The past few years have seen one of the biggest booms in technological advancements. They’ve taken the world by storm, so much that they’ve not spared any industry or sector. The payments industry has particularly experienced some of the biggest transformations, with trends indicating movement from traditional banking to alternative, more tech-focused platforms. Wholesale payments continue to bear the biggest brunt of this transformation due to the number and value of transactions usually involved.
Traditional banks and financial institutions that once held the largest share of wholesale payments (about 95 percent in 2022) are now showing signs of vulnerability. Industry leaders project that while wholesale payments revenues will increase, much of this share will go to emerging providers (such as fintech and blockchain solutions) and away from banks.
Why Wholesale Payments Are Shifting
The biggest culprit? Technology. It’s challenging banks’ and financial institutions’ historical advantage. How? Through digital payments and fintech.
By far, Digital payments are the biggest reason wholesale payments have evolved so much. Markets that primarily used checks are increasingly adopting digital payments due to convenience, speed, and efficiency. For instance, real-time payments have played a role in the declining use of checks (an average 8 percent decline every three years) among B2B transactions.
Fintech providers are also contributing to the shifts in wholesale payments. Why? Because clients value tailored solutions — something that traditional banks struggle with. Fintech providers recognize that clients’ needs and expectations change, so they provide solutions that evolve with them.
By the way, we also have to give props to globalization for also playing a part in shifting trends in wholesale payments. The world has become one big village, again, thanks to technology. As such, cross-border transactions have become more commonplace than before. This has increased the need for real-time payments, reduced fees, and transparency. While the banking sector has predominantly held this space, these needs have proved challenging to meet.
The Talent Landscape in Emerging Platforms
Changes in wholesale payments have so far had and will continue to have a direct impact on the talent industry. As trends indicate the shift toward emerging platforms, the talent industry is also seeing an increase in the demand for individuals with skills in blockchain, cybersecurity, payment systems, product management, data analysis, and compliance.
Take, for instance, cybersecurity roles. As wholesale payments move in the digital direction, the need for emerging platforms to uphold the highest security measures also increases. This will inadvertently lead to a significant increase in the demand for cybersecurity specialists in the industry. In fact, the Bureau of Labor Statistics projects that cybersecurity jobs will grow by 33 percent between 2023 and 2033, which is much faster than the average rate across other professions.
Also worth noting is the increased demand for interdisciplinary skills that will also come with the continued shifts in wholesale payments. In a bid to maintain competition so it doesn’t lose its grip on wholesale payments, the traditional banking and finance sector will need to hire talent with skills that span across the board. Sure hiring staff with specialized skills may be the way to go. However, this may prove expensive and consequently reduce competitiveness. Therefore, banking institutions may have to bring on board staff with more than just one skill.
Implications for Recruiting and Staffing
The rate at which the wholesale payments industry is changing calls for traditional banking and financial institutions to adapt or risk becoming obsolete. The truth? The future is tech. So, if you are in the banking sector, either fall in line or get left behind.
Part of adapting and staying in the game, even with platforms and solutions emerging, means aligning your recruiting efforts with trends in the industry.
For one, the competition for skilled staff is about to get stiff. What does this mean? Salaries for specialists will go up, and at the same time, skilled professionals will become hard to find, hire, and retain. And, to remain competitive and relevant, you must have the right staff on your side.
So what to do?
Hold Your Horses
First things first, all is not lost. What your organization shouldn’t do is rush to hire new talent. How about looking internally within your business and building upon the skills of existing employees? Which, in simpler terms, refers to upskilling.
Upskilling, while much more cost-effective than hiring new talent, also lets you retain long-serving staff who may have the best at heart for your organization. Not to mention that it also shows your commitment to investing in your current workforce, which further increases employees’ loyalty.
Mix It Up
Should you need to source new talent, a team composed of diverse skills can help your organization weather the wholesale payments environment, especially now that tech is involved. Sure, hiring payment and tech experts is important, but that doesn’t mean you should focus too much on that. And remember, diversity also means you hire candidates who have experience in both legacy and emerging systems, so the transition can be much smoother.
Hire Help
Sometimes, even with an in-house recruitment team, you may need help to source the best talent, especially if it’s stretched thin with responsibilities. Additionally, if you want to expand your reach for candidates, outsourcing the hiring process can help. More often than not, and especially if you’re hiring for high-demand skills, finding the right candidates might be difficult.
Challenge or Opportunity? You Decide
Industries have been changing and evolving since time immemorial. Therefore, how you view changes within wholesale payments will determine whether your organization gets phased out by emerging solutions or remains agile. One thing’s for sure, though — transitioning is a must to successfully remain relevant. More importantly, you need the right talent. That’s why recruiters are super important during this period.
Need help transitioning? Find an MRINetwork Office near you today and learn how we can help.