13 December 2017
Andrew Marshman

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Andrew Marshman - ACI Worldwide (EMEA) Ltd

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Disruption in Retail Banking

Growth in internet and mobile technologies has transformed many industries and economies. The market forces and competitive landscape has completely changed in many sectors. iTunes has fundamentally changed music industry, Amazon has driven most big brick and mortar book sellers out of business, Expedia is one of the worlds' biggest travel company….. the list goes on. Internet and mobile technologies are big disrupters for most industries. What started (and tapered a bit!) with the dot com boom of 2000 has become a lethal threat to most business models today. Powered by mass adoption in mobiles phones, proliferation of smart phones and cheaper band-width, internet and mobile technology have changed many industries. The banking industry in has been dominated by a handful of big global or regional banks for 100s of years. While the credit crisis has shaken this industry, the core market forces for the industry have not changed. Will Innovation in Internet and Mobile technologies disrupt retail banking? Will there be 5 new names in global top 10 retail banks in 2020?

The Terrible, Horrible, No Good, Very Bad Omni-Channel Day

07 December 2017  |  2679 views  |  0

I have been proclaiming for some time that ‘omni-payment’ is the missing element in many retailers’ full omni-channel customer service offering. What I mean is that many retailers offer their goods and services in-store and through various digital channels, but payments are often still processed by different systems and operate in silos. There are downsides to this isolation, and challenges to overcome in consolidating payments systems.

Retailers are, however, coming to grips with the reality that omni-channel is a necessary part of their strategy and are recognising the associated challenges. A recent personal experience highlighted again to me the challenges faced, albeit the nature of this particular service accentuates the problems that occur when payments go wrong within the strategy.

I recently returned from a holiday in Europe, during which time I had the pleasure of stopping off in France, Spain and Portugal. The high costs of using ATMs abroad and paying in foreign currencies are well publicised. The solution, so I’ve been told, is to take a foreign exchange travel card loaded with prepaid Euros; a solution that offers great savings, security and easy access. I purchased one online and it was delivered before I departed, and I used the card at a nearby ATM (in the UK) to change my PIN. So far, so good.

I started out using the card to purchase items in Euros with PIN protection. When funds began to run low, I knew it was time to top-up: I opened the card issuer’s iOS app to load more Euros, and the app asked me to authenticate myself. I entered my password, but each time the app told me that the “session had expired” and returned me to step one. That seemed a misleading error, since I performed the top-up request with minimal delay, so maybe I got my password wrong? The app suggested otherwise. Next step was to try the website, but this led to the same response. Time to try the help desk – surely they’d resolve this issue to not leave customers abroad unable to access their funds. There was no sign of an appropriate telephone number and no web chat, but there was an email address; however, I had no confidence in this as a quick way to get immediate assistance. A quick web search identified a contact phone number, but it was a premium rate number that could not be called from outside of the UK.

By now, I was somewhat irritated by the card and the associated service so I thought I’d withdraw the small amount of cash that remained on the card through an ATM. And the cash was needed urgently for a bus fare. I queried my balance at a local high street ATM. English language was offered, but the transaction was declined with a message in Spanish. I found another ATM in a tourist location, giving me more confidence that it would work in English. I queried the balance and then went to withdraw the remaining €70 remaining. But this ATM only dispensed €50 notes and added a significant surcharge to the transaction. Of course, the card issuer can’t be blamed for the ATM acquirer services, or other third-party systems outside of their control, but this experience did nothing to improve my mood.

A handful of Euros remain on the card, which is probably where they will stay. Luckily I had my bank debit card and UK credit card as back-up, but carrying these does nothing to slim the wallet and can also be a risk when traveling. No doubt, I am partly to blame for being badly organized with my foreign currency requirements, but I had put a certain amount of trust in the prepaid service being idiot proof.

The critical aspect of any omni-channel strategy is to deliver through integrated technology, of which payments is a critical part. Retailers can offer goods and services in what looks like an omni-channel service, but if the technology behind it is siloed, it’s not really omni-channel – it’s probably what we used to call multi-channel. According to the Edgar, Dunn & Company report, “Today consumers expect and demand seamless customer experiences across all channels.” But expect and demand don’t necessarily equate to receive and enjoy.

The promise of serving customers through an omni-channel experience offers great benefits – if the technology delivers – but as always, if you over-promise and under-deliver, customers won't come back.

 

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job title Senior Account Executive
location Watford
member since 2017
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Sales and Account Management to Tier 1 retailers in Europe for payments managed services.

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