Beirut International Franchise Forum
Panel 3: E-commerce & Mobile Shopping; The Future
Shopping Reality
Mr. Stephan Becker
Chief Executive Officer
Payfair
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payfair
The future of E-Commerce and Mobile Shopping
BIFEX
Beirut, 17th April 2013
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payfair –The new SEPA compliant Payment Scheme
Addressing the needs of the changing payment landscape
1. Payment scheme
solutions
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Switching
Clearing & Settlement
Rules & Regulations
Regional Focus
Niche Markets
2. Merchant acquiring
solutions
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Closed and Open Loop
Integration of different Mobile payment solutions
Case driven MIF
Cross Border Acquiring
Dedicated solutions for “High risk” business
3. Technology solutions
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Mobile Payments
Unbanked Population
New merchants (terminal costs and security)
Integration of new technology
E-commerce
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New trends are shaping the future of payments
There is a huge area where authorities, Central Banks, Banks, Mobile Operators, Merchants, Consumers, and the virtual / mobile world require
new payment solutions
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Drivers for Change
 Regulation
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Governments will try to harmonize the markets and keep control
Central Banks will need to change, allowing new entrants and new business
EU – The SEPA card framework will have influence on other regions as well
 Consumer Behavior
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Young generation has new requirements
Security and ease of use
Mobile attitude and requirements
 New Entrants
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Mobile Operators are entering the payment space in Emerging markets
Google, Apple, PayPal and other start competing with “old players” and address needs
of young generation
 Technologic Innovations
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NFC and QR-code will change the payment process as well as the infrastructure
Apps
 Market Requirements
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Merchants as well as regulators are “not happy with MIF”
Changed customer demand and behavior needs to addressed
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The challenges of E- and M-commerce
 Growing concerns regarding e-commerce/e-payments:
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50% of total card fraud is due to CNP (card not present) internet transactions
60% increase of this type of fraud per year
70% of interruptions of e-commerce transactions occur at moment of payment
 Consumers are calling for
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Security in payments
Convenience
No need to have a card (at least in the short term)
Ease of use
 Merchants are calling for
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Guaranteed payments
Secure processes leading to minimal charge backs (only service not rendered)
Robust process ensuring all transactions get to completion
Competitive cost and pricing
Mobile authentication is more secure than using card and personal data
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The Legacy Dilemma – just a comparison …
(VW Golf I, 1977)
(VW Golf VII, 2011)
Fiscal status :
if >25 years old 
« vintage car ! »
Is it reasonable to upgrade this original but
‘veteran’ version with today’s new ‘standard’
features and characteristics ? At what final cost ?
Image reputation ? Uncertainty about final
performances, life cycle and investments and
about future developments ...
2013: normal & ‘mandatory’ features &
characteristics
Consumption 3,7 l/100km, CO² 99 gr/km
ABS-EPS-DCS-Airbags
***** EuroNCap (anti collision test)
GPS-MP3-Electronics...
Better to opt straight for the new and better one with cost reductions & latest new technologies
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A competitive Market
Cards Market
• Traditionally driven by Banks and
credit Card companies
• Established networks and
infrastructure, but difficult to
change
• Dominance of Visa and
MasterCard
• Difficult to change and to adopt
• Slow innovation
• Fraud is an issue
• High costs of infrastructure
On line market
• Banks - card based schemes
challenged by new and alternative
propositions
• Fast emergence of new players /
service providers moving in the
payment value chain
• Young generation has different
behavior and requirements
• Still difficult to participate for
unbanked population
Mobile payments market
• Existing card infrastructure under
pressure.
• Banks / Telco’s / MNO’s pursuing
different objectives
• Growth in low value / quick checkout locations and in emerging
markets
• Fast innovation
• Independency from physical
infrastructure
• New technologies change the way
of payments (QR, NFC, …)
Many organisations compete for share of the payments market –
Are the etablished players still in the same boat?
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Retailers will need to establish new partnerships for payments
 The future of payments will be driven by
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Mobile operators (Vodaphone, Orange….)
Phone and Hardware producers (Apple, Microsoft, Nokia…)
E-Commerce shops (Amazon, eBay,….PayPal)
Social Networks (Facebook….)
 Regional differences need to be taken into account
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already up to 80% of the monthly salaries are paid to mobile accounts
80% of the populations have a mobile phone, but only 20% a bank account
 A new generation of consumers
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Globally the “Young Generation” is early and more often used to Mobile Phones
than Bank Accounts.
The young generation is much more used to online than to offline
New players will drive innovation in e- and m-commerce payments
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Physical cards will be replace by virtual cards and mobiles
 Physical World
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Plastic will disappear over the next 10 years
QR code and NFC will be new technology mainly on smart phones
The payment will be initiated by the consumer, therefore no need of payment
infrastructure at merchants
 E-commerce
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One time virtual cards
Mobile authentication by Sound, QR, one time PIN
Online banking – Credit transfer
 M-Commerce
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“PayPal” like services and apps
New types of accounts (Facebook, Apple)
Direct Debits to Mobile Account
Retailors will have less investment in physical infrastructure but need to
invest in E-commerce and mobile payment infrastructure
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Conclusions
Plasitc will disappear and the Mobile phone will be the “payment
device”
The exisitng infrastructure will be replaced and paymnets will be
initiated by the Mobile phone and the phone holder
New players will enter the market and drive innovation. “Old Players”
will try to protect markets and new alliances will be formed
Retailers need to establish relations with new players in the payment
industry and review their means of accepted paymnets
The changing payments behaviour and a change in requirements will
request retailers to define and establsih a new payment infrastructure
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Thank you!
Stephan Becker, CEO
payfair Group
4-Bras Building
Mechelsesteenweg 455/19
1950 Kraainem (Belgium)
T: +32 2 767 66 66
M: +32 479 81 66 45
stephan.becker@payfair.eu
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