Payment Technology
Deep Dive
October 13, 2015
8:00 am – 8:50 am
Objectives
•
Navigate the differences between loyalty and payment apps as
well as consumer perceptions of both
•
Familiarize with EMV compatible equipment and providers to
provide the best solution for your company
•
Evaluate the security risks inherent with new payment platforms
and methods
Agenda
•
Introduction
•
Approach
• Payment Trends in Retail
• Application to Convenience Channel
•
Topics
• EMV
• Security
Moderator
Panelists
Terry Mahoney Partner
W. Capra Consulting Group
Jim DuBoyce Consultant
W. Capra Consulting Group Jenny Bullard
CIO
The Jones Companies
Kara Kazazean
Director Payment Services Walmart
Payment & Loyalty Technology Trends Survey
•
Surveyed W. Capra clients and contacts
•
Verticals: convenience, QSR, grocery, pharmacy, general
and specialty retail
•
Purpose:
• Provide some insight on what other retailers are thinking • Give Convenience retailers opportunities to learn from
EMV
Payment technology activity and investment in retail is currently
dominated by EMV implementation
• October 2015 Liability Shift
• Rethinking Contactless – Apple Pay • Overall Technology Refresh
• POS Upgrades • Terminal
• Payment Switch
EMV: Components Affected
Payment Acquirer Card Issuer Issuer EMV Card Terminal IndoorEMV Card Terminal Outdoor
POS / Payment
App
Loyalty System
EMV Survey
What % of payment card transactions in US will be chip on chip by
end of 2016?
0% 20% 40% 60% 80% < 20% 20% - 40% 40% - 60% 60% - 80% > 80%EMV Survey
When will 50% of your locations be able to take EMV cards….
Face-to-Face At the Pump
9% 27% 27% 9% 27% 0% 20% 40% 60% 80% 100% 2017 or Later Dec-16 Jun-16 Dec-15 Already > 50% 36% 27% 23% 14% 0% 20% 40% 60% 80% 100% 2019 or Later Dec-18 Oct-17 Dec-16
Have you used a chip card in a chip enabled terminal
to pay for a purchase in the United States?
Loyalty Survey
Payment & Loyalty Takeaways
• Plan for EMV thoroughly…it takes longer than you think!
• EMV changes may impact Loyalty processing – talk to your loyalty provider now
• Other Retail verticals will increase consumer Loyalty expectations • Prepare for changes - Customer experience and Employee training
• Branded Retailers
• Engage with your brand
• Independent Retailers
• Engage technology providers (POS, Loyalty, terminal) • Engage payment processor
Payment & Loyalty Takeaways
• Technology vendor readiness can make or break timeline
• Coordinate with all vendors • POS changes
• Terminal changes
• Seek solutions that are already certified – shortens testing and certification process
Payment Security
•
Multilayered approach
• PCI & EMV are not enough • Encryption is next layer
• Think beyond payment to include personal information in security plan
•
Leverage Technology Refresh
Payment Security Survey
“If I am PCI compliant, then my payment environment is secure”.
44% 38% 6% 13% 0% 0% 20% 40% 60% Strongly Disagree Disagree Neutral Agree Strongly Agree
Payment Security Survey
“Within the next 5 years the PCI Council will mandate encryption on
all communications containing cardholder data?”
0% 13% 16% 50% 22% 0% 20% 40% 60% Strongly Disagree Disagree Neutral Agree Strongly Agree
Payment Security Survey
“Does your organization have plans to implement encryption on
all payment card traffic? If so, when?”
29% 19% 29% 5% 19% 9% 27% 36% 27% 0% 20% 40% 60% No Plan Post EMV With EMV Project Underway Already Implmented Other Retail C-Store
Payment Security Survey
“As other retailers implement EMV, retail petroleum sites will see a
significant increase in counterfeit card fraud outside.”
14% 32% 23% 23% 9% 0% 20% 40% 60% Strongly Disagree Disagree Neutral Agree Strongly Agree
Payment Security Takeaways
• Remember to “put on layers”
• EMV – protects against counterfeit card fraud • Encryption – protects data in motion
• Tokenization – protects data in motion and at rest • Expect security requirements to increase over time
• What is optional today, may be required tomorrow • PCI Compensating Controls can be withdrawn at any
Mobile Payment
• “Mobile” can include: • Phones, wearables • NFC or QR based
• Retailer driven (Flash Foods Go Blue, Starbucks) • Open loop (Apple Pay, Samsung Pay)
• Technology required
• Scanner (inside, outside)
• NFC readers (inside , outside)
Mobile Payment Survey
“Mobile payments will account for 20% of all retail (card-based)
payment transactions in 2020?”
0% 26% 16% 39% 19% 0% 20% 40% 60% Strongly Disagree Disagree Neutral Agree Strongly AgreeMobile Payment Survey
“In the next 5 years, who is most likely to deliver the long
awaited “killer app” for mobile payments?”
10% 3% 6% 16% 65% 0% 20% 40% 60% 80% New Entrant MCX or Retailer based Google or Samsung Apple No Single App
Have you ever used your phone or watch to pay for a
purchase?
Mobile Payment Takeaways
•
Mobile payments may finally be at the tipping point
•
Contactless transactions are small today but growing
• EMV will accelerate contactless terminal deployment
•
Uncertain longer term implications for…
• Acceptance costs
• Customer data ownership
•
Branded mobile payment offer…
• Must provide value
Key Takeaways From Today
EMV
• Develop a Comprehensive Plan / Timeline
• Engage Vendors, Card Processors, and Fuel Brand • Prepare for Significant Change
Security
• Layered Approach • Encryption Ahead
Mobile
• Tipping Point
• Offer More than Payment • Retailer Driven
Session Survey Question #1
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Disclaimer
The opinions of the contributors expressed herein do not necessarily state or reflect those of the National Association of Convenience Stores. Reference herein to any specific commercial products, process, or service by trade name, trademark manufacturer, or otherwise, shall not constitute or imply an endorsement, recommendation, or support by the National Association of Convenience Stores. The National Association of Convenience Stores makes no warranty, express or implied, nor does it assume any legal liability or responsibility for the accuracy, completeness, or usefulness of any information, product, or process described in these materials.
