Financial services companies are making huge investment in their digital transformation journey.
CEOs and CFOs of Visa, Deutsche Bank, Nomura Holdings, Mastercard, Provident Financial Services, among others, have revealed their digital achievements in the last 12 months and some of their digital plans for 2019 during their latest earnings calls with analysts.
Deutsche Bank aims that its investments in digital both in the consumer and investment products should drive volume growth, Deutsche Bank CEO Christian Sewing said.
Deutsche Bank is also working to drive efficiencies out of the IT investment. Deutsche Bank is investing digital properties such as the Autobahn platform. Deutsche Bank will be making regulatory, efficiency-oriented but business-oriented investments, Deutsche Bank CFO James von Moltke said.
Nomura Holdings said it is working on cost control and digitalization in the flow business, using AI and other measures. “We are working on those strategies, and we have already – we do have a timeline or time schedule,” Takumi Kitamura, chief financial officer of Nomura Holdings, said.
Mastercard said it’s driving the adoption of new digital capabilities to improve the customer experience and add safety and security across all transaction types and channels.
Mastercard received commitments from issuers representing approximately two thirds of its total US consumer volume to issue contactless cards within the next two years. This includes Citi, Capital One, KeyBanc, Santander, HSBC and others.
“We’re also working with leading processors like FIS to bring contactless to smaller issuers and to credit unions,” Mastercard CEO Ajay Banga said.
Retailers like Target and CDS have announced that they will accept contactless payments and in total today over half of U.S. card present transactions are happening at contactless enabled merchant locations.
Mastercard said it expanded merchant tokenization service with partners who have recurring bill pay models, including large telcos like AT&T and insurance companies such as Liberty Mutual.
JP Morgan Chase has selected Mastercard gateway services, to enhance its connectivity of support over alternative payments as they continue to expand global digital payment solutions for their merchants.
Mastercard recently announced an alliance with BLIK, a mobile payment system provider. This integrates a virtual tokenized Mastercard, debit card, so that BLIK users can make contactless payments at any Mastercard acceptance location.
Zero, a new bank in South Africa Bank with no physical branches and app only value prop, will be issuing debit Mastercard in 2019.
E.Sun Bank will launch a Mastercard co-brand with Pi Wallet, which is a mobile wallet provider in Taiwan.
“Our operating expenses for the year will be at the high end of the high single-digit range, as we invest in digital solutions, safety and security products, data analytics, expansion and platforms to address new payment flows,” Mastercard CFO Martina Hund-Mejean said.
Visa CEO Al Kelly and Visa CFO Vasant Prabhu are instrumental in running their digital investments.
Visa has partnered with Turkcell and their FinTech subsidiary Paycell to expand access to digital payment services by offering a Visa card integrated with their mobile wallet, which will provide financial services, such as money transfer, utility bill payments and acceptance at the point of sales.
In Singapore, Instram, a digital cross-border payments company powering local payments in over 55 countries, will begin leveraging Visa for business and consumers by creating products in payroll, travel and cross-border payments.
In Africa, Flutterwave leveraged Visa capabilities, including digital prepaid card issuance, mobile payments, processing in Visa Direct to service both mobile money and bank clients. While Visa Direct has processed 100 million transactions across the 50 banking partners in Africa, it plans to grow across the continent reaching those who don’t currently utilize electronic payment.
In Africa, Visa is partnering with GTPay, a prepaid processor and program manager focused on prepaid issuing in over 30 African countries. This partnership will enable faster time to markets for FinTechs and wallets.
Visa in November announced collaboration with Billtrust on their Bill Payment network to streamline the delivery of B2B payments to suppliers.
PayPal CEO Dan Schulman, COO Bill Ready and CFO John Rainey are scaling up their digital presence.
PayPal said its transformation into an open digital payments platform is resonating with its customers. PayPal continues to benefit from increasing tailwinds as cash continues to digitize and more and more aspects of our lives move to mobile.
PayPal said its ability to leverage digital trends is reflected in current results and its forward-looking guidance for 2019.
Provident Financial Services
Provident Financial Services said the digital platform is key to competing effectively in the future, Tom Lyons, chief financial officer of Provident Financial Services, said.
Provident Financial Services is expanding resources on technology focused on improving our operational efficiencies, reviewing workflows, evaluating our staffing models and deploying robotic, process automation where applicable, Chris Martin, chairman and CEO of Provident Financial Services said.