Uptake and customer experiences
Deutsche Bank has the Dovetail Payments System global platform for high-value payments. This is implemented in the US and Germany to date, with the roll-out continuing. The bank’s US operation also singed with Dovetail for liquidity management; the Party Search Engine was taken for the US and Germany. JP Morgan Chase signed for Dovetail’s system in early 2008. The bank went into production with SCTs as a first phase and had successfully run User Acceptance Tests on SDDs by mid- 2009. This successful implementation was the first phase of a strategic payments roll-out for high- and low-value payments across 28 countries. This was clearly a notable new name win and, along with Standard Bank, marked a significant pick-up in activity for Dovetail. By early 2011, Coen said JP Morgan Chase was continuing to ‘light up more countries’, with three large releases per year, each bringing on a clutch of new sites. In 2012, the roll-out had continued, adding South Africa, Norway and Mexico, among others. Standard Bank of South Africa, as mentioned, is a user of Dovetail via Logica. The deal was for LAPS, with Dovetail’s payments engine at the centre. This was basically touted as Logica’s first success with LAPS High Care. The bank intended to replace its payments systems in South Africa as well as in its 17 other country operations. The selection came down to all of the usual payment system suppliers, such as Fundtech and Clear2Pay. It already used Logica for Continuous Linked Settlement (CLS). No one from the bank was available to comment, but a key aim was understood to be high quality processes and consistent standards, through a gradual replacement of the bank’s legacy systems using the multi-entity support of LAPS. It was thought that the first operation for migration would be London, along with part of the domestic operation. The intention, said Logica executive, Richard Davies, was to migrate from a range of systems that did ‘bits of payments’, thereby consolidating everything onto one platform.
In the first quarter of 2011, HSBC selected Dovetail’s platform for its low-value requirements. No one from the bank was available to comment at the time; Coen also declined to comment. However, it was understood that the tier one bank had signed a contract, having looked at a number of other payment systems prior to this. An aggressive roll-out during the rest of the year was expected. Capgemini was believed to be a general adviser to HSBC in the area of payments and was likely to have been involved in at least the planning. The bank is implementing the Dovetail Payment Services Hub for its ‘European Volume Payment System’ business in eleven countries. To start with, it would process SCTs and SDDs, in compliance with the framework and timetable that was finally confirmed by the European Parliament in late 2011. Trevor LaFleche, global marketing director at Dovetail, said in
March 2012 that there was ‘potential for the Dovetail system to become a global mass payments platform for HSBC’, should the bank require it. ‘There is nothing limiting the platform to Europe or the Euro,’ he stated. In the initial selection, Dovetail’s offering was pitched against the incumbent payments system, Global PayPlus from Fundtech (implemented five years earlier). An in-house development route was also considered. Global PayPlus continues to support high-value payments processing at HSBC, as well as low-value payments outside Europe, in North America, Asia and the Middle East. LaFleche said that the Dovetail project so far ‘has been going well in terms of people’s expectations on both sides, and understanding exactly how much time and resources that each side has to commit.’ There had been ‘active management and engagement’ from Dovetail and HSBC, ‘which is key to ensuring things are running smoothly’, he stated. BMO Financial Group was a notable signing in early 2012. The bank opted to implement the Dovetail Payment Services Hub to replace a host of in-house and third party legacy systems, Logica’s Bess among them. Coen said that BMO, ‘being a Canadian financial institution, adopts a very conservative, low-risk way’ to conducting projects. It went through ‘an exhaustive process’ of evaluating the offerings and ‘implementation capabilities’ of potential suppliers. Major international providers, some of which are well- established in or stem from North America, competed for the deal.
‘BMO is sitting on a set of legacy systems that are expensive to maintain and not possible to move forward,’ said Coen. The bank, which went through a series of acquisitions, wants to drive down costs, harmonise operations, improve efficiency and have better time-to-market, he explained. Hence its quest for a centralised payments processing hub. Dovetail’s offering will become BMO’s ‘strategic platform’, fully supporting its payment operations in the US and Canadian dollars as well as internationally, said Coen. The roll-out was at the planning stage by March 2012. Coen expected it to be a gradual implementation, due to BMO’s ‘conservative and risk-averse approach’. The fact that two other Canadian banks followed BMO’s lead suggested a successful project. Not long after, Dovetail signed a deal for SEPA operations
with ‘a large financial institution in Southern Europe’. This turned out to be Banca Intesa SanPaolo. A bit of a give-away had been Dovetail opening an office in Milan and the hire of a regional specialist, Pier Luca Chiommino. In November 2012, the bank went live to support 29 local entities in Italy from a hub in Palma. It replaced an in-house development and was a rare instance of an Italian bank opting for anything other than an in-house or local solution. The system was then rolled out across the international locations of the Intesa Sanpaolo group, all supported by one centralised hub, replacing 27 legacy payments applications. It covers high value, low
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