Credit unions and banks joined forces to call on lawmakers Monday (Jan. 29) to bring a bill to the floor for a vote that would reform certain areas of the Dodd-Frank Act.
According to a report in American Banker, the American Bankers Association, Credit Union National Association, Independent Community Bankers of America and National Association of Federally-Insured Credit Unions all want the bill, which is the culmination of a year of talks between Senate Banking Committee Chairman Mike Crapo and moderate Democrats to overhaul some of the provisions spelled out in the Dodd-Frank Act. The banks and credit unions want the full Senate to vote on the legislation, which cleared the committee in December and has enough backing from Democrats to prevent a filibuster, reported American Banker.
“At a time of frequent congressional gridlock in Washington, this bipartisan legislation is a shining example of how our elected leaders can advance necessary solutions by working together and across the aisle,” the groups stated in a letter addressed to Senate Majority Leader Mitch McConnell and Senator Chuck Schumer, the Democrat leader. The letter called on the lawmakers to “promptly” bring the bill to a vote.
Under the bipartisan bill, institutions with assets under $10 billion will benefit the most, although it also pushes back some of the regulations in place for larger banks by raising the threshold for what constitutes a systemically important bank from $50 billion to $250 billion. The bill also eases the stress test requirements for regional and medium-sized banks, noted the report.
The bill has the backing of 24 senators who co-sponsored it, including 11 Democrats. In the letter, the banks and credit unions said the piece of legislation “offers an opportunity to demonstrate to the American public how Congress should work in unison when presented with beneficial and reasonable reforms to create and enhance economic growth.”
The travel sector comeback has been underway since the end of the pandemic.
But the accompanying digital shift has been slow to come to the travel industry itself, where complexity reigns and interactions and payments still flow across a mix of digital and legacy platforms.
A traveler can (and usually does) book a flight online and may use a different app or site altogether to make hotel reservations or reserve a rental car. For consumers, travel agents, airlines and hotels, the payment supply chain can be a long one, marked by transactions flowing across disparate systems and back offices. For the companies involved, offering a range of payment options, including pay-over-time features, is no easy task.
“The need for simplification has grown as the complexities of the travel ecosystem have exploded,” Kristian Gjerding, co-founder and CEO at payments orchestration platform CellPoint Digital, told Karen Webster.
The traveler is not concerned with the mechanics of the payment process, he said. They want to get what they want for the right price, in a friction-free manner.
In a travel-related transaction, “you’re touching a booking system or reservation system, and then you’re touching a loyalty platform … and then as you go through and pay, then you’re moving to the back-office part of it, where the reconciliation and transfer of funds takes place,” Gjerding said.
Invoices between vendors must be settled and paid, and hotels and airlines must adhere to the rules of their local regions, deal with different currencies and navigate exchange rates.
For companies looking to bring new payment offerings to their users, the time to market must be shorter, and the movement toward a digital-native experience is simply beyond the scope of the legacy systems that have been around for decades.
Customers are looking for an Amazon-like experience when it comes to traveling, Gjerding said. They want booking and paying to be as simple as loading an online cart and checking out with the payments bundled. They want the ability to get refunds or cancel part or all of a trip in an intuitive way (and the refunds can be loaded back onto cards with speed, rather than the weeks that it normally takes).
Refunds offer an apt illustration of the technologies and behind-the-scenes flows that must be in play for full or partial refunds.
“Having systems that are able to translate rules,” block or issue partial recompense, “and even determine whether a refund is possible … is essential,” Gjerding said.
The International Air Transport Association (IATA), the industry trade association, has been working on this basket-focused, bundled experience, he said.
Payments orchestrators such as CellPoint have fashioned purpose-built operating systems, connecting payment and other capabilities via APIs to simplify the tangled web of interactions that coalesce around planning a trip and paying for the journey itself, Gjerding said.
“It’s a once-in-the-lifetime movement” for the travel industry, he said.
The orchestration industry has been maturing, Gjerding said. CellPoint Digital was founded in 2007.
“We called it ‘commercial orchestration’ back then,” he said, adding, “We were trying to solve for a problem that was not there yet.”
“You’ve got B2C components, B2B components, you’re getting the funds in, and then you’ve got to reconcile those funds” in ways that the manual processes of two decades ago simply cannot facilitate, he said.
Orchestration streamlines the payments “supply chain” through intelligent routing of payments, from the point of sale to the point where the platform’s clients pay their partners and vendors, he said. Ultimately, there’s a unified view of the transaction. The robust data that flows across the platform finds the right payment methods to decrease operating costs and increase conversion rates.
As the IATA efforts take shape and carriers and other stakeholders sign on to the Amazon-like experience, payments orchestrators will prove to be “tier one, mission-critical platforms … so that you’ll be able to split payments into different components and use BNPL,” Gjerding said.
As he told Webster: “It’ll take 10 years, but you’ll see the entire travel industry transformed.”