Eric Duforest starts his career in 1986, at Bull as an IT Consultant and continues to develop his skills during 16 years at Schlumberger in various managing positions such as Sales manager, R&D manager, VP for “banking Terminals” and SEMA General Manager of the IT managed Services for France.
In 2004, he joins Atos Origin as the General Manager of the IT Managed Services for France.
Four years later, Eric Duforest enters Oberthur Technologies as Europe Managing Director of the Card System Division.
Since January 2013, he is the Managing Director of the Payment Business Unit and is a member of Oberthur Technologies’ executive management team.
First of all, could you share with our readers more about Oberthur Technologies and how do you see your role in the development of mobile payments market?
Eric Duforest: OT is a world leader in digital security solutions for the mobility space. Our core business for the past 30 years has always been about developing security software embedded in objects mostly for Payment, Telecommunications and Identity markets. What has changed is that our environment has been disrupted by the explosion of mobility demands. Mobility has become a way of life and creates an opportunity for us to develop and manage new secured solutions to protect the digital assets of our customers and their end-users without degrading service usability. We don’t just sell security anymore, we sell mobility and that’s where the future market value lies. And that is today reflected in our new baseline, “OT, the M company”.
We approach mobile payments in a variety of ways to cover all our clients’ needs: from contactless payment cards and payment stickers pasted on the back of mobile handsets, through to NFC secure elements (SE) –SIM cards or embedded SEs- and TSMs, but also mobile wallets and cloud-based solutions.
As everyday items become increasingly connected, the focus switches on the ubiquitous accessibility of payments, regardless the device used. Whether accessed via mobile phones/tablets or even smart watches, the value of mobile financial services is more and more based on the concept of ‘mobility.’ In your opinion, how is this concept going to change the industry in the next years to come?
Eric Duforest: We see mobility impacting both mobile banking (that is basically the way we manage our relationship with our bank, as well as the various services offered around bank account management) and mobile payment/shopping.
In developing economies, the use of mobile is driving financial inclusion, through the launch of mobile money services like account-to-account money transfers, but also true mobile banking services through mobile agents providing micro loans and savings.
In developed economies across the globe, most banks already provide advanced mobile banking, with a clear evolution towards branchless banking. Indeed, many pure mobile banking systems have been launched recently either by existing financial institutions or fully new disruptive players, enabling customers to manage their account exclusively through an application on their smartphone.
But mobility is also revamping the full shopping and payment experience. A smartphone is the device of choice to address “multi-channel” shopping as it combines in-store and online payment and enables to connect both worlds: you can receive a mobile coupon or scan it in-store and redeem it in a physical store where you will carry out a “physical” payment on a POS terminal. But if this book you wanted is not available, then you may switch to an online payment as the merchant proposes to ship it to your home via their e-commerce platform.
And the same smartphone can also become an mPOS, enabling a wider base of merchants of all kinds to accept cashless payments easily.
OT is building solutions to fulfill all those new needs and usages.
2013 was a year with plenty of new players entering the mobile payments industry. Start-ups, retailers, banks, big tech-savvy companies and telcos made this market very fragmented. Which of these players do you see gaining significant ground in the future and why?
Eric Duforest: It is probably too early to draw definitive conclusions, as we are still at the early stage of this mobility revolution, with all players trying to take position and testing a variety of solutions. The image of the “big banks” being shaken –if not desintermediated- by turbulent startups, represents only a part of the reality, as quite a lot of well established banks, MNOs or retailers propose very innovative solutions.
In fact, our key word to our traditional customers is: innovate, otherwise others will and they will take your place. Indeed, using all the innovations and solutions we propose, and leveraging their current assets (like historical “multipoints” relationships with customers and an image of trust and security) is a way for those traditional players to succeed against those new aggressive entrants.
One prediction is that NFC, EMV and magnetic stripe will co-exist on the same terminal for years to come. How do you think 2014 will look like for the mobile payments market with these three different technologies?
Eric Duforest: The migration to EMV is indeed well advanced in most parts of the world. The US, who long questioned the validity of such a migration, have realized after several recent huge data breaches, that they can no longer avoid it. Also stimulated by the liability shift set to 2015 by the big payment networks, we anticipate a sharp take off of EMV volumes this year in the US.
We see a trend of more EMV cards and we see them more secure (DDA) and increasingly contactless-able, providing convenience and speed of transaction as well as opportunity for multi-application (for instance combining payment and access control or transport on the same card).
Mobile payment will benefit from those investments made in more modern POS terminals featuring contactless and user-friendly interfaces (bigger high-resolution screen), that can accept transactions made with NFC handsets (using a secure element or based on host-card emulation) or alternative options like QR codes.
There shall be one loser, the magstripe and one winner, the end-user, with a wider choice of secure payment solutions, providing more convenience and speed of transaction, with a card or a mobile handset.
In many countries, mobile payment solutions have gone beyond basic functionalities, such as person-to-person money transfer, bill payment, etc. and now deploy loyalty solutions targeted at the specific customer based on his/her location or passed purchases. How do you think these offerings will change the consumer’s behavior?
Eric Duforest: First of all, as already explained, any solution we propose comes with a high level of security. This is an important prerequisite as end-users, if they are interested in coupons and offers of all kinds, strongly expect a high level of protection for their personal data that they accept to share in opt-in mode.
This being said, we propose advanced mobile wallet solutions combining payment and location/profile-based targeted loyalty and couponing, like the one we demonstrated at the last Mobile World Congress. Such a solution brings convenience and value to the end-users, thus becoming the preferred one among other apps available in their smartphone, with a clear positive impact on their shopping behavior (increased spending and coupon redemption rate)… Parameters that indeed matter for our banking or retail customers to whom we sell those solutions!
What does Oberthur Technologies plan for the future? Have you set any goals for the next 2-3 years?
Eric Duforest: We are consolidating our leadership position not only on the card market, but also on solutions among which mobile financial services in all formats will play a key role. Being the M company means investing to develop and propose solutions that bring security, value and convenience to the end-users, to the benefits of our banks, retailers and telecom customers.
Company description
OT is a world leader in digital security solutions for the mobility space. OT has always been at the heart of mobility, from the first smart cards to the latest contactless payment technologies which equip millions of smartphones. Present in the Payment, Telecommunications and Identity markets, OT offers end-to-end solutions in the Smart Transactions, Mobile Financial Services, Machine-to-Machine, Digital Identity and Transport & Access Control fields. OT employs over 6 000 employees worldwide, including 600 R&D people. With more than 50 sales offices across 5 continents and 10 facilities, OT’s international network serves clients in 140 countries. For more information: www.oberthur.com
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