nacha 2014 presentation non bank payment systems revolution final 030714
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NACHA PAYMENTS CONFERENCE - 2014 The Payments Revolution: The Role of Non-Banks Tuesday, April 8, 4:30 p.m. — 5:30 p.m. Crystal G Mobile & Digital Payments Intermediate Non-bank providers are clearly not new to the payments area, but they are increasingly leveraging innovative technologies and evolving consumer preferences and behavior in new ways to redefine the playing field. Participants in this session hear the latest assessment of who is revolutionizing the mobile payments space and how, as they lead the relentless march to a checkless and cashless future. Kevin H. Connelly Executive Vice President, The RWC GroupTRANSCRIPT
OVERVIEW
• PAYMENTS EVOLUTION
• PAYMENTS REVOLUTION
• DISRUPTIVE TECHNOLOGIES
• MOBILE MERCHANT TECHNOLOGY
• ELECTRONIC WALLET
• NFC• BLE
THE EVOLUTION OF PAYMENTS
100,000 Years 3,000 B.C. 650 B.C. 960 A.D. Dark Ages 1950’s Past 20 Years Now Future.
OVERVIEW
• NEW FRONTIER – CHANGES ALMOST DAILY
• SOFTWARE VERSION “X.X” REPLACED WITH CUPCAKE, JELLYBEANAND KITKAT
• PAYMENTS UNIVERSE CENTER NO LONGER NY, CHICAGO OR LA – SILICON VALLEY
• BANKS NO LONGER LEADING PAYMENTS INNOVATION
• NON-BANKS LEADING – PAYPAL, GOOGLE, APPLE, SQUARE
• TECHNOLOGY IS DRIVER – RAPID CHANGE IS NORM
THE REVOLUTION OF NON-BANK PAYMENTS
tech·nol·o·gytekˈnäləjē/noun1. 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·mentˈpāmənt/noun1. the action or process of paying someone or something, or of being paid.
DISRUPTIVE MODELS/TECHNOLOGY
• ITUNES
• AMAZON
• LINKED IN
• PAYPAL
THE EVOLUTION OF NON-BANK PAYMENTSNEW PAYMENT PLAYERS – THE REVOLUTIONARIES
• e-Commerce• E-Bay / Amazon / Apple
• Retailers• Starbucks / Jamba Juice
• Telecommunication• Isis
• Pre-Paid Card Providers• Money Transfer Operators• Disruptors
• PayPal / Google / Apple• Level Up / Square
• Virtual Currency• Bit-Coin / Amazon• Angry Birds?
• “The Cloud”
THE EVOLUTION OF NON-BANK PAYMENTSE-WALLETS
In 2013 120 e-Wallet or
Mobile Wallet
Applications
Gatekeeper Wallets
Bank Wallets
Retailer Wallets
e-Commerce
Wallets
Aggregator Wallets
Single-Feature Wallets
THE EVOLUTION OF NON-BANK PAYMENTSTHE GEORGE COSTANZA WALLET
http://www.youtube.com/watch?feature=player_detailpage&v=yoPf98i8A0g
THE EVOLUTION OF NON-BANK PAYMENTSFACTORS DRIVING THE FUTURE OF MONEY?
THE EVOLUTION OF PAYMENTSE-WALLETS
Hybrid UsesNot Just Payments
THE EVOLUTION OF NON-BANK PAYMENTSTHE FUTURE OF MONEY?
31% CAGR / $1.6 Trillion
THE EVOLUTION OF PAYMENTSMOBILE PAYMENTS
THE EVOLUTION OF PAYMENTSMOBILE PAYMENTS
THE EVOLUTION OF PAYMENTSMOBILE PAYMENTS
THE EVOLUTION OF PAYMENTSMOBILE PAYMENTS
THE EVOLUTION OF PAYMENTSMOBILE PAYMENTS
? ? ?
THE EVOLUTION OF NON-BANK PAYMENTSFACTORS DRIVING THE FUTURE OF MONEY?
THE EVOLUTION OF NON-BANK PAYMENTSE-WALLETS
NFC – EmbeddedIsis, Google
Cloud QR Code
Hybrid
THE EVOLUTION OF PAYMENTSE-WALLETS
THE REVOLUTION OF PAYMENTSMERCHANT SERVICES
https://www.paypal.com/webapps/mpp/credit-card-reader
EMBEDED VIDEO REMOVED – LINK BELOW
Amazon Coins is a new way to purchase Kindle Fire apps, games and in-app items from Amazon. The more coins you buy the more you will save! Purchased coins are immediately deposited into your account and they never expire. You can choose to spend them immediately or save them up for later.
Facebook Credits are a virtual currency you can use to buy virtual goods in any games or apps of the Facebook platform that accept payments. You can buy Facebook Credits directly from within an app using your credit card, PayPal, mobile phone and many other local payment methods. [UPDATE]
Bitcoin uses peer-to-peer technology to operate with no central authority or banks; managing transactions and the issuing of bitcoins is carried out collectively by the network. Bitcoin is open-source; its design is public, nobody owns or controls Bitcoin and everyone can take part. Through many of its unique properties, Bitcoin typically allows uses that could not be covered by any previous payment system
VIRTUAL CURRENCIESDIGITAL & CRYPTO CURRENCIES
THE EVOLUTION OF PAYMENTSISSUES 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
THE EVOLUTION OF PAYMENTSREGULATION
• Multiple regulators
• Overlapping reviews and conflicting enforcement
• New laws phased in and untested
• Catch up mode
• AML
• CFPB
THE EVOLUTION OF PAYMENTSIMPACTS 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?
THE EVOLUTION OF PAYMENTSIMPACTS 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
THE EVOLUTION OF PAYMENTSIMPACTS TO CONSUMERS
• Enhanced convenience
• Increased security but with new risks
• Opportunities for savings
• Loss of privacy
• App-mania
• Identify theft
• Confusion
THE REVOLUTION OF PAYMENTSWHERE TO FROM HERE?
THE EVOLUTION OF PAYMENTSWHERE TO FROM HERE?
• Will regulation kill the debit/credit card?
• Is NFC DOA?
• QR / Hybrid
• Level Up?
• Google Glass?
• Pocket Change?
• So What is Next?
THE REVOLUTION OF PAYMENTSBLE IS NEXT
https://www.paypal.com/webapps/mpp/beacon
EMBEDED VIDEO REMOVED – LINK BELOW
https://www.paypal.com/webapps/mpp/beacon
EMBEDED VIDEO REMOVED – LINK BELOW
THE EVOLUTION OF PAYMENTSCOMMENTS & QUESTIONS
Next Gen Will Drive What’s Nexthttp://www.youtube.com/watch?feature=player_detailpage&v=yoPf98i8A0g
