PAYMENTS CONFERENCE VICTORIA FALLS Sustaining Digital Payments

Transcription

1 PAYMENTS CONFERENCE VICTORIA FALLS 2018 Sustaining Digital Payments

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3 Our Role What we do Electronic transaction switching Clearing and settlement Risk management on behalf of participants

4 Our Mandate We derives our mandate from the RBZ who formally recognize the switch as a payment system. Our operations fall under the supervision and oversight of the RBZ National Payment Systems Division. We are regulated in terms of the National Payment Systems Act and Regulations as issued by the RBZ from time to time. Zimswitch is also guided by international best practice and standards to which it fully subscribes, including the Bank for International Settlements (BIS) Principles for Financial Market Infrastructures (PFMIs) and PCI DSS.

5 Our Place in Zimbabwe s Financial Services Sector Players in the Financial Services Sector Adapted from NFIS ( )

6 17 Financial Institutions Our Membership 4 Depositing Taking Microfinance Institutions 3 Sponsored Payment Service Providers

7 A Platform for Convergence Zimswith has successfully brought convergence of participants payment systems through interoperability

8 Member Depositing Taking Microfinance Institutions Our Interoperability Success Story Sponsored Payment Service Providers = Member Financial Institutions

9 Key Benefits of Interoperability Unlocks Shared Access Expands access to and utilisation of electronic payments. Eliminates unnecessary competition in infrastructure provisioning. Supports the supply side of infrastructure through shared access. As Zimswitch we have successfully established interoperability rails for Zimbabwe bringing massive economies of scale to players in the financial services sector.

10 What has been Zimswitch s contribution to the digital payments dispensation in Zimbabwe?

11 Resiliently Supporting Digital Payments With the sustained growth in electronic payments, Zimswitch is at the centre of mass with robust technology to support the cash-lite dispensation. Our platform has adequate headroom to sustain extraordinary volume peaks.

12 Statistical Overview ATMs (market total approx. 550) 60,000 active POS Terminals (market total approx. 60,000) Zimswith connects 17 Financial Institutions, 4 deposit taking Microfinance institutions & 3 PSPs 2 million active debit cards (4,3 million cards in the market) Switched transactions worth $6,6 billion 165,1 million transactions in 2017 (34,9 million in 2016 up 372%)

13 National Contribution Stats for % of all POS transactions done in 2017 were switched through Zimswitch. Thus 160,4m out of the national total of 214,9m. In terms of value, POS transactions switched through Zimswitch in 2017 account for 77% ($5,1bn) of the national total value of $6,6bn. ZIPIT transfers account for $1,6bn of the national electronic fund transfers done in 2017.

14 National SuperBrand ZIPIT First runner up Money Transfer (2017) Number 11 national Business to Business Brands (2017)

15 Market Overview 16,2 million population Approx. 4 million formally banked population Number of women with bank accounts - 935,994 GDP $14,4 billion GDP per capita approx. $1,000 Est. 4,3m debit cards in issue; Est 17,411 credit cards Est 63,987 prepaid cards Mobile payment subscribers 4,6 million Total POS devices in the market approx. 60,000 Total ATMs in the market 550

16 Market Pain Points Cyber Fraud & Security Magnetic stripe cards open to fraud & counterfeit manipulation Financial losses to banks and customers Financial Inclusion Significant percentage of the population is financially excluded Cost of digital transactions perceived to be high Slow rate of payments modernization Slow uptake of modern digital platforms by banks and customers Small value transactions remain largely cash based Market Fragmentation Resistance to interoperability resulting in payment system silos Bilateral arrangements

17 What role has Zimswitch played in the modernization of payments in Zimbabwe?

18 Payments Modernization 1. ZIPIT Transaction type 27 Credit Push HEADER Person to Person Person to Business Paragraph Business to Person Business to Business Version KYC details required to meet AML requirements 2. Payment from Account - Transaction EFT (Credits & debit ) account based 4. Pay n Go, NFC around the corner

19 The Real-time Payments Revolution We started on this journey 8 years ago through the introduction Zimswitch Instant Payment Interchange Technology (ZIPIT). ZIPIT is a versatile, enhanced data payment platform that is used for everyday payments. Transactions can be initiated from any channel (Mobile, ATM, POS and the Internet). ZIPIT transfers can be made to any bank account or any mobile number. Participants are called to ensure that transaction data reflects on the beneficiary s statement.

20 Technology Versatile Transaction Sets

21 How has Zimswitch addressed the challenge of Cyber Fraud and Security?

22 Fraud and security What Do We Have to Achieve HEADER Paragraph

23 Fraud and security Zimswitch implementing PCI DSS project HEADER Using strong cryptography and security protocols to safeguard sensitive cardholder data during transmission Paragraph over open, public networks, including the following: Only trusted keys and certificates are accepted. The protocol in use only supports secure versions or configurations. The encryption strength is appropriate for the encryption methodology in use. Introduction of Chip & Pin ISO 27001

24 Fraud and security Cryptography algorithms to provide privacy. - HSM encryption 3 DES HEADER Digital Certificates and Digital Signatures for Web servers, to provide authentication. Paragraph data integrity, and non-repudiation service. Secure Sockets Layer (SSL) uses all these techniques to achieve trusted communication.

25 How is Zimswitch contributing to the National Financial Inclusion Drive?

26 Financial Inclusion HEADER - ZIPIT to mobile Paragraph - Reduced transaction charges - Interoperability with MNOs (bank to wallet/ wallet to bank) - Interoperability with microfinance institutions - Supporting mpos

27 Financial Inclusion mpos drive HEADER Paragraph

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29 ZEEPAY Electronic Funds Transfer solution Payments Hub ZEEPAY Payments Hub Core Bankin g Channels EFT Credits (Batch, RTC) EFT Debits (Batch, Mandate management) Channels Core Banking BANK A BANK B RBZ - Clearing and Settlement

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31 Zimswitch s Vision for Payments in Zimbabwe Universal adoption of electronic and innovative payments Cash-lite economy reduced reliance on cash by consumers and business Low Cost of payment systems to users What we need Desire outcomes Leveraging on existing infrastructure through interoperability Regulatory oversight an support on new innovations Collaborative innovation and quick adoption of new products Systems that are fully interoperable, easily accessible, and efficient New innovations that do not introduce undue risk in the market Shorter innovation cycle and quick time to market

32 Dear. Our Message to International Schemes We are open for collaboration

33 In Closing

34 Zimswitch. Switching you on to financial flexibility

35 Copyright 2018 Zimswitch. All rights reserved.