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Cards and payments keynote

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  • 1. (1) your Excellencies/distinguished guests/Ladies and Gentlemen, Good morning It is my pleasure, to welcome you all here today, to the 15th , Annual Cards and Payments Middle East, conference and exhibition, and it is indeed my privilege to address this eminent gathering today. (2) Emirates Identity Authority is once again honored to be the official Government Partner for this event.. and I am sure that, in the course of these two days, we will all, see many innovations, and creative developments, in the cards and payments technologies, these will be two days of inspiration, two days of looking into the future of our industry, and the opportunities it presents. (3) Indisputably, as with other technological developments, the smart cards and payments industry, is evolving so rapidly, and in somewhat transforming ways! In short: it is a growth that has been phenomenal. A quick glance at some numbers, tells us how the cards industry, has emerged in the recent years. Let us go through some of these numbers: (4)  As per the latest statistics published in 2013, there are more than 1.8 billion, active payment cards around the globe. (5)  Around 4 trillion dollars is a total of what was spent at merchants in the year 2013 (6)  In the next three years, exponential growth is projected, with expectations of purchase transactions, to reach 280 billion, by the year 2018..  with little conservative calculations, we are talking here about trillions of dollars worth of transactions! (7)  in the next 3 years, global e-commerce, is also expected, to grow, from current 1.5 trillion dollars, to 2.5 trillion dollars. (8) Amazing numbers indeed!
  • 2.  However, we are still of the belief, that we have not yet, exploited the full potential of the digital age.. the numbers, we talked about, represent, as only, as fractions of the potential! (9)  Just imagine, from a merely 16 million people (less than 1% of global population) were accessing the internet in 1995, today we have nearly 3 billion people (about 40% of the global population) accessing the internet.  For sure, this has contributed to the exponential growth in the domain of commercial transactions. But this is also, showing that we still have, huge growth opportunities, yet to be realized. (10) The pace at which current markets are developing is owed to the evolution of technology that has enabled electronic remote transactions with digital payments processing capabilities. The securities of, chip and pin, and cryptography, have helped to enhance payment technologies and promoted extending the landscape of participatory users. (11) However, as we all have learned, no growth is devoid of risks and frauds. Some following numbers would give us a sense of the landscapes of how the payments have been manipulated in the recent years. (12)  As per recent reports, global, credit and debit cards, fraud losses exceeded 11 billion dollars during 2012. (13)  Another report published recently, revealed that, retailers have incurred more than $580 million in debit card fraud losses  and that they spend $6.5 billion annually on credit and debit card fraud prevention capabilities.  The cost associated with such fraud prevention systems is only rising!
  • 3. (14)  Another interesting piece of information.. it has been reported that, card issuers losses, occur mainly at the point of sale from counterfeit cards  while merchants losses occur mainly in situations where cards are not present in transactions .. on the Web, at a call center or through mail orders for example. (15) Another interesting piece of information.. 59% of the more than 37 billion debit card transactions that were made were verified by physical signature .. and that 85% of all fraudulent debit card transactions involved human signature “verification,” put differently; (85%) of debt card fraud losses stemmed from signature based transactions. (16) Identity theft as a form of fraud that often results in un-authorized credit card and debit card transactions has increased by almost 100% in the last few years. As such, fraud containment and risk mitigation will continue to dictate online and electronic payments…. together with huge efforts and investments to protect the payments system as a whole. (17) Smart cards such as chip and pin, chip and signature, use of biometrics in identity verification, digital signature and associated cryptography for transaction authentication are becoming the order of the day… they are, and will continue to transform the cards and payment industry and the ways we, as individuals, will use them!
