1.
Innovations in Payments
Geoffrey Barraclough
EVO Payments International
15 September 2016
1

2.
About EVO
• One of world’s largest merchant acquirers
– $100b payments processed each year
– 600.000 merchant locations
• Domestic operations in USA, Mexico, Ireland, Poland,
Spain, Germany and Czechia
• Cross-border customers include C&A, Opodo
• Setting up in the UK, closely aligned with retail
POS/ecom developers
• Easy integration methodology
2

3.
Why are Payments Important
3
Annual cost of Interchange to
UK retailers - BRC
Payments CostsThe Peak-End Rule
£1b
Mobile Matters
Q4 2015 conversion rates - Monetate
0%
1%
2%
3%
4%
5%
6%
Desktop Tablet Mobile

4.
Shopper journeys getting longer and more complex
4
Marketing Visit Shop
Make
Purchase
After Sale
Service

5.
Leading to more complex shopper journeys
5
Marketing Visit Shop
Make
Purchase
After Sale
Service
Download
App
Visit
Website
Visit
Shopping
Mall
Customise
Product
Respond to
Marketing
Geo Message
Sent to Mobile
Research
Product
Search
Reccomendations Read
Reviews
iBeacon
Message
Share on
Facebook
Loyalty Points
Post Review

6.
Each retail sector is changing at its own pace
6
White goods
Researched
purchase
Habitual
purchase
Impulse
purchase
Fashion Grocery Fast food Petrol Rapid transit
Indicative graph only

7.
8
Payments and shopping…
…is best
understood
through
behavioural
economics

8.
Reflex Pay
How easy is it to break into long
standing payment habits?
Speed is relative
Shoppers and the payment industry
have different concepts of time
Shoppers are easily discouraged
The first transaction has to be good
Confirmation
Needs to be clear and consistent
There’s a strong pessimism bias with
smartphone payments
Apple Pay may overcome this
Our research showed…
9
…five behavioural
factors determining the
speed of adoption of
new ways of paying

9.
Retailers
Payment
industry
Successful payment innovation requires the
needs of all stakeholders to be aligned
Speed
Simplicity
Strategic
alignment
Cost
It’s a complex business…
10
Shoppers
How well did these do?
…with multiple stakeholders. All need to be satisfied…

10.
Get me in/Out quick
Kiosks and self-service | Contactless
Retail asTheatre
Mobile point of sale | Visual merchandising
But forms part of the future of retail
11
…retailers are focused on transformation programmes delivering a much broader and enriched
Omni-channel customer experience.

11.
Four main questions…
How do I make it easier to
take money on a mobile
phone - website or app?
12
How can I help my
customers use their phone
to purchase in my stores?
How can I join up digital
and store channels to
serve customers better?
How can I use digital to
grow sales outside my
home market?
…retailers need to answer
…and how do I do this securely?

12.
Contactless - a rare, popular payment innovation
13
18% of all POS
purchases
Up 200% y-o-y
ATV = £8.60
£0
£200
£400
£600
£800
£1,000
£1,200
£1,400
£1,600
£1,800
£2,000
Value of contactless transactions. UK £m
Source: Payments UK

13.
Customer experience innovation
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14.
Making mobile payment easier.
It’s buttons underpinned with the -Pays.
15
Improving Plastic Improving payments Removing Payments

15.
The Pays are a valuable underpinning technology
layer but retailers need to build the CX
16
In-store Online

16.
What of the CX?
Is it (finally) time for app payments in-store?
17
Retailer Apps Bank AppsMulti-retailer apps
Ability to pay on your mobile is not enough to get consumers to use mobile payments.
Need to create a great customer experience.

17.
If we’re trying to reduce friction, what
future for the terminal?
18
SmartPOS bundle Single unit with appstore

18.
If we’re trying to reduce friction,
what future for 3DS?
• Annoying shoppers and retailers since 2002
• Schemes working on 3DS 2.0 linked to PSD2
• Likely to feature two factor authentication
– one time passcode
– Biometrics
– social graph verification
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19.
Future of payments is that you
won’t notice payments
20
Payments ceases to be a separate business process

20.
EU MIF has been a qualified success
Credit/debit fees have reduced across EU
but watch out for:
• Your acquirer not passing on the reductions
• Schemes introducing new fees
• Shoppers switching to Amex
• Shoppers switch to corporate cards
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21.
Will you block this card?
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22.
Brexit questions
23
Does MIF
still apply?
Will my suppliers
need different
licenses?
Where is my data?