Presentation Innopay Buckaroo partner day 15-11-2016
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Transcript of Presentation Innopay Buckaroo partner day 15-11-2016
2 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
• Innopay:innovation expertssince 2002
• OfficesinAmsterdamand Frankfurt
• 35consultants
• Payments,DigitalIdentity,e-Business
• Strategy,Co-creation,Transformation
• MemberofEBA,EPCAand ECP
• Founding memberofHollandFintech
Introduction
3 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
Innopaymonitorsover50trends
4 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
Today four key trendswill be highlighted2.Openbusiness
models
4.ChangingPOSinfra
3.Omnichannelauthentication
1.Regulation
5 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
Trend1:Regulation2.Openbusinessmodels
4.ChangingPOSinfra
3.Omnichannelauthentication
1.Regulation
6 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
SixEUregulatoryreformswillimpactthewaywedotransactions,todaywewillfocusonPSD2
Source:Innopayanalysis
7 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
Today’sfocus:marketentryoftwonewregulatedThirdPartyProviders(TPPs)underPSD2,i.e.‘PISP’and‘AISP’
XS2A
(‘API’)1
Customer
Bankdomain
PSD2XS2AERA
Bankaccount
Internetbankingandmobileapp
1Thereseems to be industry consensusthat ApplicationProgrammingInterfaces(APIs)provide for cost effective,easyand securemeansofenabling XS2A.However,EBARTSdonot mandate use ofAPIfor XS2A
PISPAISPT
PP
Source: Innopayanalysis
• BigTech• ERPvendors• Accountingsoftwarevendors• e-invoicingproviders
• NocontractualagreementsrequiredbetweenTPPandAS-PSP
• Non-discriminatorypaymentaccountaccessforlicensedTPPs(intermsoftiming,priorityandtransactioncharges)
KeyXS2A
provisions
• Incumbentbanks• Paymentinstitutions• E-moneyinstitutions• (Large)Merchants• FinTech
Potential
TPPs
Paymentaccount
SETTINGTHESCENE1
OPPORTUNITIESANDTHREATSPAYMENTSTAKEHOLDERS2
EXAMPLESUSEREXPERIENCE‘XS2A’3
8 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
Accountinformationservice(AIS)valuestackisverypromisingfromaninnovationperspective
AISVALUESTACK
Applicationofdata
Insights
RawData
Adde
dvalue
Personal
Finance
Management
‘Bestoffer’
selection
Creditscoring
&loans
Purchase
offerings
(micro)
Savings&
Investments
e-Wallets&
payment
services
Source:Innopayanalysis
9 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
RTSsecurityrequirementswillinfluenceinnovationinthePSD2era
SCArequiredforALLremoteelectronicpaymenttransactions(Cards,
SCT)above10EUR,noriskbasedapproachaftertransitionalperiod
1.STRONG
CUSTOMER
AUTHENTICATION
1.EXEMPTIONS
1.COMMUNICATION
INTERFACE
1.PAN-EUREACH
SCAexemptionsareoptionalforAS-PSP,outsideremitEBAtomake
decisiononthis
Directaccess(Internetbanking)versusindirectaccess(DedicatedAPI),
atdiscretionofAS-PSP
Pan-Europeanstandardisation ofinterface,ratherthanfragmented
reach
1
2
3
4
Source:Innopayanalysis
SETTINGTHESCENE1
OPPORTUNITIESANDTHREATSPAYMENTSTAKEHOLDERS2
EXAMPLESUSEREXPERIENCE‘XS2A’3
10 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
PSD2mustbetransposedandenforcedasofJanuary2018,withearliest enforcementofsecuritystandardsinOctober2018
Min.35monthsTransitionalperiod
PSD2publishedinOJ
Dec’15
PSD2entersinto force
Jan‘16
April‘17
AdoptionRTSby Commission
Oct ‘18
RTSonstrongAuth.&secureComm.enforced
Jan‘16
StartEBAwork onRTS&Guidelines
Jan’17
Submit RTSonstrongAuth.&secure
Comm.
