K connelly presentation texpo non bank payment systems revolution 2015 f
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The document discusses the evolution and revolution of non-bank payments as of 2015, highlighting key players, technologies, and trends such as Apple Pay, Google Wallet, and the rise of e-wallets. It notes that non-banks are leading payment innovations while traditional banks are losing their foothold. Additionally, the report addresses the rapid changes in payment technology, competition, and regulatory challenges facing the industry.
K connelly presentation texpo non bank payment systems revolution 2015 f
- 1. NON-BANK PAYMENTS REVOLUTION 2015 UPDATE (APRIL) Kevin H. Connelly Executive Vice President The RWC Group [email protected]
- 2. • LAST YEAR’S PRESENTATION FOCUSED ON: – PAYMENTS EVOLUTION – PAYMENTS REVOLUTION – DISRUPTIVE TECHNOLOGIES – MOBILE MERCHANT TECHNOLOGY – ELECTRONIC WALLET – NFC – BLE • THIS YEAR FOCUS IS ON WHAT’S NEW THE EVOLUTION OF PAYMENTS OVERVIEW
- 3. tech·nol·o·gy tekˈnäləjē/ noun 1. the application of scientific knowledge for practical purposes, esp. in industry. •rev·o·lu·tion •ˌrevəˈlo͞oSHən/ •noun •1. a forcible overthrow of a government or social order in favor of a new system. pay·ment ˈpāmənt/ noun 1. the action or process of paying someone or something, or of being paid. THE REVOLUTION OF PAYMENTS CONFIRM DEFINITION
- 4. • ITUNES • AMAZON • LINKED IN • PAYPAL THE REVOLUTION OF PAYMENTS DISRUPTIVE TECHNOLOGIES / DISRUPTORS
- 5. THE EVOLUTION OF NON-BANK PAYMENTS E-WALLETS In 2014 200 e-Wallet or Mobile Wallet Applications Gatekeeper Wallets Bank Wallets Retailer Wallets e- Commerce Wallets Aggregator Wallets Single- Feature Wallets
- 6. THE EVOLUTION OF NON-BANK PAYMENTS THE GEORGE COSTANZA WALLET http://www.youtube.com/watch?feature=pla yer_detailpage&v=yoPf98i8A0g
- 7. • REVOLUTION IN FULL SWING – WEEKLY CHANGE • HACKING OF PAYMENT DATA - TARGET • EMV ROLLOUT • APPLE PAY • MERCHANT CONSUMER EXCHANGE (MCX) THE EVOLUTION OF PAYMENTS WHAT’S NEW • ISIS IS NOW SOFTCARD IS NO LONGER IS NOW GOOGLE WALLET • AMAZON LOCAL REGISTER • NFC REVIVAL? NFC TAKES LEAD • IBEACON BLE TRACTION – OR NOT • BITCOIN – DOWN AND UP
- 8. • NEW FRONTIER – CHANGES ALMOST DAILY • PAYMENTS SOFTWARE VERSION “X.X” REPLACED WITH IOS8, ANDROID 1 AND KITKAT • PAYMENTS UNIVERSE CENTER NO LONGER NY, CHICAGO OR LA – IT IS SILICON VALLEY • BANKS NO LONGER LEADING PAYMENTS INNOVATION • NON-BANKS LEADING – PAYPAL, GOOGLE, APPLE, RETAILERS • TECHNOLOGY IS DRIVER – RAPID CHANGE IS NORM • EXPLOSION OF PAYMENT ALTERNATIVES IN 2015 THE REVOLUTION OF PAYMENTS WHAT’S NEW
- 9. THE REVOLUTION OF PAYMENTS ANNOUNCEMENTS IN 2015
- 10. • SAMSUNG PAY – SAMSUNG ACQUIRES LOOPAY • MCX – CURRENT C REMAINS ON BENCH • GOOGLE WALLET – ACQUIRES SOFTCARD (THAT WAS ISIS) • PAYPAL – PAYPAL BUY PAYDIANT THE REVOLUTION OF PAYMENTS WHAT’S NEW IN Q1-2015
- 11. • MICROSOFT PAYMENTS – APPLIED FOR MONEY TRANSFER LICENSE (MONEY SERVICE BUSINESS) • APPLE PAY IS DRIVING FORCE – LEADING NEW FEATURE A MUST HAVE – APPLE WATCH – TIME IS MONEY • REGULATORS CATCHING UP – BSA/AML, KYC, FRAUD, SECURITY THE REVOLUTION OF PAYMENTS WHAT’S NEW IN Q1-2015
