March 2015 Issue 711 www.retailbankerinternational.com GAMIFICATION A WINNING STRATEGY OR A RISKY GAMBLE? ● COMMENT: BASEL III ● FEATURE: ONLINE SECURITY ● INTERVIEW: NICK LEESON ● STRATEGY: ACCESSIBILITY RBI 711 March.indd 1 27/03/2015 16:32:25 Delivering innovative mobile & online financial services solutions to organisations that need to provide secure access To find out more about us please visit: www.intelligentenvironments.com We are an international provider of innovative mobile and online solutions for financial service organisations. Our mission is to enable our clients always to stay close to their customers. We do this through Interact®, our single software platform, which enables secure financial applications, engagement, transaction and servicing across all digital channels. Today these are predominantly focused on mobile, PCs & tablets. However Interact® can and will support other form factors, as and when they proliferate (as seen by our work to develop digital banking for the Smartwatch). We provide a ready alternative to internally developed solutions, enabling our clients with a faster route to market, expertise in managing the complexity of multiple devices and operating systems, and a constantly evolving solution. IE-Advert-Dec-2014.indd 1 16/12/2014 12:25:21 Retail Banker International COMMENT: EDITOR’S LETTER CONTENTS 2 COMMENT: NFC Contactless is firmly in the mainstream now, so much so that it is even entering The 2015 European Digital British soap operas. Marshall Haldane examines the tipping point Financial Services Power 50 3 COMMENT: BASEL III With Basel III fully in play, banks need to adapt their habits to become fully compliant. Damian Young looks at exactly what needs to change and how it ow I need your help. Criteria for inclusion on The European can be done The Digital Banking Club is Digital Financial Services Power 50: 4 FEATURE: ONLINE SECURITY delighted to announce the launch of • The most influential thought leaders Security is a service, not a product. The the 2015 European Digital Finan- within European financial services quicker banks realise this, the quicker N cial Services Power 50, the only independ- providers, and they can keep their customers happy ent ranking of the most influential people in • Regulators, consultants, analysts, and, more importantly, actually keep them. Michael Nuciforo argues digital - and we’re talking mobile and online innovators and influencers. - financial services in Europe. I am not seeking nominations for individ- 6 INTERVEIW: NICK LEESON The 2015 listing of the important people uals working for payments providers (unless Fergus Ewbank speaks to the former ‘Beast of Barings Bank’ about his time at in European digital financial services today their work is part of a broader digital finan- the top, his quick fall to the bottom and will build on the success of last year’s inau- cial services offering), digital and/or mobile what financial firms need to do to avoid gural Digital Banking Club European Digi- platform providers and back office technol- another Barings disaster tal Financial Services Power 50. ogy suppliers. 7 ANALYSIS: GSMA I want to hear your views on which indi- Nor nominations for journalists or PRs, Mobile financial services are now viduals deserve to be recognised as the most although nominations by these groups on available in 60% of developing countries, but there is still work to be powerful influencers and innovators. behalf of others are welcome. done. Patrick Brusnahan dives into the Voting is initially open to members of The GSMA’s recent report on this topic Digital Banking Club and to subscribers of The European Digital Financial Services 8 REPORT: GEMALTO Retail Banker International, Electronic Pay- Rising Stars: Patrick Brusnahan investigates ments International and Cards Internation- Everyone loves to spot the stars of the future Gemalto’s look into the mobile banking al. This is your chance to have a say about and The European Digital Financial Servic- behaviour of the younger generation. As mobile is firmly in the popular mindset, who should make it onto the final list! es Power 50 will also list 5 Rising Stars aged what do banks need to do to take Public nominations will close on 23 April 35 years or under who are changing the way advantage of this opportunity? and will be followed by a final vote by an their financial services firms do business. 