SOCIAL SERVICE - VISA AND MASTERCARD LEAD THE WAY IN CUSTOMER ENGAGEMENT

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SOCIAL SERVICE - VISA AND MASTERCARD LEAD THE WAY IN CUSTOMER ENGAGEMENT
ww w.cardsi nternati onal .com             Issue 555 / may 2018

                          SOCIAL SERVICE

                           VISA AND MASTERCARD LEAD THE
                           WAY IN CUSTOMER ENGAGEMENT
                         ANALYSIS                      FEATURE                       SECURITY
                Complaints rise by 2% for       Revolut and its ambitions      The push for an industry-
                 credit cards, but fall for      to develop the UK as a          wide standard in the
                    current accounts                 cashless society             e-commerce space

CI May 2018 555.indd 1                                                                                 27/04/2018 10:15:41
SOCIAL SERVICE - VISA AND MASTERCARD LEAD THE WAY IN CUSTOMER ENGAGEMENT
contents

              this month
                   COVER STORY                                                                                                           NEWS
                                                                                                                                        05 / EDITOR’S LETTER
                                                                                                                                        06 / DIGEST
                                                                                                                                        • BJ’s Wholesale Club adds
                                                                                                                                          Masterpass as payment option
                                                                                                                                        • Billon to integrate Igoria cards with
                                                                                                                                          blockchain technology
                                                                                                                                        • OCBC first in Singapore to offer
                                                                                                                                          instant issuance and Apple Pay
                                                                                                                                        • Equinox Payments to support JCB
                                                                                                                                          contactless cards in the US
                                                                                                                                        • Tesco Bank divests Irish credit card
                                                                                                                                          portfolio to Avantcard
                                                                                                                                        • Amex and Marriott unveil co-
                                                                                                                                          branded credit cards
                                                                                                                                        • Ingenico launches new biometric
                                                                                                                                          POS terminal
                                                                                                                                        • Google Pay integrates virtual Hop
                                                                                                                                          Fastpass transit card

                                                                                                                           16
                                                                                                                                        • HomeStreet Bank unveils on-off

                   SOCIAL MEDIA                                                                                                           cards to prevent fraud
                                                                                                                                        • iZettle launches e-commerce
                                                                                                                                          marketplace for small businesses
                                                                                                                                        • JCB and Idemia launch biometric
                        Editor: Douglas Blakey                   Group Editorial Director:           Director of Events: Ray Giddings     card pilot in Japan
                        +44 (0)20 7406 6523                           Ana Gyorkos                          +44 (0)20 3096 2585
                                                                                                                                        • Credit card customer sues JPMorgan
                     douglas.blakey@verdict.co.uk                 +44 (0)20 7406 6707                   ray.giddings@compelo.com
                                                               ana.gyorkos@globaldata.com                                               • Mastercard to hire 175 in Dublin
                             Senior Reporter:                                                             Head of Subscriptions:
                            Patrick Brusnahan                     Sub-editor: Nick Midgley                     Alex Aubrey
                          +44 (0)20 7406 6526                      +44 (0)161 359 5829                     +44 (0)20 3096 2603
                    patrick.brusnahan@verdict.co.uk            nick.midgley@uk.timetric.com             alex.aubrey@verdict.co.uk

                    Junior Reporter: Briony Richter                Publishing Assistant:               Sales Executive: Jamie Baker
                         +44 (0)20 7406 6701                            Joe Pickard                         +44 203 096 2622
                     briony.richter@verdict.co.uk                  +44 (0)20 7406 6592                  jamie.baker@verdict.co.uk
                                                                 joe.pickard@verdict.co.uk

                                                                                                                                        08
                          Customer Services: +44 (0)20 3096 2603 or +44 (0)20 3096 2636, briefings@verdict.co.uk

                                  Financial News Publishing, 2012. Registered in the UK No 6931627. ISSN 0956-5558
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   2 | May 2018 | Cards International

CI May 2018 555.indd 2                                                                                                                                                   27/04/2018 10:16:04
SOCIAL SERVICE - VISA AND MASTERCARD LEAD THE WAY IN CUSTOMER ENGAGEMENT
contents

                                                                                                          may 2018
                                                                                                               s to talk about cracking China, disrupting

                                                                                            20
                                                                                                                COUNTRY SNAPSHOTS
                                                                                                               SWIFT, and leveraging WeCha

                                                                                                               16 / CHILE
                                                                                                               Payment card transactions are gradually
                                                                                                               replacing cash in Chile, mainly as a result
                                                                                                               of government and bank initiatives such
                                                                                                               as a financial inclusion programme and
                                                                                                               infrastructure modernisation

                                                                                                               18 / NIGERIA
                                                                                                               The use of cash for consumer payments
                                                                                                               remains highly prevalent among Nigerians,
                                                                                                               especially for those in rural areas. However,
                                                                                                               the Central Bank of Nigeria has taken a
                                                                                                               number of steps to improve this situation

                                                                                                               20 / THE PHILIPPINES
                                                                                                               Cash’s dominance in the Philippines
                                                                                                               is mainly a result of the country’s high
                                                                                                               unbanked population, inadequate banking
                                                                                                               infrastructure, limited public awareness of
                                                                                                               cards, and low levels of card acceptance

         ANALYSIS                                            FEATURES
        10 / COMPLAINTS                                     12 / SOCIAL MEDIA
        Credit card complaints rose by 2% in the            With social media ever-present in everyday life,
        second half of 2017 while current account           the opportunities to engage with customers are
        complaints fell. Overall, a total of 3.76 million   numerous. Visa and Mastercard consistently
        complaints were received in the six months to       outrank banks in terms of social media
        end-2017, reports Douglas Blakey                    outreach, but why? Patrick Brusnahan writes

                                                    11      14 / REVOLUT
                                                            Revolut believes the UK could become fully
                                                            cashless in just 10 years, and wants to be at
                                                            the forefront of the revolution. CTO and
                                                            co-founder Vlad Yatsenko tells Briony Richter
                                                            why this vision is close to becoming reality                                                    16
         SECURITY                                            PRODUCTS                                           INDUSTRY INSIGHT
        11 / E-COMMERCE                                     15 / VIRGIN ATLANTIC                               22 / MYPOS
        Shifting from magnetic stripes to chips in          Two new credit cards are the first products to     From the casual dining crunch to major high
        cards has been a long process; however, it was      be launched from the partnership between           street retailers facing financial troubles, there is
        needed to improve security at the point of sale.    Virgin Atlantic and Virgin Money, facilitated      little doubt that we are facing a difficult retail
        Now, the biggest firms want a similar shift in      by Mastercard. Briony Richter takes a looks at     environment. However, this also represents an
        e-commerce. Patrick Brusnahan reports               the cards’ primary features and benefits           opportunity, writes Ambreen Khasru

                                                                                                                           www.cardsinternational.com | 3

CI May 2018 555.indd 3                                                                                                                                         27/04/2018 10:16:26
SOCIAL SERVICE - VISA AND MASTERCARD LEAD THE WAY IN CUSTOMER ENGAGEMENT
HEAR         ∤      NETWORK         ∤    DISCOVER                 ∤      CELEBRATE

     LEASING LIFE CONFERENCE
          & AWARDS 2018
                                                          15th November 2018             ∤   Tallinn, Estonia

