chris hamilton
TRANSCRIPT
Australian payments: strategic trends and
observations
Scenarios RoundtableCanadian Payments System Review
Chris Hamilton, CEO
4 points in 15 minutes…
• Australian payments overview
• Payments “marketisation”
• Promoting innovation
• Industry policy implications
…the ‘traditional’ view
Integrated industry governance: central
bank and APCA
Integrated daily central bank account
settlement
Bilateral links, “strong” industry
standards
Utility systems, limited contestability
(cards)
Open competition: financial institutions
and a few others
© 2010 Australian Payments Clearing Association
• ‘Button’ competition• Domestic PIN debit commercialises to compete • Increasing competition in non-card consumer
payments BPay, PayPal etc• Pro-competitive regulatory reform: access,
interchange caps (to go?), surcharging• Broad industry debate on the platform
But: ‘Marketisation’ strikes!
© 2010 Australian Payments Clearing Association
Flexible, integrated batch and real-timeCommon message
library?
APCA minimum standards for open
access, security
... the vision
Universal IP connectivity:
COIN + SWIFT + ??
Multi-layered, dynamic competition
© 2010 Australian Payments Clearing Association
A network theory of innovation
The integrator’s dilemma: how can a new CVP build
critical mass?
The “big bang”: full new service eg Faster Payments
(UK), SEPA Credit (EU)
Incumbents coordinate to improve network eg EMV/chip
Innovator’s dilemma: new entrants “pick off” marginal
customers eg PayPal
“Classic” theory: incumbents serve their best customers eg
loyalty programs BUT
© 2010 Australian Payments Clearing Association
The crystal ball: Convergence
• Smartphone app– Cards and online
collide– Opportunity: wallet
rationalisation– Plethora of choice– Lifestyle integration
• Huge challenges– Lots of collaboration– Security/antifraud
•Separate instrument and platform governance• Promote multilayered competition, allow for disruption•Transparently integrate public and industry elements
• Don’t pick winners!
The policy process