larc2014 - payments industry perspectives

1 SWIFT Latin American Regional Conference (LARC) - 2014 28-28 May 2014

Ruben

Galindo

SWIFT

Mexico

Gustavo Vega Alessandro

Albertin

ACH Colombia

Colombia

Camara CIP -

Interbancaria de

Pagaments

Brazil

Payment Industry Perspectives

Payments Session

#LARC2014

@swiftcommunity

Thank you to our Exhibitors & Sponsors

SWIFT Latin American Regional Conference (LARC) - 2014 28-28 May 2014 2

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SWIFT Latin American Regional Conference (LARC) - 2014

Payment Industry Perspectives

Real-Time Payments

5

Global Real-Time Payment Systems Landscape

What is real-time? An interbank account

to account payment

posted and confirmed

to the originating

bank within one

minute.

These systems

support different

settlement models

ranging from real-

time settlement to

deferred

settlement

The majority of

systems credits

are posted to the

Beneficiary’s

account in

RT/NRT.

What real-‐time is not RTGS / wire payment Card payment Manually processed

RT/NRT posting & settlement

RT/NRT posting, deferred settlement

Fast Batch

In development

4 Data acquired from Lipis & Lipis, “Faster than a speeding payment”, NACHA Payments 2013

Real-Time Payments Currently several RT/NRT payments systems across the globe

4

RT/NRT Payment Systems Comparison Real-time experience does not mean real-time settlement

Under development

Bankgirot

PaymentsNZ

NEFT

SIC

SPEI

SITRAF

BankServ

Faster Payments

Zengin

SPRN (ELIXIR)

G3

APCA

BIR

NETS

Existing Systems

Speed of posting

Spe

ed

of

sett

lem

en

t

Fast Batch

Deferred Settlement

Real-time settlement

Real-Time Payments Real-Time Payment Systems models

RT/NRT posting, deferred settlement

Posting of incoming credit takes place in RT/NRT

Settlement between originating and beneficiary bank takes place at a later point

in time, once or more times a day.

Credit Risk for Beneficiary Bank, Complex Liquidity management requirement for

Originating Bank

Fast Batch

Posting of incoming credit takes place in NRT after the batch is settled

Settlement between originating and beneficiary bank takes place in batches

several times a day

No Credit Risk for Beneficiary Bank, Complex Liquidity management

requirement for Originating Bank

RT/NRT posting and settlement

Posting of incoming credit takes place in RT/NRT

Settlement between originating and beneficiary bank takes place in RT/NRT

No Credit Risk for Beneficiary Bank, Simple Liquidity management requirement

for Originating Bank

SPEI Sistema de Pagos Electrónicos Interbancarios

Any regulated financial institution can participate in SPEI.

Its design and rules allow banks to offer transfer services at a low cost.

SPEI is available 23x5, however, most banks offer payment services only 12x5

Average SPEI banking fee is 4 MXN (0.3 USD).

Currently SPEI receiving banks generate an electronic acknowledgment of the SPEI funds posted in beneficiaries' account (CEP, Comprobante Electrónico de Pago).

Special services:

Tesofe

CLS

10

SPEI Real-time experience does not mean real-time settlement

BANXICO reinforces SPEI

utilization by advertising and media

Source: Bank of Mexico 11

SPEI Non cash payments instruments in Mexico (Volume)

Initiated easily, by providing only the value of the payment and the

beneficiary’s cellular phone number.

Create a relationship between a current account and a mobile number, per

client request.

Provided at low cost, Settled quickly, and operated at any time.

Done with the same standard procedures regardless whether the beneficiary

account is in the same bank or in a different bank.

12

Current situation Q4 2014

Features Interbank payments On us and interbank

Beneficiary information to

initiate the payment

CLABE

(18 digits)

Cellular phone number

(10 digits)

Availability 12X5 24X7

Processing time Less than 1 minute and 5

seconds Real time (5 seconds)

Fees $1 MXN in most accounts Same fee

Mobile Payments Expanding the actual infrastructure

Source: Bank of Mexico

Perspectivas de la Industria de Pagos

GUSTAVO VEGA

CEO

Industria de Pagos

Actores no Tradicionales

Regulación

e

Iniciativas

Estándares

Tecnología

Seguridad

Clientes

INDUSTRIA DE PAGOS

ACTORES NO TRADICIONALES

Empresas de Mensajería.

Empresas de Transporte.

Loterías en Línea.

Tarjetas Prepago (Gift Cards).

ACTORES NO TRADICIONALES

PayPal.

Google Wallet.

Amazom Payments Account.

Telcos.

Redes Sociales.

REGULACIÓN E INICIATIVAS

Las Instituciones financieras, en todas las regiones, están enfrentando un ambiente

regulatorio muy retador.

