This year, Cards and
Payments Europe celebrated its 25th year – breaking with tradition
by splitting delegates into small groups to discuss key topics in
focussed forums. The event covered in-depth the role of
social media in banking, the future of prepaid, loyalty and
rewards, and international acquiring.
The 25th annual VRL Cards and Payments Europe
conference welcomed many of Europe’s leading payments professionals
to Barcelona last week to discuss and share expertise and celebrate
the best products and services of the past twelve months.
In a year that has been marked by card data
security concerns and breaches, the continuing emergence of
alternative payment methods, rising costs of regulatory compliance
and lower average profitability per customer, Cards and Payments
Europe broke broke with tradition and took a new approach:
The event moved away from the traditional
one-to-many conference format and, instead, ran four individual
streams that each had their own focus: Social Media and marketing
for banks, cross-border merchant acquiring, merchant-funded loyalty
programmes and effective prepaid programme management.
These forums enabled the appropriate intimacy
and flexibility for attendees to not just discuss the cards and
payments environment, but also argue, learn more and share
knowledge about topics that are of greatest importance to them.
During the Social Media and Marketing
Forum, Connor Kinnear, marketing director at Gemalto-owned
card customisation service provider Serverside, engaged delegates
in a thought-provoking presentation on the positive impact a social
media presence can have. Delegates debated the importance and
significance of social media for financial institutions – is there
a return on investment, how can you measure it? Is there any point
in being on Facebook when it is highly likely, nowadays, that a
bank will get slated by their own customers? How can an institution
exploit the social media potential?
These and more questions were debated, and
argued over, and the ultimate conclusion was: There is no one
perfect way to a successful social media presence – but social
media is such an integral part of consumers’ lifestyles now. The
concensus was that not having a presence on those social media
platforms will give other brands an opportunity to position
themselves more visibly in consumers’ consciousness.
However, there were sceptics, among delegates:
One pointed to research that found consumers are usually unable to
name the brands they see on Facebook, or to recall the products or
services offerered. And this is where the social media potential
lies, the group concluded:
Be different, do not just try to market your
brand – engage consumers in topics they are actually interested in.
Best practice in this area is considered to be Barclays’s activity
on its Football Premier League Facebook page.
Parallel to the Social Media and Marketing
Forum, another group of delegates discussed the changing landscape
of Europe from a merchant acquirer’s point of view.
The Merchant Acquiring – Moving from
Domestic to International session was led by Bernhard
Lachenmeier, head of products and marketing at SIX group, who
explained the pressure felt by merchant acquirers as charging
models around Europe are changing.
On the day of the conference, the General
Court of the EU ruled that the multilateral interchange fees (MIFs)
levied by MasterCard are contrary to competition law. MIFs are
multilaterally agreed inter-bank fees charged by a cardholder’s
bank to a merchant’s bank for each card transaction made at the
point of sale (POS) and the court’s decision confirmed a 2007
decision of the European Commission (EC) that prohibited
MasterCard’s MIFs as they could constitute an anticompetitive
As a company that has followed large
merchants, such as German shoe retailer Deichman, into 17 European
countries already, Lachenmeier spurred on delegates during the
Merchant Acquiring Forum to discuss charging models, the migration
to cross-border acquiring, compliance and security issues.
Lachenmeier’s presentation was regularly
interrupted by questions and comments from delegates, who raised
issues around the different charging models, the migration from
national to cross-border acquiring as part of a acquirer’s strategy
and the subsequent change in competition landscapes.
The problematic, and in the view of some
delegates – contradictory issue that domestic acquirers face when
looking at international markets is in how to strike a balance
between bringing standardised and efficient services to a market,
and fully understanding that country’s unique requirements. This is
an area of particular concern when it comes to the processing of
local debit schemes.
The afternoon sessions focused on loyalty and
merchant-funded rewards and prepaid programme management.
