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July 14, 2021Executive Interview Series

Executive Interview Series: Bank of America Head of Merchant Services, Guy Harris

The Executive Interview Series provides readers with exclusive insights from movers and shakers in the payments industry. The Payments Industry is under continuous transformation, as such this series provides diverse perspectives on everything from strategy to payments technology and to the future of the industry.

In this interview, TSG’s Market Intelligence team-member Alex Ferguson and TSG’s Director of Revenue Steve Vickers sat down with Bank of America Head of Merchant Services, Guy Harris, to learn more about his 40+ year international journey through the payments industry and how Bank of America is continuing to grow and evolve it’s merchant services offering for the future.

Background: Guy Harris is Head of Merchant Services at Bank of America. In this role, Guy is responsible for driving the bank’s next generation merchant solutions, and building and leading a team within this organization. His focus is on establishing critical relationships – both within Merchant Services and across the bank, as well as with industry partners. 

Prior to joining Bank of America, Guy was President of North America and Global Revenue for Elavon, an industry leader in payment solutions, and a member of the senior leadership team. He oversaw strategy, profit and loss, and growth for Elavon across North America. In addition, he was responsible for global revenue and business growth across Europe. Under his leadership, Elavon experienced strong revenue growth in North America and a 65 percent increase in sales.

Guy lives in Atlanta, Georgia and holds an Ordinary National Diploma in Business Studies from Kingston College in London. He serves as president of the board for the Electronic Transactions Association and is on the board of directors for Junior Achievement of Georgia.

Q: TSG’s Alex Ferguson
How’d you get your start in the payments industry?

A: Guy Harris
I joined a company called BancTec over 20 years ago, where I ran the European side of their business in the days of supplying check clearing systems and services. BancTec had a hardware and software solution that automated the reading and sorting of checks and we helped major banks be more efficient.

Then my career took me to Misys, a global software provider to financial institutions, where I spent five years predominately on the sales side. Payments and merchant acquiring weren’t necessarily on my radar, but I started talking to Elavon – a subsidiary of U.S. Bank – and that gave me my first insight into payments on the acquiring side.

Q: TSG’s Steve Vickers
Interesting. I think one of the things that we gather too, from the majority of people that we talk to within the industry, myself included, you never start out choosing payments, payments kind of chooses you and you find yourself in that role. It’s not a straight line.

A: Guy Harris
I call it a hidden gem. Within the payments business, the speed of change is just incredible. And with change comes opportunity.

Q: TSG’s Alex Ferguson
Looking into your background, you’ve had an extensive career in financial services lasting nearly 40 years. How has this breadth of experience helped you develop your career and specifically how has it helped you in your current role as Head of Merchant Services at Bank of America?

A: Guy Harris
I’m a great believer in owning your career. I always say that it’s up to you to own where you are, and what you’re going to do. As an example, when I was with my prior organization, I had five different roles in nearly 10 years. Those roles took me from a European sales leadership role, through to P&L, through to North America, and through to then a global role. These were all important opportunities that I sought out to grow and develop. I find change very inspiring because you’re learning new things all the time.

Coming across to the U.S. was a huge, but incredibly stimulating, challenge. I think the leadership side of business is pretty consistent, the only difference is culture and scale. You have to understand the specifics for your market or solutions and adapt and you’ve really got to understand the investment that’s required in order for you to be able to deliver those platforms. That’s really one of the things that impressed me about Bank of America: the breadth and capability of our digital assets, where we are a market leader.

It’s really about the value proposition. I genuinely believe that payments is incredibly valuable to our customers and it’s something that is a differentiator. When I first started in the industry it was a slightly commoditized item, but over time, we’ve come to add significant value to our customers.

Q: TSG’s Alex Ferguson
Having worked extensively in Europe and North America, and with many of your positions having global focuses, what are some key differences between the payments industry in Europe vs. North America that you feel are overlooked by the industry at large?