10 STRATEGY: ACCESSIBILITY external judging panel including Roy Vella, Finally, the Power 50 will honour The As payments, and banking in general, Alessandro Hatami, Jerry Mulle (Intelligent Digital Banking Club Power 50 Personality gets ever easier for the general public, Environments), Chris Skinner and Kieran of the Year to recognise outstanding service there are some sections of society being left out. Patrick Brusnahan talks to Hines (Ovum). to digital financial services. the head of the RNIB to see what can European digital financial services mov- Power lists often start more arguments be done to aid the visually impaired in Britain ers and shakers will be fêted in the final list than they settle so let the debate begin. to be revealed on www.thedigitalbanking- Email me in confidence your nominations 11 DIGITAL BANKING CLUB: SECURITY club.com in June. to [email protected] Accessibility v.s. Security. Who should win in this battle or does this battle even need to exist? Patrick Brusnahan Douglas Blakey writes about the Digital Banking Club’s [email protected] latest live debate 14 FEATURE: GAMIFICATION John Schaffer speaks to industry experts on how banking is starting to become more fun for the consumer, or so they would hope 18 PROFILE: APS Anna Milne speaks to Rich Wagner, the man who got the first non-bank into the Post Office’s branch network about the state of fintech in London 20 COMMENT: NUISANCE CALLS Gabriel Hopkins from FICO considers the annoying act of cold calling, how the UK government is tackling this issue and how the financial sector will benefit www.retailbankerinternational.com January 2015 y 1 RBI 711 March.indd 1 27/03/2015 16:32:28 COMMENT: NFC Retail Banker International Contactless- the Age of Convenience Marshall Haldane, director of global card manufacturer, allpay Card Services, talks about contactless and how the latest UK soap opera plug by Visa Europe further demonstrates how the technology is becoming more readily accepted by consumers and retailers alike Contactless payments have made their big increasingly use their cards over cash for Contactless Statistics screen debut since prime time British soap other small payments too. However, with operas Coronation Street and Emmerdale consumer confidence rocketing, the banks • 58 million contactless cards have both agreed deals with Visa Europe to use cannot afford to drag their heels. been issued that can be used to make the technology during the shows. According to the UK Cards Association, a contactless payment. These cards With contactless transactions hurtling more than 94 million contactless transac- are split between 35.3 million debit towards the mainstream – and even making tions were made in 2013 – treble the number cards and 21.2 million credit or charge an appearance in the UK’s prime time soap during 2012. cards. This is an increase of 3.8% on opera– this is another example of how the Additionally, more transactions took place masses are continuing to embrace the tech- in the first 10 months of last year than those the previous month and 52.2% over nology that’s set to rise again this year. registered over the previous six years put the year; “According to the UK Cards Association, more than 94 million • £380.8m ($567m) was spent in the contactless transactions were made in 2013 – treble the number UK in December using a contactless during 2012” card. This is an increase of 25.8% on the previous month and 330.8% over Initially the market was slow in its adop- together. While banks such as Barclays and the year. The value is split between tion, punctuated by initial security scares TSB have seized the moment, others have debit (£343.6m) and credit / charge and a chicken & egg scenario between banks been slower to embrace contactless, a posi- cards (£37.2m); and retailers, but it looks increasingly like tion they can ill afford to take. we will see 2015 become the year in which The technology is also accelerating the • 46.1 million contactless transactions contactless payments is widely embraced. decline of cash as the dominant force on were made in December 2014. This is Recent Data from WorldPay revealed the high street, particularly for lower value contactless transactions leapt by 150 per transactions – the average contactless trans- an increase of 15.6% on the previous cent over the last six months, as the tech - action being nearly £8. month and 255.1% over the year. The nology became adopted across London’s Figures from the British Retail Consorti- volume is split between debit (40.5 transport network and the word itself was um show that the availability of contactless million) and credit or charge cards adopted into the Oxford Dictionary. cards has contributed to the increased use (5.6 million); of debit cards to 50% of retail sales value So what has been the tipping point? in 2013, up by 11% over the last five years. • 215,380 bank-owned terminals are Did convenience conquer, did the banks take Over the same time period there has been a available in the UK where contactless a leap of faith, or did we all just get fed up of decline in the average debit card transaction cardholders can make a contactless counting change? value, and in use of cash by 14%. transaction. This is an increase of Certainly, the roll-out of the technology on allpay Card Services is fully approved 3.3% on the previous month and the tube and bus networks in the capital has to manufacture and personalise both 22.7% over the year; made a huge impact, not just practically, but MasterCard and Visa cards – including in the mind-set of consumers.