Overcoming Infrastructure Challenges Voca Link Martin Kearsley

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Overcoming Infrastructure ChallengesPreparing for the future

Martin KearsleyDirector of Strategy

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19:00Leaving restaurant,

top-up mobile (by ATM mobile phone top-up)

14:00Check balance and pay bills online (by OneVu)

About VocaLinkAt the forefront of innovation

17:30Leave work. Withdraw

cash for night out (by ATM)

15:25Gas bill and life insurance paid

(by Direct Debit)

10:00Salary paid in

(by Direct Credit)

12:30Check your statement

on your mobile (by MONILINK)

20:30Remember nephew’s

birthday – transfer £50 via Faster Payments

18:00Funds transferred to

savings account(by Standing Order)

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Environment of innovation and change

Over time we have built a plethora of different payment types all more complex to meet our customers’ needs

Cash was the original real-time payment

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Multiple platforms drives complexity

Each payment type, lives on a separate platform

Placing valuable IT resources under intolerable pressure

Less resource available to drive new business

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Complexity multipliers

Platform diversity brings inefficiency

Operational silos grow as complexity increases

Agility and flexibility are increasingly elusive

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Proliferating channels

MobileInternet banking

ATM POSTelephone

banking

We have trained our customers to use multiple channels

These channels bring their own complexities

Increasingly mobile customers continue to expect more

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Real-Time: fit with current payment types

Customer

Customer Channel

Cash

Credit transfer

Direct debit

High value

Retail cards

E-Information

Bank

Single settlement

(per currency)

ATM infrastructure

Automated payments

infrastructure

High value infrastructure

PoS infrastructure

ATM inter-bank

infrastructure

Automated payments inter-bank

infrastructure

High value inter-bank

infrastructure

PoS inter-bank infrastructure

Inter-bankSettlement agent

PoS

Convergence

Single bank infrastructure

Singleinter-bank

infrastructure

Convergence

Instrument

settlement

settlement

settlement

settlement

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Single bank infrastructure

Singleinter-bank

infrastructure

Multiple propositions one payments backbone

Customer

Channel

Cash

Credit transfer

Direct debit

High value

Retail cards

E-Information

Bank Inter-bankSettlement agent

PoS

Single settlement

(per currency)

Convergence

Convergence

Central Real- Time

Platform

Customer Instrument

Bank switch reflects central

platform switch design

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Re-engineering the economics of payments

Central Infrastructure

Real-Timepayments Convergence

•Simplifies inter-bank architecture•Shared service model•Value-added services•Multilateral netting

• Self-service• True STP• No reconciliation• Zero exceptions• Irrevocability• Support all customer channels

• Shared platform• Rationalise connectivity

• Combine settlement• Reduce costs

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Any channel but same experience:

Internet, mobile, ATM , “cards” plus new channels

Valid anywhere

Highly secure:bank centric

Any value

Widely accepted

Integrated with day-to-day

transactions

Enhanced experience

Final for all parties No reconciliation

required

The future payment experience The same…only different

Instantaneous

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A final thought

“We are continually faced with a series of great opportunities brilliantly disguised as insoluble problems.” John W. Gardner