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andstandardsforprepaidcommerce
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ThePrepaidIndustry
Globalisation and improved propositions
Globalisationand
IncreasedGlobalisationofPrepaid:
• Paymentnetworkdevelopments,suchasSEPA,willboosttheabilityof
issuerstodevelopmultiͲnationalprogrammes
issuers to develop multi national programmes
• Bankswillincreasinglyuseprepaidasatooltosupportcorporatesintonew
countries
• Prepaidwillgrowincountries(suchasRussia,BrazilandIndia)wherethereisa
lackofanestablishedretailbankingand/orcreditinfrastructure
• Supportingthefullvaluechain– globalclientswillneedglobalbanksand
processors
FurtherPropositionDevelopment:
• MultiͲproductcardscombiningprepaidwithsavingsandcredittoincreasethe
customerbase
• U i th
UsingthenetworkstofurtherdeveloptheopenͲclosedloopconcept
t k t f th d l th l dl t
• Furtheruseoftechnologyinservicingtohelpthebusinesscase
Source:JohnGoodale,TSYS
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Nearly$680billionestimatedin
globalprepaidspendingby2015
(US$InBillions)
Europe2
UnitedStates& $120
Canada1
$385
SouthAsia,
MiddleEast&Africa1
$
$15 Asia/Pacific1
$45
Latin America &
Caribbean1,3
$115
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PIFObjectives
PrepaidInternationalForum(PIF) isanopen,globalforumfor
allparties participatingonacommercialbasisintheprepaid
economy It:
economy.It:
Developsguidingprinciplesandbestpracticesforprofitableand
ethicalparticipationintheprepaideconomy
h l h d
Createsinternationalstandardstopromotecross
Creates international standards to promote crossͲborder
border
expansionofprepaidcommerce
Providesavoicefortheindustrytospeaktonationaland
P id i f h i d k i l d
internationalregulatoryandgovernmentalbodies,andthe
media
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WhyisPIFnecessary?
Theprepaidindustryisinseriousdangerofreputationalrisk
Th i d t
Theindustryneedstocometogetherwithauniformapproach
d t t th ith if h
Uncertaintyoverprofitablebusinessmodels
Alleged moneyͲlaundering
Allegedmoney laundering
Deter“cowboy”operators
Riskofmisguided,contradictorylawsandregulations
g y g
Noindustrytracking
Noonespeaksfortheindustry
Stronglobbyingrole
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PIFBoardofDirectors
ColinGreaves
OperationsDirector,NewcastleBuildingSociety
KelleyKnutson
Kelley Knutson
ExecutiveVicePresident,TSYS
MichaelLafferty
Chairman,LaffertyGroup
MichaelMueller
CEO &Founder,paysafecard.com
,p y
ChrisReddish
Chairman,PrepaidInternationalForum
YvonneWest
GiftCardManager,Sainsbury’s
FionaWhitaker
HeadofGift&PrepaidProducts,Indue (Australia)
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PIFExecutiveCommittee
RobertCourtneidge
GlobalHeadofCards&Payments,Salans
PeterSidenius*
Peter Sidenius*
Director,Edgar,Dunn&Company
MichaelLafferty
Chairman,LaffertyGroup
ChrisReddish
Chairman Prepaid International Forum
Chairman,PrepaidInternationalForum
*SpecialadvisortothePIF Board
PIF Founders:MichaelLafferty,ChrisReddish,KenHowes(Edgar,
p y)
Dunn&Company)andRobertCourtneidge g
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PIFStructure
BoardofDirectors
LaffertyGroup
(contracted services)
(contractedservices)
PIF Central
Central
(est.2007)
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MembershipProfile
Banks&FinancialInstitutions
CardSchemes
ProgrammeManagers&CardMarketers
Retailers
MoneyTransferOperators
T l
Telcos&MobileOperators
& M bil O
PaymentsProcessors
Legal&RegulatoryServicesProviders
Gift Card & Other Prepaid Card issuers
GiftCard&OtherPrepaidCardissuers
PrepaidSolutionProviders
TransportOperators
Loyalty & Incentive Providers
Loyalty&IncentiveProviders
AncillaryServiceProviders
Acquirers
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Over50membersspanning
fourcontinents
Keyindustrymetricsandtrenddata*
Researchcapability
C d
Codesofconductandbestpractice
f d db i
*PIFDataAggregationService
* i i
11 5
PIFBenefits
PIFbenefitsincludeaccessto:
Workinggroupsonkeyprepaidissues
Working groups on key prepaid issues – suchasRegulation,Business
such as Regulation, Business
Models,ConsumerEducation,Fraud&RiskandTransport
AccesstoPIFͲgeneratedresearchincludingmarketresearchreportsand
WhitePapers
Annualsummitandgeneralmeeting
6memberbulletinsayear– featuresincludeglobalmarketanalysis
andresearch
Aninteractivewebsite
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PIFAccreditation
Why?
