Dynamics of payment industry in 2021

1. Dynamics of Payment Industry in 2021 Presented by: Rahul Patel Srishti Dey

2. Introduction • Trends & Dynamics of Payment Industry in 2021 • Closing Lines • Q&A Agenda

3. Rapid changes in the banking and payment processing industry • IT Companies rushing to adopt • Real revolution due to rapidly changing landscape • Economic • Political • social conditions • Regulations Introduction

4. Checkout process barriers minimized – online & offline. • Number of steps to make a purchase reduced by streamlining the checkout process. • Convenient choices • Mobile Payments • One-Click Payments • Auto-Renew Subscriptions • Contactless Payments • Digital Wallets • Other invisible payment methods Increased Demand for Frictionless Experiences

5. Forecast for

6. COVID-19 accelerated adoption. • 38% of consumers perceive contactless as a basic feature of payments - The Futurist Group study • Half a world population will use mobile wallets by 2024 - The Juniper Research  • From being alternative payment methods, they are quickly becoming consumers’ preferred means of transacting.

7. Enables users to send and receive money in seconds • Due to rise of • Smartphones • P2P apps • social pay • digital currencies • biometrics • real-time settlement systems • Real Motive – meet growing demands of customers Worldwide Adoption of Real-Time Payments

8. Competition from new, aggressive players with fast-growing business models • Other factors include • merchant expectations • regulatory pressure • globalization Worldwide Adoption of Real-Time Payments

9. RTP will help treasuries manage working capital and shorten the time it takes to recognize a receivable. • Push transactions will enable anyone to authorize payment securely. • Additionally, immediate payments will improve data posting and management of processes resulting in lower operational costs.

10. Capitalize on data • Process automation and fraud detection • AI-embedded tools define the future of payments • Read customers' operations history • buying and spending habits • predict their future activity • suggest an alternative payment method • Extremely reliable in customer service AI and Machine Learning Gain Momentum

11. Voice-activated transactions • Bank of America – “Erica” – a chatbot • balance notifications • report updates • money-saving tips • other simple customer services • Wells Fargo – Predictive Banking – AI-based smartphone app • recurring bill payments • travel plan alerts • money-saving alerts • over 50 other rudimentary functions AI and Machine Learning Gain Momentum

12. People spend on an average, over four hours on their phones each day – Rescue Time research. • “BUY” on Social Media & “one-click checkout” options • Mobile phone app downloads reached 204 billion in 2019 which increased to 218 billion in 2020 - Statista • Money management tools & financial wellness scores • No more inconvenience of using a physical credit card • Digital-only banks Mobile Commerce Expansion

13. Traditionally – slow, expensive, and time-consuming. • Hard currency compounds this, factoring in government regulation. • Barriers to entry lead to find alternative methods to streamline international payment systems. • Digital currencies and omnichannel payments • Continuous improvements in APIs for faster real-time operations. Cross-Border Transactions

14. Store, access, and process data over the internet, not on physical devices. It promotes • Agility • Scalability • Low operational costs • Better & robust security • Ease of migration • Minimal Downtime Cloud Migration to Suit Tomorrow

15. To leverage data to its full potential, you need it on the cloud, so your other systems can easily access it. • Figure out whether private, hybrid, community, or public cloud services best match your company’s needs. • Develop a migration strategy for critical systems that need a revamp.

16. Open banking is now a global trend opening • According to research from Accenture, 30% of small businesses and 40% of large corporate enterprises use open banking. The same report indicated that this trend is expected to boost organic growth by 10% over the next 3-5 years. • Real-time credit transfers • Help businesses ship products right away • Full access to customer information • Customize offers while safely managing risks. • Open banking is centered on an API Open Banking Accelerating Innovation

17. The COVID-19 pandemic marketed a tipping point for the cashless society. • Sharp decline in the use of cash as contactless payments and IoT payments exploded. • In the early months of 2020, over $4.4 million worth of digital payments were transacted. That is a 14% increase from the previous year, according to Statista. • Regulators recommended a shift to cashless systems to curb the spread of the virus. COVID-19 Accelerates Digital Payments Usage

18. Data – primary resource in financial decision-making • Understand customers' shopping behavior and spending patterns • Delivering relevant product recommendations • Targeting ads • Customizing user experiences • E-commerce giants like Amazon already use data to target buyers for upselling, cross-selling, and personal offers. • Make decisions that scale your ROI • Banks can analyze customer purchases and recommend different products. Loans officers can monitor those receiving large bills and propose products to lower their costs. • Calculate clients' risk, based on past payment history and social media comments. Data Remains the Most Precious Resource

19. Massive transformation & rise of convenient alternative payment industry trends due to convenience, speed, and easy functionality. • Cater to customers' global needs • Start early to outshine competitors and emerge as a trusted business that caters to the changing needs of its customers. • Disruptions forcing to evolve quickly to retain and grow their customer base. • The right software partner may be just what you need to stay within budget and make needed changes. Closing Lines

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