1. Mobile payments: the convergence of
financial services and digital businesses
13 September 2013

2. osborneclarke.com
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3. osborneclarke.com
Mobile Payments – Players and
participants

4. osborneclarke.com
Mobile Payments - Predictions
• Consumers who say they have purchased items through
their mobile phone:
• UK – 52%
• Germany – 57%
• Spain – 46%
• Visa predicts 52 million mobile payments every month
across Europe by end of 2013 and number of contactless
terminals to reach 1 million
• By the end of 2017, Forrester Research predicts that U.S.
mobile users will spend $90 billion via mobile payments
• Gartner forecasts global mobile transaction market worth
$721 billion and more than 450 million users by 2017

5. Adrian Kamellard - CEO
The Payments Council
Mobile Payments Service
13th September 2013

6. Mobile Payments Seminar
Osborne Clarke
Milon Veasey
Head of Mobile Solution Specialists
September 2013

7. The consumer environment is evolving rapidly
Social Media
Increased desire to interact with all
organisations using social media and
immediate communication
47% of customers likely to purchase from a
brand they follow via social media sites4
Immediate Account Based Settlement
Consumers move to debit card usage
and the UK industry move to FPS
Online card spend by debit card was
greater than that by credit for the first
time in 20122
Local
Consumer accessing whenever and
wherever they want through multiple
channels
25% of all web traffic in Dec. 2012 came
from mobile devices1
Instant Notifications
Growing consumer need for real-time and
up-to-date payment information
On average, Barclays mobile banking clients
access their app 3 times more than online
and 6 times more than they visit a branch 6
Technology Platform Adoption
Meteoric adoption of consumer
Smartphone technology
51% of adults in the UK use a
smartphone3
Mobile Buying
The coming of age for mobile retail
Mobile as a retail channel forecast to
grow by c.55% YoY to 2016, compared
with 8% for online channels and 1.6% for
physical stores5
References: 1(IBM 2012); 2 Payments Council , UK Payment Markets 2012; 3OFCOM Communications Market Report 2013; 4UK eRetailer; 5The future of m-commerce – verdict consulting 2011;
6Barclays internal analysis
6 | Barclays Pingit for corporates | September 2013

8. Both consumers and businesses have new
and emerging payment needs
• Developing and managing
mobile (and omni-channel)
channel strategies
• Managing cash flow
• Responding to consumer change
in a cost effective way
• Managing delays and costs
associated with processing of
cash and cheques
• Reconciliation of payments
• Creating differentiation in the
minds of consumers.
Businesses
• Ease of use for quick, simple &
secure payments
• Simplicity and being able to make
payments whenever and wherever
they are
• Transparency and lack of an up to
date view on cash position
• Convenience to take advantage of
the ubiquity of smartphones – but
no way of using them to make
payments.
Consumers
7 | Barclays Pingit for corporates | September 2013

9. Barclays Pingit – the journey so far
Send now
Transfer money using
only a phone number
Launched February 2012
Pay now
Settle a bill or invoice, easily and
instantly and make Gift Aid
enabled donations
Launched May 2012
Buy now
A range of m-commerce solutions
to pay for goods and services on
the go
Launching September 2013
8 | Barclays Pingit for corporates | September 2013

10. © 2013, Boku Inc. All rights reserved • PROPRIETARY AND CONFIDENTIAL. ‘Boku', and 'Pay by Mobile' are registered trademarks of Boku, Inc.

11. © 2013, Boku Inc. All rights reserved • PROPRIETARY AND CONFIDENTIAL. ‘Boku', and 'Pay by Mobile' are registered trademarks of Boku, Inc.

12. © 2013, Boku Inc. All rights reserved • PROPRIETARY AND CONFIDENTIAL. ‘Boku', and 'Pay by Mobile' are registered trademarks of Boku, Inc.
Boku vs. Other Payment Methods
•
•
•
•
•
↓
• Boku Merchants put up with it
because they sell more stuff
User Reach
EaseofUseonline

13. © 2013, Boku Inc. All rights reserved • PROPRIETARY AND CONFIDENTIAL. ‘Boku', and 'Pay by Mobile' are registered trademarks of Boku, Inc.© 2013, Boku Inc. All rights reserved • PROPRIETARY AND CONFIDENTIAL. ‘Boku', and 'Pay by Mobile' are registered trademarks of Boku, Inc.