  For its 14th edition Leasing Life Conference and Awards 2018 moves to the Baltic Region to bring together asset
  finance professionals and industry disruptors in an active discussion of the key issues facing the leasing industry.
      This year’s Leasing Life conference explores how Europe’s leasing industry is responding to the value chain
      opportunity - the operational, and strategic, implications of the paradigm shift, and the role that technology
                       must play in transforming the industry so that it thrives in the digital age.
                                                             .
    Event highlights:
    ∤ Re-defining asset ownership for a digital
      generation
    · The Baltic Approach: Regulatory arbitrage
      in the digital era
    · GDPR and its implications for reporting,
      asset management and marketing
    · Funding strategies for a lean world
    · Re-defining sales and distribution channels
      for the digital era
    · Harnessing the power of agile: Assessing the
      transformative potential of digital
    · Embracing the circular value chain approach
      to lease delivery & design
    · Taking the right risks for the rewards:
         Strategic implications of the era of asset
         ownership
    · Using data and analytics to drive
      performance, deliver value

 Headline Sponsor:                Gold Sponsor:                       Silver Sponsors:

                     Brand Sponsor:          Exhibitor:            Badge and Lanyard Sponsor:   Table Hosts:

                                                               For more details please contact:
Page 1                           Vicki Greenwood on vicki.greenwood@compelo.com or call +44 (0) 20 30W96 2580
SOCIAL SERVICE - VISA AND MASTERCARD LEAD THE WAY IN CUSTOMER ENGAGEMENT
editor’s letter

             Tinkoff remains the Russian
             cards player to watch
                                                                                                                  Douglas Blakey, Editor

        L
               aunched only 11 years ago by serial entrepreneur             Sberbank, with more than 3.5 million customers. But debit card
               Oleg Tinkov, Russia’s number one direct bank can             customer numbers are catching up fast, as Tinkoff ended 2017
               already claim to be the world’s largest fully online         with more than three million customers.
        bank by customer base.                                                 Hughes tells me Tinkoff is now attracting 120,000 new debit
          It is generally regarded as punching above its weight in terms    card customers every month; he says that the day is not far
        of credit cards, but is now repeating the trick with a successful   away when current account customers will exceed credit card
        range of debit cards.                                               customer numbers.
          The list of growing Tinkoff innovations is impressive:               Hill, whom I have known and admired since his Commerce
          • The first organisation in Russia to roll out facial             Bank days in the US, is fond of asking banking journalists just
                biometric recognition to identify and verify customers      how many online-only banks have really made a success of
                in 2016;                                                    their business with sustained profitability. Tinkoff can claim
          • The first in Russia to implement real-time voice-               such a success: in fiscal 2017 Tinkoff posted net income of
                authentication technology in 2014;                          RUB19bn ($300m).
          • With around 4,600 operators, Tinkoff has the largest               Hughes says Tinkoff is on track to report a net profit for
                cloud-based Home Call Centre powered by proprietary         fiscal 2018 of at least RUB24bn, and will hit its target of a net
                software in Russia;                                         income increase for the next two years of 20-40% per annum.
          • 20% of all incoming electronic messages are                        The upcoming launch by Tinkoff of a premium Tinkoff
                automatically handled by bots, and                          Black product line and associated concierge service to target
          • Tinkoff was among the first to launch Apple Pay,                the mass affluent segment and the lower end of the private
                Android and Samsung Pay services in 2016.                   banking sector makes perfect business sense. It is just one of
                                                                            a number of new product lines in the Tinkoff pipeline likely to
           Tinkoff is now transitioning to become an online financial       ensure that Tinkoff will hit its next business targets. <
        marketplace: Tinkoff.ru offers a full range of both own-brand
        and partner retail financial services via mobile and desktop.
           By chance, as CI was preparing to go to press, I spoke with
                                                                                                   market shares
        Oliver Hughes, president and CEO of Tinkoff just minutes after                  Russia: leading credit card issuers, 2017
        speaking with Metro Bank chair and founder Vernon Hill as
        Metro Bank released its first-quarter earnings.
           There are shades of Hill’s background, success and charisma
        in the background of Tinkoff’s founder. While Hill made his
                                                                                               Others
        first fortune in fast food as part-owner of a group of Burger                          27.7%
        Kings, Tinkoff has, in his time, owned a network of restaurants,
        frozen food factories and brewing firms before concentrating                                                Sberbank
        on financial services.
                                                                                                                     45.5%
           There the similarities end, as while Hill and his UK and US                   VTB
        banks, Metro and Republic respectively, are focused on the                       6.9%
        store, Tinkoff has no branches and has acquired and services                           Alfa
                                                                                               8.3% Tinkoff
        all of its seven million-plus and growing customers via online
        channels and its call centre.
                                                                                                    11.6%
           Tinkoff’s share of the credit card market has almost doubled
        in the past five years to more than 11.5%, second only behind                                 Source: Tinkoff

                              Get in touch with the editor at: douglas.blakey@verdict.co.uk

                                                                                                              www.cardsinternational.com | 5

CI May 2018 555.indd 5                                                                                                                   27/04/2018 10:16:35
SOCIAL SERVICE - VISA AND MASTERCARD LEAD THE WAY IN CUSTOMER ENGAGEMENT
News | Digest

              news digest
              BJ’s Wholesale Club adds                                                                          OCBC first in singapore
              Masterpass as payment option                                                                      to offer instant digital
                                                                                                                issuance and Apple Pay
                                                               be entered. It can be used with various devic-
                                                               es and channels.                                 OCBC has become the first bank in
                                                                  Mastercard’s executive VP for US mer-         Singapore to enable customers to transact
                                                               chants and acceptance, Linda Kirkpatrick,        at merchants that accept Apple Pay within
                                                               said: “We are thrilled to partner with BJ’s      minutes of applying for a Visa credit or
                                                               Wholesale Club to enhance its one-stop           debit card.
                                                               shopping experience with our latest and             OCBC customers no longer need to wait
              US-based warehouse chain BJ’s Wholesale          safest digital technology.                       for a physical card to arrive – they can now
              Club has added Masterpass, Mastercard’s             “With Masterpass as a payment option,         add a digital card to Apple Pay instantly via
              digital contactless payment service, as a        BJ’s members are just a click away from a        the OCBC Mobile Banking app.
              payment option for its customers.                seamless and secure checkout.”                      According to OCBC, Visa cards make up
                 The integration will enable BJ customers         BJ’s Wholesale Club CFO Bob Eddy said:        almost 80% of OCBC Bank cards currently
              to pay for purchases without taking out cards    “As we continue to grow our Omnichannel          linked to Apple Pay. Instant provisioning
              or sharing credentials.                          capabilities, we’re focused on delivering a      of cards for use with Apple Pay has been
                 Masterpass securely stores sensitive pay-     seamless experience for our members. Add-        enabled for OCBC Bank Visa credit
              ment information such as card and shipping       ing Masterpass as a payment option on BJs.       cards – including the 365, Frank, Voyage,
              details, and payment preferences, and does       com offers our members another convenient        Robinsons Group, Plus! Visa and NTUC
              not require all of a customer’s credentials to   way to shop with us.” <                          Plus! cards and the Yes! debit card.
                                                                                                                   Aditya Gupta, OCBC Bank’s head of

