Industry Session on Banking & Financial Services

1June 25 and 26

Hyatt Regency, Santa Clara, Calif.

Banking & Financial Services

2June 25 and 26


Digitize Session: Mobile PaymentsKumar Rao, Head of Cards & Payments, TCS

3June 25 and 26Hyatt Regency, Santa Clara, Calif.TCS Innovation

Forum

Forces of change leading to Digital Payments

Relevant Global Trends

Consumer Behavior/Expectations

Payments at a Cusp of Innovation

Regulatory Landscape

Globalisation / Global Standards

Competitive Pressures/Threats

Evolving Financial Crime

B2B Demands

Shift to Debit, Decline in Check, Cash Value Conscious, Need for convenience Service Expectations, Instant handling Recognition, Personalisation, Control

Mobile/NFC, Social Network, Location Intelligence Diverse form factors, Ubiquitous access Micro-payments, Virtual currencies, Prepaid cards Financial Supply Chain Management Promoting efficiency & competition Consumer protection , Transparency, Portability Interchange and Pricing regulations Data and Reporting standards

Demand for cross border payments Regional ACH systems Global message & security standards International Payments Framework

Alternate Payment Services Third party bill payment, mobile & P2P schemes Entry of non-traditional players (Retail, Telecom) Commoditization, Reducing barriers to switching

Ease of doing business, Seamless Integration Improving Efficiencies and Service Real-time, faster bulk payments Complete information with payments

Emerging technology risks Data and Identity theft opportunities Fraud rings, Increasing cross-border activity Money laundering, Stringent AML regulations

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Strategic Response ThemesAnalytics &

Insights/Big Data

Channels & Form Factors

Enterprise Fraud and Risk

Systems

Global Message Standards

Partner Ecosystem

Customer Loyalty and Retention

Open API/Software Platforms

Enterprise Risk and

Compliance

Tokenization & Encryption

Payments Hub

Cloud Services

New CSMs/Payment Schemes

B2B Integration Information based Services

Analytics for Test & Learn

Risk & Fraud Analytics

Behaviour based

Authentication

Faster Payments

Canonical Data Models

Insight driven Service

Excellence

Straight Through

Processing


Forum

Industry Analysis – Mobile Payments

Mobile Devices purchases will exceed $1 Trillion by 2017Just above 2.5% of worldwide commerce theoretically addressable by mobile payments Source IDC Financial Insights

Faster and safer ways

Universal ‘everyone can use it for all types of payments’

Drivers in the Payments Landscape

Ease and convenienceCost Reduction – Eliminate

paper-based payments

Mobile device - The next best form of payments

Convenient‘simple, always

available, and least expensive’

Secure ‘as good as cash for

transfer of value’

Mobile for payments

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Search, see, experience, price check & buy

Location based offers & real time discounts

Multi factor authentication (OTP)

Real time access to account, reward points

Can carry multiple payment cards

Complete man to machine payments, effectively

Mobile for beyond

payments


Forum

View on Digital Payment Innovations

• Cloud Services • E-Wallets• Proxy Payment• Bill Payments• Mobile POS• M-RDC• Contextual Offers• 2D Barcodes for payments

• Open APIs and Software Platforms

• NFC based payments• Open Mobile Wallet• Offer redemption at POS• Location Aware Applications• PFM across Banks• Spend Advisor for best payment

• Closed Loop Mobile Wallets• QR / Color Code• Carrier Billing• Social Share of Card linked

Offers and purchase experience• Dynamic Card

• Alternate Digital Currency• Enhanced Authentication /

Biometrics• Speech Recognition• Wearable device authentication

Time Horizon

Adop

tion


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Mobile Payments – Industry Trends

Wallet Apps

Pre TXN Info

PaymentPost TXN

Value

• Open Wallets• Closed Loop• Retailer

Wallets• Carrier Billing• Virtual Wallets

• Offers and Coupons• Invoices and Bills• Calendared

Payments• Rewards

Information• Merchant APIs• Spend Advisor

• Contactless (NFC / QR) P2P, POS

• OTA P2P, m-Commerce, Bill Pay

• Dynamic Cards POS• M-POS Dongle, Camera scan• Remote Check deposit• Card Less ATM withdrawal

• Rewards Accrual / Redemption

• Offer Redemption• Receipts upload• Spend Analytics• Social share• Gift Cards

Value added services that enhance the experience and deliver benefits to the end user before, during and after the payment activity will be key to driving mobile payment adoption

7TCS Innovation Forum

June 25 and 26Hyatt Regency, Santa Clara, Calif.

Wallet Applications

m-CommercePayment

Physical POS Payment

e-CommercePayment

Remote P2P

Payment Credentials stored on : Cloud Device

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1.5

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1.5

Empty Hand

CardCard

Others

Merchant Customer Exchange

(MCX)

Apple Passbook

Microsoft Wallet Hub

Wallaby

Considerations

Authentication – In-band vs. Out-

of-band

Secure Element Management

Control of Customer ID

Card


Forum

Mobile Payments – What’s in it for Banks ?

Advantage Banks –• Existing relationship with consumers and merchants• Customer trust with data protection• Ability to leverage and extend existing loyalty programs, redemptions and offers

Enhance Custome

r Experien

ce

Business Growth

Cost Efficienci

es

Marketing

Advantage

• Customer retention

• New Customer acquisition

• Improved cross selling

• Maintaining leadership position

• Get access to larger customer base

• Lower unit transaction cost

• Optimizing operational costs

• Significant incremental revenue generation from multiple new streams


Forum

Key Questions to be addressed

What is the elusive secret sauce for success in mobile payments ?

