Author: JGM versión 03_2016

Mobile payments adoption in Europe

1. Mobile Survey 2012 - 20162. Today‘s Overview mobile business 3. Future Development

Agenda

Agenda

1. Mobile Survey 2012 - 2016

GFT Group 4

Mobile payment survey 2012 | 2016Key facts

The Blue Paper from 2012 provides a general introduction to the mobile payment marketplace, maps the new mobile payment ecosystem, describes the players, both financial and non-financial, and examines the impact this new market will have on traditional financial institutions

The report provides a series of recommendations for financial institutions that will help them to move forward with a strategy and action plan to leverage their strengths

The 2012 blue paper had a very good international media coverage Due to very positive feedback from our clients, we are currently working on an

update – comparing the situation 2012 and today within following countries: Germany Spain UK Brazil USA Asia Switzerland Italy

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Mobile payment survey 2012 | 2016What happened in 2012?

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Mobile payment survey 2012 | 2016What happened in 2012?

“Mobile payment is any payment where a mobile device is used in order to initiate, activate, and/or confirm this payment.”

IEEE Symposium on Trends in Communications at the SympoTIC conference in Bratislava, Slovakia, in 2004

2012 M-payments landscape

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Mobile payment survey 2012 | 2016What happened in 2012?

Actors involved in the m-payments space

Technical standards

Mobile OS Industry protocols Industry standards and regulations

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GFT’s recommendations 2012Status 2016

Monitor the market

Develop an enhanced mobile presence: much more functionalities

Focus on the user experience: only low efforts

Build partnerships: e.g. SIA, Paydirekt, vodafone+paypal

Develop trials: still lack of willingness

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2. Today‘s Overview mobile business

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Bank Accounts

ATMBank CardsWallet & Prepaid Cards

Contactless(Any NFC POS)

Other (QR, Code…)

Stores

mCommerce

P2P

Other (Promotions,

Transportation, Restaurants…)

Regular Cards Virtual Cards

Money can be withdrawal by anyone with the identification

technology provided (QR, Code…)

Financial Telco Independent

Application owner’s Industry

Today’s mobile payments overviewSPAIN

GFT Group 11

Downloads(android only)

2014 201520102004 2016

Not an App

1.000 to 5.000

5.000 to 10.000

10.000 to 50.000

Above 50.000

Today’s mobile payments overviewSPAIN

GFT Group 12

P2P mobile payments solutionsItaly

• Launched in 2014

• 250.000 active users (not app downloads)

• Average value of each transaction: 42 €

• 50% of the transfers are under 25 €

• 50 Italian banks are offering Jiffy P2P service

• 6 new banks joining the service in the next moths

• Once they join Jiffy the service will be accessible by over 32 million of Italian current accounts, around

the 80% of the total.

• Entering now in the German market

• Based on SEPA protocols, so potentially can be used by more than 400 millions of European current

account holders.

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With Apple moving to NFC and Google using HCE, NFC made the breakthrough Strong position of MNO in comparison to Mobile Payment Report 2012 has been lost (they were

needed for Secure Element) Mobile Payment will be independent from the MNO the clients are using Furthermore well positioned are big internet companies with ecosystem like Facebook, Paypal,

QQ/Wechat or Alibaba Ecosystems with clear added value will bring people to use Mobile Payments cooperation required

for Banks Security:

- Biometrics will triumph in payments as security procedure- Apple‘s Fingerprint was a first step towards a broader acceptance

Instant Payment may also be a game changer, retailers may prefer to be credited instantly Vodafone brings Paypal to the PoS. Spain is the first country where the new partnership will be tested New regulations and standarisation initiatives (PSD2 / Euro Retail Payment Board)

New players in the market and new approaches

3. Future Development

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. Interoperability

. Standardization

Euro Retail Payment Board

• Instant payments in Euro• Mobile and card-based

contactless proximity payments

• Electronic invoicing solutions related to retail payments

Confidence, Clarity Model and Security

Mobile Payments future development

Clients & Merchants

GFT Group 16

A future Single Euro Payments Area?

