Finetics™ Studio at Money20/20: Tony Craddock

Finetics Studio | Payments | 12/14/2015 3:35 PM

Sitting down with PaymentEye's Sarah Gill, Tony Craddock believes that European--specifically UK--regulators are having the right conversations with industry stakeholders to accommodate and foster payments innovation.


Sarah Gill, Reporter: I'm joined by Tony Craddock, the Director General of the Emerging Payments Association.

And what are the kind of key hurdles or challenges for businesses that you're trying to overcome?

Tony Craddock: So often, it's about getting people to really understand the scale and shape and nature of the opportunity, and then working out how to engage with the community to make sure that they can capitalize on those opportunities.

Everything's moving very, very fast. The ecosystem is massively complex. There's new people, new players, new technologies, new regulations, and it's about making sense of all of this in a way that makes sure the customer's happy, and makes sure there's profit in the model, and, quite often, there's profit in the model but no satisfaction for the customer, or, sometimes, there's very happy customers, but the company that's behind it doesn't have money.

So, those are the challenges.

Sarah Gill, Reporter: And how would you describe the relationship between the regulators and the innovators in the U.K.? Have you been having the right conversation, or do you think they could be better?

Tony Craddock: It's enlightened. We do work across Europe, and compared to other regulators, and, I suggest, compared to the U.S. regulatory environment, it is refreshing. We have a progressive regulator who recognizes that if you're going to allow and encourage an industry, you have to allow and encourage innovation.

So, we collaborate with the industry. They ask us what we think. They involve us in making big decisions. They help us to help them to create a better future through payments.

And that is extraordinarily enlightened, and so, that's one of the four things that make the U.K. a great hot spot for innovation in payments.

Sarah Gill, Reporter: And, as we look ahead in the next 12 months, do you-- with your perspective on emerging payments, what are kind of the key trends we should be looking out for?

Tony Craddock: So, the first thing that's going to happen is most of next week is going to be spent recovering from Money/20/20. There's no doubt bout that.

I think in Europe there's a whole band of new regulation coming in, particularly around something called the Payment Services Directive 2. This is a lovely example of good regulation, and it has the possibility of challenging one of the big problems that we have in this market, which is the big banks. I'm a friend of the big banks individually, but they've got a lot to answer for in terms of preventing innovation.

So, what we're going to see is regulation that's going to be helping us to challenge the big banks, and helping us to adopt new ways of doing business through the payments ideas and payments innovations that we've got.

So, does that answer your question?

Sarah Gill, Reporter: So, you mean more kind of collaboration between established banks and new innovation?

Tony Craddock: I think "collaboration" is one of these words, again, that's a bit-- you know, it's motherhood and apple pie, in a way. Of course, you've got to collaborate, but really collaborate.

Because big banks don't know how to do this. One of the things we have the support of Visa Collabs, which is a-- Visa Europe Collab, which is innovation center promoting entrepreneurship in the U.K., and they're working with us, as MasterCard are working with us with our incubator at the Catalyst. And the two organizations, they're big companies. They said, we don't know all the answers.

And what we're going to see in the year ahead is the understanding of the impact of the new regulation, the development of new business models to reflect that, and, with the support of big companies like the bank corp, who are also one of our benefactors, who have invested in allowing us to nurture entrepreneurs, we're going to see more entrepreneurs being successful than before, and some really exciting developments in pay share.

Sarah Gill, Reporter: No one can deny the sheer amount of money coming into the Fintech space at the moment.

Tony Craddock: Yeah.

Sarah Gill, Reporter: Do you think there are any kind of areas where you'd like to see more innovation, any problems people aren't really solving, or kind of sort of gaps in the ecosystem?

Tony Craddock: Actually, I do. There's a particular gap that I think needs to be filled, and filled quickly. This stuff is complex. It's difficult. It's changing fast. It's unpredictable, sometimes. I believe that we've not recognized the need to invest in education and personal development and training of people, not necessarily the people at the front end, and often the technology people at the back end are good, too. I think it's the people in the middle, and I'll quote Tony Kerr, who is the CEO of one of our members, GPS, talking to me about this last night.

We've got lots of great front end people, lots of great technology people, but let's train and develop the people in the middle. So, that, ironically, is the gap. It's a people gap, and it's about skills and competencies.

Sarah Gill, Reporter: And who should be responsible for that?

Tony Craddock: Well, the trade association is going to make a good bash of coming up with a training program for our members in the wider community next year, which is very exciting. I think that every company who is looking at developing their staffing, has got to recognize that you have to recruit from outside Fintech, and if you're brought up in it, you understand it. If you're outside it, you probably don't, and I think it's important to not assume that people have the knowledge.

It's difficult, this stuff. It's complicated, and if you haven't been in it for some time, you can easily-- you and I can talk about something, think we're understanding each other, but we might not be, and we've actually written a glossary of terms, of-- in international payments, and it has 383 items in it.

Sarah Gill, Reporter: Really?

Tony Craddock: All technical items that the challenge is-- I mean, it's great for insomniacs, actually. If you want to read that, put you to bed right away, put you to sleep right away.

The challenge is that you actually have to understand a whole heap of things to even understand how to read it. So, that's-- so, I think, the challenge is going to be up-skilling the people in the middle of these organizations.

Sarah Gill, Reporter: And there are a lot of entrepreneurs here, a lot of startups. Do you have any kind of advice, maybe, that you've been given in the past that you think early stage entrepreneurs need to be thinking about as they start up in payments?

Tony Craddock: Well, I think it's a good question. There's a real danger when giving advice to entrepreneurs It becomes a platitude, it becomes just what every business entrepreneur book says, you know, work hard, listen to your customers, get the money in the right place, all those sort of things.

I completely agree, those are very important. I think that the advice that I would give them is, not to assume that they have access to the-- I would say, get engaged with the community. The people I find most inspirational as entrepreneurs are the ones who realize there's a chance, through doing Fintech and Paytech better, we can change the world.

If you can have that as your mantra, it's not just about making money, it's about doing something that changes the world, then suddenly your motivation goes up. Your ability to bring in investors and the right staff, and the right technologists increases, and you have a more-- a greater chance to be successful.

So, I'd say engage with the community, and have a very big vision about changing the world.

Sarah Gill, Reporter: What is the one thing that makes you so excited and passionate to be involved in this industry?

Tony Craddock: Being alive. I mean, you know, actually being here is great. You know, you're surrounded by enterprising, upbeat people who are ready to do business, and that's what we love is being the progressive, collaborative people who are committed to, sure, innovating, sure, doing better business and making more money, but, ultimately, using payments as a means of improving the world we live in.

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