SPICON 2016 presentation

1. Mahesh Ramachandran
18th Nov 2016
SPICON 2016
Trends & Innovation in #FinTech
that will change customer expectation and experience forever

2. Hello!
I am Mahesh Ramachandran

3. Mahesh Ramachandran
Distinguished Sloan Fellow of London BusinessSchool
Masters ofScience in Leadership & Managementfrom LondonBusiness School, Universityof London
MBA from Universityof Westminster
Director, Commonwealth Inclusive Growth Services Ltd
Chartered Member of TiE (www.tie.org). Chair TiE #FinTech SIG.
Director (International Business), Commonwealth InvestmentCorporation(CIC)
Serial Entrepreneur in theareas of Targeted Messaging, Peer to Peer Foreign Exchange portal. Mentor for several
startups and SocialBusiness.
Corporateexperience includes Dun & Bradstreet, Ford Motor Company (UK), TCS (EMEA)

4. Change is not only inevitable,
but essential too…

5. Change is not only inevitable,
but essential too…
… especially after
demonetisation of Rs.500 and
Rs.1000 J

6. Demonetisation
Customer Service @ Doorstep
In the Villages
Use Tablet with Biometric
Connect to Aadhaar Server
Connect to Core Banking
Accept Deposit
Disburse Cash

7. Trends in#FinTech
(that will alter customer
expectation and experience)

8. The Future IsAlready Here…
It’s Just Not Evenly Distributed

9. Strong integration with Smart phones
• Biometric • User-Friendly • Convenient

10. Mobile
Payment’s
Kissing Cousin

11. Challenge in
Predicting the
Future

12. “The horse is here to stay but the
automobile is
only a novelty – a fad.”
President of the MichiganSavings Bank advising Henry
Ford’s lawyer,Horace Rackham, not to invest inthe Ford Motor
Company in1903

13. “… there is a world market for maybe five
computers.”
ThomasWatson, IBM Chairman in 1943

14. “Cellular phones will absolutelynot replacelocal
wire systems.”
MartinCooper, Inventorof CellPhone in1981

15. Few
Predictions

16. The best way to predict
the future is

17. “The best way to predict the future is to invent it” –
AlanKay
To invent it

18. Mobile First Banks On Rise

19. Peer-to-PeerLending getting regulatory approval

20. Say Hello ToYourNew Broker- RoboAdvisor

21. BLOCKCHAIN
TECHNOLOGY

22. Appliances will reorder

23. Digital Money will Permeate

24. Wallet will transform

25. Payment Queues will bereduced
(after Dec 30!)

26. Interchange fee will reduce

27. Crowd Funding will Dominate

28. Biometrics will take over

29. QuickServiceRestaurantswill be really quick

30. Connected Cars will be commerce platform

31. Micro Businesses will go Digital

32. How Many Trends did IPredict?

33. Unified Payments Interface (UPI)
innovation
from

34. What is Unified Payment Interface ?
• Unified Payments Interface (UPI) is a simple and effective way to
transfer money between two bank accounts in India by using a
Smartphone.
• Built on IMPS
• Uses Virtual Payment Address (VPA)
• No need of account number and IFSC details of beneficiary.

35. What is Unified Payment Interface ?
• The payments can be both sender (payer) and receiver (payee) initiated
and are carried out in a secure, convenient, and integrated fashionPush & Pull Payments
• The unified payment system is expected to further propel easy instant
payments via mobile, web, and other applicationsEasy Instant Payments
• This next generation payment system provides an ecosystem driven
scalable architecture and a set of APIs taking full advantage of mass
adoption of smartphone
1 Click 2FA & Virtual address
• Virtual payment addresses, single click 2 factor authentication, Aadhaar
integration, use of payer’s smartphone for secure credential capture,
etc. are some of the core features
Scalable Architecture

