The document discusses the revolution of non-bank payments driven by new technologies. It describes how payments have evolved from early bartering systems to modern digital wallets and mobile payments. Technologies like NFC, BLE, and electronic wallets are disrupting traditional banks and driving new payment players like PayPal, Google, and Apple. Issues around security, regulation, and consumer adoption may impact how future payments develop, with mobile and proximity-based technologies like BLE positioned to transform in-store and peer-to-peer payments.

1. NON-BANK PAYMENTS REVOLUTION
Kevin H. Connelly
Executive Vice President
The RWC Group
kevin.Connelly@therwcgroup.com

2. OVERVIEW
• PAYMENTS EVOLUTION
• PAYMENTS REVOLUTION
• DISRUPTIVE TECHNOLOGIES
• MOBILE MERCHANT TECHNOLOGY
• ELECTRONIC WALLET
• NFC
• BLE

3. THE EVOLUTION OF PAYMENTS
100,000 Years 3,000 B.C. 650 B.C. 960 A.D. Dark Ages 1950’s Past 20 Years Now  Future.

4. OVERVIEW
• NEW FRONTIER – CHANGES ALMOST DAILY
• SOFTWARE VERSION “X.X” REPLACED WITH CUPCAKE, JELLYBEAN
AND KITKAT
• PAYMENTS UNIVERSE CENTER NO LONGER NY, CHICAGO OR LA
– SILICON VALLEY
• BANKS NO LONGER LEADING PAYMENTS INNOVATION
• NON-BANKS LEADING – PAYPAL, GOOGLE, APPLE, SQUARE
• TECHNOLOGY IS DRIVER – RAPID CHANGE IS NORM

5. THE REVOLUTION OF NON-BANK PAYMENTS
tech·nol·o·gy
tekˈnäləjē/
noun
1. the application of scientific knowledge for
practical purposes, esp. in industry.
•rev·o·lu·tion
•ˌrevəˈlo͞oSHən/
•noun
•1. a forcible overthrow of a government or
social order in favor of a new system.
pay·ment
ˈpāmənt/
noun
1. the action or process of paying someone or
something, or of being paid.

6. DISRUPTIVE MODELS/TECHNOLOGY
• ITUNES
• AMAZON
• LINKED IN
• PAYPAL

7. THE EVOLUTION OF NON-BANK PAYMENTS
NEW PAYMENT PLAYERS – THE REVOLUTIONARIES
• e-Commerce
• E-Bay / Amazon / Apple
• Retailers
• Starbucks / Jamba Juice
• Telecommunication
• Isis
• Pre-Paid Card Providers
• Money Transfer Operators
• Disruptors
• PayPal / Google / Apple
• Level Up / Square
• Virtual Currency
• Bit-Coin / Amazon
• Angry Birds?
• “The Cloud”

8. THE EVOLUTION OF NON-BANK PAYMENTS
E-WALLETS
In 2013 120
e-Wallet or
Mobile
Wallet
Applications
Gatekeeper
Wallets
Bank
Wallets
Retailer
Wallets
e-
Commerce
Wallets
Aggregator
Wallets
Single-
Feature
Wallets

9. THE EVOLUTION OF NON-BANK PAYMENTS
THE GEORGE COSTANZA WALLET
http://www.youtube.com/watch?feature=pla
yer_detailpage&v=yoPf98i8A0g