              Billon to integrate Igoria cards                                                                  e-business Singapore, said: “This is the new
                                                                                                                digital – instant, embedded and frictionless

              with blockchain technology
                                                                                                                access to banking products and services.
                                                                                                                Our customers can now receive their new
                                                                                                                card digitally and provision it to their Apple
                                                               and provide a digital system to manage           Wallet to start paying with it straight away
                                                               limits and payment histories, and facilitate     – all from within our mobile banking app
                                                               currency exchange.                               and within a few minutes.
                                                                  Igoria cards will be stored in electronic        “We believe this is a huge level-up in
                                                               form on Billon’s blockchain platform.            customer experience, and will accelerate
                                                               Payments made using the cards will be            our digital card applications and cashless
                                                               funded through e-money present on the            payments market leadership drive.”
                                                               platform.                                           One in every two Visa contactless
                                                                  Billon CEO and founder Andrzej                transactions in Singapore, including Apple
                                                               Horoszczak said: “The partnership with           Pay, are made with an OCBC Bank card.
                                                               Igoria is the start of a relationship that       Monthly mobile wallet payments have
                                                               could see us fully commercialise our             doubled since 2016, while the number of
              UK-based blockchain services provider            distributed ledger technology and move           credit cards provisioned to mobile wallets
              Billon has partnered with Polish business        from existing individual deployments to a        has increased sevenfold.
              Igoria Trade to allow digital use of the         much broader transformation of payments             Around 60% of OCBC Bank cards linked
              multi-currency IgoriaCard in 150 countries       and the banking system.”                         to mobile wallets are on Apple Pay. Mobile
              through blockchain technology.                      Igoria Trade CEO Wojciech Kuliński            wallets are particularly popular for lifestyle
                 Billon uses a blockchain ledger to store      added: “The move to integrate Billon’s           transactions including groceries, hire cars,
              and transfer real, regulated currencies and      distributed ledger technology with               food deliveries and fast food.
              smart data. The collaboration will allow         IgoriaCard is truly exciting.                       Vincent Tan, OCBC Bank’s head of
              Billon customers to use Igoria cards for            “We’re committed to staying at the            credit cards, said: “With our instant digital
              transactions in physical stores as well as       cutting edge of technology and believe           card issuance, customers can immediately
              online purchases at low exchange rates.          the partnership with Billon is the perfect       provision their new cards to Apple Pay via
                 Available in plastic and virtual forms,       opportunity for us to take the next leap         our mobile banking app, and start to enjoy
              the cards run on the Mastercard network,         forward.” <                                      our cards’ rewards and rebates.” <

   6 | May 2018 | Cards International

CI May 2018 555.indd 6                                                                                                                               27/04/2018 10:17:02
SOCIAL SERVICE - VISA AND MASTERCARD LEAD THE WAY IN CUSTOMER ENGAGEMENT
News | digest

        Equinox Payments to support JCB AmEx and Marriott
        contactless cards in the US     unveil co-branded
        Payment terminals provider Equinox
        Payments is set to upgrade its terminal lines
                                                        JCB EMV liability shift that takes effect next
                                                        year. Once completed, all Equinox payment        credit cards
        to support contactless transactions on JCB      terminals will be automatically enabled to
        cards in the US.                                support JCB Contactless at the factory prior
           Equinox plans to integrate its Apollo,       to release.”
        L5000 and Luxe terminal lines with contact-        Equinox also added JCB support to its
        less chip technology. The business said an      L5300 terminal, which is used at various
        upgrade path will be provided for mer-          high-volume retailers, and the Apollo stand-
        chants with these terminals over the coming     alone terminal.
        months, enabling acceptance of contactless         JCB’s VP of emerging technologies, Linda
        payments through JCB cards and Apple Pay.       Horwath, said: “This relationship under-         American Express and Marriott
           Commenting on the move, Equinox              scores the partner-friendly approach that        International have unveiled new the
        Payments VP Rob Hayhow said: “Merchants         Equinox brings to the table.                     Marriott Rewards Premier Plus credit
        that adopt these solutions can improve the         “We are excited to extend the speed and       card and the Starwood Preferred Guest
        checkout experience for JCB card members,       convenience of contactless payments to our       American Express Luxury card, along with
        and make sure their business is ready for the   valuable card members visiting the US.” <        the refreshed Starwood Preferred Guest
                                                                                                         Consumer and Business credit cards.

        Tesco Bank divests Irish credit                                                                     Set to be available from May this year,
                                                                                                         the Rewards Premier Plus credit card is

        card portfolio to Avantcard
                                                                                                         part of Marriott’s loyalty programme and
                                                                                                         will feature a new 100,000-point limited-
                                                                                                         time offer for new card members, with a
                                                                                                         variety of other benefits such as reward
                                                                                                         points on purchases.
                                                                                                            Both the new and refreshed cards
                                                                                                         under the Starwood Preferred Guest
                                                                                                         programme will be available from August
                                                                                                         this year. They will provide travel benefits
                                                                                                         and rewards that can be access at around
                                                                                                         6,500 hotels in 127 countries.
                                                                                                            The American Express Luxury card is
                                                                                                         designed for premium customers and
                                                                                                         features complimentary Gold Elite Status,
                                                                                                         additional cards at no charge, and a chance
                                                                                                         to earn Platinum Elite Status, among
                                                                                                         others. The Consumer and Business cards
                                                                                                         will offer new benefits such as points on
                                                                                                         purchases at select SPG and Marriott
                                                                                                         Rewards hotels, Annual Night Award and
                                                                                                         automatic Silver Elite Status.
        The UK’s Tesco Bank has agreed to sell its      Fee card does not charge a fee for balance
                                                                                                            The Business cards will also offer
        Irish credit card portfolio to Spain-based      transfers, the Premium card focuses on
                                                                                                         additional ways for small merchants to
        consumer finance company Avantcard.             reward points, and the Foundation card           earn points when they make common
        As a result, around 27,000 credit card          allows its holders to improve their credit       purchases, including dining, gas, wireless
        accounts are set to be transferred from         ratings.                                         bills and shipping.
        Tesco Bank to Avantcard.                           The deal follows Tesco Bank’s decision to        American Express’s senior VP of US
           Cardholders will be able to continue         cease accepting applications for its credit      commercial cards, Courtney Kelso, said:
        using existing cards until they receive         card services from Irish customers in May        “We know our card members love to stay
        a new card, which also applies to Tesco         last year.                                       at Marriott hotels when they travel the
        Clubcard reward points, The Irish Times            Avantcard MD Chris Paul said:                 globe. With our expanded card offerings,
        reported.                                       “Avantcard’s strategy is to be a leading         soon they will get access to even more
           Tesco offers a variety of credit cards,      consumer finance provider in Ireland by          benefits to enhance their hotel stays and
        each with different features. Its Purchases     2020, and this will be achieved through          their entire travel experience – all while
        card offers interest-free payments for 28       ongoing product innovation, continuing           giving them more ways to earn the points
        months, while the No Balance Transfer           investment and strategic partnerships.” <        we know they love.” <

                                                                                                                   www.cardsinternational.com | 7

CI May 2018 555.indd 7                                                                                                                            27/04/2018 10:17:12
SOCIAL SERVICE - VISA AND MASTERCARD LEAD THE WAY IN CUSTOMER ENGAGEMENT
News | Digest

