Treasury Strategy & Transformation
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A New Hub for Transaction Banking Innovation?

An Interview with Murali Subramanian, EVP and Head of Transaction Banking, Abu Dhabi Commercial Bank

In this month’s Executive Interview, we feature Murali Subramanian, Head of Transaction Banking at Abu Dhabi Commercial Bank (ADCB). In conversation with Helen Sanders, Editor, Murali discusses some of the innovations that are taking place in the transaction banking space, and how these are reflected in the UAE and more widely across the Middle East.

How are trends in the emergence of new payment technologies being reflected in the Middle East?

Murali SubramanianThe growth of non-traditional payment technologies that we are seeing in some regions, such as mobile, SMS and contactless payments, is largely being driven by demands from the retail banking sector and fulfilled by start-up operations with the flexibility to anticipate and respond to changing demands very quickly. Many of these are then acquired by larger businesses and banks to complement existing solutions and services. However, many of these developments represent more than simply the use of alternative devices for making payments. Instead, they mark a fundamental shift in the concept of a payment. In the past, a payment referred to the combination of messaging and clearing. This link has now been broken, with payments messaging now available via a growing range of methods, and payment engines complementing traditional transaction clearing.

Although innovative payment technologies have been slower to take hold in the Middle East, this is changing. One difference, however, is that there are fewer of the start-ups and venture-capital-funded businesses in Middle East that have typically initiated innovative solutions in Europe, Asia and North America. Consequently, innovation in this region is largely bank-driven at present. However, we are seeing considerable interest in the payments space from potential investors given the size of the market, as well as from institutional and retail users of payment services. This combination of a significant value proposition for innovative payments technologies, and investment potential from major investors such as sovereign wealth funds, positions the UAE in particular as an exciting prospective centre for innovation in financial technology.