  • 4. (18) Further, we see some fascinating developments:- We are actually witnessing developments in real life .. straight out from our sci-fiction movies .. where a retina scan and a voice recognition system actually authenticates the customer over remote channels. (19) Quantum computers crunching numbers, at unbelievable speeds, to check the customer history and risk assessment.. (20) and advanced robots identifying, picking up and delivering the goods from an automated super store, or payment transfers taking place in real time across the globe.. these are no longer the realm of fantasy film makers.. but a reality. (21) Embedded Chips in the people? An encoded live DNA in a human with identity credentials – we are there! In fact, It is here! (22) All such developments are pushing not just the payments industry but also the governments and business alike to reinvent themselves. (23) Ladies and Gentlemen, Digital identity, government-based or provided through third party identity services are increasingly being adopted following closely coordinated efforts.
  • 5. (24) It is in this context, where smart Government and Smart Services initiatives of UAE take prominence. Emirates Identity Authority with our National Digital ID Program and the issuance of a state of art smart card as a tool for digital identity credentials plays a key role in facilitating the smart services with the underlying secure digital identity for every single legal resident in the country. (25) With a 100% enrollment in the National Population Register, the UAE has the unique distinction of placing verifiable digital identity credentials in the hands of every single citizen and legal resident in the country. (26) The impacts and the implications of this fact are obvious. We are in the throes of an accelerated e-transformation in the country. The National Identity Management Infrastructure serves to provide a unique and common digital identity across all the service providers; be it government or private sector. (27) The ability to verify and validate this identity in real time, not only enables cross domain service provisioning, but also cross domain service delivery. A major beneficiary in this scheme indeed would be the financial industry. (28) Imagine the scenario where a customer seeks to conduct a financial transaction like acquiring high value assets such as a car, a house or such property. This scenario involves not just the buyer and the seller, but a financier such as a bank, a regulator and a credit risk assessor. (29) The current situation demands customers to submit multiple documents for identification and statements of financial capabilities. Multiple agencies are involved in credit assessment and mortgaging. The process of acquisition could take days if not weeks in completion. (30) The UAE national identity management infrastructure seeks to bring this acquisition to real time enabling instant gratification to the buyer. An Identity card issued by the Emirates ID Authority is presented to the property seller which is verified and validated for authenticity by Emirates ID online systems.
  • 6. In turn this ID validation is referred to a financial institution of the buyer’s choice. A credit assessment is made available in confidence to the financial institution which can then decide and approve of the financial arrangements. (31) A contract is entered into by the three stakeholders - the buyer, the seller and the financial institution and the transaction will be digitally signed with the respective ID cards of the representatives. Acquisition is completed. This, Ladies and Gentlemen is the true digital enablement of the country. Identity Management Infrastructure, managed by Emirates Identity Authority will support this transformation in the country, and the development of the new economy. (32) Our recent efforts with the leaders in the payment industry in the UAE have borne fruit, and the use of the ID card as a secure identity mechanism in the ATMs has become a reality. You will soon see the ID card being used for not just for secure withdrawals but also for conducting secure and authentic transactions at the Points of Sale. The ID card would typically act as a government backed authentication mechanism, bringing in an exponential enhancement to the security and prevention of Identity related frauds. (33) Following the current national initiatives on smart government, Emirates Identity Authority is enhancing the ID Management Infrastructure by Mobilifying the Digital Identity. This entails the use of UAE's Identity Management infrastructure for providing credentials in the mobile (GSM) cards to support mobile identification and authentication. (34) You will soon see this in action with mobile phone users enabled to use the digital credentials in their mobiles and conducting transactions with digital signatures. This digital transformation will enable the nation to take a frog leap in business competitiveness by saving millions in terms of costs related to frauds and fraud containment.
  • 7. (35) Ladies and Gentlemen, Surely, the speed at which technological developments are advancing will not only add to the complexity of the interesting times we are witnessing in this digital age, but make us seem myopic in our views of how even the short term future could look like! (36) With such developments and speed, the expectation bar is raising to new levels! Regardless of the industry, government or private sector, they all have difficulties keeping up with the new ‘expectations-normal’. (37) We are strongly of the view that we need to work together to make this world a better place for everybody to live in. This requires that we share knowledge, and work collaboratively. This event, is one of such attempts, aimed for such cooperation. (38) I thank the organizers for their great effort.. and wish you all, a very fruitful association in the coming days. Thank you.

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