Virtual Prepaid - How to Make (Real) Profit | PayExpo June 2013 | Ixaris Systems Ltd
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Virtual Prepaid - How to Make (Real) Profit | PayExpo June 2013 | Ixaris Systems Ltd

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Virtual Prepaid - How to Make (Real) Profit | PayExpo June 2013 | Ixaris Systems Ltd Virtual Prepaid - How to Make (Real) Profit | PayExpo June 2013 | Ixaris Systems Ltd Presentation Transcript

  • Virtual Prepaid: How to Make (Real) ProfitAlex MifsudFounder & CEOJune 2013
  • Confidential and Proprietary Information | © 2013 Ixaris System Ltd1. What is Virtual Prepaid2. Who Needs Virtual Prepaid3. Delivering Profitable Solutions4. Lessons learnt – Dos and Don’ts2Outline
  • Confidential and Proprietary Information | © 2013 Ixaris System LtdVirtual prepaid cards are just payment cards without plasticMultiple use modes: single-load multi-spend, single-load single-spend, multi-load single-spend, multi-load multi-spendReal time issuance: Issued, funded and delivered electronicallyin real time, at almost zero costFine-grain control: at the time of issuing can set the value-as-needed, MCC-restriction, time-validity windowPerfect reconciliation each card issued against externalreference provides to the penny reconciliation against externaldata such as purchase order, client claim, etc3
  • Confidential and Proprietary Information | © 2013 Ixaris System LtdCorporate prepaid is the most lucrative segment in prepaidCorporate Prepaid Transaction VolumeEuropean Potential Transaction Volume by 2015Source: Visa Europe 20114and Virtual Prepaid delivers incredible advantagesin most application areasGlobal Potential Transaction Volume by 2015Source: Visa Europe 2011
  • Confidential and Proprietary Information | © 2013 Ixaris System LtdIxaris has 10 years experience delivering Virtual PrepaidConcept2003: Visa’s first virtual prepaid cardprogram in 2003. ~$0.5 billion p.a. nowInnovation2010: Developed application platform forVirtual PrepaidTechnology2013: Serving 20+ corporate clients withVirtual Prepaid solutions across mostCorporate prepaid segmentsSolutions5
  • Confidential and Proprietary Information | © 2013 Ixaris System LtdCase Study 1: Corporate PurchasingBackground• Top 10 European online travel agencyBusiness Challenge• Purchasing of low cost carrier flights involved surcharges that was negativelyimpacting their bottom line• Velocity checks by merchants limiting effectiveness of corporate cards• Problems with allocating funds from refunds and cancellations back to customers• Poor internal controls due to high limit s on corporate cards2. Saves on lowcost airlinesurcharges2. Books hotelrooms andrental cars1. Order virtualcards via API orvia console3. Download reports forreconciliation6
  • Confidential and Proprietary Information | © 2013 Ixaris System LtdCase Study 1: Corporate PurchasingCard activity• Average transaction value €150• Monthly volume €20MRevenue• Total monthly revenue from fees andinterchange =€92,000Cost• Total monthly processing and card schemecost =€45,333P&L - annualised• Revenue €1,104K• Gross Profit €560K7
  • Confidential and Proprietary Information | © 2013 Ixaris System LtdRight card type for the job• Virtual cards are an extremely powerful tool for corporate purchasing• Prepaid BINs are not always the best option – interchange can be an excellentsource of revenue (Prepaid BIN vs Corporate BIN)Deliver a complete business solution• Solution needs to cater for comprehensive management by the client,minimizing operating overheads for the provider• Rich-data reconciliation reports• Tools to facilitate allocation of cancellations and refunds to customersFlexible pricing to incentivise volume• Many procurement clients multi-source, therefore price to incentives volumeCase Study 1: Corporate Purchasing – Lessons Learnt8
  • Confidential and Proprietary Information | © 2013 Ixaris System LtdBackground• Our Client is a global top 5 market research firm, carries out marketresearch/surveys with professionals in 90 countriesBusiness Challenge• The use of a variety of country-specific gift vouchers was costly andcausing major operational issuesCase Study 2: Incentives9We delivered a complete branded solution to send paymentsworldwide in multiple languages with a seamless customer experienceOur client now issues rapidpayments at a lower cost
  • Confidential and Proprietary Information | © 2013 Ixaris System LtdGet the economics right for incentive programs• Using virtual cards as default, and plastic as an upgrade is a very cost-effective combination for incentivesHighly configurable re-usable applications, not bespoke• Corporates want customisation, especially when it comes to the userexperience and their brand, but avoid bespoke developmentAble to tap into multiple revenue streams to win business• Many sources of revenues, including interchange, client-fees, end-userfees, dormancy/breakage• Not all may be acceptable to the client, so must be able to trade off andoffer right mixOptimize support for effectiveness and cost• Provide tools / FAQ for the client to provide first line supportCase Study 2: Incentives – Lessons Learnt10
  • Confidential and Proprietary Information | © 2013 Ixaris System LtdProven with Ixaris’ own corporateclientsPCI-compliant, in-the-cloud for rapiddeployment – no IT integration neededReady-to-market, highly configurablecorporate prepaid applicationsFull lifecycle : client configuration, on-boarding, monitoring and supportJust bring your own BIN11We achieved profitable Corporate Prepaid programmes by creatinga highly configurable re-usable application suitePayments Server
  • Confidential and Proprietary Information | © 2013 Ixaris System LtdSummary1. Virtual cards can address many aspects of Corporate Prepaidapplications in a novel way2. The economics of virtual cards can deliver superior profitability inmany Corporate prepaid applications3. Must have a flexible fit-for-purpose platform, like Ixaris PaymentsServer, to optimize applications for client needs and deliveringprofitability12
  • Thank youAlex MifsudFounder and CEOinfo@ixaris.comwww.ixaris.com