Silicon Valley Bank Debuts Global Payment Hub

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  • Banks like Wells and Chase are adopting chip and PIN and facing big tech overhauls.
    June 1

Large banks such as Bank of America and Wells Fargo have been working for years to build global payment "hubs": online banking platforms their corporate customers can use to send and accept payments of different types and in foreign currencies to their customers and partners around the world.

It's an exceedingly difficult task; even offering one online banking interface for the many accounts a corporate customer holds is not simple; having disparate payment pipelines all feed into that online banking interface with the ability to execute transactions is a major IT challenge.

Santa Clara-based, $17.5 billion-assets Silicon Valley Bank may be beating such larger competitors to the punch. It has rolled out an international payment processing hub that handles 85 different payment types and 187 currencies. This move follows on the heels of the bank's introduction of EMV compliant credit cards for global use earlier this year.

"We have a lot of clients that do business globally," says Pradeep Moudgal, head of global cards and merchant services for Silicon Valley Bank, which estimates that about half of its business comes from outside the U.S. The bank serves tech, science, environmental tech, venture capital, private equity and premium wine businesses around the world.

This international exposure, which Moudgal says is expanding, requires the bank to transact in local currency and payment methods, a complex challenge which that bank believes it has solved by contracting with Adyen, an e-commerce and payments tech firm.

Adyen's platform integrates the bank's clients' varied payment acceptance methods and channels with Silicon Valley Bank's accounts. Adyen recently partnered with Merchant e-Solutions, another payment processing firm, creating a processing platform that includes sales support, credit underwriting, risk management, chargeback processing, fraud pattern detection, a 24-hour help desk, and a guaranteed processing speed of less than one second.

The expanded processing services will give Silicon Valley Bank's clients the ability to accept online payments from their own international customers, collect payments in foreign currencies and automatically deposit those funds into Silicon Valley Bank accounts.

Silicon Valley Bank will host the processing service for its clients, which can accept payment methods such as credit cards, debit, PayPal, IDeal, Dankor and others. For example, a retail client of Silicon Valley Bank that has a client of its own in the U.K. or Germany can now accept card payments agnostic of currency, which the bank will be able to automatically process on that retail client's behalf. "We can offer clients a way to collect funds and deposits in euros or pound sterling, etc." Moudgal says.

The new international payments processing service is part of a larger Merchant Services suite at Silicon Valley Bank that includes access to bank advisors that help develop a business strategy to accelerate payments and minimize fraud and other risks; a view of cash flow, trends, chargebacks and details of transactions through online reports and statements; reconciliation through the institution's online banking platform; and other features. The bank has expanded its mobile capabilities to include iPad, iPhone, BlackBerry and Android delivery—processing payments through a "virtual terminal" payment system that is encrypted and complies with standard processing rules and PCI compliance.

Silicon Valley Bank debuted a new EMV chip credit card in May. EMV stands for Europay, MasterCard and Visa; it's a global standard for the inter-operability of chip cards. The card is designed for bank clients that do a large amount of international travel in countries where the EMV standard has been broadly adopted, a move also made by other institutions including Wells Fargo, JPMorgan Chase and the United Nations Federal Credit Union.

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