance.