EPCA Speaks – A Table Talk with the EPCA Conference Chairmen

Unlocking the payments potential: Imagine. Create. InnovateFor the past nine years, professionals and experts who share an active interest in the latest developments in the payments space have gathered in various European locations for an event dedicated solely to the changing payments landscape: the EPCA Payments conference.Each year, the event is organized by Innopay, a Dutch financial consultancy in collaboration with Smorenberg Corporate Consultancy (SCC), a provider of marketing and innovation strategy expertise for the financial services industry.

EPCA: a for professionals, by professionals event
The conference has always been deeply devoted to one goal: to help identify the main developments that will shape the future of the payments landscape, thus improving the general understanding of industry trends and business needs. A perfect place for professional learning and networking.

Right from the start EPCA Conference has gathered a true base of payments professionals. Apart from the changing and evolving key topics, EPCA Conference had become THE meeting place for payments professionals who take a wider view on transactional services. Afterall we are more and more in an information business. A once a year must do for a still growing group of professionals, in the words of Harry Smorenberg, CEO of Smorenberg Corporate Consulting.

The conference has always been a place where learning is the top priority, says Douwe Lycklama, founding partner of payment consultancy Innopay. He also adds: “We look for the dialog. We expect delegates to speak up on what is keeping them busy. EPCA Conference is instrumental in getting strategic questions answered and meeting the right people. Therefore (starting this edition) we will do a personal ‘intake’ prior to the event, so we know exactly from everybody for what he or she is coming.”

A different approach?
“Reaching new frontiers”, “Breaking down the walls”, “Releasing the power of payments” are only some of the topics which have been addressed and explored “by professionals, for professionals”. Apart from the focus areas which have been the subject of yearly debate and which include e-payment, mobile, e-identity and the SEPA update, Harry Smorenberg offers some insights on other topics the 2011 edition will cover:

Social media is hot. We see a huge growth in new payments solutions based e.g. on PayPal-X! Platforms like Google and Facebook turn into new continents with their own payments identities... Yet also these virtual worlds need to be linked and connected. We see a replication developing in the virtual world as we have seen in the actual world of payments. A lot of attention should be paid to further standardization and exchanging formats seamlessly. User friendliness and simplicity will be among the challenges as usual.

Apart from the strategic update on current developments, EPCA Conference has more and more focus for new developments and out of the box thinking in adjacent transaction service areas. This is dubbed as ‘Financial Logistics’ and deals with ‘message of value’, which can be any transaction which means value for the sender and receiver. Think of e-identity, e-invoicing and mobile payments. We see an enormous challenge for financials to bridge the gap towards clients. Transactional interaction is a key feel good component in their relationship management... and yet we see less banks invest and develop in that area ...!

2011 theme: Imagine. Create. Innovate
In the payments industry, innovation can frequently be met with skepticism (by market players, vendors, payment experts etc.), if not immediate opposition. On the other hand, the attitude towards various industry trends or developments (mobile commerce for example), as illustrated by various studies released by market research firms, seems to be rather too enthusiastic or not even realistic. In this context, some might interpret this lack of objectivity as the reason why the payments industry still harbours a couple of myths (e. g. the cashless society or mobile payments), which are constantly reinforced with optimistic reports/predictions, but rarely receive any significant argument.

In Lycklama`s opinion, the most decisive element of an innovation is not ‘the idea’ but ‘the timing’. Overoptimistic research agencies have an interest. On the other hand this can influence the innovation speed positively. What we usually learn from these reports is that innovation always takes longer than foreseen. Innovations in two sided markets (such as payments) are not easy to accomplish. Parties have to innovate together, and this is not always obvious and easy in a global competitive setting.

Nevertheless, an increased focus on the client and merchant propositions could overcome some of the barriers to innovation in the European payments landscape. “Today’s innovations are merely driven by regulatory pressure. The customers have ‘to swallow’ the changes, e.g PSD and SEPA, which the benefits are limited. There a gap in serviced needs, that is why we see new concepts coming up, both in the retail and commercial space”.

Innovation in Payments is hard to accomplish... We have to consider scale, acceptances by the mass, security, adaptability in the infrastructure of e.g. merchants, etc. So innovation is only possible in either a true greenfield situation (like the start of PayPal on email payments) or by collaboration of essential parties in a scheme and/or users group. Working together is an essential element to establish a base on technology (low entrance levels, changing consumer behaviour and investments in infrastructure. And as you know, collaboration takes time... a lot of time!, Harry Smorenberg adds.

Taking a look into the future
What are the main trends that will impact the payments business in 2011? In Harry Smorenberg`s view, e-identity and further efforts on simplification of safe and scalable e-payment will be key, while Douwe Lycklama adds that the smartphone (also its e-identity function) ”is just on its way in becoming a primary channel. With a lot more client intimacy, but with new challenges in terms of user experience, functionality and of course transaction possibilities. In networked industries innovation starts on platforms, but that leads to ‘continents’ within the web. Pervasiveness can only be reached in the network paradigm, so distributed platforms. The banking sector is traditionally good at this. But not yet on the web and mobile. This still has to happen. I expect this starting in the coming five years.”

The payments industry is witnessing tremendous change brought about by various initiatives that are expected to improve the efficiency of transactions. However, in spite of challenges/developments emerging in the payments industry, conferences will always play a crucial role. They are the ultimate check on developments, opening up for new ideas and new steps and meeting the right friends in payments to continue best collaboration, as Harry Smorenberg concludes.

The European Payments Consulting Association (EPCA) is a pan-European association of independent national consultancies, each of which has expertise in payment systems and payment products. Each year EPCA organises an international conference. The 9th EPCA Conference was held in Paris on 22 – 24 March 2010. The 2011 location will be Amsterdam, the creative capital of Europe. Save the date: 4-6 April 2011!