Secure, Simple, Seamless: Payments in the post-PC era

Simple,Secure,Seamless:Payments in the post-PC era

Thomas Bostrøm JørgensenCEO, ENCAP

Secure,Simple,Seamless:Payments in the post-PC era

Thomas Bostrøm JørgensenCEO, ENCAP

Joined Encap as CEO in 2011 Previously CEO at Luup,

global leader in mobile payments

Executed global strategic partnerships with Deutsche Bank for rolling out mobile money

VP R&D at Force Group Co-founder at Voycast AS

Intro

The payment ecosystem

Messaging

Payment facilitation

Funds movement

SECURITY (authentication and anti-fraud)

• FORCES: What are the market forces at play in the post-PC era?

• POTENTIAL: What is the potential of post-PC era financial services?

• CHALLENGES: What key challenges does the market need to overcome?• Adoption -> compelling & convenient user

experience is required to drive uptake• Security -> security cannot be compromised - high

security, banking-grade two-factor authentication is essential

• QUESTION: How do we ensure a strong user experience without compromising security?

Agenda

FORCES

In the news 2000: Egg suffers security breach, defrauded of

thousands 2005: Phishers target Nordea´s OTP system 2006: Bank of America debit cards compromised,

200,000 customers affected 2007: ZeuS trojan attacks bank´s 2FA – Malware for

mobile

The post-PC era

App store revolution

Consumers demand convenience from financial

services via apps

Cloud opportunity

Financial services can are increasingly adopting cloud-based solutions

Smart opportunity

Consumers want to use smart devices more than PCs for financial services

Growing mobile security threat

Threats to mobile devices will continue to grow

Key industry trends impact

payments security

Trust is even more imperative as market forces are rapidly changing the payments landscape

The post-PC era

Source: Economist, 08.10.2011http://www.economist.com/node/21531109

Smartphone penetration

Source: Economist, 08.10.2011http://www.economist.com/node/21531109

Mobile broadband penetration

Source: Economist, 08.10.2011http://www.economist.com/node/21531109

Apps market

Source: Economist, 08.10.2011http://www.economist.com/node/21530920

The move to the cloud

POTENTIAL

Advanced Payments

Source: Edgar Dunn & Company, Advanced Payment Report 2011

• Online payments currently dominate the advanced payments market.

• This trend is expected to continue but contactless card and mobile payments will become significant by 2016.

• The market size for online payments is expected to be $2,068 billion representing two thirds of the advanced payments market by 2016.

Big players are lining up

Paypal does $7bn in mobile transaction volume

Square does $5bn in commerce transaction volume

Google > $5bn in mobile revenues

16

Security fears

29% said that despite shopping online, they did fear their financial security may be breached *

Only 16% believed online financial transactions are always secure *

700% growth in the last two years in mobile security threats

*Source: Avira

New Account fraud

‐ Costs the industry $579 per case‐ Costs $18bn in total

Existing account fraud

‐ Costs the industry $526 per case‐ Costs $31bn in total

Cost of Identity Fraud: US

Source: Javelin Strategy & Research

CHALLENGES

SecureSimpleSeamless

Adoption of post-PC world financial services require them to be:

Secure

$No security Usable security

2FA

$Un-usable security

UN: *****PW: ******0

Cost

Risk

Usability is the ease of use and learnability of a human-made object*

The payment solution has to be designed for:

Efficient use Easy learning User satisfaction

Simple = Usable

* Wikipedia

Small screen real estate Users´ low attention span Awkward input Complex user experience design PC-era authentication solutions

Unique usability issues in post-PC era (mobile) financial services

PC-era authentication solutions

Consumers and service providers want a seamless payment experience across all channels

Seamless

QUESTION

How do we ensure a strong user experience without compromising security?

PC-era payments solutions

Post-PC era payment solutions

Secure– 2-factor authentication – Lower cost then PC-era authentication

Simple– Designed for ease of use– No new hardware required: use customers existing hardware

Seamless– Fully Integrated with the customer´s devices– Work across any channel

…Without costing too much!

Post-PC era payments solutions

Post-PC era authentication – TCO comparison

Post-PC HW OTP Smart token

OTP soft token

SMS OTP

Thanks for listening…

…any questions?