Should Banks co-operate or compete with non-Traditional Wallet providers like Google, ISIS or MNOs ?

Panel DiscussionModerated by: Shashi Bhushan, TCS

Panelists Rich Clow, Global Head of Mobile Strategy, Products and Programs, Citi Global Consumer TechnologyKumar Rao, Head of Cards and Payments, TCS


Thank You


12June 25 and 26


Analyze : Business Insights from

Big DataK Arumugam, Head of Big Data & Analytics Practice-BFS,

TCS


Forum

The digitization of the customer’s world iscreating new norms of interaction

Self Servic

e

Web

Mobile

Social

Needs

Risk Toleranc

e

Personal

Profile

Imp

licati

ons

Infrastructure

Data Management

Data Analytics

Visualization


Forum

Big Data Adoption in BFS

Low-cost, high volume and performance Data Warehouse which can easily scale-out

Huge Cost Savings per TB as compared to EDW appliances

Massive parallel computing tool to divide and conquer workloads

Significantly reduced computation time for complex analytics from days to a few hours

Horizontal Use cases

• Log Analytics

• Click Stream Analytics.

• Social Analytics

Functional use cases

• Improved Fraud Prevention

• Churn Prediction• Improved

delinquency predictionn

• Campaign Management

• Multi Channel Customer Sentiment

• Product Strategy• Risk Monitoring

Complement existing Enterprise Data Warehouse

Data Transformation Platform, ETL -> EL-T

Warm Data Archival

Digital Asset Management

Customer Acquisition & Retention

Regulatory & Compliance

Risk & Finance


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Big Data Global Survey by TCS - Context

White space on Big Data

How much companies are investing in Big Data

Specifically, what they are doing with their Big Data investments – what activities in what business functions they were focusing on and saw the highest potential

What kinds of returns they are getting on their investments

How they have organized the people who process and analyze Big Data

Source: www.tcs.com/BigDataStudy


Forum

Key Observations from Survey

Banks Are Spending heavily on Big Data and they plan to spend even more• Median 2012 Spending per Bank is around $19M• Twice the median Spending across 12 Industries• Predicted to be 28M per Bank by 2015

Unstructured Data is a large part of Big Data Mix and expected to grow• On an Average 26% Unstructured and 20% Semi Structured• Growing proportion of around 30% is coming from outside the enterprise

Where Banks are focusing their Big Data Investments ?• Two out of top 3 enterprise goals for Big Data is about their customers (Up Sell /

Cross Sell)• 47% of Big Data spending Priorities were related to Customer Acquisition and

Retention(17% Marketing, 16% Sales and 14% Customer Service.)



Forum

Key Observations from Survey - Contd..

The ROI on Big Data• 86 % had improved decision making using Big Data initiatives• Average ROI of around 44% in 2012

How are Banks organizing their Big Data Activities• Majority had centralized their Big Data activities• (32 % in IT , 34 % in Analytics group , 35% in embedded in business functions )

Greatest Challenges to Tapping Big Data are NOT Technological• Getting business units to share information across organizational silos• Determining what data to use for different decisioning• Business Case approval for Investments



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Top 5 Innovations in BFS using Big Data

Customer 360 – Next Best Action• Reduce Customer Churn• Predicting customer’s need• Fostering cross sell / up-sell• Customer Profitability

AML / Fraud Detection• Credit card fraud – point of

compromise• Trade Surveillance – Rogue/ Circular

Trading• Complex Money Transfer Chain• Internal Fraud

Investment Banking / Wealth• Post Trade Analytics platform• FA Recommendation Engine• Price Optimization

Sentiment Analytics• Brand Loyalty / Analysis• Customer Sentiment• Customization of Product /

Offers

Active Management of Risk & Compliance• Aggregation of counter party

exposure• Manage and optimize portfolio

risk• Basel Process Optimization• Warm Data Archival

Using Big Data to Acquire and Retain Digital Banking Customers



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Role of Big Data in Customer Acquisition and Retention

Customer

Product Transactions

Web Intelligence

Social Media

Internal Text Data

What do they SearchPage NavigationWhich Product

BlogsTweetsPosting

Call CenterDirect ContactResearchLog Files

Big Data Analytics

Improved Customer Acquisition

Product Innovation

BetterCustomerRetention

Ability to find hidden meanings and relationships in data when it is combined from multiple sources in its raw form.


Forum

Sales and Marketing

Customer Acquisitio

n

Customer Service

Brand Reputatio

n

Customer Retentio

n

Product Innovatio

n

Top 6 ways Big Data can Help Customer Experience

Micro Segmentation Campaign Management

Leads to

Leads to Improved

Improved

Next Best Action Increase wallet Share

Customer Sentiment Brand /Product Sentiment

Loyalty Management Channel Strategy Churn Prediction

Product Customization

Panel DiscussionModerated by: Dr. Gautam Shroff, TCS

Panelists David Webb, Chief Information Officer, Equifax

K. Arumugam, Head of Big Data and Analytics Practice for BFS, TCS


SummaryQ&A

Thank You


Industry Session on Banking & Financial Services

Technology

Transcript of Industry Session on Banking & Financial Services