              Ingenico launches new                                                                              HomeStreet Bank
              biometric POS terminal                                                                             unveils on-off cards
              Payment solutions provider Ingenico Group             VP of Ingenico’s marketing of banks and
                                                                                                                 to prevent fraud
              has launched a new portable mobile point-         acquirers business unit, Frédéric Lepeintre,
              of-sale terminal, the Move/2500 B, with           said: “We are pleased to introduce the
              biometric capability.                             Move/2500 B, our third-generation
                 The new product is intended to meet            biometric POS, designed to support
              standard financial inclusion requirements         financial inclusion scenarios as well as
              for the unbanked population and                   innovative payment schemes in mature
              government schemes. According to the              markets.
              company, India will soon require these                “The launch of the Move/2500 B
              systems for fingerprint authentication, and       illustrates Ingenico Group’s commitment
              Mexican banks can use them to verify a            towards reaching the two billion people
              loan recipient’s identity. Ingenico noted         excluded from financial services.
              that the EMVco certification of fingerprint           “It also demonstrates our ability to
              authentication may initiate new global            adapt to new regulatory frameworks
              schemes.                                          and consumer demand for fingerprint
                 Promoted as secure and cost-efficient,         authentication.”
              the Move/2500 B supports all types                    The company plans to introduce its new
              of payment methods, and can match                 biometric POS in India in June this year,
              fingerprints in a fraction of a second.           and subsequently into the Middle East. <
                                                                                                                 US-based HomeStreet Bank has

              Google Pay integrates virtual
                                                                                                                 introduced a new mobile security feature,
                                                                                                                 Card Controls, to give clients greater

              Hop Fastpass transit card
                                                                                                                 control over their debit cards.
                                                                                                                    The new feature aims to prevent fraud
                                                                                                                 and improve the security of debit cards.
                                                                                                                 Available through the bank’s mobile app,
                                                                                                                 the new capability allows customers to
                                                                                                                 turn cards on and off, and enable usage
                                                                                                                 alerts. It also enables cardholders to track
                                                                                                                 spending, and manage expense limits,
                                                                                                                 merchant types and geographic locations.
                                                                                                                    HomeStreet Bank CEO and president
                                                                                                                 Mark Mason said: “Protecting our
                                                                                                                 customers from fraud is one of our top
                                                                                                                 priorities, which is why we continue to roll
                                                                                                                 out security features like Card Controls.
                                                                                                                    “Through Card Controls, customers have
                                                                                                                 total control over their debit card right at
              Init, TriMet and moovel have collaborated         beginning of a new era in the fare-collection
                                                                                                                 their fingertips, giving them peace of mind
              to integrate the virtual Hop Fastpass card for    world.
                                                                                                                 that their banking information is secure.
              Google Pay users in the Portland, Oregon             “The vision of a secure transit payment
                                                                                                                    Mason added: “We’re committed to
              region.                                           solution without carrying a card has now         our customers, and we’re looking forward
                 Cardholders using TriMet, C-Tran and           finally been realised.”                          to rolling out more features that make
              Portland Streetcar rides in the Portland-Van-        When the virtual card is used by riders, a    their banking experience safer and more
              couver region will now be able to use a           back-office management tool, Mobile-var-         convenient.”
              virtual smart card to pay transit fares.          io by Init, will estimate the fare, verify the      The Card Controls feature follows a
                 The card can be loaded through the Hop         transaction and provide the fare-validation      series of digital upgrades such as Cardless
              Fastpass mobile app available at the Google       result in real time.                             Cash, Apple, Samsung and Android Pay
              Play store. It is said to be the first regional      TriMet general manager Doug Kelsey said:      launched by the bank over the past
              account-based virtual transit fare card, and      “The combination of Hop and Google Pay           few months to enhance the customer
              can be used at any of the 1,200 Init fare         puts transit riders in the Portland-Vancouver    experience.
              validators.                                       region on the cutting edge of technology,           The bank also plans to roll out the Zelle
                 Init project engineer Thomas Schaich said:     while truly getting the best value with daily    person-to-person payment network in the
              “The use of virtual transit cards marks the       and monthly fare caps as they ride.” <           near future. <

   8 | May 2018 | Cards International

CI May 2018 555.indd 8                                                                                                                               27/04/2018 10:17:40
SOCIAL SERVICE - VISA AND MASTERCARD LEAD THE WAY IN CUSTOMER ENGAGEMENT
News | Digest

        iZettle launches e-commerce                                                                        JCB and Idemia launch
        marketplace for small businesses                                                                   biometric card pilot
                                                                                                           Japanese card issuer JCB has partnered
                                                                                                           with Idemia, an augmented identity
                                                                                                           business, to trial its first biometric chip
                                                                                                           card aimed at enabling faster checkouts.
                                                                                                              The payment card integrates Idemia’s
                                                                                                           F.Code technology designed to replace PIN
                                                                                                           with fingerprint authentication to allow
                                                                                                           easy and secure transactions. Customers
                                                                                                           can use a smartphone or tablet app to
                                                                                                           initially record their fingerprints, which will
                                                                                                           be stored in the card.
                                                                                                              At the time of purchase, they can make
                                                                                                           a payment by simply touching a fingerprint
                                                                                                           sensor embedded on the card. An Idemia
                                                                                 Jacob de Geer, iZettle    algorithm then validates the identification
                                                                                                           by cross-checking with the stored data.
        iZettle, the Swedish fintech business that       to maximise sales and improve the customer
                                                                                                              The pilot is set to be conducted in
        serves small businesses in Europe and Latin      experience.
                                                                                                           alliance with card-personalisation partner
        America, has launched a new e-commerce              iZettle CEO and co-founder Jacob de
                                                                                                           Toppan Printing, and will see issuance of
        platform that allows merchants to sell in-       Geer stated: “This is iZettle’s biggest product
                                                                                                           cards to JCB employees in Japan.
        store, online and on mobile devices.             launch since 2011, and it is a huge moment
                                                                                                              Executive VP of JCB’s brand
           The platform will enable small busi-          for us.
                                                                                                           infrastructure and technologies
        ness owners to set up and customise new             “Today’s consumers expect businesses
                                                                                                           department, Tac Watanabe, said: “This
        webshops and start selling products through      to be present both offline and online. Half
                                                                                                           pilot programme, through our strong
        multiple online channels, including social       of iZettle’s users currently don’t have an
                                                                                                           partnership with Idemia, is to demonstrate
        media, blogs and existing websites.              online shop, and the other half struggle with
                                                                                                           a use case of how JCB intends to provide
           The iZettle E-commerce platform is            different complex online systems. iZettle
                                                                                                           customers with a secure and smooth way
        available in the UK as part of the iZettle       E-commerce solves these problems, helping
                                                                                                           of making payments in the future.”
        Go Plus full-feature package that costs £29      small businesses find new customers and sell
                                                                                                              Executive VP of Idemia’s financial
        ($42) per month. Small businesses that take      more – all from one place.”
                                                                                                           institutions business unit, Pierre Barrial,
        up the offer will benefit from a full overview      The online platform processes all major
                                                                                                           added: “F.Code is a unique technology that
        of in-store and online sales in one place.       credit cards and online payments, and sup-
                                                                                                           provides highly secured authentication and
        Inventories are automatically updated after      ports PayPal. The launch is part of iZettle’s
                                                                                                           we are eager to implement it for the first
        each sale.                                       strategy to extend its commerce platform by
                                                                                                           time in Japan.” <
           The platform will also enhance data pro-      offering a wider range of affordable tools to
        ductivity, enabling merchants to harness data    small businesses. <

