Technology Trends in Finance

Rey Lugtu

Imagine your life in 2020…..

1.Mobile & Frictionless Transactions Explosion

•38 million users

•19% of smartphone users

•$27 billion transactions

•210% growth in 2016

•100% growth until 2019

•Apple Pay app to be accepted in 1.5 million locations by the end of 2015.

•Android Pay will be accepted by more than 700,000 physical stores and over 1,000 mobile apps.

• Samsung Pay, already being tested in South Korea, is launching in the United States later this month.

•Microsoft plans to jump into the market.

•Growth in digital deals and discounts

• Starbucks mobile app enables buyers to order and pay for beverages via their phone, and skip the line.

• The app registers loyalty points in the user’s device, integrates discounts and coupons.

• Merchants to upgrade tech. Invest in terminals that support Near Field Communications systems, the technology on which mobile payments are based.

• In the US, deadline for merchants to switch from traditional swipe-and-sign credit card transactions to chip-and-pin card systems.

• If the merchants don’t invest in new terminals, the liability for transactions with fraudulent credit and debit cards will shift from the card companies to them.

2. Growth in Chip Cards

•2 Billion EMV (Europay, Mastercard, Visa) cards

•20% growth

•40% adoption

•$20B credit card fraud globally

•October 2015: The End of the Swipe-and-Sign Credit Card

• The shift to EMV (Europay, MasterCard, Visa) chip cards may happen earlier than 2017, the Bangko Sentral ng Pilipinassaid, as more local banks move to protect their systems and consumers from fraud.

3. Growth in Digital Currency• Bitcoin versus Blockchain• Bitcoin is a form of digital currency, created and held

electronically. No one controls it. Bitcoins aren't printed, like dollars or euros – they're produced by people, and increasingly businesses, running computers all around the world, using software that solves mathematical problems

• Blockchain is just a record, or ledger, of digital events — one that’s “distributed,” or shared among many different parties. It can only be updated by consensus of a majority of the participants in the system. And, once entered, information can never be erased. The bitcoin blockchain contains a certain and verifiable record of every single bitcoin transaction ever made.

• Faster, cheaper bank transfers

•A boost to global remittances

• Safe money for the poor

•Unleashing the potential of e-commerce

•Programmable money and smart contracts

4. Omnichannel for Financial Services

•Seamless integration

•Any product delivered from anywhere

•Digital payment

5. Capitalizing on Big Data

•Analytics to gain customer insight

•Chief Finance Officer as main driver

6. Tighter cybersecurity

• Hackers getting more sophisticated

• Technology is catching up

•Behavior change is important

Implications

•Growth in eCommerce

•We are less and less secure

•Regulatory scrutiny

•More venture capital funds

What you should be prepared for

•You will drive the changes

•Learn technologies

•Be responsible

•More opportunities

END

Goodluck!

Rey Lugtu