- 12. • SAMSUNG PAY – SAMSUNG ACQUIRES LOOPAY THE REVOLUTION OF PAYMENTS WHAT’S NEW IN Q1-2015
- 13. • GOOGLE WALLET – ACQUIRES SOFTCARD (THAT WAS ISIS) – NEW OPERATING SYSTEM THE REVOLUTION OF PAYMENTS WHAT’S NEW IN Q1-2015
- 14. • PAYPAL – PAYPAL BUY PAYDIANT – SPUN OFF FROM EBAY THE REVOLUTION OF PAYMENTS WHAT’S NEW IN Q1-2015
- 15. • MCX – CURRENT C REMAINS ON BENCH – AND IN PILOT THE REVOLUTION OF PAYMENTS WHAT’S NEW IN Q1-2015
- 16. • MICROSOFT PAYMENTS – APPLIED FOR MONEY TRANSFER LICENSE THE REVOLUTION OF PAYMENTS WHAT’S NEW IN Q1-2015
- 17. • APPLE PAY IS DRIVING FORCE – PAYMENT FEATURE A MUST HAVE – APPLE WATCH – TIME IS MONEY THE REVOLUTION OF PAYMENTS WHAT’S NEW IN Q1-2015 •1 Billion | The Number Of iOS Devices Sold •200 K | The Number Of Vending Machines, Laundromats and Parking Kiosks Now Accepting Apple Pay •400 | The Percentage Increase In Apple Pay Use Since Whole Foods Launched It APPLE PAY Your wallet. Without the wallet.
- 18. THE REVOLUTION OF PAYMENTS WHAT’S NEW IN Q1-2015 APPLE PAY Your wallet. Without the wallet. http://www.pymnts.com/in-depth/2015/major-banks-cashing-in-on- apple-pay-potential/#.VTEc9yFViko • FEB-15 CHASE 1MM CUSTOMER • JAN-15 BOFA 800K CUSTOMERS • 750 BANKS • $100MM SPENT ON ADS http://adage.com/article/cmo-strategy/capital-launches-apple-pay-ad- orange-bowl/296437/
- 19. THE REVOLUTION OF PAYMENTS WHAT’S NEW IN Q1-2015
- 20. • APPLE PAY IS DRIVING FORCE - CHASE THE REVOLUTION OF PAYMENTS WHAT’S NEW IN Q1-2015
- 21. THE REVOLUTION OF PAYMENTS FORECAST BEYOND THE TIPPING POINT
- 22. THE REVOLUTION OF PAYMENTS E-WALLET COMPARISON
- 23. THE REVOLUTION OF PAYMENTS E-WALLET COMPARISON
- 24. THE REVOLUTION OF PAYMENTS E-WALLET COMPARISON
- 25. THE REVOLUTION OF PAYMENTS E-WALLET COMPARISON
- 26. THE REVOLUTION OF PAYMENTS E-WALLET COMPARISON
- 27. THE REVOLUTION OF PAYMENTS E-WALLET COMPARISON
- 28. THE EVOLUTION OF PAYMENTS WHAT DOES THE DATA TELL US? • Rapid and seismic changes – much more to come • Technology • Multiple competing platforms and solutions • Banks, Retailers, Telecom, Tech Industries vying for foothold • No clear winner yet • Retailers are heavily engaged and vested interest • Banks are following – but now engaged • Safety & Security are considerations to all
- 29. THE EVOLUTION OF NON-BANK PAYMENTS E-WALLETS NFC – Embedded Apple, Softcard, Google Cloud vs Device QR Code MCX Hybrid MST
- 30. THE EVOLUTION OF PAYMENTS APPLE PAY – THE LEADING FRONT • Apple owned • NFC tech embedded in iPhone6 • Only works on iOS8 and new phone • Banks Participating • Retailers Participating
- 31. THE EVOLUTION OF PAYMENTS APPLE PAY – THE LEADING FRONT How does it work? http://www.bloomberg.com/video/popout/4 S9n3TNbQA6vW_~xMyGaqg/21.13/ http://techcrunch.com/2014/09/09/heres- apple-pay-in-action/ Quick Market Reaction
- 32. THE EVOLUTION OF PAYMENTS APPLE PAY – THE LEADING FRONT • High Level Process Flow
- 33. THE REVOLUTION OF PAYMENTS APPLE PAY – THE LEADING FRONT Participating Banks • .15% Apply Pay Fee • 1-2% is the norm • 750+ BANKS NOW
- 34. THE REVOLUTION OF PAYMENTS APPLE PAY – THE LEADING FRONT Participating Merchants • 220,000 Locations • 9 Million Locations • <10% • Cost: $300-500 • Walmart using MCX • Is Timing Better For NFC?