                                                                                                           Mastercard to hire 175
        Credit card customer sues JPMorgan                                                                 to drive innovation
                                                                                                           Mastercard has announced plans to
        JPMorgan Chase has been sued by a credit            The bank reportedly charged $143.30
                                                                                                           bolster its footprint in Ireland by hiring
        card customer in Idaho over high interest        in fees and $20.61 in interest for five
                                                                                                           175 new technical staff at its facility in
        rates and fees for buying cryptocurrency         cryptocurrency transactions made between
                                                                                                           Leopardstown, Dublin.
        using a credit card.                             27 January and 2 February, and refused a
                                                                                                              The company will hire software
           According to reports, Brady Tucker has        request for their removal. Tucker, who is
                                                                                                           engineers, blockchain and cloud
        filed a lawsuit against the banking giant in     now seeking actual and statutory damages
                                                                                                           infrastructure specialists, data scientists,
        the federal court in Manhattan, claiming         of $1m, said he used a credit card because
                                                                                                           analysts, project managers, information
        JPMorgan considered the cryptocurrency           it was the only means to make an instant          security experts and product designers.
        purchases as cash advances and levied            cryptocurrency purchase on Coinbase.                 Mastercard said the new employees will
        higher charges than usual.                          Reuters quoted Chase spokesperson              primarily focus on expanding innovation in
           JPMorgan banned the use of its credit         Mary Jane Rogers as saying the                    payments and security solutions.
        cards for buying cryptcurrencies in              bank ceased processing credit card                   Mastercard Ireland country manager
        February this year, but Tucker’s lawsuit         cryptocurrency purchases in February              Sonya Geelon said: “At our Dublin office,
        claims the bank did not issue any notice         because of the credit risk involved, but          we’re working on innovations that will
        that the purchases will be treated as cash       that customers can use debit cards without        shape the future of payments not just in
        advances.                                        incurring cash-advance charges. <                 Ireland, but all around the world.” <

                                                                                                                      www.cardsinternational.com | 9

CI May 2018 555.indd 9                                                                                                                                27/04/2018 10:17:52
SOCIAL SERVICE - VISA AND MASTERCARD LEAD THE WAY IN CUSTOMER ENGAGEMENT
ANALYSIS | COMPLAINTS

                                                                                                                  in the six months to the end of March, and

                  CREDIT CARD
                                                                                                                  expected to receive another 110,000 by the
                                                                                                                  complaints deadline set for August 2019.
                                                                                                                     Excluding PPI, the number of complaints

                  COMPLAINTS
                                                                                                                  received by firms was 2.21 million – around
                                                                                                                  13,000 fewer than the previous six months.
                                                                                                                     After PPI, the next most complained-about
                                                                                                                  products are current accounts with 509,047

                  INCH UP IN UK
                                                                                                                  complaints, and credit cards with 314,586
                                                                                                                  complaints. These products have a higher
                                                                                                                  proportion of complaints closed within three
                                                                                                                  days (see table).
                                                                                                                     The amount of redress paid out in total
                  Credit card complaints rose by 2% in the second half                                            during the second half of 2017 was £2.36bn,
                                                                                                                  up 19% year on year. This was driven by
                  of 2017 while current account complaints fell. Overall,                                         an increase in redress payments for PPI
                  a total of 3.76 million complaints were received in the                                         complaints, which rose by 26% to £2.05bn.
                  six months to end-2017, up 13% year on year, as PPI                                             Redress per upheld complaint fell in the
                                                                                                                  second half of 2017 for all product groups (see
                  continues to haunt UK banks, reports Douglas Blakey                                             chart), with the average banking and credit
                                                                                                                  card payment falling from £270 to £253.

              F                                                  CLAIMS HANDLING
                      irst off: the positives. Take a bow,                                                           Christopher Woolard, executive director
                      Nationwide. Of the major UK banks                                                           of strategy and competition at the FCA, said:
                      and building societies, Nationwide         The latest FCA complaints data suggests that     “Having set a deadline for PPI complaints, we
              attracted the least complaints in the second       banks’ internal complaints-handling processes    are encouraging consumers to decide whether
              half of 2017, with only 1.44 complaints per        remain a work in progress.                       they want to claim, and if they do, to make
              100,000 accounts for banking and credit               A whopping seven in ten (70.1%) of            their complaint as soon as possible, as many
              cards.                                             banking and card customer complaints against     already have.
                 Skipton Building Society and Yorkshire          Lloyds were upheld by the FCA. Sister brand         “We are continuing to monitor and
              also scored well with only 1.57 and 1.92           Bank of Scotland (60.2%) also scored poorly      challenge all firms to ensure they maintain the
              complaints per 100,000 accounts respectively.      by this measure. By contrast, less than one-     expected standards and are delivering on their
                 At the other end of the scale, HSBC is the      half of all complaints against Bank of Ireland   commitments to make it easy for people to
              most complained-about major retail banking         UK (43.0%), Allied Irish Banks UK (43.4%),       complain about PPI,” Woolard added.
              brand with 6.88 complaints per 100,000             Santander (43.5%), Tesco (49.0%) and Metro          “When PPI is taken out of the mix, the
              banking and credit card accounts, just ahead       Bank (49.3%) were upheld.                        numbers of complaints firms are receiving has
              of RBS with 6.69 and Barclays with 6.51.              Complaints about PPI rose by 40% to           remained stable. Firms should be doing all
                 Of the other major brands, Santander            1.55 million in the second half of 2017, the     they can to reduce complaints and ensure they
              (5.26) and Lloyds (5.23) continue to attract       highest level of complaints about PPI for more   are treating customers fairly.” <
              more complaints per 100,000 accounts               than four years. In January, firms paid out
              than challenger brands such as TSB (4.35)          £416m ($581m) in PPI compensation, the
              and Metro Bank (4.18). Co-operative Bank           highest figure since March 2016. The total for
                                                                                                                                       compensation
              and Virgin Money, on only 3.09 and 2.68            compensation payments since January 2011 is           Redress per upheld complaint, 2017
              respectively, performed strongly.                  now £30bn.
                 RBS’s private banking brand, Coutts, is                                                                    £
                                                                    Banks continue to add to their PPI             3,000                      H1 2017           H2 2017
              among the worst overall performers (10.22);        provisions, with Clydesdale Bank setting
              sister RBS brands NatWest and Ulster Bank,         aside a further £350m for PPI claims in April.    2,500
              on 5.48 and 4.25 respectively, fared better.       Clydesdale said it received 59,000 claims
                                                                                                                   2,000

               UK – MOST COMPLAINED-ABOUT PRODUCTS, 2017                                                           1,500

                                                                                             % closed within       1,000
                                         H1 2017              H2 2017         change %       3 days, H2 2017
               PPI                      1,112,043         1,551,897               40                 9              500

               Current accounts          518,608              509,047             -2                70
                                                                                                                        0
                                                                                                                                  ts         ce )      e   ns                     I
               Credit cards              309,875              314,586              2                70                          en                                      nd s    PP
                                                                                                                                         an PI Homnce nsio          g aard
                                                                                                                          st
                                                                                                                            m        s ur l. P      n a e       i n   c
               Motor and transport       241,319              230,146             -5                56                 ve          In exc         fi      P    nk it
                                                                                                                     In              (                     Bacred
               Packaged accounts         203,509              206,089              1                25
               Source: FCA                                                                                                                   Source: FCA

   10 | May 2018 | Cards International

CI May 2018 555.indd 10                                                                                                                                                        27/04/2018 10:17:54
security | e-commerce

              will a new standard
              revolutionise
              e-commerce?
              Shifting from magnetic stripes to chips in cards has been a long, almost everlasting,
              process; however, it was needed to improve security for consumers at the point of sale.
              Now, the biggest firms want a similar shift in e-commerce. Patrick Brusnahan reports