KRIIs – Key Regulatory and Industry Initiatives

Con un impacto directo o indirecto sobre la Industria de Pagos.


Incrementar la conveniencia de los usuarios.

Incrementar la seguridad y transparencia en los pagos.

Fortalecer la prevención de fraude.

Estimular la innovación.


Basilea. Pagos Móviles LA / FT. e-Government. e-Invoicing. Disminución del Uso de Cheques. Dood-Frank. CPSS – IOSCO. FATCA. SEPA.


Riesgo de Lavado de Activos y Financiación del Terrorismo.

Riesgo Operativo.

Estatuto del Consumidor.

Ley Protección de Datos Personales.

Inclusión Financiera.

INCLUSIÓN FINANCIERA


“Vive Digital”.

Sociedades Especializadas en Depósitos y Pagos Electrónicos (*).

Reversión de Pagos (*).

ESTÁNDARES

Mensajería SWIFT.

NACHA-M ISO 20022.

.

.

TECNOLOGÍA

Internet.

Tarjetas sin contacto.

Dispositivos móviles.

Aplicaciones (Apps).

Redes Sociales.

Monederos Virtuales.

SEGURIDAD

Cyber Seguridad.

Autenticación:

– Tokens – OTPs – Biometría.

Certificados Digitales.

ISO 27001.

Manejo del Fraude.

CLIENTES

Son más exigentes.

Tienen mayor conocimiento.

Tienen más opciones.

Requieren más información.

Requieren agilidad y accesibilidad.

Exigen mejores precios.

Industria de Pagos

Actores no Tradicionales

Regulación

e

Iniciativas

Estándares

Tecnología

Seguridad

Clientes

INDUSTRIA DE PAGOS

Servicios

ACH Transferencias (Créditos –Débitos)

PSE - Pagos Seguros en Línea

SOI – La red de la seguridad social

ACH Directo

SSC – Soluciones SWIFT Colombia

30

Usuarios

Empresas

Entidad Financiera

Originadora

Entidad Financiera

Originadora

Entidad Financiera

Receptora

Entidad

Financiera Receptora

Usuarios

Empresas

ACH TRANSFERENCIAS

CIERRES DE CICLO

CICLO DE PROCESO CIERRES

1 9:00 a.m.

2 11:30a.m.

3 2:00 p.m.

4 4:00 p.m.

5 6:00 p.m.

ACH COLOMBIA vs. Cheques

-

20,000,000

40,000,000

60,000,000

80,000,000

100,000,000

120,000,000

140,000,000

160,000,000

180,000,000

200,000,000

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Total ACH Total Checks

Es un servicio ofrecido a las EMPRESAS, el cual permite que sus CLIENTES realicen pagos a través de Internet, debitando los recursos en línea de su cuenta de ahorros o corriente, desde la Entidad Financiera donde el usuario tiene su dinero, realizando el abono en la Entidad Financiera y cuenta recaudadora que defina la Empresa.

PAGOS SEGUROS EN LÍNEA (PSE).

Usuario Sitio Web Empresa Entidad Financiera del Usuario

Lista de Bancos

El usuario autoriza el pago con debito a cuenta

• Liquidación • Compra

PSE -Esquema de Operación

PSE - Esquema de Operación

Entidad Financiera del Usuario

Usuario Sitio Web Empresa

A través de ACH Colombia

Empresa

Entidad Financiera de la Empresa

Servicio que permite a los

Aportantes (empresas y

trabajadores Independientes),

realizar la liquidación y el pago

de aportes a la seguridad

social.

SOI – Servicio Operativo de Información

Administradoras

SOI – Servicio Operativo de Información

Aportantes

Servicio que permite realizar

transferencias entre cuentas de

diferentes Entidades Financieras en

tiempo real (10 segundos), de manera

segura y sin restricción de horarios.

TRANSFERENCIAS EN LÍNEA (ACH DIRECTO).

Entidad Financiera

Originadora

Entidad Financiera

Receptora

(Pagos y Desembolsos)

en Tiempo Real

RETOS Y TENDENCIAS

Regulación e Iniciativas.

Seguridad.

Pagos entre Países (Cross-border).

Estándares.

Micropagos.

Redes Sociales.

No Bancarizados.

