Ten Execs On What’s in Store for the Rest of 2014

From security to breaches to EMV to mobile wallets, those at the forefront of innovation in payments have a lot to say about what’s defined the first half of this year and what’s likely to dominate as we barrel full speed ahead through the rest of it. Will there be one mobile wallet or none?  EMV en masse or just a trickle? More investments in startups or fewer?

We’ve got the views of ten players who’ve changed the game for the part of the ecosystem they occupy. How does their view of the next six months synch up with yours?

QUESTION 1: WHAT HAVE YOU SEEN THIS YEAR IN PAYMENTS THAT HAS SURPRISED YOU?

Justin Benson
CEO, Spreedly

“PayPal’s loss of David Marcus was a shock to me. PayPal had a lot of momentum and much of that appeared to be due to David’s relentless push and culture drive. If he decided it was too hard to keep fighting then I wonder what things are like at PayPal.”

Jeff Thorness
CEO, Forte Payment Systems

“We had higher expectations of adoption for mobile wallets, EMV and PayPal’s retail push. Despite the liability shift and the massive data card breaches of Target and other retailers, there still hasn’t been enough fuel to ignite broad EMV adoption within the U.S. Although millions have been spent on investment, marketing, and incentives, the mobile payment providers have failed to come up with a compelling enough solution to make Americans leave their plastic at home.”

Ralph Dangelmaier
CEO, BlueSnap

“The pace at which swipe transactions are moving to online transactions with the continued release of mPOS, wallet and mobile app solutions has happened quicker than people thought and predicted. In addition, VC/PE funding this year in the $2m – $100m bracket for Fintech has hugely outstripped any previous years showing that this is one of the fastest growing spaces globally.  It has been surprising how many people feel there are going to be tons of winners in this space and not just the handful of seriously backed players.”

Paul Beverly
EVP of Marketing, Gemalto 

“In the mobile wallet race, I am surprised that there has yet to be widespread adoption of one mobile wallet. It is also surprising that not all leading smartphone producers have introduced NFC on their mobile devices and continue to resist the call from their customer base.

In 2014 EMV has been discussed at length, but I am surprised that contactless is not the default EMV card. Choosing contactless EMV cards makes sense from an issuer standpoint as it easily paves the way for “tap and pay” both with EMV and NFC and benefits the consumer with a faster payment experience and better security. Another surprise in payments that has been interesting to watch unfold is that some issuers are continuing with chip and signature instead of the traditional chip and PIN technology. Chip and PIN is more secure and I believe US consumers are smart enough to remember their PIN!”

Mark Adams
SVP and Chief Technology Officer, Meritus Payment Solutions

“This has really been the year of increased cardholder data breaches. Merchants across the spectrum have been grappling with the challenges of how to secure their card data and lock down their infrastructure. It’s surprising how US consumer sentiment has shifted from surprise at a card data breach to an almost anticipation of the event. We’ve reached a turning point.”

Teri Llach
Chief Marketing Officer, Blackhawk Network

“I expected consumers to continue to steadily adopt prepaid products, but I am surprised at how using prepaid has become adopted by the mass market, especially in the millennial generation. Consumers have embraced prepaid in so many forms including, telecom, debit, gift and even using gift for self-use to help with budgeting and building loyalty points.”

Marc Gardner
Founder, President, and CEO, North American Bancard

“I’ve been pleasantly surprised by the amount of new tools now available to small-and-medium-sized businesses (SMBs). The data visualization, inventory management and security that they now have access to are unprecedented. They have access to the same tools large retailers have. This was not the case a year ago. PayAnywhere Storefront was built to pull all those tools into one place at a very affordable price, and we’ve had great success through it.”

Scott Holt
Vice President of Marketing, ROAM

“It’s no surprise that mobile point of sale (mPOS) has taken off in the way that it has, but it’s been really interesting to see how quickly this technology has advanced from basic mobile payment acceptance to highly sophisticated, enterprise-grade solutions designed to help merchants run and grow their business. And as this technology evolves, it’s been exciting to see how the reach of mPOS and the number of use cases has grown so rapidly across industries. We’ve seen retailers creating pop-up stores and accepting card payments free from the hassle of manual reconciliations. Home service providers are not only transacting in the field, but also scheduling appointments, processing change orders, and checking inventory on the go. Direct selling organizations are providing their sales consultants with a single mobile solution that allows them to manage their commissions, display product catalogs, and accept card payments while hosting a home shopping party. And these are just a few of the exciting use cases appearing as more advanced, highly customizable, fully integrated mPOS solutions have been made available to the market. “One size fits all” is no longer the answer, and I think that this has been one of the biggest changes we’ve seen this year.”

Daniela Miekle
Chief Strategy & Product Officer, Vantiv

“I think it is and has been a big surprise how unprepared and unprotected large retailers are when it comes to security issues. A lot of the breaches could have been prevented had the retailers implemented the right technology (which clearly exists). It is also surprising how little consumer sentiment and awareness has changed.”

Chad Person
Chief Revenue Officer, @Pay 

“For such an established field, there are a lot of exciting and surprising developments, both good and bad. There seems to be an ongoing fracturing of the market as developers continue to churn out wallet solutions, for better or for worse. That’s mostly negative in my mind. I favor solutions that make it easier for consumers to purchase across every platform using the tools they have on hand. On the flip side, I have been impressed by merchants’ willingness to accept risk while providing consumer-friendly payment options. For example, I was buying groceries at Whole Foods recently, and had left my wallet at home. I opened an image of my credit card from a secure vault on my phone and the cashier processed the payment as a CNP. They could have left my ice cream to melt in the cart.”

