Mr. Chris De Smet has an international managerial experience in the financial services, telecommunications and information technology areas. In those sectors he acquired expertise as CEO, COO and President at national, European and worldwide level, whereby a continuous focus on customer relationship management and customer profitability were guiding factors. Chris operates since more than 10 years his own consultancy company with main focus on financial services, retail and card payments and related areas. After having worked as a partner with Arthur D. Little, KPMG and Unisys Consulting, he now works for international clients as an individual consultant and mentor. Over the last years, he has been actively involved with Visa Europe. He is 63 years of age, married and lives in Belgium.

„The third day of the conference allowed us to spend time on what matters most: ensuring that the customer proposition has a sexy appeal with focus on the top line growth. The built up of the day was such that our first three speakers gave an update about how their ‘conventional’ markets were gradually evolving from old school monopoly to a more open environment with new players and new ideas being implemented. The three banks that elaborated on their respective markets also showed a European wide interest from banks for the acquiring market. They are each convinced that they have what it takes to respond to the demands of their merchant-customers, albeit that the largest retailers cannot yet hope for a European one stop shop.

Our second set of speakers talked about loyalty and CRM, a word that has some negative connotation due to the many flaws in implementing technology that promised to deal with the ‘one customer’. However, in the case of our speakers, each in a very different way proved how serious they are about their customer focus, about providing real and tangible advantages to their customer base and in doing so, ensuring that the proposition is sticky. Their initiatives are not the standard loyalty program, but initiatives that trigger interest and look very promising. With the regulators continuing to put pressure on the business case, the loyalty proposition has even more value in order to grow the business (and no, one cannot shrink to greatness!).

Finally, in the third and last session of the day and last session of the conference, the audience was confronted with ‘out of the box’ thinking from players that often were not around (or not that prominent) ten years ago, but now are amongst the biggest in their markets. Whereas the appetizer gave us insight in how the PSP and acquiring markets in Europe are on a convergence and consolidation course, the next speakers were confrontational for the established players: they showed that new players are capable of implementing business models and customer propositions that banks cannot possibly copy and certainly cannot match in the same time frame. It is all about filling the gap that is wide open for E-payments, M-payments and developments that are not about card but about providing a hard to match customer experience.

And although Barclays informed us about their international expansion plans, Badoo confronted us again with the fact that a large international company still does not have the possibility to one stop shop for all of their acquiring business.

As a final remark, if there is one thing I learnt during this day (and the whole conference), then it is that our old school acquiring environment will be gone sooner than later: there are too many initiatives out there that will undoubtedly balance the industry and this will happen in the next three to five years through a combination of technology and clever marketing. Whoever are the dinosaurs, they better prepare to adapt or disappear.“

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Summary of the entire conference by Leon Dhaene, Chairman, N2Finance

 

„Ladies and Gentlemen,

I was asked to summarise the Conference, the last two and a half days, in a few minutes. And in fact I can summarise in just one sentence, written more than 200 years ago:

“Das Alte stürzt, es ändert sich die Zeit, und neues Leben blüht aus den Ruinen.” Friedrich von Schiller wrote this sentence, for his theatre play, in 1804.

”The old order dies, the times are changing, and new life grows on the rubble”.

Allow me to explain...

Now’s where the rubble ...???
The rubble today is caused by closed domestic schemes, using proprietary standards on legacy systems, to operate payment schemes using a 100 year old technology of plastic cards dedicated for payments only. The schemes were deciding on the business model, on the value chain, on the transaction processing, and on the operating rules and procedures. Someone had to do it... The rubble was processed on many different systems, each more expensive than the other, and not very cost effective. On top of that, we run after the fraudsters, trying to catch them, but often they are fasters or we catch the wrong guy or girl. And we make the rubble even so more expensive. However, merchants and consumers were paying for all that rubble, and we loved it, because we were using it in ever larger volumes.

The new life will come from an open, read in Europe “SEPA”, market, with no more borders, but areas of comfort where the consumers will make most of their transactions. And we all except that a flat is more expensive in Berlin than the same on in Neuwied. Then why would a croissant in Flaine be as expensive than the same one in Paris ? Let competition play, with the same arms, all over Europe.

New life will blossom on the basement of the regulatory intervention, whether in Europe, the US, Canada, Australia, or the other 25 nations looking into the game of cards.

Unbundling on the acceptance side will empower merchants and cardholders, and oblige schemes and issuers to demonstrate and deliver real added value to their premium products, and here, for instance, loyalty can help. If not, those will be added to the rubble.

Unbundling also of the layers, services owned by issuers and acquirers, schemes, and processing, will force transparency in operating procedures and pricing, and subsequently reduce operating costs. Each of the parties to the card table is to look at the total cost of ownership of their solutions. If not, your business will be added to the rubble.

If too complex or difficult to clean up your operating rubble yourselves, please join others, sell your business whilst still worth a eurocent, or merge or buy others, and rationalise. Convergence is the call of the day. The Acquirer Personality of the Year comes from a company whose strategy was based on convergence.

Tackle your fraud by intelligent rule based solutions and restore trust in the payment system; if not, your business will be found in the rubble. Pattern recognition will be the future in fraud and risk management. Pattern recognition, like in : if the people get into the streets to chase their dictators, the price of top art pieces will go through the roof!

And as we all invest in increased security, we will want to see a tangible return on our investments. Not security for security’s sake. Not security to scare the competition. But security to strengthen the business.

The future MEN, the Mobile Electronic Nomad, will want to travel light; and that will be with a portable, mobile, multi-functional device, but without a wallet. That mobile device will serve as a phone, GPS, content provider, payment terminal as well as a payment instrument. The POS vendors are warned. The traditional point-of-sale will end up as rubble. Banks will be called to deliver their services to that mobile solution; they will not be called to deliver the mobile solution. Banks will be called to deliver, for instance, authorisation services and payment guarantees, to providers of payment solutions, who will no longer be banks or bank owned schemes. The bank service delivered will be “inside”, like “INTEL Inside”, in the old laptops, do you remember ?, which are now with the rubble. Partnership between stakeholders will be the call of the day. That is why the Award statuette of Sofie Muller are two intertwined hands, a fused handshake.

But I want to close with a call. The acquiring business is not on the radar of the regulatory, nor on the radar of mobile solutions or alternative payment solutions. The acquiring business may be on a side track soon. The acquiring business will have to proof their value add and their value for money. As IKEA mentioned in this meeting : show your value, I don’t want to be in your business; but if you can’t demonstrate...join the rubble...!!!

Concluding on that bombshell, to quote Jeremy Clarkson of Top Gear, it was a most interesting and thought provoking conference.

Leon Dhaene, Chairman

ACKNOWLEDGEMENTS

We want to explicitly thank the event sponsors:

•    First Data
•    Equens
•    Trustwave
•    Visa
•    Innovalue
•    Discover Financial Services/Diners Club International
•    SIX Pay
•    VeriFone
•    Tieto
•    OpenWay
•    Welcome Real-time
•    RS2
•    Compass Plus
•    Retail Decisions
•    PayFair
•    EPAS
•    First Annapolis
•    Clear2Pay
•    SIA SSB