Mobile Cash: Digital Innovation Keeping ATMs Relevant (Moldindconbank case)

ATMIA

Europe ATM & Payments Innovation Summit

16th-17th October 2019 Rome

by Valeriu Stratan Deputy-Chief of Card Processing Directorate

Summary:

• Introduction • Mobile Cash evolution:

a) Mobile Cash-Out b) Mobile Cash-In c) P2P by barcode

• Conclusions

Introduction: Moldova?

Ladder efficiency for commercial banks in Moldova, July 2019 (in points):

Source: www.expert-grup.org

6.2

4.2 3.9 3.2 3.0 3.0 2.8 2.6 2.5 2.5

2.2

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

1 138

1 099

1 046

2018 2017 2016

1 000

1 020

1 040

1 060

1 080

1 100

1 120

1 140

1 160

Total number of ATMs in Moldova

26,4 24,2

21,6 23,8

16

10,4

0

5

10

15

20

25

30

2018 2017 2016

cash withdrawals non-cash payments

Total number of cash withdrawals and non-cash payments performed in Moldova over the reporting period by means of

cards issued in Moldova(mln.)

Source: bnm.md

millions

Quota of Moldindconbank ATMs and POS network in report

with national Moldavian network by August 2019:

18%

ATM CashOut

172 ATMs

36%

ATM Combi (CashIn+CashOut)

70 CashINs

28%

POS

5100 POS

ATM operations

Domestic and international cards(MSR/EMV/CTLS): Cardless: On-us cards(EMV/CTLS):

Quota of digital clients:

75%

25%

Q4 2018

Total Clients*

Clients WB/MB

9%

16%

23%

29%

4%

7% 11%

14%

0

5

10

15

20

25

30

35

Q4 '17 Q1 Q2 Q3 Q4 '18

WB/MB Clients

Total Clients*

Dynamic of digital clients in the last year

*Total clients – clients who have minimum one issued MICB card

78%

22%

Q4 2017

Total Clients*

Clients WB/MB

Internet & Mobile Banking services:

• Fingerprint authentication(Mobile Banking iOS/Android)

• P2P transfers

• Billing Payments

• Mobile Cash

• SMS notification management

• ATM Geolocation

• Card limits management

• Card block/unblock

• Card protection service - "Transactional window“

• One time password (Mobile OTP) generation

Moldindconbank has been recognized as “2019 Innovator in Payments for Mobile Cash” by the prestigious American magazine Global Finance in the annual listing of the most innovative banks and fintech companies in treasury and transaction processing „The Innovators 2019”. “The financial institutions winning Global Finance’s The Innovators 2019 honors excel in breaking down silos to unleash creative thinking.”, “Best of all, they have shown how to channel creativity into valuable products and solutions.”, “These firms are not just advancing rapidly, they are changing rules of the game." said Joseph D. Giarraputo, publisher and editorial director of Global Finance.

• Cash is still remaining the most universal tool of payment. There are still a lot of “Cash Only” merchants

• Many Moldavian people still love cash and trust in it.

• ATM Cash-IN and ATM Cash-Out transactions are still growing up.

Mobile Cash is an important concept that has the power to multiply and speed up ATM transactions, as well as improving customer convenience and digital banking.

Mobile Cash represents a combination of digital and

physical banking that includes 3 services: a) Mobile Cash-Out b) Mobile Cash-In c) P2P by barcode

First scenario - Cash by Code

Second scenario – Mobile Cash-Out

Number of transactions per month – Cash by Code and Mobile Cash-Out

M 1 M 2 M 3 M 4 M 5 M 6

Second scenario MobileCash-Out(November-April2017/2018)First scenario Cash by Code(April-October 2017)

+2300%

+900%

Number of transactions per month – Cash by Code and Mobile Cash-Out

M 1 M 2 M 3 M 4 M 5 M 6

The last stats March-August 2019

Second scenario MobileCash-Out(November-April 2017/2018)

Mobile Cash – only 50% of ATMs

are equipped with barcode

readers

+2300% +900%

+3100% +300%

35%

65%

ATM Cash-In transactions by August 2019

Cash-In Cardless

Cash-In by cards

Cash-IN

82%

18%

Quota of Cash-In transactions by August 2019

Cash-In at ATM

Cash-In at Branch

First scenario – Cash-In Cardless

First scenario – Cash-In Cardless

Second scenario – Mobile Cash-In

18%

Cash-In Cardless

Mobile Cash-In

+30%

Transactions

Number of Mobile Cash-In transactions the last 6 months Quota of Mobile Cash-In transactions in comparison with Cash-In cardless transactions by April 2018

Mobile Cash – only 50% of ATMs

are equipped with barcode

readers

Second scenario – Mobile Cash-In

P2P by Barcode

Cash-In Cash-Out

Conclusions of Mobile Cash:

• Security – biometric authentication. Mobile Cash-Out is based on OTP passwords – no authorization card data are used.

• Migration of ATM UI(user interface) to Mobile Banking UI made ATM transaction to be more secure, faster, flexible, simple and intuitive.

• Can be implemented at all brands of ATMs that work on NDC/DDC standard protocols. • Mobile Cash bring the customers closer to the digital banking. • Paperless – no receipts. All receipts can be downloaded via Mobile Banking in .PDF

format. • Cardless – anti-skimming and anti-card trapping solution. No card captures. Solving the

technical issues like card chip contact errors and ATM card reader errors. • Mobile Cash - one button for all 3 services(Cash-In, Cash-Out and P2P by barcode). • Contactless ATM transactions case is not about the evolution of ATM UI/UX, it is about

card tokenization only.

Thank You!

Valeriu Stratan Deputy-Chief of Card Processing Directorate, valeriu.stratan@micb.md www.linkedin.com/in/stratanv

Moldindconbank www.micb.md