[Eng] IoT day 2017 - eWallets: the Internet of Things Invades the Financial System

1. April/2017

2. eWallet Is the good old [& unplugged] Wallet already retired? Gerson Rolim Vecto Mobile www.vectomobile.com.br

3. Summary • eWallets, IoT and the “Invisible Payments” • The Internet of Things (IoT) and the Banks • The Perfect Storm • eWallet Drivers • The mCommerce Climax • Mobile Payments Trends • NFC – Contactless Payments • Wearable's • What eWallet to Use? • eWallet: Types & Technologies • eWallet: Who Leads Innovation? • Future of Digital Payments 3 / 39

4. eWallets, IoT and the “Invisible Payments” • The eWallet “fit” all forms of Payment • In IoT all things in the world will be connected [and thinking]! • In the collision of the Physical and Digital Worlds... – … there will be no room for unplugged, non- ecological, non-social, ... things – so lets say goodbye to leather wallets, checkbooks, paper money and plastic cards, ... 4 / 39

5. eWallets, IoT and the “Invisible Payments” Bitcoin does not fit into the good old [and unplugged] Wallet 5 / 39

6. 6 / 39 https://www.youtube.com/watch?v=JV6eGUSC2a8 The Internet of Things (IoT) and the Banks

7. 7 / 39 In IoT the POS (Point of Sales) is everywhere! https://www.youtube.com/watch?v=BclusZJ8sjA The Internet of Things (IoT) and the Banks

8. Mobile Climax + InAPP Pay WiFi & Bluetooth Anywhere Fintechs POS NFC 1 2 4 5 One Click (Touch) Buy + Click & Collect3 USA Liability Shift6 Massive Frauds7 The Perfect Storm 8 / 39

9. eWallet: Is it the Perfect Storm? • Smartphone and WiFi [almost] ubiquitous • POS NFC massive Rollout • US EMV Fraud Liability Shift – Magnetic Stripe vs Chip & PIN • Many massive credit card fraud cases Merchants & Consumers demanding: • One Click (Touch) Buy + Click & Collect • Safer Payment Solutions • Tech Innovations (Fintechs) • Second [& intuitive] Auth Factor 9 / 39 +

10. eWallet Drivers • Growth of Mobile Internet Users & Smartphones 2020: . 80% of Internet Users will be mobile . 56% via Smartphone • Newcomers . Apple and Samsung . Google, eBay, Alibaba and Square . Amazon, Walmart and Starbucks 10 / 39

11. eWallet Drivers • Growth of eCommerce and mCommerce • Online & Offline stores cross-benefits . Cash back . Discount & Coupons • Better Experience & Convenience . Security . Pre-Paid and Unbanked 11 / 39

12. Starbucks – mPayment 12 / 39 Starbucks Video: https://www.ispot.tv/ad/ACjh/visa-checkout-starbucks-app-green-light

13. [start of] mCommerce Climax • Jan/15 - 16% of eCommerce transactions in Brazil • Jan/16 - 25% of eCommerce transactions in Brazil 13 / 39 Webshoppers 2017

14. mPayment Users - World 14 / 39 Source: Gartner - Mobile Payment Worldwide - 2013

15. Volume of mPayments transactions - World Source: Statista e IDC 15 / 39 Total revenue of global mobile payments will surpass U$ 1 Trillion by 2019!

16. eWallet Usage Worldwide - World 16 / 39 Source: Statista – Ago/2016 Top 5 China Norway England Japan Australia Colombia

17. Mobile Payments Trends - World 17 / 39 Source: % of total spending on eCommerce Worldpay- Global Payments Report – Nov/2016

18. Mobile Payments Trends: LatAm 18 / 39 Source: % of total spending on eCommerce Worldpay- Global Payments Report – Nov/2016 Asia-Pacifc Trends X

19. eWallet: US Market Snapshot 19 / 39 Source: War of the Wallets - Juniper Research - 2016

20. Mobile Payments Trends: Brazil 20 / 39 Source: Worldpay- Global Payments Report – Nov/2016

21. One Size Does Not Fit All • Many Technologies and Use Cases will continue to coexist in the future of digital payments • After all, Cobol has been dying for at least 30 years... ;-) 21 / 39 Silicon Valley vs. Wall Street?

