Community Blog

Preventing Payment Failures in Finance with Temporal’s Durable Execution Model

Written by Temporal | 12/23/24 1:20 PM

When a routine automatic payment fails due to a network glitch, the consequences stack up fast: late fees, service disruptions, and hours spent attempting to resolve the issue.

For the customer, it’s stressful — important services can depend on this payment. For the bank, it triggers a wave of support tickets, operational strain, and damaged trust.

Failures like this show the critical need for reliable payment systems in financial services. Missed payments lead to financial loss, reputational damage, and potential regulatory issues — high stakes for any FinServ application.

Temporal, an open-source workflow tool for developers, offers a solution through a concept called “durable execution:” the guaranteed completion of every transaction, even during disruptions. Through this guarantee, Temporal helps financial institutions deliver reliable, customer-focused payment systems that meet regulatory demands.

The Complexity of Reliable Payment Processing

Building a reliable payment system is challenging. Scaling that system adds a whole new layer of complexity. As your financial platform grows, you’ll face issues like:

  • Handling concurrency: Managing thousands of simultaneous transactions without delays or conflicts.
  • Managing failure states: Ensuring workflows recover gracefully from outages or crashes.
  • Responding to demand spikes: Accommodating transaction surges during peak times without compromising performance.

Failures often result from network disruptions, software bugs, or human errors. Regardless of the cause, these failures can lead to costly setbacks, making the search for a reliable solution essential.

This is where Temporal and FINOS come into play. FINOS’ Open RegTech project, including the Open Regulatory Reporting (ORR) initiative, addresses these challenges with open frameworks that improve system reliability. Temporal complements these efforts by providing durable execution to ensure accurate, disruption-proof transactions.

How Durable Execution Ensures Payment Reliability 

Durable execution is a powerful concept for developing reliable systems. Here’s how Temporal implements it: 

  • Maintenance of state: Temporal stores state of every step in a transaction, to keep workflows on track even through disruptions. 
  • Orchestration of sagas, compensations, and rollbacks: Temporal orchestrates complex, multi-step processes and guarantees incomplete transactions are safely completed or rolled back to preserve data integrity.
  • Automated failure handling: Temporal automates failure-handling logic like retries and recovers systems from the point of failure, to reduce the burden on developers.

Additionally, Temporal ensures every transaction is tracked and accounted for. This guarantees a “single source of truth,” which is critical not only for your compliance, but for the invaluable trust of your customers.

Numerous FINOS members, including major banks and tech companies, are already demonstrating how open-source collaboration and reliable workflow orchestration change financial operations for the better. 

By using Temporal’s durable execution in tandem with open standards, these organizations are building modern systems that are not only resilient — they set the benchmark for innovation in the industry.

The Business Impact of Durable Execution in Financial Services

Reliability is important to any business, not only because it alleviates developer stress and leaves more time for innovation, but also because it directly affects success

Reduced Operational Risk

Temporal minimizes downtime and errors by abstracting error handling, automating compensations, and reducing manual interventions.

As a result, you’ll achieve lower operational risk. This means fewer disruptions, improved customer trust, and reduced financial losses because of failed transactions or outages.

Accelerated Modernization

Temporal simplifies the orchestration of distributed workflows, making it easier to modernize monoliths, and move away from outdated BPMN or unreliable choreography-based event-driven architecture. 

You’ll achieve faster modernization, quicker time-to-market for new features, improved developer productivity, and a competitive edge in delivering innovative solutions.

Improved System Reliability

Temporal’s automatic retries and point-of-failure recovery ensure that your transactions complete every time. This reduces failures, boosts uptime, and strengthens compliance.

This approach reflects a broader trend in financial services. As noted in the State of Open Source in Financial Services Report, open collaboration is improving software resilience across the industry. 

Temporal’s durable execution, combined with open-source principles, only further empowers FinServ companies to build reliable and modern systems.

Proven Use Cases

The benefits of durable execution shine through in our customer stories. 

Will Bank reliably supports millions of invoices 

Processing boletos, Brazil’s asynchronous, barcode-based payment invoices, was a significant challenge for Will Bank. While boletos are popular with consumers, their complexity made it difficult to build a reliable, scalable system.

With Temporal, Will Bank reimagined its approach, streamlining their previously complex, human-centric workflows. Temporal’s durable execution ensured every transaction was either completed or safely rolled back, enabling the bank to process over 2 million invoices with ease.

Will Bank’s success reflects a broader movement in financial services toward open standards, which not only boost reliability but also promote efficiency and scalability. For professionals looking to adopt similar frameworks, the Introduction to the Common Domain Model (CDM) Express Learning Course offers a practical guide to aligning data, systems, and processes using CDM principles.

Global banking leaders use Temporal

Leading financial institutions face the dual challenge of managing high transaction volumes and modernizing legacy systems. To address these demands, many have adopted Temporal’s durable execution model alongside open standards from FINOS, such as FDC3, which ensures reliable integration and workflow orchestration in distributed systems.

FINOS members like Morgan Stanley and BlackRock show how open collaboration and durable execution can transform financial operations. Temporal powers fundamental workflows for three of the five largest U.S. banks, the top two banks in India, and major institutions across Europe and Asia-Pacific.

By integrating Temporal with open standards, these institutions have reduced operational risks, modernized legacy infrastructures, and delivered more reliable, scalable payment systems. Together, Temporal and FINOS are enabling financial institutions to innovate and meet the demands of a rapidly evolving industry.

In Conclusion

Durable execution is more than a technical solution — it’s the anchor of any successful backend infrastructure. It allows your financial application to minimize risks, improve reliability, and accelerate innovation to meet the growing expectations of customers and regulators alike.

Further educating yourself on these matters will only improve your business trajectory. Read our white paper to learn how you can use durable execution to reduce risk in your FinServ application.

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