Attitudes to modern methods of non-cash payments

Transcription

1 SIA Mobile Innovation Roadmap Attitudes to modern methods of non-cash payments Marek Lekki, Managing Director, ARC Rynek i Opinia Warsaw, 10 December 2015

2 About the study The study was conducted using the method of Computer-Assisted Web Interviews (CAWI) among respondents who have accounts that can be accessed online; The study was conducted on the Poland-wide representative sample of Internet users who use Internet banking: N=803 respondents; The study was conducted between 28 August and 9 September 2015 by ARC Rynek i Opinia for SIA.

3 Usage of modern forms of payment Q1. Do you pay using: N=803 Source: Modern Banking Services 2015, syndicated survey

4 Assessment of transactions security Q2. How do you assess the security of transactions made with (question asked for each carrier from P30)? Use a scale od 1 do 7, where 1 means definitely low security level, and 7 definitely high security level. N=803 Source: Modern Banking Services 2015, syndicated survey

5 Values associated with electronic payments Q3. When thinking about electronic payments, what values come to your mind? N=803 Top 5 answers

6 Benefits of paying by card Q4. What, if anything, do you see as the benefits of paying by card for expensive products/services, e.g. costing 2000 zlotys? Q5. What, if anything, do you see as the benefits of paying by card for small shopping, e.g. costing 2 zlotys? N=803 Top 5 answers

7 Preferences towards form of payments in different situations Q6. Which of the listed methods of payment do you consider most convenient when buying things for the following amounts: 1 zloty 10 zlotys 100 zlotys 1000 zlotys zlotys N=803

8 Missing features of card payments Q7. What is the thing that you miss most as a user of payment cards? N=803

9 Parties benefiting from non-cash payments Q8. In your opinion, do modern methods of non-cash payments such as BLIK payments, NFC payments, contactless payment sticker have more advantages for banks or the clients who use them? Banks 20% Clients 18% Both parties 62% Why? Why? Why? Profit for the bank 59% Convenience 49% Convenience 43% Speed of transactions 4% Speed of transactions 44% Profit for the bank 29% Promotion for the bank 4% No need to carry cash 7% Speed of transaction 25% Way to obtain information about clients 4% Security 3% Promotion for the bank 11% Convenience 3% Profit for client 3% No need to carry cash 5% N=803 Top 5 answers Source: Modern Banking Services 2015, syndicated survey

10 Card payments in public administration offices Q9. During the last year, when visiting public administration offices (e.g. to have a passport or driving license issued etc.) did you pay by card, at least once? Q10. Why didn t you pay by card in public administration offices in such situations? If no: N=462 Q11. Would you like to pay by card in public administration offices? N=803

11 Preferences to the possibility of card payments in different situations Q11. Would you like to have the possibility of paying by card when: N=803

12 Attitude to modern forms of payment Q12. How much do you agree with the following statement? Currently, so many modern non-cash payments solutions are available that I am less and less interested in the novelties. N=803

13 Knowledge of innovative payment methods Q13. Have you heard about the following innovative payments services: Q14. Considering your habits, which other new and innovative payments services Polish people would like to use or test and in which situation? Peer-to-peer transferring 22% Peer-to-peer transferring 49% P2B 9% P2B 24% P2Gov 7% P2Gov 40% Q15. In your opinion, can the interoperability of mobile payments system (in particular P2P transfer) be useful among different countries? Yes No I don't know 1 29% 6% 66% N=803 Source: Modern Banking Services 2015, syndicated survey

14 The importance of innovative solutions in bank s offer Q16. When taking a decision about being the client of a bank, how important it is to you that the bank offers innovative solutions? N=803

15 How the possibility of accessing the account from a phone/tablet influences the choice of bank Q17. Did the fact that the bank offered the possibility of accessing the account from a mobile phone / tablet influence your decision about choosing a bank? Definitely yes Rather yes Rather not Definitely not Don't know, hard to say % 24% 36% 24% 7% % 20% 38% 27% 3% % 19% 37% 31% 4% N=803 Source: Modern Banking Services 2015, syndicated survey