        S
               tandardisation is not a new thing in         common checkout button.” As a result, the             where we have the more traditional players. In
               payments. Europay, Mastercard and            checkout experience would be more consistent          the e-commerce world, we also have gateways,
               Visa combined their efforts to create        for consumers. In addition, it would reduce           shopping cart providers, people who build
        the EMV standard, now run by EMVCo.                 the amount of steps consumers need to take            part of the user experience.
           This introduced the ‘smart’ payment card,        at different sites, as well as making it easier for     “Many of these parties will have to make
        or the chip card, to increase security at the       merchants to implement.                               changes in order for these new standards to be
        POS. Now, companies are coming together                Cowen says: “The security side is very             adopted.”
        again to re-enact this process for online           important but it’s also about trying to
        purchases.                                          standardise the user experience as much as            HOW LONG?
                                                            possible. It’s about making it simple and
        SUCCESSFUL TRANSITION                               consistent for consumers.                             Mastercard is not the only firm pushing for
                                                               “There is a proliferation of different ways to     standardisation. Visa and American Express
        Mike Cowen, VP of digital payments at               pay online, and even when you’re paying the           have also displayed their support, and more
        Mastercard UK, tells CI: “It’s about trying to      same way, there are proliferations of different       are set to follow. With the amount of large
        achieve something similar in the online world       user experiences that enable card transactions        companies backing the move, how long will it
        to what has been achieved in the physical           to happen. This is potentially confusing              take to implement?
        world at the point of sale.                         for people. It certainly reduces confidence,             Cowen says: “This is not something that
           “We’ve all seen the very successful transition   because if you’re asked to do something               Mastercard is trying to do on its own. It is
        from magnetic stripe as a technology for            different every time, that ability to build up        very much a call to the industry to adopt
        payments being increasingly replaced by chip.       familiarity and comfort is reduced.”                  this new standard. It’s intended to be for the
        One of the key benefits is driving security, and                                                          benefit of everyone. A better and more secure
        reducing fraud, at the point of sale. Now we        THREE MAIN AREAS                                      payment experience should help everybody.”
        want to do something similar in the online                                                                   “In terms of timing, it’s not going to be
        world.”                                             Cowen continues: “These are the three main            overnight,” Cowen warns. “This is the start
           This comes in the form of the EMVCo              areas where we see this development helping:          of a journey and that is the right way to talk
        Secure Remote Commerce (SRC) framework,             security, standardisation and simplicity.”            about this.
        which aims to give consumers the same                  One solution is tokenisation. Utilising               “We’re talking months or maybe even one
        simple, secure and convenient payment               tokens to protect sensitive data can aid              or two years. It’s not going to take anything
        experience across every browser and device.         security as well as bring a standard to all           as long as the journey from magnetic stripe to
           “We now feel it’s the right time to increase     payment processes.                                    chip, which is not yet complete and it started
        security in the online world,” Cowen explains.         “Our ecosystem is a massively distributed          20 years ago.”
        “We want to do it in a similar way to what          one,” Cowen explains. “We’re talking billions            Cowen concludes: “The improvement in
        we did with POS, and that is standardisation.       of consumers, tens or hundreds of thousands           security should attract everybody, and that
        That’s where the SRC standard comes in. This        of banks and tonnes of players in between.”           is an area we will push. We want to get to a
        defines a secure framework in which online             He adds: “The ecosystem is highly                  point where every online or remote payment
        transactions can take place.”                       fragmented and people have different roles            is at least as secure as a payment at POS. That
           In a blog post from Mastercard, the firm         within the ecosystem and the value chain. This        means using the secure technologies we have
        states: “SRC can be implemented as one,             doesn’t take into account the physical world,         available to us.” <

                                                                                                                            www.cardsinternational.com | 11

CI May 2018 555.indd 11                                                                                                                                       27/04/2018 10:17:54
Feature | social media

                                                       mastercard and visa:
                                                     the experts in
                                                     social media

                                     Financial companies strive to relate to their customers, and vice
                                  versa. Branding can be crucial in this objective, and with social media
                                  being ever-present in day-to-day life, there are many opportunities to
                                   achieve it. Visa and Mastercard consistently outrank banks in their
                                        social media outreach, but why? Patrick Brusnahan writes

              F
                      or the last four years, Visa and Mastercard have outranked             “We would use social media as one of the many channels that form
                      banks in terms of social media, and placed in the top two.          our marketing campaigns across the year. I think we find it quite a
                         According to CI’s rankings, Visa has 22,378,077 Facebook         useful channel to have a dialogue with cardholders and consumers in
              likes, an increase of 4% from 21,420,012 in 2017. Mastercard also           the space of their everyday life. It’s a mutual channel where we are able
              saw a rise in the same time frame, from 14,950,982 to 15,974,241,           to talk to them about their passions, their interests, and hopefully take
              a growth of 6%. State Bank of India is the closest bank in terms of         them on a journey of understanding on how Mastercard can help them
              Facebook likes, but it still falls behind Mastercard by more than four      enable that.”
              million at 10,615,876.                                                         Farina adds: “Social media has become part of our DNA over the
                 Clearly, ‘fans’ are engaging with both Visa and Mastercard’s brands      past five years and, from a marketing perspective, ever-more important
              on social media, but what are they doing to create this interaction?
                                                                                                                   facebook likes
              INTEGRAL TO OPERATIONS
                                                                                             millions
              Adrian Farina, senior VP, marketing, at Visa Europe, tells CI: “Visa uses    25.0                             Visa      Mastercard
              social media in a variety of ways, and it has became integral to many        20.0
              of our team’s operations – be it marketing, corporate communications,
                                                                                           15.0
              customer services or recruitment.
                                                                                           10.0
                 “We see digital and social media as great tool to help us achieve our
              corporate vision of being the best way to pay and be paid, for everyone,      5.0
              everywhere.”                                                                    0
                 Kirsty Redfearn, head of consumer and digital marketing, UK and                          15             16                      17     18
                                                                                                        20             20                   20        20
              Ireland at Mastercard, has a similar opinion. Speaking to CI, she says:
              “Social media forms part of our integrated marketing mix.                                            Source: Cards International

   12 | May 2018 | Cards International

CI May 2018 555.indd 12                                                                                                                                      27/04/2018 10:17:56
Feature | social media