A: Guy Harris
There is quite a bit of difference when it comes to payments, specifically consumers in Europe who are paying with local payment types as opposed to using credit cards. For example: local debit cards or direct debit and buy now pay later with Klarna. In the Netherlands where 60% of sales are done online using I-DEAL and debit is heavily regulated. Germany is another example. It had the lowest credit card penetration and volume in all of Europe because Germans don’t want to have any form of debt. These are nuances that you need to understand when dealing with your customers.

Then the second big change of course is Brexit, which has changed the landscape. It’s taken the U.K. out the European domestic card region which impacts effective interchange and card brand fees. Then adding to that PSD2, which is the authorization on the ecommerce transactions. In certain respects the big differentiator in Europe is there’s a centralized governance of payments capability. In the US, it’s not. The EMV rolls it out through a centrally mandated process, while we tend to roll them out through the networks. But some of the changes in Europe are helping us. They were way ahead of us on contactless in many of the countries. Now we’re catching up through COVID.

In London, “tap and go” is a cultural thing that is fully accepted and “pay at the table”: you wouldn’t dream of allowing anybody to take your card away. Bringing it back to Bank of America, the successful companies are able to offer a global capability on a single platform, as opposed to multiple platforms to handle those kinds of issues that I’ve just described. So, we need to think about that and are thinking about that, at Bank of America.

Q: TSG’s Alex Ferguson
What do you feel is your biggest contribution to the payments industry thus far?

A: Guy Harris
One of the biggest contributions is bringing value back to the conversation – understanding the value we offer to our customers and demonstrating that value but also showing that it’s more than a simple pricing mechanism.

Secondly, I think at times we as an industry have overcomplicated payments for our customers in two ways. One, there’s the technology side of it, which is a very complicated process. Sure, we can get technical but ultimately, it’s about fixing customer problems. And then there’s transparency to our customers. I’ve been a great advocate of the fact that we need to be as transparent as we can.

Anecdotally I remember going to visit a small customer in Atlanta. I said, “Why don’t we go through your statement?”  She had no idea how the pricing on her statement was constructed. It was clear to me that we need to make it much simpler for our customers. At Bank of America, we’re focused on simplifying the payments ecosystem and strengthening direct client relationships, giving them one seamless relationship with a trusted global brand delivering a comprehensive suite of solutions; our integrated offering uniquely positions us to deliver an unmatched value proposition to serve complex needs.

Q: TSG’s Alex Ferguson
It’s been nearly a year since the conclusion of the joint venture between Bank of America and First Data/Fiserv. What can you tell us about the future of Bank of America’s Merchant Service offering? Where do you see merchant services at Bank of America five years from now?

A: Guy Harris
The first thing I’d point out is although the joint venture was dissolved, we continue and will continue to have a really strong and robust relationship with Fiserv. They’re a key partner of ours, our customers are on their platform today, and many will remain on that platform.

That being said, we are developing our own proprietary merchant solution. Over the last two years, we’ve been building it and we believe we’re going to better serve the payment needs of our customers across all the Bank of America lines. We’re in the process of rolling out our new platform to various segments within our customer base. By supplying customers with an integrated payment solution to the products that they already have, we are strengthening both our relationship and giving them a unique capability which no other competitor can do.

Bank of America leverages best in class innovations, such as real time payments, best in class digital capabilities and value added services like analytics and security solutions. And all of those are built on the knowledge that we as a bank, uniquely have of our customers. I can’t overemphasize it: it is the seamless relationship that we offer our clients, which will help us differentiate our solution. So, when a customer sees “merchant,” they don’t see it as a standalone solution. They see it as integrated in their digital platform with the total relationship, and in the COVID world of pace of change, we’re going to be there with them as they evolve and be ready to support them.

Payments are a two trillion-dollar business globally and there is still room for growth. The runway for replacement of cash, the new usage of payments, are all significant in terms of the way things are going to continue to grow and that doesn’t seem to be slowing down. Last but not least, payments have become one of the core activities for the bank. We view that as a total payments capability, whether it be real time payments, whether it be Zelle, whether it be our wholesale payments and our larger customers in terms of moving their business. We are uniquely positioned to own both the issuing and acquiring side of the relationship with our customers.

Q: TSG’s Alex Ferguson
What planned aspect of Bank of America’s future merchant services offering are you most excited about?