22. Silicon Valley vs. Wall Street Battle field: mPayment patents – intelectual properties 22 / 39 Source: Vivek Sharma paper at IPWathcdog – Jan/17

23. Beyond Phones… Don’t think that mobile payments will be limited to your smartphone or tablet! • Bluetooth Beacons, WiFi, NFC and so on... 23 / 39

24. NFC - Contactless Payments • Contactless Payments are growing • NFC technology will leverage digital payments in the POS • 40% of new Payment Cards in 2014 were NFC • 9,5M new POS NFC 2014, 33% more than 2013 (ww) 24 / 39 Source: NFC Ready POS Worldwide – Nov/2015

25. Wearables 25 / 39

26. Wearables • Mobile Payments + Wearables = Perfect Match • 2015 . American Express & Jawbone . U$ 3B in payments via Wearables • 2020 . 214M Wearables sold . U$ 500B in payments via Wearables • Compelling Reasons: Wearables x Credit Card: – Reduce Friction in payment process – Added Value– Ex.: Payment with Loyalty Card – Security: Visa NFC Ring / Rio 2016 Olympic Games – Perfect Success Case: Disney MagicBand 26 / 39

27. Compelling Reasons: Wearables x Credit Card Disney MagicBand • This wearable goes far beyond the payments! • Park Tickets • Fastpass • Room Key – Disney Hotels • Disney Photopass • One Click Buy Experience in Real World • Social Desire => Status, Commodity & Comfort <= 27 / 39

28. [almost] Disney Magicband 28 / 39

29. The Dawn of eWallets • Revamped by newcomers: Apple Pay and Samsung Pay • eWallet Wars: – Google Wallet suffering since 2011 – Visa V.me RIP since 2016 • Major eWallets – Has the time Internet Titans begun? – Android Pay (Google) – Apple Pay – PayPal (ebay) – Samsung Pay 29 / 39

30. What eWallet to Use? 30 / 39

31. Fonte: Q Insights eWallet: Types and Technologies 31 / 39

32. eWallet: Who Leads Innovation? 32 / 39 Source: Digital Payments Report 2016 – PCM Research

33. eWallet: Who Leads Innovation? • Innovators – Device Manufacturers – Digital Payment Providers • More Confidence – Banks – Credit Card Companies 33 / 39 Source: Digital Payments Report 2016 – PCM Research • Less Probability – Mobile Operators • Less Confidence – Retail Stores – Mobile Operators

34. The future of Digital Payments • The future will be like this... – Omni-Channel & Channel Agnostic – Click & Collect & One Touch Buy – Infinite Shelves – Device Agnostic, Any time & Anywhere – + Open eWallets / + Loyalty Wallet 34 / 39

35. In IoT the Point of Sales (POS) is EVERYWHERE! 35 / 39

36. References • Webshoppers - http://www.webshoppers.com.br • Gartner - Mobile Payment Worldwide - '13 - https://www.gartner.com/doc/2484915/forecast-mobile-payment- worldwide • Worldpay- Global Payments Report - '16 - http://pt.worldpay.com/global/insight/articles/2016-11/global- payments-report-2016 • eWallets: US Market Snaphot – War fo the Wallets - https://www.juniperresearch.com/document-library/white- papers/war-of-the-wallets • Silicon Valy vs Wall Strett - Patentes de mPayment - http://www.ipwatchdog.com/2017/01/06/mobile-payments- fintech-vs-non-fintech-patent-landscape/id=76455/ 36 / 39

37. References • NFC World – NFC Ready POS Worldwide - '15 - https://www.nfcworld.com/2015/02/24/334209/berg-insight- reports-on-nfc-pos-terminal-growth/ • Q Insight – eWallets: Tipos e Tecnologias - https://www.slideshare.net/nquibria/future-of-payments- evolution-or-revolution/16 • Digital Payments Report 2016 – PCM Research - http://www.paymentscardsandmobile.com/digital-payments- report-2016/ • Volume Mundial de Mobile Payments - https://www.statista.com/statistics/226530/mobile-payment- transaction-volume-forecast/ • Statista eWallet Usage Worldwide - ‘16 - https://www.statista.com/statistics/218615/mobile-payment- methods-used-on-smartphones/ 37 / 39

38. Thanks! 38 / 39 linkedin.com/in/gersonrolim/