At Infosys Cards and Payments, we help our clients harness the power of technology-led innovation across the entire payments ecosystem encompassing payment networks, merchant services, stored value, FI payment services, and payment aggregators. Our thought leadership and a design thinking approach helps us co-create solutions with our clients to address their business problems.

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October 17, 2017

New Payment Platform - Australia's transformational journey to cashless society

Payments Industry is undergoing disruptive change over the last few years. And this change will continue for foreseeable future. Digital payments are rapidly replacing currency as the primary instrument for payment transactions. With the increased accessibility, affordability and reliability of technology, cash-less society is turning out to be a reality. While cash still remains 'king', newer and better payment instruments are changing the customer behavior rapidly.

There are three 'C's which are critical for any good payment instrument. And in comparison to cash as payment instrument, Digital Payments are showing better performance on these three 'C's. They are:

1. Confidence: The instrument has to be 'trusted' by the transacting parties; ensuring soundness of digital payments including availability, security and reliability.

2. Convenience: The instrument has to be easy and quick to use. While societies find cash as a 'convenient' instrument, modern technologies using mobile phones, contact less cards, wearable devices etc. are turning out to be much more convenient than cash.

3. Cost-effectiveness: Handling cash is costly as it involves printing, logistics, distribution, processing etc. The digital payments can provide much better economy of scale.


Considering these imperatives and industry trends, Reserve Bank of Australia (RBA) started an initiative called New Payments Platform to propel Australian market into such cash-less world. In 2014, thirteen financial institutions, including the Big 4 banks in Australia, signed up to build the New Payment Platform (NPP). Accordingly, Industry Consortium was created to govern the program under the leadership of RBA. This Consortium has representation from all the thirteen financial institutions.

NPP provides basic payment infrastructure which offers following key capabilities to retail and business consumers in Australia:


1. Near real time payments - Payments can be made from one party to another almost instantaneously, including settlement. Within a matter of few seconds, funds will be transferred and made available for payee to use.


2. 24X7 availability - The infrastructure is always-on. The platform is designed to be made available for 99.995% of the time. It means a maximum down-time of 2 min/month. Besides, there would be zero data loss for the transactions during any outage.


3. Data-rich - The global ISO20022 messaging standard is used to provide ability to send more complete remittance information along with a payment transaction.


4. Simple Addressing - The centralized addressing service enables retail payments by way of using an identifier like phone number or email ID or an organizational identifier. There is no need to use complex account codes and branch codes of the payee.


5. Versatile - NPP offers basic payments infrastructure on which financial institutions can build 'overlay' services looking at the specific needs of their clients. These overlay services can offer additional functionality to retail and business customers of financial institutions. In many ways, NPP is similar to operating system on a mobile phone, while overlay services are the apps built on the top of this operating system.


While smaller financial institutions have not signed up for NPP directly due to their inability to make upfront investments, they are expected to tie up with others to make use of the capabilities offered by NPP. This approach will ensure that entire Australia supports NPP covering each and every consumer.


The participating financial institutions see the initiative as an opportunity to create a futuristic payments platform that meets not only stringent NPP requirements; but also enables rapid adoption of overlay services. Some of them have a simplification roadmap to replace other digital payments platform with NPP.


In late 2015, Infosys was chosen as the System Integrator for one of the Big 4 banks in Australia. The payments business contributes 15% of the bank's revenue from the customer base of 3 Million. The bank believes that 50% of its payments business is at risk without NPP. Importantly, the bank sees NPP as a huge revenue generation opportunity through overlay services. It is also the largest investment initiative for the bank for FY2016 and FY2017.


The scope for Infosys includes technology architecture/design, requirements, development, infrastructure sizing/selection/build, integration across channels and back-end systems, testing and vendor management services. It is the largest 'turn-key' project for Infosys in the region and across FS business at the moment. Infosys has pushed its traditional boundaries and accepted stringent SLAs, liquidated damages and full responsibility for the work done by the product vendor. Infosys has set up an integrated team of 175+ professionals with participation from 10+ units (ADM, DCG, CIS, EAIS, IVS, Lodestone etc.). In addition, product vendor is also the key partner of Infosys in this journey. The valiant efforts put by this team for last 20+ months have brought us very close to the completion of the program. The bank acknowledges the contributions made by this team has already given an interim Engagement Level Feedback (ELF) of 6/7. The go-live is expected to happen before the end of 2017. The team is now busy giving a final push and take the platform to 'live'.