16 Frequency of logging on to the account using a telephone/tablet Q18. How often do you take advantage of the following possibilities when logging on to your account using a mobile phone or tablet? Often Occasionally Almost never Never Check account balance 56% 24% 4% 16% Check account transaction history 39% 36% 6% 19% Check card transaction history 31% 34% 10% 25% Make wire transfers 28% 35% 10% 27% Make repetitive wire transfers 19% 29% 15% 36% Top up a mobile phone 10% 27% 16% 47% Viewing the list of pending transactions 10% 28% 19% 44% Pay off credit card 9% 17% 12% 62% Find the closest no surcharge ATM 5% 22% 22% 51% Find the closest bank division 4% 20% 25% 50% Open savings account 4% 17% 15% 64% Check stock charts 3% 10% 13% 75% Termination of deposit 2% 7% 17% 74% N=803 Source: Modern Banking Services 2015, syndicated survey

17 Reasons for not using mobile banking Q19. Why don t you use the possibility of logging on to the account from a mobile phone / tablet? Source: Modern Banking Services 2015, syndicated survey

18 What could convince you to use mobile banking services Q20. What could convince you to use the possibility of accessing the account from a mobile phone / tablet? Source: Modern Banking Services 2015, syndicated survey

19 SIA Mobile Innovation Roadmap Marco Polissi, Head of Digital Payments Warsaw, 10 December 2015

20 REGULATORS TECHNOLOGY Payment industry is changing very fast Disrupting forces CONSUMERS Branches Internet Banking (Digital Bank) VAS Services (Cloud, wallet ) Core Services (Advertising, ecommerce) VAS Services Reporting, Fidelity, e-wallet Payment Network, Issuing Mobile VAS Services Cloud, NFC, M2M Network Services Connectivity ASYMMETRIC COMPETITION Effective Customer experience; Large Customer Base; High innovation and investing capabilities; Banks need to offer secure, easy and user friendly solutions on global scale to maintain their position. 20

21 EasyPay Digital Payment Platform Modular solution to offer a comprehensive set of services for digital payments to support banks in their Mobile Payments strategy Non Payment services Payment services Loyalty & Couponing P2P P2X Loyalty & couponing cashback programs P2X Money Transfer through mobile Business Intelligence E-commerce Advanced Reporting system to support marketing campaigns IBAN Mobile wallet for e-commerce and e-payments Ticketing Proximity payment (HCE-TSM) Ticketing purchase and validation through a mobile Contactless Mobile proximity payment 21

22 Focus on: Proximity payments Proximity payment SE: SIM Players Telco Banks TSM SP Enable users: NFC handset and NFC SIM SIM based SE: Handset + tokenization Players Apple Banks Enable Users: iphone 6 handset SE: Cloud Players Banks Enable Users: NFC handset and Android 4.4 SE: Cloud Players Google Banks SE: Handset + tokenization Players Samsung Banks TSM SP Enable Users: Samsung 6 handset Enable Users: NFC handset and Android

23 Mobile Proximity Payments: HCE SIA Cloud Base Platform Role of SIA in the HCE value chain SIA HCE platform in service facilitates banks to roll out HCE services with minimum impact in the following processes: 1.Issuing, 2.Fraud management 3.Clearing&Settlement 4.Dispute and for the Mobile APP development mar 15 AUDIT Roadmap set 15 AUDIT SDK e APP Apr 15 Lug 15 Ott 15 Gen. 15 Dic. 15 lug 15 Live dic 15 Live Key Goals 2015 Certification Data Center SIA (Visa & MC) Top Player Visa Top Player MC

24 Host Card Emulation (HCE) A solution to facilitate Issuer roll out 1 1 Payment Network A,B,C,D,E = Card enrollment/post issuing use case 1,2,3,4 = Payment Merchant Acquirer 1 Token based payment transaction D C Lock/Unlock Token Transmision HCE PLATFORM 2 3 Technical authorization PIN Verification Token/PAN Translation 1 AUTORIZATION SYSTEM FRONT END CLEARING SYSTEM E Reset/ Change PIN B Cardholder Identification/ Enrolment 4 Financial authorization App A Card virtualization request WALLET SERVER AUTORIZATION SYSTEM BACKEND & BANK SYSTEM ISSUER 24

25 Main challenging faced 1 CERTIFICATION PROCESS FOR PROCESSORS 2 IMPLEMENTATION OF BOTH PAYMENT NETWORK SOLUTIONS 3 COMPLEXITY 4 INNOVATION THROUGH A PROCESSOR ALLOW INVESTMENT SHARING 25

26 P2P Service European scenario Plenty of Non-Banking players involved Many local initiatives Not interoperable Based on domestic ACH Linked to Stored Value Account (prepaid) APP non integrated in the Bank APP Lack of a pan-european SEPA initiative 26

