an alternative payment engine for nonstop
TRANSCRIPT
An Alternative Payment Engine For NonStop
David Canavan
Regional Sales Manager, Lusis
© Copyright LUSIS 2010
Agenda
Payment Engines and Payment Trends
Challenges for BASE24, ASx, ON/2 and OpeN/2 Users
HP NonStop and Lusis
The Alternative Payment Engine Choice
© Copyright LUSIS 2010
Engines… What Do They Do All Day… ?
Engine: “…an agent, instrument, or means of accomplishment ”
• Predictable• Dependable
• Versatile• Cost-effective
• Adaptable
Profitable businesses rely on them
Ordinary people take them for granted
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Payments Volumes Need A Reliable Driver ...
UK ATM Withdrawals: Friday 30 April 2010• £590m. 1.1m trans/hour. 20k trans/minute.
German ATM Withdrawals, 2008:• 54,300 ATMs. 4.832bn transactions
ACH Payments in US, 2009:• $18.76bn value in ACH payments
Mobile Payments Worldwide:• $250bn value by 2012, 50% via contactless
APACS UK:• 295m FPS Payments. 5.6bn BACS DDs,CTs• 39.1m CHAPS payments. 949m Cheques• £69.4 trillion value – 4 x value global economy
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What Do We See in the Payments Market …?
Transaction Growth
Regulatory Compliance
Innovation and Change
2006: 223bn, 2008: 250bn
BRIC Economies, CEE
Online merchants, Mobile, Contactless
Convenience ATMs, P2P
Quicker and better public acceptance
Integration and New Territory Expansion
Regulation tightening across all banking
activities
Broader and more complex, e.g. SEPA
Regulators do most to influence Payments
70+% of budget is spent on compliance
Processes, strategy and technology must
be able to adapt
Customers are bored, ignored, cautious
New entrants are more attractive
Legacy payment technologies are not
cost-effective
New products need flexible delivery and
business models
Collaboration and convergence
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Traditional ‘Western’ Banking v New ‘Emerging’ Banking• Understanding clients is key to future success
• Smarter, simpler bank operating models will win
• Technologies can help this, e.g. SOA,
• Flexibility to offer services customers will pay for
• Customers will pay for something that’s easy to use
• Payments must improve overall cost : income ratio
Cost : Income RatioC H I N A U S A
2004 49.8% 58.8%
2007 35.8% 71.9%
What Do We See In the Payments Market ….?
+/- 28% BETTER 32% WORSE
© Copyright LUSIS 2009
Source: Javelin Strategy & Research, Jan. 2010
Summary of Observers Views for 2010
MORE customers, transactions, channels, competitors
TIGHTER margins, regulations
INCREASING COST of compliance and integration
FLEXIBILITY and TIME TO MARKET both require changing to a cost-efficient business model
capturing volume and offering customer value
exploiting new transaction types
enabling innovation and competitive differentiation
CUSTOMER SERVICE will bring successful new entrants
INFLEXIBLE INFRASTRUCTURES unable to respond effectively
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Multiple Channels Management
Pan-European Competition& New Regulations
Mobile Banking & Mobile Payment
Instant Rewards & Promotions, 1-2-1 Loyalty
Ownership & Control of The Customer
Real-Time Access to and Use Of Data
What does all this mean for Payments Systems?
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Allowing you to deliver what your customersare asking for ?
Enabling you to deliver products and services that differentiate and grow yourbusiness?
Allowing you to do these things quickly enough, and cost-effectively?
Enabling you to reduce the cost of multiple legacy systems that process financial transactions ?
Is Your Payments Engine Fit for the Road ?
Payment systems are complex, highly-visible mission-critical solutions
They are a long term and strategic investment
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Specific Challenges forACI BASE24
Users…
and ASx, ON/2, and OpeN/2 Users
26 months since BASE24 sunset was announced,
18 months until standard software support is ended
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• Principle of gradual migration, reduced risk
• BASE24-eps code co-existing with legacy BASE24 code
• Multiple platform support to ensure client hardware choice
• Like-for-like functionality will be available on all platforms
• No sunset, no end-of-life, no coercion of BASE24 clients
• Business cases for client events would drive migration
• Skills training to reflect client environment and direction
• ACI corporate commitment to this BASE24-eps strategy
BASE24-eps:The Original ACI Ethos
Migration by evolution, not revolution
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• Communication ?