Once 'live', NPP is expected to alter the customer behavior like never before. As of now, 47% of payments in Australia happen using cash. Conservative estimates suggest that Australia will be a cash-free society by October 2027, while aggressive estimates suggest that this feat will be achieved by June-2022. When that happens, it is certain that NPP would have played a huge role in it. And Infosys can take pride in its contribution to this transformation!


October 13, 2017

Design Thinking - Our approach to identify and address untold customer needs

Financial Services Industry is getting disrupted with emerging players meeting customer expectations with new technologies and business models. To address these disruptive changes for our clients, we find Design Thinking to be a refreshing approach to problem-solving and use the core premises of desirability, feasibility, and viability. Design Thinking spark customer-obsessed innovations thereby solving the initially unrecognized challenges faced by our customers.  Infosys has been working closely from an organizational perspective to incorporate Design Thinking and an innovator's mindset into how our teams collaborate, ideate and prototype more user-centric solutions.

 

In this blog, I will share two such specific examples from Loyalty and Lending Program Design.

 

Design considerations across loyalty burn and earn customer journey

 

Through empathy sessions, we listen to our clients, end-users, and industry experts and formulate the best responses to the megatrends in the Loyalty and customer experience space.  Following is an outcome from such a Design Thinking session specifically addressing Loyalty Issues faced by customers today.

 

Customer Journey

Customer Persona - Empathize

Addressing Solution -Define and Ideate

Design Considerations - Prototype & Test

Earn

I do not understand the Loyalty Program - too complicated.

The Loyalty Program should be easy to understand and easy to use.

 

Show them Value from the program

 

Explain them the point accumulation and redemption process through interactive statements and communication

 

Provide Chatbot/FAQ/Self-serve channels to clarify doubts around the Loyalty Program

 

It takes too much time to earn meaningful points

Show Contextual Loyalty at the point of Sale- time for immediate gratification

 

Short term Loyalty promotions build long-term loyalty by making customers feel valued and understood frequently and thus maintain & grow a relationship.

Provide them additional benefits for their frequent purchases.

 

Convergence of online and offline commerce - provide deals in stores based on their online searches

 

There are just too many Loyalty Cards in my wallet

 

Why should we use your loyalty program?

Can the various points become interoperable with minimum costs involved in redemption?

 

Can we provide unique value to the customer for program differentiation?

Blockchain or Points Bank based solution with a partner ecosystem

 

Personalized offers - build relationship beyond spend pattern - non-liner loyalty design(Behavioral rewards) for effective engagement

 

Can I get special treatment for my loyalty beyond cashback/points?

Can we offer special pricing for the customer based on the relationship?

 

Can you waive annual fee or provide travel benefits beyond points/cashback offers?

 

 

Gamify the experience with Leaderboards/ Milestones/ Variable tier benefits.

 

Can I get benefits for sharing with my friends in Social Media?

 

Can I get benefits for sharing feedbacks of my experience?

Offer points for Social media likes or shares

 

Offer special benefits for sharing any constructive positive/negative feedbacks.

Plan non-linear engagement models

Burn

Can I be reminded to use the points and best offers at the right time?

Can we offer a personal shopping experience for best deals?

Automate the deal-finding algorithm based on various factors and send push notifications/auto-apply best offers

 

 

Do you know me, my interests?

Allow using points in both online and offline stores

 

Understand customer spend pattern and push right offers for redemption at right location at right time

Allow expedited redemptions for preferred customer categories

 

Customer segmentation and analytics led campaign management

 

Beacon-based notifications

 

Can I redeem my points/cashback seamlessly?

Mobile coupon or better automatic redemption at smart point of sales

 

Promote redemption and avoid making rewards points a balance-sheet liability. Rather engage customers through meaningful redemption options to make the experience meaningful.