Tocreateaninternationalstandardforgrowthinprepaid
commerce
Toaddressadversemediacoverageaboutprepaidsuchas
allegedmoneylaundering,aggressivemarketingandpoor
customerservice
t i
Toenhanceconfidenceamongstusersofprepaidproducts
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PIFDataAggregation
Service
Objectives(June2008):
CreateaDataAggregationservicethatprovidesrealinsightandvaluetothoseissuing
prepaidcards
Providebenchmarkdata
Test/PilottheUKpriortorollouttootherPIF Chaptersonatemplateormanaged
basis
Wh F
WhoFrom/Where:
/Wh
Dataiscollectedfrom:
Prepaidcardprogrammemanagers,BankswhoalsomanageprogrammesandBIN
sponsoringbanks
No‘closedloop’dataiscapturedasthisiscoveredalreadybytheUKGCVA
Data collected reflecting circa 60 70% of UK prepaid card sector
Datacollectedreflectingcirca60Ͳ70%ofUKprepaidcardsector
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PIFDataAggregation
Service
CardCategorisation– NottooBroad:NottooNarrow
Withmajordifferencesincardcharacteristicsbetweendifferenttypesof
cardsthedangeristhatbyamalgamatingdifferenttypesofbehavioursthe
data becomes meaningless as becomes an average rather than a benchmark
databecomesmeaninglessasbecomesanaverageratherthanabenchmark
TheLaunchCategories:
Government/CorporateLoaded
ConsumerpurchasednonͲreloadable /Gift
FX/Travel/CurrencyCards
y
Consumerloaded
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PIFDataAggregation
Service
AFlavour:
ConsumerLoadedCards
Nearly a 10% drop last quarter v the YTD figuresintheaveragelaod
Nearlya10%droplastquartervtheYTD figures in the average laod value
value
pertransaction
FX/TravelCurrencyCards
Nearly a 20% increase in the number of loads per card
Nearlya20%increaseinthenumberofloadspercard
OnlyaslightincreaseinthenumberofATM/POStransactionspercard
Corporate/GovernmentLoadedCards
45% increase in the average spend value per transaction
45%increaseintheaveragespendvaluepertransaction
Where Next?
