Kriya Patel, The Bancorp’s Managing Director of Payment Solutions in Europe analyzes the future of European payments in the Finetics™ Studio with PaymentEye's Sarah Gill, live from the exhibition floor at Money 20/20.
Sarah Gill, Reporter: I'm joined by Kriya Patel. He is the Managing Director of The Bancorp in Europe. What are the main differences between the US and Europe?
Kriya Patel: I guess the main difference is in terms of size. The US payments portfolio that we look after is hugely significant. In Europe, I still think prepaid where we pretty much focus, but the different form factors associated with EU money is where we play our part from an issuing perspective.
And in respect of that area, there are certain countries where maturity is already there. But if you think about Europe and each country has its own quirks, its own rules, even though there's a degree of consistency with EU-driven policy, what you'll tend to find is each market is unique. And one of the assets that we bring to partnering up with program managers and technology payments folks in Europe is that we give them that insight. You know, the more boring, regulatory, compliance-related items, we look after and we make sure that they have a full insight.
And I think one of the key things to understand beyond the size difference is--and the maturity of the market--is the sheer fact that technology adoption in Europe has already been there and is continuing to kind of move out at a rate in art. So if you think about chip and PIN and how long that's been there, you look at merchant terminals already prepared for contact lists in quite a lot of countries, there's a great strategic push at government level across multiple markets in Europe wanting to make that whole payments adoption and elimination of cash in market and check in market a strategic objective. And so it plays perfectly into our hands, really, because that's what we're there to do, you know, is taking it from a physical transaction more into an electronic transaction.
Sarah Gill, Reporter: Yes. I mean, definitely. I think markets like, I don't know, in the Nordics, they're moving very quickly towards becoming cashless, aren't they?
Kriya Patel: Yes, very much so. And we see quite a lot of drive there with mobile-based technology, contact list adoption. But even a few years ago, the Netherlands government made an announcement about elimination of checks within market because of the cost of processing, the administration overhead, the error rates and things like that, it makes no sense when you have a pretty mature banking infrastructure that you can leverage on. And ultimately, that's what we're trying to do.
If you look at the UK government as well and the creation of the Payment Systems Regulator, that's very much about allowing folks like ourselves to come in and challenge the traditional banking operators. And our job is to facilitate, bring in partners who have the great ideas, the great tech, really good use cases for consumer adoption. And being able to partner with those gives them the ability to get into the traditional infrastructure and grow that out.
So I think it's a fantastic time to see how government are changing. The EBA on the European side, you know, bringing out policy to try and create a more level playing field for EMIs like ourselves, as well as the traditional bank players. And if I'm perfectly honest, it's not the banks that are going to drive the new technology in payments forward; it's always going to be the challenger banks or EMIs and the partners that the EMIs have today, like program managers with the great kind of ideas that they bring to market.
Sarah Gill, Reporter: Yes, for sure. But I think maybe like a trend we're seeing, especially in London and more widely in Europe, is that kind of older, established finance and younger sort of challengers starting to work together a little bit. Because I guess one can't really exist without the other, in a way.
Kriya Patel: Oh, so true, so true. So if you have a great front-end option from a payment device point of view but you can't plug into a BackChats, Sepa Direct Debit network, or you can't get agency banking, then the solutions are only 50% of what a consumer is really going to want. You know, you're forcing an interaction that's not smooth.
So I'm really hopeful that the PSR will help drive getting access that we need, whether that's direct or whether that's agency. And if it's agency, that the banks can't sort of sit back anymore and say, "You know, it's outside of our risk profile." Because there isn't a greater risk to that. You know, you're talking about a regulated company providing services for another regulated company. That's tried and tested, and it's something that we should, as an industry, have real trust in. And we need policymakers to really help push that for us as well.
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