Offer Omni channel redemption options

 

Focus on great customer experience, think just beyond points accumulation or burning if you solve some real customer problem (i.e. Starbucks App to order beforehand and avoid queue or Uber VIP Program to arrange cars with privilege)

 

 

DT.jpg

Design Thinking Approach to Lending Program Design

 

Almost one-third of Bank revenue comes from Lending which is under pressure from fintechs and other anti-incumbents. Banks need to build a frictionless digital lending experience by extracting intelligence from the data that persists within and outside the enterprise to fight back in the Lending business. Following is a sample Design Thinking outcome for desigining Lending Program. 

 

Customer Journey

Customer Problem - Empathize

Addressing Solution -Define and Ideate

Design Considerations - Prototype & Test

Apply for loans

Customers expect a seamless connected experience across channels, instant quote generation, and faster loan disbursal

Build a Digital user-friendly interface to reduce loan application time and paperwork and improve loan origination experience.

 

Workflow Management - Configure Status and define a Status workflow. Configurable business rules Track Status and Asset Status (when applicable) 

 

Lead Management - Generate and Track Leads

 

Build Self-serve options like Chatbot, interactive video guides, loan repayments calculators, payment reminders, set up automatic payment facilities etc.

 

Need a unified approach towards Lending Platforms

 

Need to utilize already available information from various sources to avoid asking a question which we already know - Can I get most of the information in the form pre-filled?

Single View of the Customer and consolidation of platforms to help Customer Support, Risk Management, and faster decision making

 

Document & Content Management - Better capturing, storing analyzing and retrieving systems to harness customer relationship and transactional data. Use improved Paperless signing, Optical Character Recognition(OCR) and other digital technologies to minimize paperwork

 

Build Mobile Apps for effective Loan Origination through handheld devices - this is very effective in contextual car loan space

 

Build systems with high Straight Through Processing and Automation to reduce multiple redundant touchpoints and improve disbursal time.

Faster and more accurate Credit Decision making

Credit Decisioning Team to take a quick and improved Credit Decision to compete with the Fintechs while analyzing new dimensions of data which was not available/used before

Build new interfaces/APIs to collect relevant data from various sources (like Social Media, 3rd parties etc.).

 

Use Big Data Analytics Platform to analyze unstructured data and then feed them to Machine Learning algorithms and historical data for better decision making.

 

Build improved monitoring systems for timely alerts, forewarnings, compliance and fraud prevention.

For Student Loans build Decisioning systems which think beyond FICO score and consider potential future earning of the student from the degree to decide the overall credit risk.

 

Build better personalized risk-based pricing systems with improved multi-dimensional credit risk system

 

Improve Credit Underwriting and Decisioning efficiency by building a more dynamic and real-time credit portfolio management system.

 

Use Robotic Process Automation(RPA), Distributed Ledger Technologies and Internet of Things(IoT) technologies for automation and transparency in Trade Finance/Supply Chain and Operations Space.

 

Partner with right Fintechs for acquiring niche and hard-to-build capabilities.

Direct and Open Marketplace Lending

How a bank can complete with Fintechs offering Direct Lending solutions which offer faster loan disbursal and better rates

Adopt Lending-as-a-service model to partner with Fintechs.

 

Use Incubation partners to drive build a faster working prototype with improved credit decision model.

 

Embrace regulations driving Direct Lending and monetize the opportunity.

Banks are adopting Challenger Bank model to test new Direct Lending models and then making it mainstream with Legacy modernization and Lego-building-block approach.

POS Lending

How can banks venture into Point of Sale(PoS) instant lending which is becoming a bigger trend. PoS Credit is helping Merchants to reduce increase sales and reduce shopping cart abandonment

Develop short-term financing products and integrate with PoS and Checkout process. Partnership with merchants for engagement and sponsorship is the key

 

Need instant Credit scoring and decisioning systems based on internal and external data sources

Partner with merchants and POS Platforms to push Bank driven POS Lending Solutions.

 

Develop Machine Learning based instant credit scoring and decisioning systems.

Handle Regulations

How to effectively manage regulations related to Lending, treasury, and Liquidity(BASEL etc.)

How can I effectively manage the cost of compliance especially when competing with fintechs having a lesser burden of regulatory compliance

Use Digital technologies to reduce the cost of compliance by reducing paperwork.

 

Use introduction of any new regulation as an opportunity to build a nimble IT and operations Infrastructure so that handling future regulations become easier.

 

 

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