eBooks, Guides, & Reports • 7 MIN READ

The importance of a payment monitoring system

IR Team

Written by IR Team


The payments industry is evolving at blinding pace. How can businesses effectively manage booming transactions volumes, emerging technologies, regulatory challenges and higher customer expectations, as well as the ever-increasing risk of fraud?

'Transaction monitoring' is a broad term used by the financial and banking sector to refer to automated monitoring systems implemented as part of an organization's infrastructure. Transaction monitoring is a key element of Anti Money Laundering (AML) and Counter-terrorism financing (CFT) methodology. But transaction monitoring does much more than fulfill compliance requirements and keep a handle on fraud. In an increasingly consumer driven economy, customer experience is becoming the key metric for every business..

Payment transaction monitoring for a better customer experience

Transaction monitoring refers to the monitoring in real time of customer transactions, including historical as well as current information and interactions. This provides a complete picture of the activities from all your customers, including transfers, deposits, and withdrawals. Payment monitoring systems use highly sophisticated software to automatically analyse this data.

Whether you’re an acquirer, payments processor or merchant, it’s crucial to be able to gain complete real-time visibility into your payments ecosystem. Poorly performing systems increase frustration throughout the entire payments chain. It can lead to long queues, the likelihood of customers abandoning purchases, and dissatisfaction from customers – severely impacting revenue. Transaction monitoring and POS monitoring is vital to combat any service disruptions and potential lost revenue.

Real time visibility is crucial

It's not enough just to be able to look at historical data. Payment monitoring solutions simplify the complexity of managing modern payments ecosystems by bringing real-time visibility to your entire payments ecosystem. Without insights and data analysis of transactions and trends, your payment systems lie vulnerable. Declined transactions, system outages, security breaches all lead to serious disruptions. Being able to spot problems and issues as they occur, or even predict when problems are likely to happen, means proactive, fast resolution.

Payment monitoring helps you streamline the payments experience, turning data into intelligence and assuring the payments that keep you in business, breaking down transactions by card, merchant or acquirer. This enables you to drill deep into individual locations and provide geographical insights into card taker and usage.

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Key features a payment monitoring system must provide

With the rapid changes in technology and payments trends, there is a lot to comprehend when it comes to monitoring your payments system. Whether you’re looking to improve or completely replace your existing transaction monitoring solutions, there are some essential features to look for - and no compliance officer should have to do without.

The ability to alter and test rules

The ability to test, build on or modify rules is crucial. AML systems rely on algorithms, which in turn depend on rules. The performance of a company's monitoring system is greatly affected by a its unique set of rules. The better the rules, the better the algorithm works and the lower the rate of false positives and false negatives.

Economic changes are a factor that affect your system rules. For example, the impact of COVID-19 has certainly reinforced that rules which worked perfectly six months ago may no longer be applicable today.

Flexible deployment options

There are essentially three core options for monitoring system deployment, but this will depend on the vendor:

  1. Cloud based, hosted by the vendor
  2. Cloud based, hosted by the business itself
  3. On premises server based

Some regulators, for example, require on premise AML systems to ensure the data doesn’t leave the server.

Systems hosted on the cloud are popular due to benefits including cheaper implementation costs and easier maintenance and upgrades. Some systems operating from the cloud will, however face limitations, which can impede performance.

A simple, unified platform

A complete and comprehensive payment monitoring solution should provide several applications that can be viewed from a single pane of glass. Transaction monitoring, payment and client screening, client activity reviews and enhanced risk assessment.

Using different vendors for different monitoring applications, or a single vendor who doesn't provide a unified platform, means an inefficient and patched-together system with silos and difficulty in integrating all-important data from one application to another.

How payment monitoring benefits management execs

The job of a VP or senior account executive is to concentrate on avoiding penalties, missed deadlines, improving customer experience and satisfaction through careful business decisions. Real time analytics can help enhance business decisions by providing a specific dashboard through which to view and monitor the entire payment platform. Analytics tools reveal:

  • Payment product activity
  • Profitability and expense analytics
  • Multi-channel payment activity

Whether you’re a retailer, acquirer, or payments processor, it’s crucial to have complete visibility into your payments environment. The ability to accommodate new technology, deliver on SLAs and gain business insights is what will drive digital transformation into the future.

How IR's Transact can ensure the success of your payments systems

IR's Transact payment monitoring solutions bring real time visibility to your entire payments ecosystem so that businesses can:

  • Streamline operations and reduce operating costs
  • Allow the flexibility of adding new payment types and enable you to quickly spot patterns and solve problems to ensure successful deployments
  • Elevate customer experience with real-time insights, allowing you to proactively prevent issues before they become customer-facing, and ensuring a seamless customer experience, every time
  • Ensure that you stay in control, bringing deep visibility and insight into all your inter-connected technologies and channels from a single point of view. This gives you the peace of mind that your systems are optimized and networks are running at their best.

For more information on our Transact payment solutions, and a look at payments trends, have a read of our blog 'The Changing World of Payments:2021 Outlook'.

Want to find out more about how to manage the evolving complexities of your payments environment? Download our essential guide.

Download Managing Your Changing Payments Environment


Topics: Payments Payment processing eBooks, Guides & Reports Transact Transaction analytics

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