Passionate About Payments
Payment intelligence to enrich, protect & grow your business
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Passionate About Payments
Risk Optimisation Not Risk Minimisation
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INTRODUCTION Petrol to payments
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Risk Optimisation The holy grail - how do we find the perfect customers
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Risk Optimisation Measuring KPI’s that help optimise the KVIs Key value indicators
Value – best in class
Volume growth
Grow customers
• # accounts • Customer life • Cust lifetime value
• Revenue/account • Share of wallet
Segment to target high margin customers
• Revenue & Cost per Tx • Margin/account
Reduce fraud, bad debt
• Fraud • Bad debt
Key performance indicators
Grow existing customers
Unit margin growth
• # customer support
Increase self service Reduce attrition
Extend Sales Channels
• # dormant accts • # lost accounts • Account attrition volume
Operational improvement
• Number of partners
Additional high margin products/services
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interactions • Cust satisfaction • Hr/core activity • # process steps
• Revenue due to add’l
prod/svc
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Risk Optimisation Segmenting out high value/low risk
Customer Value/ Risk Segmentation Low Value Low Risk
High Value Low Risk
Risk Minimise
Low Value High Risk
High Value High Risk
Small Companies
Value Risk Index
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Big Companies
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Have Strong Balance Sheets
Take greater risk Don’t have the balance Sheet
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Risk Optimisation Not that easy
Success The Three Disciplines – companies should seek to excel in one and be competent or better in the others
what people think it looks like
what it really looks like CONFIDENTIAL
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More complexity Explosion of innovation
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Managing Greater Customer Choice Technology and adoption rates
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More customer choice = more data Creating more and more decisions
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More customer choice = more decisions Creating more and more decisions
Cgenuine
Cfraud Plausibility Range
Expansion
Expansion
Genuine Examples
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Crisp Decision Boundary
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Fraud Examples
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Business Reality Under invested back offices
Banks looking for a pay-off from investments made in digital processes should focus on back office automation projects and steer clear of multichannel integration, according to research from McKinsey. FINEXTRA, 9th December 2014
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Rapidly Evolving Landscape We understand your challenges
Payment types
Sales channels physical online mobile
Fraud
Reduced resource
Services
Competitors
Demand for value added & personalised services
Integrated Platforms Rising costs
more complexity
more risk
more effort
Your business is under increasing pressure from external and internal drivers
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Solution – Back Office Automation Self services systems linked with self learning systems
Sales and marketing
Customer service
Credit and finance
Operations
Customer friendly self service solutions
Self learning back office solutions Self service
Rules engine
Real time information
End-to-end industry-compliant payment service platform
Payment data is rich with information, what, where and what time it was bought, the price of the goods, (some channels, who has bought, delivery address, e-mail, telephone number)
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Real Time Decisions Using Automation We do it for fraud – why not other areas
Utilising payment “purchasing pattern” information;
to build customer retention, to prompt up-selling by using buying recommendations techniques at the point of sale
to optimise price/margins and supply chain
to help better manage the credit and settlement processes
Data Imports Established Payment Data Sources New Emerging Data Sources
Using payment data to automate decisions making
Data Exports
Rules Engine
Pattern Detection
System Alerts
Business Alerts
Rule Optimisation
Enterprise Links
Customer Management Real Time Portfolio Management
Customer Value/Risk Segmentation Low Value Low Risk
High Value Low Risk
Low Value High Risk
High Value High Risk
Prospect Targeting Criteria
“AD HOC”
Customer Value/Risk Segmentation Low Value Low Risk
High Value Low Risk
Low Value High Risk
High Value High Risk
New Customer Monitoring
Existing Customer Monitoring
REFINED
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Holistic Business Management Measuring KPI’s that help optimise the KVIs Key value indicators
Value – best in class Volume growth
Unit margin growth • # accounts • Customer life • Cust lifetime value
Grow existing customers
Reduce attrition
Extend Sales Channels
Segment to target high margin customers
• Revenue & Cost per Tx • Margin/account
• Revenue/account • Share of wallet
Reduce fraud, bad debt
• Fraud • Bad debt
• # dormant accts • # lost accounts • Account attrition volume
Increase self service
• # customer support interactions • Cust satisfaction
Operational improvement
• Hr/core activity • # process steps
Additional high margin products/services
• Revenue due to add’l prod/svc
• Number of partners
Key performance indicators
Grow customers
Fraud risk
Marketing
Credit risk
Collections & recoveries
• Traditional transaction rules looking for suspicious activity or changes in behaviour
• Identifying customers who met spending milestones or where transaction activity may be applicable for product upgrade
• Identifying customers with a change of circumstances who may require credit review
• Identifying customers who spend beyond means or continue to accumulate debt.
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THANK YOU FOR YOUR TIME
Questions?
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