QUESTION 2: WHAT DO YOU THINK IS IN STORE FOR THE REST OF THE YEAR?

Justin Benson
CEO, Spreedly

“I think the lack of adoption of bitcoin in its current state will result in a very different opinion of it’s upside by the end of the year, as well as competition between PSP’s and the card networks to “own” the customer and avoid being commoditized. Pay by Stripe/Venmo/Braintree/PayPal vs.Visa/MC/AMEX competition will also heat up.”

Jeff Thorness
CEO, Forte Payment Systems

“We started, and will continue, to see fallout from investments that have been made over the last few years in payment companies, especially in the mobile space. Many of these companies have had challenges in driving adoption, profitability, or a combination of both. We could see several of these companies fold over the next 6- 12 months due to an inability to secure additional rounds of funding.”

Ralph Dangelmaier
CEO, BlueSnap

“Merchants are starting to realize that simple solutions are generally not the right solution for them with the demand for cross border and international sales increasing.  This will continue to be a big realization the rest of the year.

Awareness around digital currency will increase with the number of hot start ups not working in this space. PSP’s will need to think about whether to include it in their strategy.  Recognized customers/mobile wallets will interact at a deeper level on websites, so we will start to gradually see more personalized curated content on the big players such as Amazon and ASOS.”

Paul Beverly
EVP of Marketing, Gemalto 

“I think in addition to the transition to EMV, the largest payment upgrade in decades to hit the US – the adoption of mobile payment will increase. With the move to mobile payments, businesses and financial institutions will want to adapt their offerings and security measures to remain innovative, relevant and maintain their brand integrity with consumers. The converging trend of Mobile EMV adoption, which extends the same benefits to mobile payments as to EMV cards, will provide greater piece of mind and financial security for users adopting these emergent payment technologies.

In the last two years, I have seen more and more players in our ecosystem caught up in the next great payment idea and jump from one technology to the next, causing inaction in the industry. I think going forward, due to the need for mobile payment security, the industry will implement the best, proven technology available now.”

Mark Adams
SVP and Chief Technology Officer, Meritus Payment Solutions

“The rest of the year looks to have a heavy focus on EMV and other technologies that will lock down cardholder data. There are still a lot of questions out there on what role each player will take on. For example, what will the card brands do? What’s the ISOs role? Who bears the infrastructure upgrade costs?  Is EMV the future or should we leapfrog the technology? We’re all going to need to resolve the tough questions soon.”

Teri Llach
Chief Marketing Officer, Blackhawk Network

“As we approach the holiday season, it will once again be a great time to be a prepaid gift consumer in grocery and other third-party retailers. We expect promotions that will help consumers maximize their gifts and that’s definitely something to look forward to. In addition, we’ll likely see an increase in the use of multiple channels to purchase prepaid this holiday season. While physical will probably remain the dominant channel, it wouldn’t come as a surprise to see an increase of prepaid purchases through the mobile and digital channels as consumers grow more comfortable with these access points.”

Marc Gardner
Founder, President, and CEO, North American Bancard

“It will be interesting to see companies like Amazon continuing to enter different parts of the payments ecosystem. Google is expected to grow beyond Google Wallet. We’ll see how the tech players are moving into the space and helping it evolve. It’s a challenge that helps our drive to keep innovating and coming up with new products and services to help our customers’ bottom line.”

Scott Holt
Vice President of Marketing, ROAM

“For the remainder of the year, I think that we will see significant growth of mobile payment technology being deployed in new geographic markets across the globe. Europe and Asia are still very much in the early stages of mobile payment implementation and present huge opportunities for development as the standard for a successful mPOS business model has yet to be established. It will be interesting to see if mPOS solution providers within these less mature markets follow the same path as the U.S. or if they take some of the lessons learned and create an entirely new mPOS approach.

I also believe that the demand for a seamless omnichannel payment solution will continue to grow, as this is becoming an increasingly critical business strategy for merchants. Some merchants have already made this move, expanding their accessibility to consumers across all retail channels by leveraging a seamless solution that combines mobile, physical, and online transactions. This allows merchants to manage their business through one centralized system, while providing multiple touch-points with their customers. At the same time, consumers benefit from a streamlined user-experience no matter how they choose to interact with a merchant. I think that any merchant without an omnichannel strategy already in place will need to move fast or risk falling behind their competitors.”

Daniela Miekle
Chief Strategy & Product Officer, Vantiv

“We will see the first signs of disruptive changes at the POS, e.g. Apple NFC rumors, Starbuck’s. Players will move in, bringing existing accounts and thus will only have to solve one part of the equation, pushing terminal technology, such as open platform and authentication method agnostic, to evolve quickly.”

Chad Person
Chief Revenue Officer, @Pay

“I hear a lot of buzz about EMV. That will be interesting. I’m also expecting big things coming in the omni-channel space as we see processor agnostic payment convergence between brick and mortar, web stores and email payment solutions like @Pay. It’s exciting to be part of a movement to drastically simplify payments, and to build products that can change the buying landscape.”