It appears, in Brazil, banks are much more likely to monitor system availability (90% of banks) and the total business costs associated with system downtime. Compare that with their North American counterparts: only 52% of banks can pinpoint that cost. So what is it that drives banks in Brazil to know about their payment systems that many across the globe fail to appreciate?
The nightmare scenario phone call for every Payments Operations manager around the world sounds a bit like: “We are not seeing transactions come through!” As the complications of that statement begin to clear, getting out of bed in the middle of the night seems to be the least of all concerns. Tomorrow there will have to be explanations of what happened and how much did it all cost. On your little check list will be the following:
– [ (Transactions per second X duration of down time) X revenue per transaction] in millions of dollars
– [(Penalty on broken Service Level Agreements X duration of down time) X number of Service Level Agreements ] in millions of dollars
– (Number of customers who swear they will never charge another transaction on your card X lost revenue of fees and transactions per customer) + marketing costs to acquire that number of customers again
The calculations above might look quite simple and they probably are. But you get the picture: 1) it could have all been avoided; 2) the impact could have been in thousands, not millions. In a Payment Service Management world, troubles do happen. However, they are diagnosed faster and more accurately, resulting in significant loss prevention. Payment systems, while primarily handled in operations departments, have an effect on the entire financial institution – ability to realize profits, make investments, responding to cost and customer pressures. So while real-time monitoring and management of these systems sounds trivial, it impacts the entire financial institution.
Back to our inquiry of Brazil – putting your finger on the pulse of profitability and knowing how well you are doing gives you the ability to handle your business with assuredness and a solid plan for the future. I’ve been told, that in São Paulo people enjoy to celebrate, more so than their counterparts in North America or Europe. It sounds like they have the reason to – knowing how the money flows would definitely be a reason for celebration.