27 Jiffy Solution Real Time P2P Money Transfer Beneficiary identified by a phone number Security (Enrollment and user authentication) provided by the Bank; SDK on the APP Based on current account or card with IBAN (dedicated velocity spending limits) Immediate debiting and crediting (i.e. Instant Payments) Settlement at cut off through Credit Transfer Multi Layer Architecture Privacy Tel. # Amount Immediate crediting and notification User authentication SENDER RECEIVER SCT 27

28 P2P Use Cases Three scenarios Real Time Invitation Real Time Enrollment One shot Invitation D+1 fund availability One Shot Enrollment 28

29 Jiffy Governance Cooperation of PSPs Service provider Advisory Board Experience sharing, roadmap definition Brand owner of the product to end customer Pricing definition to end customer Contract Agreement between the Service Provider (SIA) and each individual Bank Rule Book Operational Rules Role and responsibility of Banks and Service Provider Business Model Brand guide lines Privacy Risks Oversight of Central Bank of Italy according to the Banking Law (Art 146. Testo Unico Bancario) Based on SEPA Regulation UE 260/2012 PSD I e II EBA (Dec 2004) and ECB internet security recommendation 29

30 Jiffy Solution Roadmap evolution Area Euro Countries UE non Euro Countriesi non UE SEPA 1. P2P: a. ITALY: in production since October More than 80% of IBAN coverage b. EUROPE: lot of interest in some countries 2. Charity: first event in November P2B: Pilot before end of P2P Interoperability according to European standards 5. P2G: H Remittances: H

31 3. P2B Approach Market segment First phase: Merchant category with large usage of cash (small business, mobile merchant, self-employed workers etc..) Second phase: Vertical segments. Entire Shopping experience (oil, ticketing, etc..); Buyer as transaction initiator Geolocalization QR Code Mobile Number Merchant Name Debit transaction Transaction amount Credit transaction Preferred list Dispute management Customer fee Merchant fee Merchant settlement Business model Issuer Service fee Acquirer 31

32 4. Interoperability Most relevant P2P solutions in Europe Player USERS Market share ,5 mio 90% mio All main Swedish Banks 2,5 mio 66% Jiffy, is the only one based on SEPA SCT; Jiffy, is already in line with the existing ERPB recomendations and shall be interoperable with other P2P solutions according to the framework defined by the international regulators ECB key guidelines: Leveraging on SEPA infrastructures Real time clearing and immediate funds availability Deferred settlement acceptable with no liquidity risks Interoperability 32

33 Mobile Wallet is the primary communication mean The Mobile Wallet (mwallet) supports different integrated services m-commerce m-payment couponing loyalty Purchase experience is integrated within the wallet giving a «compelling experience» that is not reproducible with other payment instrumens (e.g. cards) that don t allow a process integration. Thanks to the mwallet clients will be tracked before, during and after their mobile purchase : Locate customer To offer personalized deals/coupon Before During Secure and simple payment Coupon redeeming Discount application Monetizing data Building of effective loyalty programs After Without a complete and value added customer journey on top to the payment itself, threre s no reason to leave plastic and use an mwallet 33

34 PAYMENT TOOLS SIA Open Wallet Overview SERVICES e-commerce e/m-payment P2P / P2B Proximity Payment Card of the issuer MasterPass Mobile top up, Utility bill payments Card reload Parking Ticketing Visa Direct HCE TSM Current Account MyBank Mobile top up, Utility bill payments Card reload Parking Ticketing Jiffy Card of other issuer MasterPass Mobile top up, Utility bill payments Card reload Parking Ticketing Visa Direct Store Value Account Mobile top up, Utility bill payments Card reload Parking Ticketing Jiffy Strong Authentication 34

35 Customer fidelity programs arrive LOYALTY Point accumulation to access a rewards catalogue to increase volumes and improve the shopping experience CASHBACK Cash back as a percentage of transaction amount credited directly on the bank account, based on threshold COUPONING Coupons and free tickets as benefits in order to push the customer to return to the shop PROCESS Cart usagei CASHBACK Merchant loyalty / cashback program Processing platform Cashback Merchant contracting Coupon acceptance COUPONING Coupon issuing and redemption, program funding to customer and bank 35

36 Mobile wallet solution in white label Wallet white label Jiffy MasterPass HCE Couponing 36

37 Mobile Innovation Key elements 1 COOPERATION WITHIN THE INDUSTRY 2 DESIGN AND DEVELOP LOOKING AT EUROPEAN LEVEL 3 TIME TO MARKET 4 TRY, WITHOUT BEING AFRAID TO FAIL 37

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