Transposed andenforced PSD2
byMemberStates
Jan’18
24months
18months
Source:Innopayanalysis
11 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
Trend2:Opens businessmodels2.Openbusiness
models
4.ChangingPOSinfra
3.Omnichannelauthentication
1.Regulation
12 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
Thefinancialindustry isexploring openingup,while other industrieshavealready embarkedtheroadtowardsopenbusinessmodels
THIRDPA
RTYINPU
TAP
Is
MAPS
UBERAPP
MESSAGING
PAYMENTPROCESSING
DELIVERYONDEMAND
RIDEREQUESTS
TRIPEXPERIENCES
UBERO
UTPU
TAPIs
Source:Innopayanalysis,Uber
13 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
REDUCEDCOMPLEXITY
• Offersseparationofbusinesslogicandpresentationlogictospeedupproductdevelopmentcycles
• Simplifiesconnectivityandsecuritybyadheringtocommon,easytousewebstandards.
OMNI-CHANNELREACH
• Integrationofproduct/serviceinanyapplicationinanychannelallowingreachtodifferentcustomersegments
INNOVATIONBOOST
• Buildservicesontopofyourdataand/orfunctionality.
• Allowsforanecosystemofthirdpartyservicestogrowaroundyourproducts/services,
• Cultivationofbusinesspartnerships
OpenAPIsarekeyenablerforopenbusinessmodelsandcreatevalueinthreeways1 2 3
Source:Innopayanalysis
14 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
COMPANY APIUSAGE %REVENUESAPIS
AnovelapproachtodelivertheirCRMpositionandmakeiteasierforcustomerstointegratetheSalesfore CRMintotheirexistingworkflowsandcustomiseit
50%
Createamutuallybeneficialrelationshipbetweenthirdpartydeveloperstoenablemorefunctionalityandconvenienceforcustomers
Notpublicallyavailable
Extendtheirproductofferingtootherdigitalplatformssocustomerscanbenefitfromtheirlargeproductoffering
69%
APIscanbeusedtobookhotels,flightsandcars 90%
Enabledeveloperstodevelopapplications‘ontopof’platformthatenableintelligentlifestylechoices,andassessmentofnewbusinessventures
Notpublicallyavailable
ThegoaloftheplatformgoesbeyondbeinganetworkaccesspointbutaglobaldistributionplatformforitsproductsandservicesbyusingAPIstounbundletheirservices
Notpublicallyavailable
Improvingengagementandcustomerrelationshipswithclientsbyenablingdeveloperstodevelopapplications’ontopof’theplatform (e.g.socialapplicationsandgames)
Notpublicallyavailable
ManycompaniesuseAPIsforvariouscommercialpurposesandfordevelopingservicesthatfitcustomerneeds
Source:Innopayanalysis
15 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
PRICINGMODELSREVENUEMODELS
VariousrevenuemodelsareusedtopricethebenefitsthattheAPIowneroruserreceive
Source:Innopayanalysis,JohnMusser,CEOofAPIScienceandfounderofProgrammableWeb
• PayasyouGo:Fixedpricepertransaction
• Tiered:Differentpricesaccordingtovolume
• Freemium:Free,butpaidupgrade
• Unit-based:Priceperbatchoftransactions
• Revenueshare:Payshareofrevenues
• Affiliate:PaywhenAPIisused• Costperclick(CPC)• CostperAction(CPA)• Referral
• Blended:Combinationofrevenuemodels
User
pays
APIowner
pays
Indirect/
Noonepays
• WhethertheAPIownerpaysortheuserdependsonwhoderivesbusinessbenefitsfromthetransaction
• TheAPIownerhoweversetsthepriceandcandosobasedontheuser’swillingnesstopay
16 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
Dependingonthetargetgroup,thelevelofopennessdiffers
PublicAPI
PartnerAPI
Internal
API
Closed
Open
• Innovationbyengagingrelevantdevelopercommunity
• Extendedmarketreach• Monetizationoptions
BENEFITSFUNCTION
APIsusedbyexternalpartnersanddeveloperstobuildinnovativeapps
• Extendeddigitalvaluechain• Partnerintegrationefficiency• Enhancedcustomerexperience• Monetizationoptions
APIsusedbybusinesspartnersand/orcustomers(e.g.corporates/merchants)
• Operationalefficiency• Costreduction• Internalcostmanagement
APIsusedbyinternaldeveloperswithinenterprise(e.g.bank)
Source:Innopayanalysis
17 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