GRACIAS

Payment Systems

Real Time Transactions

Alessandro Albertin

May 2014

45

Agenda

CIP – Institutional Overview

Brazil - Financial Sector Context

Payments Channels Overview

Brazilian Payment System

Looking to Future

46

CIP

Non-Profit Organization

2,9 billion of transactions

R$ 5,9 trillion in 2013 ( US$ 2,5 trillion)

• Online Real Time Payment System

• Systemicaly Important Security Clearing

• ACH T+1

• Other Shared Services

ISO 22.301

ISO 27.001

47

Changes in Banknotes and Coins

1955 Cruzeiro

1967 Cruzeiro

Novo

1972 Cruzeiro

1989 Cruzado

Novo

1990 Cruzeiro

1993 Cruzeiro

Real

1994 Real

1986 Cruzado

÷ 2,750,000,000,000,000 ÷ 2.75 Quadrillion – Cruzeiro x Real

Source: http://www.portalsaofrancisco.com.br/alfa/historia-da-moeda-no-brasil/imagens

48

Brazil – Inflation

Year

%

Inflation (logarithmic scale)

49

Payments Channels Overview

Quantity: 9.2 billions

Total Quantity and Amount of Transactions

Amount: U$ 370 billions

Direct Debit Cheque Cards Credit Transfer e-Money

Payments Channels – Volume of Transactions

Source: ABECS and http://www.bis.org/publ/cpss116.htm

4.357

18,5%

1.438

6,1%

8.664

36,9%

9.012

38,3%

36

0,2%

50

SPB – Brazilian Payment System

Source: http://www.bcb.gov.br/?SETTLEMENT

51

The Brazilian Payment System Evolution

2001

CIP

was born

Apr, 2002

SPB

launched

Dec, 2002

CIP

SITRAF (RTGS+DNS)

starts

Feb, 2004

CIP

SILOC (DNS)

takes place

Boleto Collection Slip

DDA

e-Invoice

SLC

Card Industry

. . .

Evolution keeps running

• Payment Standard

• Security

• Risk Reduced

• Under Central Bank

• STR (real time)

• Express Wire Transfer

• T0 settlement

• Credit Transfer

• T1 settlement

SPEI Mexico

Aug, 2004

52

Payment Systems – CIP

SILOC SITRAF

Deferred Settlement

System for Interbank Credit

Orders and other services

Two settlement sessions

are carried out daily (08:20

am and 4:10 pm)

Under the supervision of

Central Bank

Hybrid System: RTGS and DNS

Express Wire Transfers (“real time”)

Operation starts at 04:00 am

and ends at 5:10 pm

Under the supervision of

Central Bank

2 Settlement System

53

Payment Systems – CIP

SILOC SITRAF

2 Settlement System

DOC Credit Transfer

TEC

Boleto Collection Slips

Payment Services Tecban

ATM

Seltec

Notary

Card Industry

TED

Wire

Transfers

54

Statistics 2013 – SITRAF

Annual Volumes

Quantity: 175 million of transactions

99,98% Availability Index

Amount: US$ 1,49 trillion * * dolar in 31/12/2013

99,6% of total < 1min

Message Processing Time

55

How SITRAF Works

04:00 am 06:35 am 05:00 pm 05:10 pm

Message

Queuing Period

• Credit Transfer Payment Messages • Credit Transfer Schedule Payment Messages

(+3 days after) • Anticipates sending messages by banks • No clearing, only processing and queuing

56

How SITRAF Works

Message

Queuing Period

• CIP informs the total amount queued to the Debtors Bank

• Debtors Bank transfer funds (based or not in the queued messages) to CIP via Central Bank

• Messages are being cleared based on the funds and the Creditors Bank are informed

• Funds can also be withdrawn in this period

Message Clearing Period and Cash Withdrawal

04:00 am 06:35 am 05:00 pm 05:10 pm

57

How SITRAF Works

Message

Queuing Period

• CIP requests the transfer of amounts to the Creditor Bank via Central Bank

Message Clearing Period and Cash Withdrawal Settlement

04:00 am 06:35 am 05:00 pm 05:10 pm

58

New Brazilian Regulation – Law 12.865

- Until October 2013 there were no

regulations for mobile payments in Brazil

- The rules and procedures were made together

with the evolution of the market for

mobile payments

- Law 12.865 of October 9, 2013 arises to

assign transparency, provide the legal

basis for the card industry and open the

market for financial inclusion and

competitive advantage

TRANSITION

Financial

Inclusion

Risk

Management

Operational

Procedures

59

But ... what’s next?

P2P x Time Transaction x Costs World Standard x Regulation

The strategy is to reach

the financial inclusion

with costs reduced and

provide more efficiency.

• A lot of players

• Interoperability

• “Real time” system

• Social benefits

The need to break the

cross border payments

communication

• ISO20022

• AML

• Unique Identification

• Agility and Security

ChAlLeNgEs

Thanks!

Alessandro Albertin

[email protected]

Q&A

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62 SWIFT Latin American Regional Conference (LARC) - 2014 28-28 May 2014

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64

Coffee Break & Exhibition Hall

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Sponsor:

SWIFT Latin American Regional Conference (LARC) - 2014 28-28 May 2014

larc2014 - payments industry perspectives

Economy & Finance