As banks and financial services firms are increasingly automating their software operations and digital infrastructure, its payment networks are no exception, particularly since online payments have become the norm, thereby rapidly replacing cash and cheques.
However, banks do not pay sufficient attention to payment testing, according to an industry insider.
Austin, Texas-based Steve Semelsberger, the chief executive officer of Testlio, warns this week that “rigorous checks” are needed to catch hiccups in the payments software of most banks.
“Typically, 2 in 10 digital transactions fail,” Semelsberger said recently at a conference called PYMNTS B2B Payments 2024.
Payment failure at time of purchase, whether it’s a B2B transaction or B2C transaction, is a really big problem,” he said. “It’s a trillion-dollar problem for companies.”
Therefore, payment providers and financial institutions should pay much more attention to payment testing.
“Rigorous checks to catch every hiccup before it hits the market,” stressed Semelsberger. “From compliance challenges to software bugs, any minor issue can have major repercussions.”
He argues that, without thorough testing, payments advances like embedded finance and cross-border solutions, even blockchain payments, could “crumble under the pressure of real-world transactions.”
Payment testing
Semelsberger stressed that for effective payment testing, using real people, real devices and real accounts are paramount.
“We can have somebody in Nigeria processing money in, and someone in Argentina taking money out,” Semelsberger said.
“We want to ensure that the entire transaction from bank through network to bank is secure and completed.”
“There’s been an industry overcorrection towards automation.”
– Steve Semelsberger
By simulating real-world transactions, the testing process can identify and resolve issues that may not be apparent in a controlled environment, he noted.
“Even if things are deployed well, and these are really large companies, it still matters at times the device you’re on and the state of that device,” Semelsberger continued.
“And so intentionally using in the wild devices we find is a great way to make sure that things work well.”
Manual vs automation
In recent years, the QA space has seen a major shift towards automation, largely driven by more sophisticated LLMs, ML capabilities and most evidently the arrival of advanced AI solutions.
While automation does drive efficiency and reduce costs, Semelsberger does warn financial services firms should not rely too much on mere automated software testing tools.
“There’s been an industry overcorrection towards automation,” he said. “Companies are now moving back to a hybrid, integrated approach that fuses automated and manual testing.”
With over 10,000 quality analysts and engineers worldwide, Testlio focuses on ensuring that devices, software and payment gateways function seamlessly. The company’s client roster includes tech giants like Amazon, Microsoft and PayPal, as well as emerging companies.
Semelsberger calls this approach “fused testing” and he argues this method is particularly suited for payments.
He goes on to claim that his company has around 10,000 quality engineers around the world, serving giants like Amazon, Microsoft and PayPal.
“A key focus for our clients is zero-escape issues,” Semelsberger discloses, explaining that Testlio’s testing processes aim to prevent any issues from reaching the end customer.
Meanwhile, the payment landscape becomes increasingly complex and fragmented, as he points out cryptocurrencies such as bitcoin are becoming mainstream.
“For blockchain and crypto, you need experts who deeply understand the technology,” Semelsberger noted. “This isn’t a scenario where just anyone can step in.”
“For big companies, there are often months of testing,” he said.
“For small companies, it may be hours, but you can now do it at a level of scale that was hard to achieve before,” Semelsberger concluded.
UPCOMING EVENTS
QA FINANCIAL FORUM LONDON: RECAP
Last month, on September 11, QA Financial held the London conference of the QA Financial Forum, a global series of conference and networking meetings for software risk managers.
The agenda was designed to meet the needs of software testers working for banks and other financial firms working in regulated, complex markets.
Please check our special post-conference flipbook by clicking here.
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