• Sunset Date ?
• Migrations ?
• Bandwidth ?
• 300+ clients next 18 months ?
• HP Non-Stop is preferred platform ?
• Cost-justification ?
• Alternatives ?
BASE24 Sunset: What More Do We Know . .?
What decision can you make without clear information?
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Go-to-market strategy ?
Global Tier 1 FI’s & IBM ?
Where to for mid-sized and smaller Financial Institutions ?
Performance ?
Cost of support options and implications for business ?
Speed of response to development and support requests
Local autonomy ?
Local market issues and conditions ?
BASE24 Sunset: What More Do We Know . .?
What decision can you make without clear information?
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• Source code ?
• BASE24-eps references ?
• Performance and availability metrics on IBM System z ?
• Implementation and go-live options ?
• Product roadmaps ?
• Networks First ?
• Like-for Like ?
BASE24 Sunset: What More Do We Know . .?
What decision can you make without clear information?
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? What does this really mean for clients who do not want IBM System z ?
? Is BASE24-eps on any other platform (including HP Non-Stop) somehow :
• less functional ?
• less efficient ?
• lower priority for upgrades and new releases, therefore behind the curve ?
• less easy to integrate with related apps unless they too are on IBM System z?
• costlier to support from ACI ?
• ultimately non-strategic to ACI, therefore a potential risk to clients ?
• potentially therefore a waste of investment resources ?
? How is the ACI – IBM relationship influencing ACI product direction ?
BASE24-eps is optimised for IBM System z …
What decision can you make without clear information?
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The Essential Elements of a Payments Engine
Performance Reliability Scalability
Strong Standard Features Strong Functionality
Flexible Architecture for Future Payments Evolution
Flexibility to Use Value-Added Data Easier and Quicker
Flexible Support Models to meet Local Market Needs
Flexibility to Launch New Ideas Quickly and Cheaply
Open, Modern Architecture
Ability to Respond to Customers
Flexible Business & Delivery
Models
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Payments platforms should be optimised for the client, and adaptable to how the market shapes their future business strategy
The commercial model should be flexible enough to accommodatefuture payment initiatives, but also offer some cost predictability
Any payments infrastructure is a major business investment and has to be operational and contributing to the P&L for 20+ years
The decision to change system requires 100% trust and faith in the selected vendor, initially, and throughout the future relationship
Company ethos is as important as technology in the selection of a payments system
Quick decisions based on few or forced choices are seldom the most appropriate for business
The Essential Elements of a Payments Engine
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An Alternative Payment Engine on HP NonStop
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HP and Lusis
“I was really impressed by three things - the comprehensive business functionality, the professionalism and technical skills of the management and staff, and the complete belief that NonStop was the platform for this type of application,” Dave McLeod, Director, Financial Services Industry, HP
“ Lusis has a solid customer reference base with the existing Tango implementation and there will be a number of Tier 2 and Tier 3 financial institutions that will find their offerings attractive…it wouldn’t surprise me at all to read of a Tier 1 bank pursuing a Lusis conversion.”Richard Buckle, Founder, Pyalla Technologies
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Who is Lusis ?
An innovative provider of 24/7 payment transaction processing solutions, committed to modern technologies that reduce cost and time to market yet retain reliability, scalability and performance. Lusis core transaction engine is called Tango.
Founded in 1999, with HQ in Paris, Lusis is a privately-held company with strong payments leadership and expertise. FY09 turnover was €13m, with 110 employees, and customers in Finance, Retail, Utilities and Transport in EMEA and USA.
Lusis promotes flexible licensing and support of Tango including supply of source code. Add-on modules include Data Replication (Active-Active), Risk Management, and Loyalty. There is no capacity licence element in Tango pricing.
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• Before BASE24-eps was ‘optimised’ for IBM System z, very few clients indicated a desire to move away from HP NS.
• HP has continued to advocate a gradual, business-led, low-risk approach to migrating from BASE24.
• Where a BASE24 EMEA client wishes to change software, HP advocates the Tango solution on NonStop from Lusis.
• In partnership with HP, Lusis ported Tango to Non-Stop in only 10 weeks, benchmarking at over 800tps.
• Tango is a proven, highly functional payments engine, architected for maximum flexibility and control by the client.
• BASE24 EMEA clients are approaching HP asking what alternative they would recommend to BASE24-eps.