The Euro Retail Payments Board (ERPB), chaired by the European Central Bank (ECB), has requested the European Payments Council (EPC) to develop an Instant Payments scheme, named the SCTinst scheme.

It will be based as much as possible on SEPA Credit Transfer but adapted to support Instant Payments

The scheme will be optional, but it is expected that any solution wanting to provide Instant Payments will adopt the SCTinst scheme

The premise on which the scheme is based is that any participant in the scheme must be reachable by any other participant

The scheme is still under development with the draft expected to be ready for public consultation by April 2016, and the agreed final version published by the following November.

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Standardization & Interoperability P2P payments. The Standardized Proxy Lookup (SPL)

Sample of the Standardization & Interoperability proposed by the Euro Retail Payments Board (ERPB) for the P2P:

The Standardized Proxy Lookup (SPL)

© Copyright GFT Technologies AG, 2012

Thanks you!

GFT Group 19

What happened with ISIS Mobile Wallet? Mobile payment survey 2012 | 2016

Isis Wallet Joint Venture btw ATT, Verizon, T-Mobile

Feb2012

July 2011

Nov 2010

Strategy Change. Agreement with

AMEX, Visa, MasterCard

Sept 2011

Mobile manufacturers committed to

launch compatible

mobiles

Card issuers adherence:

Barclaycard, Capital One & Chase

Oct 2012

Nov 2013

Sept2014

Pilot in Salt Lake City and Austin

National (USA) availability Feb

2015

Renamed as Softcard

Google acquisition

Softcard service ceased on 31st

March 2015

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Who we areGFT – The sector Specialist

GFT is a business change and technology consultancy trusted by the world’s leading financial services institutions to solve their most critical challenges.

GLOBAL DELIVERY MODEL

4,100employees

ApproximatelySTRONG INTERNATIONAL PRESENCE

Germany, Brazil, Canada, Costa Rica, Italy, Mexico, Peru, Poland, Spain, Switzerland, UK, USA

12Countries

40 Locations in

shaping the future of financial services

EXPECTED REVENUE IN 2015

368Million €

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USP: Big enough to deliver – small enough to careGFT – The sector Specialist

Focus on financial services industry Top 50 global IT service providers (FinTech 100, 2015) Long-standing partnerships with over 15 top-tier institutions

Commitment to delivery – passion for innovation Client centricity: The center of our strategy is the individual client We deliver services and solutions to the business need based on a broad range of technologies Delivery from onsite, near-shore and offshore locations Excellent quality for the best price

Culture of collaboration Our behavioral model is based on trust, collaboration and empowerment We collaborate and challenge our clients Our diversity enables us to deal with complexity

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Offering: Advisory, Creative, TechnologyGFT – The sector Specialist

Front-office Innovation Regulatory Compliance Risk Management Operational Efficiency

Digital Transformation Core Banking Operational Efficiency Regulatory Compliance

Claims Management Digital Transformation Operational Efficiency

Core Banking

SOLUTIONSCHALLENGES

Digitalisation GFT Digital Banking lab develops innovative solutions for the bank of the future

Fintechs increasingly occupying parts of the value chain

Regulation As sector specialist GFT offers onshore consultancy by experienced industry experts and qualified nearshore implementation services

Growing compliance and regulation requirements

Delivery Efficiency

Pressure to reduce costs for maintaining core banking systems due to falling margins

GFT delivers IT services at attractive prices by nearshore hubs in Spain, Poland, Brazil and Costa Rica for the European and US Market

Capital Markets

Insurance

Private Wealth

Retail Banking

GFT Group 23

Capital Markets

Insurance

Private Wealth

Retail Banking

Trusted by the world's leading financial institutionsGFT – the sector specialists