Pierre Boces, senior marketing consultant at
Welcome Real-time presented the benefits of merchant funded rewards
at the Loyalty forum. Delegates agreed that while
there is a benefit for both the acquirer, loyalty service provider
and merchant, there are complexities and challenges involved in
identifying a successful strategy and bringing such merchant-funded
loyalty schemes to the market.
In a series of interactive role-plays,
delegates worked through scenarios and analysed how banks and
merchants, as well as the loyalty service providers could agree on
the key deliverables at the heart of any successful loyalty
Meanwhile, Chris Ellis, UK country manager for
prepaid payment processor Yalamanchili, engaged delegates in a
discussion on prepaid programmes around the world
and why some succeed, while others do not.
In a sometimes heated debate, delegates argued
and discussed their individual point of views on effective prepaid
card programme management, with some arguing that it has to be a
pull marketing effort, while others claimed a push effort is the
right way to go.
The opinions in all sessions were varied, but
none were wrong. As this year’s conference has shown, there are
many potential ways and views with which a successful business
model can be set up. What is most important is identifying your own
niche and market proposition.
The evening of the conference saw the
announcement of the winners of this year’s Trailblazer Awards. The
winners in each category were:
Best New Credit Card: Santander
Things were heating up in the UK credit cards
market in 2011, and Santander grabbed headlines for its 123 Credit
Card, and the judges felt it fully deserving of nomination. The
card has an annual fee of £24 and 18.9% p.a. variable on card
purchases. The bank has got a cash back calculator on its website
that makes it easy to see how much money a card holder can earn
back. Card holders earn 1% cashback on supermarket shopping, 2% for
spending at selected department stores; and 3% at petrol
Best Debit Product: CGD Caixautomática
The Caixautomática debit card was launched on
March 2011. It can be issued as Visa or MasterCard depending on the
customers` choice. The judges consider the product to be flexible
and consumer-friendly, differentiated from other debit cards by the
facility to delay the charge of purchases to the current account
for three working days after the transaction.
Best New Prepaid Product: APS CashPlus
APS has stepped prepaid up a gear with the
CashPlus Card. The issuer became an agency bank in order to enable
Direct Debit payments from the prepaid card. Judges considered this
a major innovation.
Best New Co-branded Affinity or
Loyalty Product: Friiworld
The judges considered Friiworld to be an
outstanding loyalty programme. Consumers receive considerable
discounts on purchases paid for by any type of payment method and
merchants receive commission on their customers spending at other
participating merchants. Plus they receive significant amount
of data to aid business development.
Best Industry Innovation: La Caixa
The panel considered the world’s first
contactless-enabled ATM to be a praise-worthy and long-awaited
innovation. The application makes use of increasing number of NFC
debit cards and it is adapted to work with al existing contactless
payment methods including mobile contactless.
Merchant Acquirer of the Year:
Since becoming the first non-UK bank to become
principal members of Visa and MasterCard in 2010, CashFlow has
sought to differentiate its acquiring offering through a range of
innovative solutions to our business customers and the consumers
shopping with them. These technological advancements have spanned
multiple channels, allowing merchants to offer a range of payment
options than are unique within the UK market.
Card Processor of the Year: First
Despite the economic crisis and the overall
market dynamics First Data is balancing a deep restructuring
initiative with moves to centralise its platforms, while still
managing to invest in innovations like Google Wallet, GoTag and
Marketing Initiative of the Year:
Turkey’s interbank centre BKM started its
latest, and perhaps most impressive, anti-cash campaign last year,
proclaiming that cash will be eliminated as a payment in favour of
cards by 2023. Although this was not the first anti-cash campaign
(the first campaign started in 2004), it was the most quirky, yet
the most serious.
M&A of the year: WorldPay’s
acquisition of Envoy
WorldPay acquired this small, but innovative
global e-commerce payment solutions provider part of the expansion
of its e-commerce offering. The deal demonstrates WorldPay’s eye
for new business streams a fact backed-up by its other impressive
deals, including those with China UnionPay and mobile player