HP and Lusis
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The Tango Payments Engine
Tango is a core transaction processing engine which can be configured for any acquiring, authentication, routing, switching and authorisation environment. It uses a service oriented (SOA) architecture & dynamic data bus, for new services and functions to be quickly and inexpensively added
Tango is a modular solution that supports business expansion and change. Tango has a rule-based routing engine, with XML files being used to manage rules. The overall architecture allowsthe configuration to be modified by a technical administrator
Tango benchmarked on HP NS at over 800tps. Lusis continues to test with HP the latest ODBC release. Tango is licensed in source code form, with no transaction capacity limitimposed. Fees are predictable. Local support options exist.
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HP NON-STOP• The market reference in 24/7 payment systems• Open architecture (Posix, SQL/MX) • Server of the Year award, beating IBM zSeries and Sun• Consistently best TCO in independent studies
LUSIS• Tango is a fully functional EFT suite• Strategic partner of HP• Tango is fully compatible with Non-Stop concepts• Innovative software to achieve business objectives
HP Non-Stop and Tango from Lusis . . .
A Major Market Event :The Announcement of BASE24 Sunset from November 2011
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SQL/MXANSI complianceSELECT • INSERT •
UPDATEMERGE • DELETE •
JOINUNION • CREATE •
Porting the Tango Application to HP NonStop
Modern softwareWeb/GUI interfacesJava/C++Standard development toolsRelational databaseEnterprise integrated
Standard hardwareIntegrity basedCommon chipsetsBladesStorageI/O infrastructure
HP OSS, SQL/MX, Training & Education
Migration PlatformODBC testing
Technical,Functional &Performance
ValidationBenchmark
Report
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Porting the Tango Application to HP NonStop
• Quickest ever port of any application to HPNS
• 10 weeks from start to successful completion
• Tango easily handles Tier 1 FI requirements
• A true alternative for the Payments Industry• retaining the ‘payments fundamentals’
• flexibility to proactively focus on customers
• flexibility and freedom of access to source code
“Porting Tango was one of the easiest non-Java ports I have encountered; primarily because it had a well-
implemented modular architecture capable of flexible deployment across multiple processors,” Moore Ewing, HPNS
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Who is Lusis ?
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Caisse d’Epargne was able to reduce its payments infrastructure cost thanks to a unique solution covering all saving banks requirements.
The rework and re-engineering of the solution, for the 17 regional entities of Caisse d’Epargne, was completed in 12 months (from the functional design to the user acceptance), demonstrating Lusis capacity to deliver strategic projects in an ambitious time-frame.
VOLUME FACTS
11 000 ATMs managed
100 000 POS acquired
210 TPS authorisations processing
In addition, the platform is integrated to S’Miles, the largest coalition program in France, in order to earn points and perform points balance enquiries.
Lusis Customer Case Studies
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Consumers' actual purchasing behavior is accessed to understand their preferences and more effectively communicate in-store via incentives, advertisements, loyalty programs, sampling and more. High-impact promotions and advertisements are hand-delivered to consumers at the point of sale via a full-color printer.
VOLUME FACTS
40m+ cardholders20m+ target offers per week10 threshold programs1733 stores, 500 TPSOver 71,000 POSStrict Performance SLA
(Server hosted in Phoenix, AZ)
Online, central management of counters/threshold programs
–Dynamic user defined counters–Accumulate sales, product sales, visits, products bought… –Triggered by CID–Program can be open to all cardholders or targeted
Instant Reward–Award is a one time debit card delivered by TPG–Valid at a merchant for a pre-defined amount–Can be used to reward customer with theatre ticket etc
“ Purchase-driven customer promotions right at the point of purchase. That’s something you can build relationships on ! “
Why Lusis Customer Case Studies
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Conclusions
Payments landscape is changing, but flexibility and control will be key to survival.
Modern, open architectures will win out as new entrants drive customer service higher.
HP Non-Stop continues to be the platform choice for strategic payments players.
Lusis and HP Non-Stop offer a low-cost, low-risk alternative for your future payments strategy.
Many other ACI customers are engaged with us, and momentum is building ….
LET’S TALK ABOUT YOUR REQUIREMENTS !
Danke schön
Lusis5, Cite Rougemont
75009 Paris
www.lusis.com
+33 1 55 33 09 14
+44 7795 060353