36. What’s New in UPI that makes payment experience seamless?
Pull Paymentfor P2P – Hitherto not available
Virtual Address (‘Username@domain.Name’) – Unique single identifier for both Push & Pull
Transfer using Single identifier like Mobile No, Aadhaar No (It will use NPCI Mapper)
New Entities i.e. Payment Service Provider (PSP), who will provide App to customers of any bank
One App for all Payments
1 Click 2FA – seamless customer experience

37. Steps
Steps 2.1: Generate
PIN for Transactions
Step 2:
Adding Bank
Account
Step 1:
Download of
PSP App and
Profile
Creation

38. Benefits – Ecosystem Participants
Simplified (Single click 2FA)
Universal App for Payments
Leveraging existing
Infrastructure
Secure
Paymentsbasis Single/Unique
Identifier
Opportunity to tap C2B segment
Opportunity to tap E-commerce
& M-commerce
Benefits to Banks
No risk of storing customer’s
virtual address like in Cards
Can tap customers not having
credit/debit cards
Suitable for e-Commerce & m-
Commerce
Single click 2FA facility to the
customer leading to seamless Pull
In-App Payments(IAP)
Benefits to Merchants
Seamless fund collection from
customers using single identifiers
Single click 2FA – Seamless check
out
Can work across various interfaces
(PULL):
Paymentsthrough Single Identifier
Choice of a single interface with
multiple bank accounts
Benefits to Customers
Privacy: Transfer funds using just
their personal details like Mobile
No.
Multiple Utility: Collect Request can
be initiated to pull funds

39. What are the Implications of UPI?
Before UPI - Low volume, High Value,
High Cost
After UPI - High Volume, Low Value,
Low Cost

40. 40
Expected population growth, Internet andMobile
Internet Penetration present attractiveopportunities
354M
213M 314M
500M
Mobile InternetUsersInternet Users
2015 2017 2015 2017
India : 1.27b
Population
China : 1.35b US : 318m

41. India is a unique and exciting market
41
• Youngest economy in theworld
• 68% of populationunder
• the age of35
• 3rd largest internet
• user base
• 460M internet usersgrowing to 700M+ in2020
• Mobile-first access Smartphone
penetration 54% in2020
• 76% of incrementalinternet
• users from mobile
• E-commerce growth potential
~$800B retail,
• only 8% organized and <1% is online. Etail to
touch 159B in 2020
• Limited use of cards Only ~20M
credit cardsand stagnant
• 450M debit cards but<10% active
• Cash ondelivery
dominates e-tail
• ~60% of e-tailtransactions are CoD, mainly
driven by trust

42. A changing society where cash stilldominates
(though Demonetisation will change user behaviour)
TRUST AND SOCIETY FINANCIAL CLIMATE
SOCIAL ATTITUDETO
MONEY
SAVING VS CREDITCASH FOCUS
FINANCIAL
EDUCATION

43. Aadhaar UPI
Payments
Bank
BBPS

44. Be Prepared for a Platform Play
Be aPlatform
Orbe the Platform

45. Uniform Payment Experience
Identification
Web Mobile
Authentication
Offline New
Channel

46. Frictionless Invisible
Habit Velocity
Loyalty

47. Data isthe new Oil, new Gold. Don’t Just sit,Analyse

48. Regulation, Mindit!!

49. PEOPLE & TRUST

50. Acknowledgement
The content of this presentation has been assimilated from contacts who are
considered industry veterans in payment system process and have been in
various Leadership – in particular, Mr. Ramesh Vijayakumar of National
Payment Corporation of India (npci.org.in ), Unique ID Authority of India
(uidai.gov.in), Nandan Nilekani’s presentations on #FinTech, Pradeep head of
PayPal Incubation (paypal.com), Innovative Startups, Christopher Woolard of
Financial Conduct Authority, UK
Mahesh Ramachandran
Chairperson, FinTech Special Interest Group
The Indus Entrepreneurs (TiE)

51. Place your screenshot here
CONTACT
Email: mahesh@cigs.in
Mobile: +919940660409
Landline: +914430989999 Ext199