        as part of our media mix. Social media is extremely versatile and
        provides us with the means to position our brand with our clients,
        engage consumers around the benefits of Visa products, highlight
                                                                                       recent distinctive campaigns
        elements of our corporate narrative, such as our focus on innovation           Kirsty Redfearn, Mastercard:
        and security, and operate promotions and competitions.”
                                                                                       “We’ve been sponsoring the Brit Awards for 20 years, and
           Of course, the days where there were a handful of social media
        channels are long gone; Facebook, Twitter, Instagram, Pinterest,               this year was quite an occasion. We’ve been trying hard
        Snapchat – the list goes on.                                                   this year to build an integrated campaign that connected
           Redfearn continues: “We use the majority of channels in some form           some of the dots in the Brits ecosystem, such as the Brit
        or another, depending on the objective of the campaign. Don’t get              school and the charities that the Brits works with. We
        me wrong, we would probably prioritise Facebook and Twitter as our
                                                                                       worked with David Arnold, a famous composer, who
        main core channels. Most brands will tell you that the majority of their
                                                                                       composed a track for us which we could then illustrate and
        audience is in that space, so it makes sense for us to understand those
        channels and use them appropriately.”                                          create an experience where music brings people together.
           “That is not to say we don’t use other channels. We have an
                                                                                       “We’ve had some wonderful responses, and it even had
        Instagram channel; we have also been on Tumblr, where we saw some
                                                                                       around 99% sentiment response; for most brands, that’s an
        amazing creativity in our [music award show] Brits campaign. We have
        been on Snapchat as well. It’s not been haphazard; it’s all decision-          unheard-of space.”
        based,” Redfearn explains.
                                                                                       adrian farina, visa:
        24/7                                                                           “Generally we use our sponsorships as a backdrop for the
                                                                                       benefits that Visa brings to consumers – an approach that
        Social media is not static. There is content posted constantly, so it can      we took during our recent contactless campaign around
        be hard to stand out in an ever-changing field.
                                                                                       the Winter Olympics.
           “Interaction rates have changed a lot recently, particularly on
        Facebook as they changed their algorithm again,” Redfearn notes. “This         “This global campaign was fully integrated across our
        year, the organic reach is dropping considerably. This means we are            social and digital channels and saw us working closely
        more careful and more thoughtful on how we bring messages to life.
                                                                                       with our Team Visa athletes [individual Visa-sponsored
        We need to make them effective and enter a dialogue with consumers.”
           “We put in a great deal of effort into ensuring that we are up to           athletes from a range of national teams] who were able to
        speed with the latest developments in how social media platforms               amplify our campaign through their personal social media
        prioritise content and reach consumers through their advertising               channels.
        formats,” Farina explains.
           “This means working closely with our partners – either agencies or          “Our cross-border campaign last summer consisted of a
        the platforms themselves – to ensure that our marketing investments            series of short videos designed to encourage travellers to
        are allocated appropriately and that the right content reaches the right       consider the benefits of using their card abroad instead
        people at the right time.                                                      of cash. We were able to use our social media channels
           “As we shift our marketing investments from traditional to digital          to deliver these videos to travellers journeying between
        media, we aim to be at the cutting edge of creativity and targeting best
                                                                                       Europe and America, serving the right message to the right
        practices. Ultimately, it comes down to reaching people wherever they
        choose to spend their time, whether online or offline.”                        traveller when he or she was most receptive.” <
           Redfearn adds: “We have an always-on team, a wonderful agency
        network and a wonderful agency team. It’s an always running thing.”
           Banks are regulated and constantly monitored; they cannot post
        whatever they want. Companies such as Mastercard are similar, but the
                                                                                       KEY STATISTICS, 2018
        restrictions they face are not as strenuous.
           “We have slightly different positioning as we are able to be a B2B2C
                                                                                                                      visa         mastercard
        company rather than a bank,” Redfearn says. “That gives us the position
                                                                                       Twitter followers            368,464            473,058
        where we can utilise the channels as part of our brand, rather than
        just being a customer care portal – not that we don’t open ourselves
        up to answer queries. Our average response time is 24 hours, so we’re          Facebook likes             22,378,077         15,974,241
        pretty real-time in getting back to our consumers. That’s high up in
        our priorities, but at the same, [we aim] to make sure it’s part of our        Instagram followers          27,141               91,655
        integrated marketing mix, whatever channel it is.
           Redfearn continues: “I think we’ve gone from the days where social          Youtube subscribers          39,751               31,958
        media was a separate channel on its own. It’s very much at the centre
        of our thinking as we plan campaigns. It’s become quite integral to us
                                                                                       Youtube views                334,538          62,580,808
        understanding our consumers and their passions. We spend a lot of
        time and energy making sure that we’re relevant and adding value.” <        Source: Cards International

                                                                                                                    www.cardsinternational.com | 13

CI May 2018 555.indd 13                                                                                                                             27/04/2018 10:17:56
Feature | revolut

                                                                                                                      Cashless technology can be tricky to

                 cashless society:
                                                                                                                   integrate into places in the UK that are rural
                                                                                                                   and more difficult to reach. Many worry that
                                                                                                                   a cashless society could further marginalise the

                 leading the
                                                                                                                   elderly and lower-income citizens.
                                                                                                                      Whether you are for or against increased
                                                                                                                   surveillance, a cashless society will significantly
                                                                                                                   increase the level of insight governments and

                 revolut-ion
                                                                                                                   banks have into individuals’ lives. In a world
                                                                                                                   without cash, every payment is traceable.
                                                                                                                      Today, Facebook profiles reveal a public
                                                                                                                   persona that an individual can tweak and
                                                                                                                   control, but in payments, consumers put their
                                                                                                                   money where their mouth is.
                 Revolut believes the UK could become fully cashless in just                                          Many argue, correctly, that digitising all
                 10 years, and wants to be at the forefront of the revolution.                                     payments will reduce levels of financial crime,
                                                                                                                   such as extortion, corruption and burglary.
                 CTO and co-founder Vlad Yatsenko explains to Briony                                               That said, it also opens the doors to different
                 Richter why this vision is close to becoming reality                                              types of financial crime. Companies and
                                                                                                                   consumers will still be vulnerable to security
                                                                                                                   risks such as online fraud and cyberattacks.

              R
                         evolut has been breaking down                                                             If all transactions are digital, a well-executed
                         barriers in the banking industry                                                          cyberattack could lead to massive losses.
                         since its launch.                                                                         Furthermore, by adding more financial details
                  According to GlobalData research, the                                                            online, along with the personal data that is
              number of Revolut users sat at around 1.5                                                            already accessible, crimes like identity theft
              million in 32 countries, as of April 2018.                                                           will increase.
                  There is no denying that the vast majority                                                          Revolut believes that, overall, a cashless
              of consumers enjoy and benefit from a range                                                          society has more positives than negatives, and
              of digital payment methods. The simplicity of                                                        wants to lead the way in creating a thriving
              conducting banking tasks is one of the biggest                                                       and secure one. Yatsenko states: “Revolut is
              motivators to go digital. Carrying wallets and                                                       enhancing the accessibility and ease of cashless
              numerous cards has become an annoyance.                                                              societies with its mobile and contactless
                                                                                          Vlad Yatsenko, Revolut
                  Speaking to EPI, CTO and co-founder,                                                             payments services.
              Vlad Yatsenko details what the UK needs to         “Unfortunately, UK infrastructure lags behind        “Revolut’s latest feature, disposable virtual
              do to become cashless: “If the UK aspires to       countries like Sweden, and our relatively large   cards, includes card details that automatically
              be fully cashless within the next 10 years, we     population isn’t an ideal test-bed for cashless   change after every transaction, protecting
              need to continue to innovate and encourage         innovation.                                       customers against account fraud, cybersecurity
              the use of financial technology. Britons still        “We’ve still got a long way to go until        threats and runaway subscription fees.
              have a very strong emotional connection to         lumbering traditional banks fully adopt              “We believe that digital-only banks are
              cash, even if they aren’t using it as much, so     cashless technology, and even then not all        beginning to be recognised by the majority
              it’s best to slowly make the transition into       consumers tend to trust the big banks or          of the public, driving significant numbers
              becoming a fully cashless society.”                institutions with their information.”             of customers to change banks, and building
                  Across the world, cash transactions                                                              awareness and trust,” Yatsenko notes.
              are continually and significantly falling.         WIPING OUT CASH                                      “Digital-only banks are offering powerfully
              According to the 2017 World Payments Report                                                          attractive alternatives and improvements
              (WPR), non-cash transactions will increase at      Sweden is wiping out cash at a rapid              on how people handle their finances, and
              a CAGR of 10.9% between 2015 and 2020.             rate. According to the WPR, 36% of the            increasingly convincing consumers they can
                  So should the UK accelerate its cashless       population in Sweden claim they never use         be trusted by delivering on their promises for
              efforts? Yatsenko certainly thinks so: “The        cash, compared with 17% of Brits.                 security, reliability and privacy.”
              advantages of a cashless society are an increase      SEB, one of Sweden’s largest banks, only          Technological innovation is pushing
              in ease, convenience and security. Cashless        handles cash in seven of a total of 118           countries towards a cashless environment.
              transactions speed up services and reduce the      branches, and the bank has stated in the          Looking at London in particular, where
              risk of crime – specifically robberies. Digital    past that its new focus will be on providing      contactless technology was successfully rolled
              transactions are easier to track.”                 digital tools in branches that are designed to    out by Transport for London, it is clear there
                  The idea of a cashless economy can appear      encourage customers to complete banking           is scope for such innovation to thrive in the
              utopian, and yet in Sweden, it is within           tasks on their own. ‘No cash accepted’ signs      UK. Whether it takes 10 years or longer,
              touching distance. Yatsenko explains that          are increasingly becoming a common sight          Revolut is set to make breakthroughs in
              the UK is behind due to infrastructure.            across Sweden.                                    developing more cashless initiatives. <