10. THE EVOLUTION OF NON-BANK PAYMENTS
FACTORS DRIVING THE FUTURE OF MONEY?

11. THE EVOLUTION OF PAYMENTS
E-WALLETS
Hybrid Uses
Not Just Payments

12. THE EVOLUTION OF NON-BANK PAYMENTS
THE FUTURE OF MONEY?
31% CAGR / $1.6 Trillion

13. THE EVOLUTION OF PAYMENTS
MOBILE PAYMENTS

14. THE EVOLUTION OF PAYMENTS
MOBILE PAYMENTS

15. THE EVOLUTION OF PAYMENTS
MOBILE PAYMENTS

16. THE EVOLUTION OF PAYMENTS
MOBILE PAYMENTS

17. THE EVOLUTION OF PAYMENTS
MOBILE PAYMENTS
? ? ?

18. THE EVOLUTION OF NON-BANK PAYMENTS
FACTORS DRIVING THE FUTURE OF MONEY?

19. THE EVOLUTION OF NON-BANK PAYMENTS
E-WALLETS
NFC – Embedded
Isis, Google
Cloud QR Code
Hybrid

20. THE EVOLUTION OF PAYMENTS
E-WALLETS

21. THE REVOLUTION OF PAYMENTS
MERCHANT SERVICES

22. https://www.paypal.com/webapps/mpp/credit-card-reader
EMBEDED VIDEO REMOVED – LINK BELOW

23. Amazon Coins is a new way to purchase Kindle Fire apps,
games and in-app items from Amazon. The more coins you buy
the more you will save! Purchased coins are immediately
deposited into your account and they never expire. You can
choose to spend them immediately or save them up for later.
Facebook Credits are a virtual currency you can use to buy
virtual goods in any games or apps of the Facebook platform that
accept payments. You can buy Facebook Credits directly from
within an app using your credit card, PayPal, mobile phone and
many other local payment methods. [UPDATE]
Bitcoin uses peer-to-peer technology to operate with no central
authority or banks; managing transactions and the issuing of
bitcoins is carried out collectively by the network. Bitcoin is
open-source; its design is public, nobody owns or controls
Bitcoin and everyone can take part. Through many of its
unique properties, Bitcoin typically allows uses that could not
be covered by any previous payment system
VIRTUAL CURRENCIES
DIGITAL & CRYPTO CURRENCIES

24. THE EVOLUTION OF PAYMENTS
ISSUES AND POTENTIAL ROADBLOCKS
• Security
• Fraud losses
• Identity theft
• Privacy concerns
• Technology
• Multiple platforms competing
• No clear winner yet
• Consumer/Business confusion
• Safety
• Non-bank accounts
• Criminal activity
• Regulation

25. THE EVOLUTION OF PAYMENTS
REGULATION
• Multiple regulators
• Overlapping reviews and conflicting enforcement
• New laws phased in and untested
• Catch up mode
• AML
• CFPB

26. THE EVOLUTION OF PAYMENTS
IMPACTS TO BANKS
• Disintermediation
• Revenue loss
• Still most trusted
• Checking account remains financial hub
• Burdened by regulation and scrutiny
• Innovate and invest?
• Partner and private label?

27. THE EVOLUTION OF PAYMENTS
IMPACTS TO BUSINESS
• Risk model changes
• Investment increases
• Technology disruptors can impact business
• Opportunities for cost savings
• Opportunities for revenue increase
• Opportunities for customer relationship building

28. THE EVOLUTION OF PAYMENTS
IMPACTS TO CONSUMERS
• Enhanced convenience
• Increased security but with new risks
• Opportunities for savings
• Loss of privacy
• App-mania
• Identify theft
• Confusion

29. THE REVOLUTION OF PAYMENTS
WHERE TO FROM HERE?

30. THE EVOLUTION OF PAYMENTS
WHERE TO FROM HERE?
• Will regulation kill the debit/credit card?
• Is NFC DOA?
• QR / Hybrid
• Level Up?
• Google Glass?
• Pocket Change?
• So What is Next?

31. THE REVOLUTION OF PAYMENTS
BLE IS NEXT

32. https://www.paypal.com/webapps/mpp/beacon
EMBEDED VIDEO REMOVED – LINK BELOW

33. https://www.paypal.com/webapps/mpp/beacon
EMBEDED VIDEO REMOVED – LINK BELOW

34. THE EVOLUTION OF PAYMENTS
COMMENTS & QUESTIONS
Next Gen Will Drive What’s Nexthttp://www.youtube.com/watch?feature=player_detailpage&v=yoPf98i8A0g

35. www.therwcgroup.com