Trend3:Omnichannelauthentication2.Openbusinessmodels
4.ChangingPOSinfra
3.Omnichannel
authentication
1.Regulation
18 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
BUNQOnboarding intwentyminutesisthenewbenchmarkinbanking
19 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
Recognizingcustomersisnotnew
Source:Innopayanalysis
BEHAVIOUR RELATIONSHIP
20 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
Recognisingacustomerearlyinthecustomerjourneyiskeytopersonalisation
Orientation Selection Transaction Delivery Customercare
Checkout
Checkin
Orientation Selection Transaction Delivery Customercare
Hi,I’mJohnandauthorizethispayment
Hi,I’mJohn Iauthorizethispayment
Source:Innopayanalysis
21 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
Butthemainchallengeistorecognisecustomers through variouschannels along their customerjourney
CUSTOMERJOURNEY
FYSICALSHOP
WEBSHOP
(MOBILE)APP
INSPIRATIONCHANNELS
CUSTOMERSERVICE
Orientation Selection Transaction Delivery Customercare
WEBSHOP
Source:Innopayanalysis,Expertgroup ‘Omnichannel CustomerIdentification - Shopping2020
22 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
Connectingchannelsrequiresaccounts/identifiersthatcanbesharedacrosschannels
WEBSHOP
Source:Innopayanalysis,Expertgroup ‘Omnichannel CustomerIdentification’- Shopping2020
23 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
If you havethe capability and the budgetsyou can getthe accountsand connect the channels
BIGRETAILERS
• Omni-channelcapability• CanbarelargeITinvestments• Arerelevanttoconsumersinawaythatjustifiesadedicatedrelation
• Leadtheway
WEBSHOP
ALBERTHEIJNEXAMPLE
Source:Innopayanalysis,Expertgroup ‘Omnichannel CustomerIdentification’- Shopping2020
24 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
BIGRETAILERS
• Omni-channelcapability• CanbarelargeITinvestments• Arerelevanttoconsumersinawaythatjustifiesadedicatedrelation
• Leadtheway
SMERETAILERS
• Multi-channel(mostlywebandshop)
• LimitedITbudgetsand/orLimitedrelevancetoconsumers
LONGTAILRETAILERS
• Onlyone’developed’channel(maybeinfowebsite)• VirtuallynoITbudget• Mayberelevanttoconsumers
SMEretailerswillonlyhaveabusinesscasewhenreachtorelevantconsumerandITcapabilitiesareprovidedtothem
Source:Innopayanalysis,Expertgroup ‘Omnichannel CustomerIdentification’- Shopping2020
25 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
BIGRETAILERS
• Omni-channelcapability• CanbarelargeITinvestments• Arerelevanttoconsumersinawaythatjustifiesadedicatedrelation
• Leadtheway
SMERETAILERS
• Multi-channel(mostlywebandshop)
• LimitedITbudgetsand/orLimitedrelevancetoconsumers
LONGTAILRETAILERS
• Onlyone’developed’channel(maybeinfowebsite)• VirtuallynoITbudget• Mayberelevanttoconsumers
Majorityofmerchantscannotcreateenoughreachthemselvesandneedtobepartofacommunitytoeffectivelyengageconsumers
NeedforPlatform
Source:Innopayanalysis,Expertgroup ‘Omnichannel CustomerIdentification’- Shopping2020
26 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
DigitalIdentityisaprerequisiteforopenAPIs,andbanksareinaprimepositiontoleveragethiscapability
• Whetherpaymentsorsharingofcustomer’sdataexplicitconsentoftheconsumerisrequired
Explicitconsent
• Strongdigitalidentity(onboardingandauthentication)processesarekeyrequirementstoofferpaymentservices
• WithintroductionofPSD2,PISPsandAISPswillneedtocomplywithsimilarAML/KYCrequirementsasbanks
• Thisgivesbankscompetitiveadvantageinofferingthirdpartyservicesastheyalreadyhavethesemeasuresinplacefortheirownpaymentandaccountprocesses
Example:UsingaccountinformationserviceAPItocheckeligibilityforloanatconsumer’sbank
REQUIREMENTSTOPROVIDECONSUMERCONSENT EXAMPLE
Source:Innopayanalysis
27 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
