CONSUMERSCORPORATES

SMEs

MERCHANTS ISSUERS

ACQUIRERS PROCESSORS& NETWORKS

ACISCHEME

THE NEW PAYMENTS ECOSYSTEM

The New Payments Ecosystem is fast, open and secure and thrives on disruption.

INF6093 10-16

The introduction of cards was a game-changer for payments. It is organized, secure and trusted; however, the

advent of new payment methods has highlighted that it can be restricted and inaccessible in nature.

What does the traditional payments landscape look like today?

Merchants, businesses and consumers are demanding more choice and flexibility from

payment providers. At the same time, schemes, technology firms and regulators are

intensifying the disruption with new policies and standards.

How is the traditional payments landscape changing?

The payments landscape will become increasingly fragmented as RegTech levels the playing field.

New technologies and business models such as Open APIs, platform payments and immediate

payments will drive continued innovation that shapes the New Payments Ecosystem.

What does the future payments landscape look like and how should payment providers prepare?

New entrants and existing players are embracing the disruption in the pursuit of modern payment platforms.

Who is challenging the current paymentsenvironment and what is their motivation?

The last millennium experienced steady incremental innovation in payments with card the principal disruptive element. Today, regulators and consumers are

demanding FAST, OPEN and SECURE payments causing the pace of innovationto accelerate and payment models to become fragmented.

Welcome to a new era of DISRUPTION in payments!

Google Wallet

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1973250 De La Rue Barclaycash machines are in operation throughout Britain

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1986The first standard for smart payment cards is deployed in France

Google Wallet

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2012ACI introduces UP Framework for next generation payments

2009The launch of Uber sparks debate as to what extent “uberization” will displace traditional business models

2015ACI receives Technology Aggregator Accreditation for UK’s New Access Model

2016ACI launches its SaaS-based UP eCommerce Payments solution

Credit Cards

Debit Cards

ATMs

? Augmented Reality

? Virtual Reality

? IOT

Charge Cards

Cash

Online Banking & Shopping

Payment by text message & contactless payment

EMV Standard

In-App Payments

Mobile Wallets

Tokenization

IS0 20022

mPOS

PayPal acquires Braintree

PSD2

Wechat introduces first virtual Hong Bao

Apple Pay / Samsung Pay / Android Pay

Internet of Things

SEPA Inst

New Access Model UK Faster Payments

Distributed Ledger & CrypotcurrencyFaster Payments UK

Open APIs

Social Payments

Electronic Bill PaymentsAmazon & eBay launch

?

Regional regulatory initiatives such as implementation of immediate payments systems cascading to a global scale

2008Faster Payments is the first new payments system to be introduced in the UK for over 20 years

Demanding instant, secure

personalized choice

CONSUMERSCORPORATES

SMEs

Impact by challenger banks & FinTechs

Increase of fraud

Demand for innovative new products

Legacy systems no longer fit for purpose

BANKS

Revenues under pressure

Demand for value-added services

Need to growvolumes

Card to non-card payments

PROCESSORS& NETWORKS

MERCHANTS

Increase of fraud

Demand for new ways to pay

Demand for omni-channel

BlockchainOpen APIs

Internet of thingsSaaSPaaS

TECHNOLOGY

EMVInterchange/MIF

Immediate paymentsRewardsLoyalty

SCHEMES

PSD2Interchange/MIF

Immediate paymentsSEPA Inst

Scheme consolidation

REGULATORS

PO

LIC

Y &

STA

ND

AR

DS

Online payment platforms

mPOS

P2P Social

Embedded payments

Mobile payments

eWallets

P2P social

P2P lending

Immediate payments

Account 2 account

Bill pay providers

Online payment platforms

Direct connect

New payment methods

Remittance

eWallet

Mobile payments

Cash management

P2P lending

Cross border

CONSUMERSCORPORATES

SMEs

BANKS PROCESSORS& NETWORKS

MERCHANTS

NEWENTRANT

NEWENTRANT

NEWENTRANT

REGULATORS,TECHNOLOGY

SCHEMES

NEWENTRANT

NEW PAYMENTECOSYSTEM

PLAYERS

Banks, Processors, BigTechs, FinTechs,

Central Infrastructures, Networks, PSPs, ISOs,

VARS, Merchants, Corporates, SMEs,

Consumers

DATA PROTECTION

CRYPTOCURRENCIES

CUSTOMER EXPERIENCE

TOKENISATION

CROSS-BORDER PAYMENTS

BLOCKCHAIN

ALWAYS ON

OPEN APIs

IMMEDIATE PAYMENTS

INTERCHANGE

POS / m-POS

SEPA INSTCENTRAL INFRASTRUCTURESNEW WAYS TO PAY

BIG DATA

NATIONAL REGULATION

KYC

PLATFORM PAYMENTSPSD2

LOCAL REGULATION

API GATEWAYS

OMNI-CHANNEL

ACCOUNT TO ACCOUNT

INTERNET OF THINGS

PASSPORTING

ACCOUNT INFORMATIONSERVICE PROVIDERS

PAYMENT INITIATIONSERVICE PROVIDERS

PEER TO PEER

XS2A

IMMEDIATE SETTLEMENT

eWALLETS

EMBEDDED PAYMENTS

AUTHENTICATION

eCOMMERCE / xCOMMERCE

VIRTUAL REALITY

?

?

?

?

?

?

?

?

?

?

?

MULTIPLE WAYS TO PAY

1975ACI is founded

Over 350 ways to pay

1910$3,148 million of cash value is in circulation in the U.S.

1951 20,000 Diners Club cards are in circulation

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smart payment cards is deployed in France

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Online Banking & ShoppingOnline Banking & Shopping

EMV Standard

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ts shift fro

m p

hysic

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Electronic Bill PaymentsElectronic Bill PaymentsAmazon & eBay launchAmazon & eBay launch 1997

Payment by text is offered through a limited number of vending machines inthe U.S.

In-App Payments

Mobile WalletsMobile Wallets

Tokenization

IS0 20022

Distributed Ledger & CrypotcurrencyFaster Payments UK

2008Faster Payments is the first new payments system to be introduced in the UK for over 20 years

Payment by text message & contactless payment

Amazon & eBay launchAmazon & eBay launch 1997Payment by text is offered through a limited number of vending machines inthe U.S.

1994The first encrypted online payment is made between friends for Sting’s Ten Summoner’s Tales album

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2012ACI introduces UP Framework for next generation payments

Open APIsOpen APIs

Social PaymentsSocial Payments

Over 350 ways to payOver 350 ways to pay

Distributed Ledger & CrypotcurrencyDistributed Ledger & CrypotcurrencyFaster Payments UKFaster Payments UK

2015Wearable payments total close to-$35 billion worldwide, set to increase to $95 billion in 2018

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regulatory initiatives such as implementation of immediate payments systems cascading to a

initiatives such as implementation of immediate payments systems cascading to a global scale

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Regional regulatory

$95 billion in 2018

By 202530% of revenues are at risk in payments due to existing and future market disruptions

SOURCES:1910 Federal Reserve Bank of Atlanta | 1951 CreditCards.com | 1973 https://lra.le.ac.uk/bitstream/2381/8163/3/ATM_v7_wtables.pdf.txt | 1986 Wikipedia

1994 Fast Company | 1997 NearFieldCommunication.org | 2008 Faster Payments Scheme Limited | 2015 Juniper Research

Regional regulatory initiatives CapGemini | 2025 McKinsey & Company