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PIFCentralWorkingGroups
BusinessModels(BMWG)2007Ͳ 2008
ConsumerEducation(CEWG)
Transport(TWG)
p ( )
Fraud&RiskSubWorkingGroup(FRSWG)
g p( )
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BMWG(2007Ͳ2008)
BusinessModelsWorkingGroup(BMWG)
Ͳ ChairedbyJohnGoodale,TSYSEurope
ComposedofPIFMembersinterestedinadvancingthebusinessmodels
C d f PIF M b i di d i h b i d l
specificallyforschemeenabledprepaidcards
Aimedtocapture,analyseanddeveloptheformativeverticallyaligned
Aimed to capture, analyse and develop the formative vertically aligned
businessmodelsthatareemerginggloballyinprepaid
OperatedwithintheremitofPIF,representedthegeographicalmembership
b
baseandcoversthebusinessmodelchallengesaffectingtheinternational
d th b i d l h ll ff ti th i t ti l
prepaidindustryasawhole
ProvidedalinkintoPIFtoallowittocommunicatewithandinfluence
Provided a link into PIF to allow it to communicate with and influence
externalbodiesthatcouldhaveanimpactondevelopingthebusinessmodel
withintheprepaidindustry
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CEWG
ConsumerEducationWorkingGroup(CEWG)
Ͳ ChairedbyPeterSidenius,Edgar,Dunn&Company
ThetwomainaimsoftheCEWGaretorecommendcodesofconduct forprepaidbusinessesand
develop policies and plans for the education of consumers andotherprepaidusers
developpoliciesandplansfortheeducationofconsumers and other prepaid users
ThetwoaimsareconsideredtoberelatedbutwillresultindifferentdeliverablesforPIF.The
intentionisnottoreinventthewheelintheseareasbuttakewhatisbestpracticefromaround
theworld,considertheapplicabilitytotheEuropeanenvironmentaswellaswork/collaborate
, pp y p /
withallinterestedbodiestoensureunderstandingandcommitment
CodeofConduct – theobjectivewastodiscussandagreetoastandardisedwideͲrangingcode
ofconductforprepaidbusinessesthatcanberecommendedforadoptionbythewiderindustry
– andglobally.TheresultisthePIFIssuerCodeofConduct
and globally The result is the PIF Issuer Code of Conduct
ConsumerEducation – theobjectiveistodiscussandagreetostrategies,plansandactivitiesfor
theeducationofconsumers,otherprepaidusersandthemediaacrossEuropetodemonstrate
therealbenefitsofprepaidsolutionsandprovideguidanceonhowprepaidoperates.
p p p g p p p
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FRSWG
Fraud&RiskSubWorkingGroup(FRSWG):
Objectives:
ToexplorewhatPIFcouldandshouldbedoinginrelationtofraudandriskinthe
prepaidmarketandtorecommendactionstothePIFWorkingGroups
T
Tounderstandthetypesoffraudinexistenceandestablishwaystomitigaterisk
d t d th t ff di it d t bli h t iti t i k
Workinprogress&complete:
InteractiveTypologyRegister:documents(international)incidentsoffraud,typesof
fraud,geography,itssignificanceandbasicmitigationstrategies.
Discussionareasinclude:
Ͳ Negativebalances
Ͳ Secondaryissuance
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LRWG
Legal&RegulatoryWorkingGroup(LRWG)
Ͳ ChairedbyRobertCourtneidge,Salans
Obj i
Objectives:
Toprovideamediumthroughwhichtoliaisewithlocalregulatorstodealwith
inconsistenciesacrossdifferentjurisdictionsandtrytoeducateandmoveregulators
towards a more level playing field
towardsamorelevelplayingfield
Tobuildaknowledgebankacrossdifferentkeyjurisdictionstoenablemembersto
understandthelocallawissuesofrunningcardprogrammesforprepaidcardsin
thosecountries
h
Toprovidealinkforsomeofthekeylocaltradeorganisationssuchas
trade/retail/payments groups to achieve an international reach and understanding of
trade/retail/paymentsgroupstoachieveaninternationalreachandunderstandingof
howlocallawsandregulationswillapply
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TWG
T W ki G (TWG)
TransportWorkingGroup(TWG)
Ͳ ChairedbyAlanLeibert,AlcoConsulting
Objectives:
ToaddressissuescreatedthroughthenonͲcashfarepaymentsrequirementin
electronicticketing
electronic ticketing
Ͳ Governanceandregulatoryissues
Ͳ Technical,standardsandperformanceissues
ToincreaseawarenessofPIFinthetransportandalliedmarketplaces
Ͳ Stimulatestakeholderparticipation(e.g.transportoperators)
Stimulate stakeholder participation (e g transport operators)
Ͳ provideaforumformeetinganddiscussionacrossPIFWorking
Groupsandallmembertypes
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Withspecialthanksto:
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