   14 | May 2018 | Cards International

CI May 2018 555.indd 14                                                                                                                                     27/04/2018 10:18:01
products | virgin atlantic

                                                                                                       • Free access to over 1 million global
                                                                                                         hotspots via Boingo Wi-Fi, and

           virgin atlantic:                                                                            • An annual fee of £160.

           flying higher with
                                                                                                          Both cards offer double miles when
                                                                                                       bookings are made directly with Virgin
                                                                                                       Atlantic Virgin Holidays as well as access to
                                                                                                       Virgin Money lounges across the country.

           new credit cards
                                                                                                          Simon Hall, senior public relations
                                                                                                       manager at Virgin Money, tells CI:
                                                                                                       “Successful partnerships are a key part of
                                                                                                       Virgin Money’s strategy and we’re delighted
                                                                                                       to be working with Virgin Atlantic to offer
                                                                                                       customers exciting products supported by
           Two new credit cards are the first products to be launched                                  excellent customer service.
           from the partnership between Virgin Atlantic and Virgin                                        “Choice in the airline rewards credit card
                                                                                                       market has reduced significantly compared
           Money, facilitated by Mastercard. Briony Richter takes a                                    with recent years, so we’re delighted to offer
           looks at the cards’ primary features and benefits                                           new and attractive options for customers
                                                                                                       looking to earn miles.
                                                                                                          “The Reward and Reward+ cards give

        T
                 he Virgin Atlantic Reward and         • If £20,000 is spent in a year, customers      customers an easy way to earn Virgin
                 Virgin Atlantic Reward+ credit          can choose a credit card reward, and          Atlantic Flying Club miles when they use
                 cards will enable customers to earn   • No annual fee attached.                       their card for everyday spending, which can
        Flying Club miles when using their card.                                                       be redeemed for flights and ticket upgrades,
           Their bold and eye-catching designs,          The features of the Virgin Atlantic Reward+   and customers can also receive companion
        created by Virgin, reinforce the Virgin        card differ slightly:                           seats and Clubhouse access.”
        Atlantic ethos of standing out from the        • Earn 1.5 Flying Club miles for every £1          However, users must be careful to play
        crowd with strong statements.                     spent;                                       by the rules with these credit cards, or
           Miles earned on the cards can be            • Earn 15,000 bonus Flying Club miles           they could face some hefty penalties. For
        exchanged for the full range of Flying            with the first card purchase – within the    example, the representative APR on the
        Club rewards including flights and cabin          first 90 days of the account opening;        Reward Plus card is 63.9% and on the
        upgrades. Customers will also have free        • If £10,000 is spent on this credit card a     Reward card 22.9%.
        access to Virgin Money lounges and several        year, customers can choose from a range         Furthermore, the purchase rate is 22.9%
        offers from the Virgin Group.                     of credit card rewards;                      and while there is a 0% balance transfer
           Depending on spend, customers using the                                                     offer for the first six months, it comes with
        Reward and Reward+ credit cards can access                                                     a 3% fee. These charges are high and can eat
        a range of credit card rewards.                                                                into any potential rewards offered.
           Red Flying Club members can choose                                                             Oliver Byers, senior VP of sales and
        a free premium upgrade when flying                                                             customer loyalty at Virgin Atlantic,
        economy, or an economy reward companion                                                        concludes: “We are incredibly excited to
        seat which enables them to take a                                                              launch our new credit cards. With our
        companion for no additional miles.                                                             cards, customers can earn miles on their
           Silver members have access to the same                                                      everyday spend to redeem for flights and
        options, as well as a premium reward                                                           upgrades and more. On top of that, we’re
        companion seat or a pass for a Virgin                                                          offering our most valuable customers even
        Atlantic Clubhouse. Gold members can                                                           more choice of rewards so that they can
        choose two Clubhouse passes, an economy,                                                       create the Virgin Atlantic experience that
        premium or upper-class reward companion                                                        suits them best.’’
        seat. They can also choose a free premium                                                         Customers have access to Virgin Money
        upgrade.                                                                                       lounges, as well as free refreshments, use
           Key features of the Virgin Atlantic                                                         of iPads and Wi-Fi. Offers from the Virgin
        Reward card include:                                                                           Group include discounts on train tickets,
        • Earn 5,000 bonus Flying Club miles                                                           holidays and experience days.
            with the first card purchase – this only                                                      Virgin Money believes the new credit
            applies within the first 90 days of the                                                    cards meet the demands of travel-hungry
            account opening;                                                                           consumers, and will allow them to accrue
        • Earn 0.75 Flying Club miles for every £1                                                     holiday benefits no matter where they are in
            ($1.50) spent;                                                                             the world. <

                                                                                                                www.cardsinternational.com | 15

CI May 2018 555.indd 15                                                                                                                          27/04/2018 10:18:02
country snapshot | chile

                                                                        E
                                                                    CHIL

                  country snapshot:
                  chile
                  Changing lifestyles and new facilities boost card uptake and use

             C
                   ash remains the preferred method                           However, payment card transactions             inclusion programme and infrastructure
                   of consumer payment in Chile,                            are gradually replacing cash in Chile,           modernisation.
                   accounting for 73% of the total                          mainly as a result account of government           Furthermore, government efforts
              payment transaction volume in 2017.                           and bank initiatives such as a financial         to provide basic banking and financial

                          value of credit tRanSfers                                   value of cheque payments                           value of payment cards
                       $bn                                                        $bn                                              $bn
                  10,000                                                        600                                               80

                                                                                                                                  70
                                                                                500
                   8,000
                                                                                                                                  60
                                                                                400
                   6,000                                                                                                          50

                                                                                300                                               40
                   4,000
                                                                                                                                  30
                                                                                200
                                                                                                                                  20
                   2,000
                                                                                100
                                                                                                                                  10

                          0                                                       0                                                0
                                                                f
                                13       16         7e        21                          13       16         7e        1f                 13       16         e
                                                                                                                                                                         21
                                                                                                                                                                           f
                              20       20          1
                                                          20                            20       20          1         2
                                                                                                                                         20       20        17
                                                20                                                        20        20                                    20        20

                              Source: SBIF, CCA, GlobalData                             Source: SBIF, CCA, GlobalData                    Source: SBIF, CCA, GlobalData

   16 | May 2018 | Cards International

CI May 2018 555.indd 16                                                                                                                                                        27/04/2018 10:18:20
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