March 4, 2015 David Dechamps © 2015 MasterCard. Proprietary and Confidential Dynamics Backgrounder Emerging payments: what is at stake? Emerging payments: what is at stake?
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Jul 14, 2015
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March 4, 2015David Dechamps
© 2015 MasterCard.Proprietary and Confidential
Dynamics Backgrounder
Emerging payments: what is at stake?Emerging payments: what is at stake?
�Payments, like commerce, are influenced by key trends
�Fast-growing e-com
�New devices: mobile & smart
�Digital players are fighting for digital services, therefore
What you should remember from this
©2015 MasterCard.Proprietary and Confidential 2
�Digital players are fighting for digital services, therefore having to integrate payments
�MasterCard is investing significant amounts to address this new environment, developing solutions aimed at optimizing both convenience and security
March 4, 2015
So far, card payments could easily be separated in two worlds...
Face-to-face
(card @ terminal)Remote
(mostly browser)
PCPC
87%87%
85%85%15%
©2015 MasterCard.Proprietary and Confidential 3March 4, 2015
MobileMobile
TabletsTablets
13%13%
However, things are evolving fast...
E-commerce transactions have been growing fast over the last years
©2015 MasterCard.Proprietary and Confidential 4March 4, 2015
Source: ComScore
Very fast…
New Sales of connected devices - WorldwideMillion
“87% Of Connected Device Sales by 2017 will be smart-phones and tablets, with PCs representing only 13%” *
©2015 MasterCard.Proprietary and Confidential 553/4/2015
2012
340
2014 2017
PCsDesktop Notebook
Tablets
Smart-Phones
120
290
260
1200
270
470
1700
* From Forbes quoting IDC research. Chart Source: Gartner projection from June 2014
700
Connected devices enable the “commerce value chain” to become more integrated into applications
©2015 MasterCard.Proprietary and Confidential 66March 4, 2015
COMMERCE VALUE CHAIN
Orientation Selection Transaction Delivery Customer care
Account Identification Authorization Settlement Information
PAYMENT VALUE CHAIN
Orientation Selection Transaction Delivery Customer care
To serve today’s customers, our 4-party system must evolve
Issuers AcquirersPayment networks
©2015 MasterCard.Proprietary and Confidential 7
Consumers Merchants
March 4, 2015
Our ambition:deliver the best multi-channel solutions
Security / Control
3Dse-com3Ds
e-com3Ds
e-com
MasterPass
MasterPass
MasterPass
MobileMobileMobile
SecureMulti-
channelSolutions
SecureMulti-
channelSolutions
SecureMulti-
channelSolutions
ApplePay
ApplePay
ApplePay
DSRP MCBP
Token
(MDES)
BIO-METRICS
©2015 MasterCard.Proprietary and Confidential 88March 4, 2015
Convenience
Scale
Trad.e-comTrad.e-comTrad.e-com
Mobilecontactless
Mobilecontactless
Mobilecontactless
F2F Remote Converged solutionsNFC
Master
Pass
BIO-METRICS
38 contactlesscountries
13
TfLPL: 4in5locations
contactless
RU:mobile NFC
(eSE)
Contactless has now reached a “point of no return” in Europe
©2015 MasterCard.Proprietary and Confidential 9* In-store MasterCard and Maestro card transactions.
Source: banks’ own reporting (QMR) and MC data Warehouse. Q4 2014
13with mobile
NFC
almost
1in5 locations have a contactless
terminal
CZ:>1in2transactions*contactless
NL: debit migration
EE
Contactless acceptance Contactless & mobile
6Mio (out of 8,8Mio) Maestro NFC cards
and ~25% of all terminals
Page 10
MasterPass will add convenience while embedding enhanced security over time
©2015 MasterCard.Proprietary and Confidential 10103/4/2015
User Experience Improvements
U/N
PWD
Issuer controlled authentication
Device Secured
(EMV-Like) authentication
This year in Austria
Tokenization
Enable third party wallets
proprietary merchant interface
Other digital players
Page 11
©2015 MasterCard.Proprietary and Confidential 1111
Tokenization
MasterPass allows Issuers to create their own mobile experience and balance the dependency on powerful 3rd party wallets
March 4, 2015
Enable Banks through MasterPass
Key innovations helping to drive the converged paradigm
Page 12
CloudCloud BasedBased SecureSecure ElementElementHCE(MCBP)
©2015 MasterCard.Proprietary and Confidential 12
EMVEMV--like security for like security for eCommerceeCommerce transactionstransactions
EMV over the internet (DSRP)
March 4, 2015
Mobile payment combats fraud
230
110
230
92
153
85
Countefeit
Lost / stolen
European MC Issuer Fraud Million USD
Mag stripe
©2015 MasterCard.Proprietary and Confidential 133/4/2015
2011
277
230
2012
342
2013
462
CNP
CountefeitMag stripe
The segments which the Digital Giants will address
©2015 MasterCard.Proprietary and Confidential 14
ee--ComCom
inin--appapp
F2F F2F comcom
March 4, 2015
MasterCard’s value proposition so far and in the future
•SIM(with the MNO)
BrowsersBrowsers
…
©2015 MasterCard.Proprietary and Confidential 15
ee--ComCom
inin--appapp
F2F F2F comcom
March 4, 2015
•eSE(with Samsung)
•Cloud based(MCBP)
“Traditional” eCommmerce
Questions?
©2015 MasterCard.Proprietary and Confidential 1616March 4, 2015
©2015 MasterCard.Proprietary and Confidential 1717
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