- 35. THE REVOLUTION OF PAYMENTS APPLE PAY – THE LEADING FRONT • Compatible Apps
- 36. THE REVOLUTION OF PAYMENTS MERCHANT CUSTOMER EXCHANGE (MCX) • Merchant owned • 110,000 locations • Pilot in 2014, rollout 2015 (WAITING) • Software download • Works on iPhone and Android devices • QR Code Based
- 37. THE REVOLUTION OF PAYMENTS MERCHANT CUSTOMER EXCHANGE (MCX) • Coupons and Offers • Loyalty • Easy of Payments • Security
- 38. THE REVOLUTION OF PAYMENTS AMAZON LOCAL REGISTER
- 39. THE REVOLUTION OF PAYMENTS AMAZON LOCAL REGISTER http://localregister.amazon.com/ How does it work?
- 40. THE REVOLUTION OF PAYMENTS SOFTCARD • Telecom Joint Venture • AT&T, Verizon, T-Mobile • NFC Based • Works on iPhone and Android devices – app comes pre-loaded on 30 devices • Changed Name from ISIS
- 41. THE EVOLUTION OF PAYMENTS SOFTCARD How does it work? https://www.youtube.com/watch?v=tH5RWt 6HdKk&feature=player_embedded#t=0 Announced partnership with Subway this week – 26,000 locations
- 42. THE REVOLUTION OF PAYMENTS BEACON TECHNOLOGY
- 45. THE REVOLUTION OF PAYMENTS PAYPAL POSITIONING • Merchant Solutions • Consumer Solutions • Financial Hub • eBay
- 46. THE REVOLUTION OF PAYMENTS PAYPAL POSITIONING • Safety • Security
- 47. THE EVOLUTION OF PAYMENTS IMPACTS TO BANKS • Disintermediation • Revenue loss • Still most trusted • Checking account remains financial hub • Burdened by regulation and scrutiny • Innovate and invest? • Partner and private label?
- 48. THE EVOLUTION OF PAYMENTS IMPACTS TO BUSINESS • Risk model changes • Investment increases • Technology disruptors can impact business • Opportunities for cost savings • Opportunities for revenue increase • Opportunities for customer relationship building
- 49. THE EVOLUTION OF PAYMENTS IMPACTS TO CONSUMERS • Enhanced convenience • Increased security but with new risks • Opportunities for savings • Loss of privacy • App-mania • Identify theft • Confusion & excitement
- 50. THE EVOLUTION OF PAYMENTS REGULATION • Multiple regulators • Overlapping reviews and conflicting enforcement • New laws phased in and untested • Catch up mode • AML • CFPB
- 51. THE EVOLUTION OF PAYMENTS ISSUES AND POTENTIAL ROADBLOCKS • Security • Fraud losses • Identity theft • Privacy concerns • Technology • Multiple platforms competing • No clear winner yet • Consumer/Business confusion • Safety • Non-bank accounts • Criminal activity • Regulation
- 52. THE EVOLUTION OF PAYMENTS WHERE TO FROM HERE? • CFPB and Other Regulation of Mobile Wallets, Non-Bank payment participants WILL INCREASE • Apple Pay will CONTINUE TO have a major impact payments • Google will continue to make a variety of significant bets in payments vertical • Retailers will implement variety of payment receptors and focus on security, loyalty and up-sell • Bank’s will continue to follow, but more aggressively participate to avoid continued disintermediation
- 53. THE EVOLUTION OF PAYMENTS COMMENTS & QUESTIONS
- 55. THE EVOLUTION OF PAYMENTS STATISTICAL INSIGHTS View of Most Current Data on Payments Revolution and Mobile Wallets
- 56. THE EVOLUTION OF PAYMENTS STATISTICAL INSIGHTS
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