A: Guy Harris
We have a strong client focus and the ability to serve our clients’ needs holistically through an integrated product offering, which is exciting.

We’re focused on how we can make it easier for our customers to achieve their financial goals, with high tech merchant services that are integrated into our banking services, so they serve as one relationship.

Just to emphasize, we are the leader. We’ve been recognized by the industry for having the best business bank account for small business, more digital functionality and best practices than any other bank. And our preferred rewards for business consistently ranks in the best customer loyalty programs.

So, in thinking about preferred rewards for business, merchant is another way that our customers get to the reward system just as you would as a consumer. The big difference is that we can expand that relationship which nobody else can do because we reward them on the total financial relationship they have with us as a bank, not just on individual lines of business. Then for large customers, we provide efficiencies in pricing, underwriting, and again we can review their whole relationship when we put together any of our proposals, whether it be from a technology perspective, and/or from a commercial perspective.

Another exciting thing is the recent acquisition of AxiaMed. As we were building our brand-new platform, we recognized that healthcare is one of the largest verticals and the largest growth opportunities for the bank. Our thought process was that we can build or buy or partner, but only when we’re interested in accelerating the capability. AxiaMed’s technology stack was a perfect fit for us both from an integration perspective and as a gateway, but also from vertical perspective, and the customers already processing on their platform match really well with our customer base and our large customers, specifically in the hospital space.

Q: TSG’s Alex Ferguson
How has merchant services at Bank of America been affected by the COVID-19 pandemic over the past year? What kind of impacts and trends have you seen affect Bank of America’s merchants?

A: Guy Harris
First and foremost, from the start there was the dramatic impact. But the obvious change as I sit here now in my home office in Atlanta, for the 15th month was this: I’ve watched the UPS van and I’ve seen the Amazon van three times today. The transition from physical point of sale to ecommerce has happened and the stats will show that. Then with order ahead and the delivery services, what we’re all waiting to see is how many of those trends remain over the next three to five years, or whether they were a point in time, and it drifts back to where we were before. I think we all believe that there will be a significant shift that doesn’t go back, but I also think the winners in the customer experience will ultimately determine that.

We see 40% of merchants during the pandemic have implemented contactless and 75% of all transactions are occurring at contactless enabled merchants. We at Bank of America will have at least 50% of our cards issued be contactless by the end of this year. That represents 60 million cards with a target of over 100% of our cards being contactless by 2024. So that’s been a real positive and I think we’ll all see that in the in the market as we go around.

Then omni channel has changed the behavior and I again think about my own experience. Adidas – one of my favorite brands – I have their app on my phone. They’re contacting me through multiple channels and making it easier to do business. According to reports, 36% of consumers will have a higher adoption and will continue to use that model and buy online and pick up in store.

Our job is to give our customers a simple deliverable solution to address that opportunity and I think we are coming back to the other angle of this, which is security. Banks are trusted brokers, and we can provide a consistent secure experience. We spend a lot of time, money, and resources on ensuring we deliver a secure solution. Lastly, merchants and customers need an easy card management solution. Customers expect a nice, easy experience, and merchants must deliver whether it’s contactless, tap and go, or ecommerce, etc.

Q: TSG’s Steve Vickers
I have one question for you, Guy. What is your prediction for the North London Derby next year? I know you’re a Premier League fan!

A: Guy Harris
No worse, I am a Tottenham Hotspur soccer fan, and my team has had a very poor year. We’ve sacked our manager and we’re in a mess. So now I’m much more interested in what the Hawks and the Braves and the Falcons are doing. Although the Falcons are similar to the Spurs as well, they’re not exactly having a great time either. I’ve not been too lucky with my sporting connections, but I’m enjoying it nonetheless. Most importantly, you can quote me on this, I’m a big Roll Tide fan. So, we win championships. By the way, my daughter went to Alabama, so it’s not just follow the winners, but my final comment will be Roll Tide!

Want more from this series? Catch up on more executive interviews.

Featured companies include FortisPay, NMI, UNION POS, Celero Commerce, Paysafe, Talus Payments, Authvia, WePay, NetCents, Zuza, and more.

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