Capturing an Elusive Market

Transcription

1 Capturing an Elusive Market The World of Global Remittances Payments 2010 April 28, 2010

2 Meet the speakers Ernest Gregg, Treasurer, Ria Financial Wendy Miller, Global Payments Manager, BNY Mellon Steve Wojciechowicz, Senior Business Manager, SWIFT 2

3 Agenda Market overview Ria Financial Service SWIFT Workers Remittances BNY Mellon Questions? 3

4 Market overview A remittance is a cross-border, person-to-person payment of relatively low value. Customer Reach: Estimated 300 million migrants worldwide. 66% send money home regularly Receive side family groups average 4 to 5 people International migrants 200 million Annual transactions 1 to 1.5 billion Average transaction value +/- USD 300 4

5 Considerations for Providers Build a Global Remittance Offering Revenue Opportunity is significant Compliance Working within the confines of your compliance team Each bank must adhere to its existing compliance for new customers and transactions Education Educating staff tellers and CSRs Technology Work / partner with an organization that can provide the global low-value payment infrastructure Support an easy to use front-end solution for capturing payment activity Ethnic marketing focus How to market to the different communities 5

6 Options for service delivery Consider: Commercial autonomy Consider: Cost Efficiency Partner with a MTO franchise Build a proprietary network Consider: Scalability Build a bilateral service with a correspondent Use open correspondent banking arrangements Consider: Service Price & time transparency 6

7 Family Remittances Place Subsidiary Logo Here Proprietary Information The contents of this document are confidential and may contain trade secrets. This document may not be distributed and its contents may not be disclosed, in whole or in part, without the express written consent of Euronet Worldwide, Inc. This document is an unpublished work protected under the copyright laws of the United States of America and other countries. Copyright Euronet Worldwide, Inc. All rights reserved. 7

8 Place Subsidiary Logo Here Euronet Worldwide Business Segments and Countries of Operation Processing more than one billion transactions annually for customers in 42 countries. CORPORATE EFT & SOFTWARE PREPAID MONEY TRANSFER Euronet Countries of Operation Family Remittances (P2P) Bill Payments Prepaid Debit Cards Check Cashing Money Orders Currency Exchange Other Prepaid Products 8

9 Money Transfer Segment P2P Money Remittances Profile of Customer Unbanked/Underbanked Prefers cash Exchange rate sensitive Community centric First generation immigrant Multiple products CASH ACCOUNT CARD HOME DELIVERY CASH CARD ACCOUNT 9

10 Value Chain Customer Settlement POS Product Player Settlement POP Beneficiary Person Immigrant - Cash - Check - Agent - Store Money Remittance - RIA - MG - WU - Banks/Swift - Visa/MC - Banks - FX House - Retailers - Cash - Account Person Non Immigrant - Cash - Check - Card - Account - Store - Online Remittance - Domestic - P2B - RIA - PayPal - MG - Banks - WU - Banks/Swift - Visa/MC - Banks Check Casher - Retailers - Cash - Account Business Bank Account Online ecommerce - B2B - Bank Banks/Swift - Visa/MC Bank Account Card Account Check Cash Western Union Money Gram RIA Bank Online Paypal Mobile 10

11 Place Subsidiary Logo Here Conclusion How vertically integrated do you want to be? Find your place in the space and focus The business and the customer define the technology If you understand your place Different value propositions strategic alliances make sense Customers Partners 11

12 SWIFT Workers Remittances 12

13 Objectives Deliver a robust end-customer value proposition time transparency price transparency ease of use Bring scalability to bilateral bank services Support any type of retail payment product Remain commercially and brand neutral 13

14 Workers Remittances A business and technical framework for bilateral clearing and settlement of person-to-person payments Business framework Technical framework Business Contract Market Practices Reference Data Messaging Standards Messaging Services => Interoperability, efficiency, scalability => Commercial flexibility 14

15 SWIFT Workers Remittances what is it? An interbank platform for the bilateral clearing and settlement of cross-border, person-to-person, payments Market Practice Rulebook Messaging Standards Reference Data Messaging Services Business and Operational Rules and Guidelines ISO XML payments clearing & settlement messages, specified for P2P payments Counterparty data: central repository of participant, agent, and point-of-service in a common format FileAct 6.1 Store & Forward Business terms and conditions remain bilaterally agreed between counterparties 15

16 Implementation customer teller E-banking ATM Mobile Call-desk Front Office services Back Office services Network services Transaction initiation Workflow Market practices Messages ISO FileAct Workers Remittances SWIFTNet 16

17 Remit Worldwide Worker Remittance Payments through Banking Channels April 2010 Presented by Wendy Miller Information Security Identification: Confidential

18 Opportunity for Banks Acquisition: New business and customer loyalty growth, remittances are value-added services that attract new customers. Retention: Offer existing customers a service usually offered by another provider. Fee income: Transaction revenue continues to grow in importance to banks 18

19 Opportunity for Banks Approximately 90% of outgoing remittances originates outside of banking channels. Immigrant Day Laborer Full Time Immigrant Employee Fully Assimilated Immigrant Immigrant Married to U.S. National Upwardly Mobile Individuals Migrants make up a significant percentage of the US population, and growing Immigrants are the fastest growing segment of the population and retail banking. Multi-cultural retail client base Many segments are active senders International payments is a core product to attract customers 19

20 Opportunity for Corporates How it works Opportunity to offer payroll deduction (similar to term insurance, gym memberships etc.) Why Meet the needs of a diverse workforce Convenience Value add benefit to employees 20

21 BNY Mellon s Remit Worldwide A white-label solution, a global network Sending Party BNY Mellon Receiving Banks (Originator) (Operator) (Distributor) R e m i t W o r l d w i de Electronic Deposit Cash Pick Up R e m i t W o r l d w i de 21

22 Case Study Apple Bank Needed: Solution for deposit and revenue growth, considered remittances as possibility 50 branches located throughout the New York Metropolitan area NYC approximately 36% of population foreign born Top 5 nations of origin are: Dominican Republic, China, Jamaica, Mexico, Ecuador. Apple Bank s Requirements: Easy to implement solution with little development Global reach to target ethnic communities with new service Compliance friendly solution Recognized leader in space to partner with in launching successful program 22

23 Case Study Apple Bank Solution: Apple Bank launched AppleGram January Remit Worldwide web-based implementation, no IT development Global network of partners in 16 key remittance destinations Easy tools for compliance reporting BNY Mellon provided turn key marketing materials to announce new service Training branches, staff, admin, compliance 23

24 Remit Worldwide Robust Receiving Bank network Leverage correspondent banking relationships in all key markets we navigate the world for you Leverage the best within each country Technology platform -- Easily integrated with bank s existing channels Built in compliance tools Private label solution allows for retail bank s branding BNY Mellon is exclusively a wholesale bank, no retail customers Pursuing opportunities to expand how we service global client needs 24

25 Questions??