Nexo Standards Annual Conference: equality and fraternity

Not all payments are created equal – that much is clear. While this may not present too much of a problem for some companies, those with operations across countries are increasingly discovering that it is only detrimental for their management.

These were the topics that were discussed at Nexo Standards’ annual conference, which took place 1-2 October in Paris. FinTech Futures packed up for the city of love to find out whether standardisation of payments received any of it.

During the chairman address, Claude Brun, chairman at the host company, kicked off the day-long event with an expression that, although may raise eyebrows for many, is certainly descriptive of many retail experiences throughout the world: “Phigital” Journey Experience.

At the keynotes, he remarked that physical and digital purchases cannot be seen as separate domains, but rather, the whole customer journey must be seen as a sequence of interactions, persons and processes, which MUST be consistent for both consumer delight and corporate efficiency.

In other words, a technological change is due, but whether this will replace humans or just help them be more efficient in their duties can only be subjected to the customer’s preference.

He didn’t fail to mention mobile payments, in particularly Chinese ones, which are not only changing the landscape in the Middle Kingdom, but also in Europe, through influencing other firms to launch products inspired on these, or just tourism.

Mobile payments of this type are a great example, due to the high number of firms working on different types of payments solutions – it shows variety, yes, but more a more potentially precarious fragmentation. From banks, to GAFAs, to card schemes, mobile operators…. They all supply their own solution.

This is what Nexo is out to find a solution for: the difficulty of integrating a variety of different solution, and payment processes together. Standards that satisfy those wanting to tap their iPhone with Apple Pay, and those wanting to scan a QR code.

A case study of sandwiches

There was one case study that stood out in my opinion: Subway, the sandwich shop. Benoit Lamoureux, payment product company at Subway, tells us about the journey to a shared payment experienced.

With a presence in over 100 countries, over 42,000 shops worldwide, out of which 25,000 are in the US, it is clear that processing the three million electronic payments daily is not an easy feat.

Subway shops, the executive told us, have every electronic device, from fridges to light, controlled and monitored centrally. His mission was to make sure payments were controlled too.

His goal is to unify the six payment journeys, from customer, to POS, to Subway’s backend, in the six major countries it operates. These include Europe, North America and Australia.

His major struggle was testing the proper functioning of all these systems. While at the beginning the firm tried building a lab, with robots that could automate payments, it later realised that virtual simulations were much more efficient.

Subway’s implementation of Nexo’s standards led to a complete virtualisation of the terminal, which allowed them to automate testing digitally. At the same time, all systems were compatible, as the standards ensured the interoperability of solutions.

From this quick testimony, it becomes clear that working across solutions is possible and more efficient only when standards are ensured, as well as the ability to work with each one in the same manner. For this reason, the firm admits that Asia will prove a harder target to homogenise than Europe.

Quick and easy

Derk Busser, product manager at Adyen, a Dutch POS firm, explains why making sure all technology across providers and within a company is standardised helps solve many of the issues that large firms are facing around payments.

For starters, in the age of PSD2 and open banking, a common set of standards means that it also has a shared and, ideally, well-defined API specification.

This makes the development of the solution, or an additional API to be layered on top, much easier and more efficient, as the firm or provider of the API doesn’t face any compatibility issues.

Needless to say, debugging and merchant support is simplified, so merchants can conduct their own IT maintenance.

And lastly, Busser said, it allows providers to roll out silent firmware solutions company-wide that don’t require training, gradual implementation or create disparities across systems.