14. © 2013, Boku Inc. All rights reserved • PROPRIETARY AND CONFIDENTIAL. ‘Boku', and 'Pay by Mobile' are registered trademarks of Boku, Inc.
CHANGING THE WAY THE WORLD USES MONEY
Steffan Aquarone
CEO, Droplet

15. © 2013, Boku Inc. All rights reserved • PROPRIETARY AND CONFIDENTIAL. ‘Boku', and 'Pay by Mobile' are registered trademarks of Boku, Inc.
CHANGING THE WAY THE WORLD USES MONEY
• With smartphone ownership set to reach 31m units in UK (60%+ market
share), mobile expected to extend to payment imminently
• Mobile payments will accelerate at the rapid pace of web development.
• Retail sector accounts for roughly 8% of the UK‟s GDP. Equates to £300bn
every year in retail sales being transacted by cash or card.
• The payment component in an exchange of value in this space is
fundamental and simple - whilst opportunities for customer relationship
extension are infinite.
• Non-bank payments expected to reach 10% worldwide by end of 2013.
• Existing mobile payments innovations have been almost entirely focused on
“credit cards on your phone”, maintaining the status quo and placing huge
limits on innovative capacity.
• An end-to-end payment method delivered in 5 seconds on the web free at the
point of use can expect to seize the lion‟s share of the this market
THE MARKET FOR MOBILE PAYMENTS

16. © 2013, Boku Inc. All rights reserved • PROPRIETARY AND CONFIDENTIAL. ‘Boku', and 'Pay by Mobile' are registered trademarks of Boku, Inc.
WHY DROPLET IS UNIQUE
CHANGING THE WAY THE WORLD USES MONEY
• API allows developers to integrate Droplet into existing
systems.
• Merchants can offer loyalty, customised marketing and
mobile commerce options to their customers in seconds.
• They can track, interact and directly engage with them all
from within the Droplet space and without the need for a
separate app.
• The „Pay with Droplet‟ button means that merchants can
even add one-touch mobile payments to their existing apps.
• Droplet has quickly superseded such technologies as NFC
and all similar proprietary offerings which require hardware.
• Users are enjoying bespoke, timely and relevant messages
within their mobile journey without any interruption for
payment.

17. © 2013 Wirecard AG 16
Wirecard’s Role in the Ecosystem
ESTABLISHED
BANKS
MERCHANTS
MOBILE
NETWORK
OPERATOR
CONSUMER

18. © 2013 Wirecard AG 17
Web is the New Offline
Mobile is the New Online

19. © 2013 Wirecard AG 18
and both need payment!

20. © 2013 Wirecard AG 19
Mobile Payment is diverse!
with – on - at

21. © 2013 Wirecard AG 20
Technology for payment
with mobile (NFC) is
ready!

22. © 2013 Wirecard AG 21
but are the consumers
and merchants ready?

23. © 2013 Wirecard AG 22
ESTABLISHED
BANKS
MERCHANTS
MOBILE
NETWORK
OPERATOR
OVER THE TOP
PLAYER
And … the ecosystem is
still developing

24. © 2013 Wirecard AG 23
The key questions?
„Where is the business
case?“
AND
„Who owns the user?“

25. © 2013 Wirecard AG 24
Mobile Payment must offer
more than payment!
Payment is just THE core
layer for further services.

26. © 2013 Wirecard AG 25
The race just started!

27. © 2013 Wirecard AG 26
And the winner will be
YOU

28. Break

29. A View from the USA
Developments and trends in
Mobile in Payments
John de Lavis
Managing Partner
Greenings
International

30. Mobile Payments: Environment
• Increasing convergence of channels
• Changing structure of the market
• Multiplication of offerings
• Merging of technologies with platforms
• Formation of multiple relationship structures
• Growing role of non-banks
• A number of issues emerging across the value chain
• A growing need for universal interoperability standards

31. Stakeholders and their drivers
• MNOs
• OEMs
• Operating system providers
• Payment processors
• Alternative payment system providers
• Card and ACH networks
• Financial Institutions
• Merchants
• Consumers
• Regulators

32. Value chain
• Security and fraud
• Merchant cost efficiency
• Incremental services
• Revenue and the business model

33. Conclusions
• Open wallet is likely to evolve
• Despite high cost NFC will prevail in the long term
• Payment will only be one thread in consumer and
merchants models
• Existing payment rails will be used but ACH will
become very important
• Standards for interoperability will emerge
• Mobile will transform the payments landscape

34. © 2013 Wirecard AG 33
Experiences and
the European
Perspective

35. © 2013 Wirecard AG 34
There is a difference
between
„I can“
AND
„I do“

36. © 2013 Wirecard AG 35
Legal and regulatory
frameworks are varying
and challenging!

37. © 2013 Wirecard AG 36
Where Telco meets Banks!
Similiarities
Differences
Difficulties

38. © 2013 Wirecard AG 37
What can we expect in the
near future?
Ecoystem will settle
Launches, launches, …
Services and Shaping

39. © 2013 Wirecard AG 38
What do we need for
success?
The whole ecosystem
And services, services, …

40. osborneclarke.com
Mobile Payments – Access/Authentication
Mobile phone as initiator and number as proxy
Payer Payee
Payer's PSP Payee's PSP
Sale of goods and services
Customer
Ts&Cs
Payment
system
Mobile App
Ts&Cs
Mobile phone
number proxy
database
Customer
Ts&Cs
Mobile App
Ts&Cs

41. osborneclarke.com
40
Mobile Payments – Contactless
Typical structure for partnering arrangements

42. Thank you.
Please join us for refreshments.