Trend4:Changing POSinfrastructure2.Openbusinessmodels
4.Changing
POSinfra
3.Omnichannelauthentication
1.Regulation
28 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
46% 48% 51% 51% 51% 55% 56% 56% 59%
66% 68%
29% 27%
32% 23% 25%
26% 25% 25%
25% 20% 17%
11% 15%
7% 12%
13% 9% 10% 12% 6%
7% 9%
14% 10% 10%
14% 10% 10% 9% 7%
10% 7% 7%
DedicatedApp
MobileQRcodes
Smartcardbasedloyaltyprogram
Tokenisation
MobileNFC
Nonnetworkorbrandedcard(e.g.Storecard)
Directconnectionbetweenretailersorbillerswith…
Locationspecificpaymentservices
EMV
Realtimeclearing&settlement
Contactlesscards
WHICHPAYMENTPROVIDERDOYOUTHINKISMOSTCAPABLEOFHELPINGYOUOFFERTHEFOLLOWINGPAYMENTTECHNOLOGIES
Myexistingbankorpaymentacquirer Athirdpartypaymentspecialist(e.g.PayPal)Atelecomsprovider Astartup
Banksareviewedasthemostcapableprovidersacrossallpaymenttechnologies
Source:OVUMsurvey2015(n=700)
29 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
Fragmentedwalletlandscapecreatescomplexityforconsumersandretailers
TECHNOLOGY
CHAN
NEL
Web QR&Barcode NFC
Proxim
ity
(POS)
Remote
(e/m-commerce)
Rabowallet
Source:Innopayanalysis
Not applicable
30 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
‘Extinction’ofphysicalPOSterminals?
Time
S-CURVESOFCARDDEMATERIALISATION
Relevanceoftechnology
CardsCash ContactlessNFC
cards
MobileNFC
(wallets)
Wearables/QR/BLE/
check-in
Cashisstillkinginmostcountries
Source:Innopayanalysis
31 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
Devices
Customer
Journey
Orientation Selection Transaction Delivery Customercare
Context
(Crossborder)Paymentsanytime,anywhereonanydevicealsoincreasesnumberofpotentialtouchpoints
Source:Innopayanalysis
32 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.Source:Innopayanalysis
Newtypeofinfraisnecessarytofullyexploitpotentialofnewtouchpoints:Omni-touchpointConversionInfrastructure(OCI)
SHAREDINFRASTRUCTUREBENEFITS
• Customershaveonesingleexperienceandhavefulldatacontrol
• Customersgainfromautomatedrewardsandappliedgiftcards
• Organisationsbenefitfromtransparencyoftouchpointsandencounterfullaccountabilityofmarketingspend
• Organisationscanconnectdirectlyandaremoreflexibleandversatile
• Tocloseloop;presenceonconsumermobileANDintegrationinCashRegisterismandatory
Source:Innopayanalysis
Media
Brand
Retailer
34 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
Mostuselesstrendin2016…….
36 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
• Foundedin2002
• OfficesinAmsterdam(HQ)andFrankfurt
• 35+consultantsplusInternationalnetworkofassociatedexpertsviaEPCAnetwork(seealsopicture)
• Threecorepractices:Payments,DigitalIdentityandE-Business
• Strategy,co-creationandtransformation
• Memberofa.o. EBA,ECPandEPCA• FoundingmemberofHollandFintech
Moscow
Warsaw
Budapest
Milan
Rome
Malta
Frankfurt
Amsterdam
Paris
London
Copenhagen
Source:EPCA(2015)
Zurich
Riga
InnovationexpertsinPayments,DigitalIdentityandE-Business
37 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
InnovationServices
Corepractices
Strategy
Co-creation
Transformation
PAYMENTS DIGITALIDENTITY
E-BUSINESS
• Marketandproductassessment• Multi-sidedplatformdesign• Vendorandsolutionselection
• Co-creationofproductsandservices• Developingplatformsforco-creation• Buildingco-creationcapabilities
• Content-basedprojectmanagementsupport• Opportunitybasedoperatingmodelimprovement• Digitalchangeandmigrationmanagement
Ourserviceportfolioensuresclientscancountonusthroughoutthewholedigital
journey
38 Buckarootrendsanddevelopments– November2016©InnopayBV.Allrightsreserved.
Strongassetsinco-creatingvalueincomplexmulti-stakeholderfields
Bron:Innopay
2.PaymentEU1.PaymentNL
8.Accountbasedtraveling&ticketing7.Invoicing
3.(Open)Banking 4.PSD2/OpenAPI
OTA
OpenTransactionAlliance
6.InclusiveSCF5.Omni-ChannelAuthentication&
Onboarding