John.jpgWith over 20 years’ experience in process re-engineering and innovation, John Vasili discusses “Payments in 2016”  

What has really sparked your interest this year in payments?

Distributed ledgers which include cryptographic signatures are being used increasingly this year. This is a massive advance in technology and means that the distributed ledger is now unforgeable. This has really sparked my imagination as it will be a major benefit for both B2B and B2C payments and I expect to see significant growth in this area.

In your opinion, what has been the biggest process re-engineering change you have experienced in the industry?

To my mind, the biggest change in the industry has been the move from honorary notes, such as cash and cheques, to digital payments. Nothing has moved this fast in the consumer and business world since the internet was invented… apart from possibly Concord flying across the Atlantic!

It has taken time but banks are now realising that innovation can help their corporate customers and increase their own yield by partnering with innovative companies like Invapay. Can you explain why it’s a win - win for all parties?

By their very nature, banks have always been extremely risk adverse. The regulatory environment has also slowed down their approach to implementing change and addressing the real needs of their customers. Banks are recognised for trust and offer the comfort of security. In contrast, innovators are flexible and willing to challenge the status quo. Banks have adopted the Invapay system because this revolutionary approach is a challenge to the way banks have traditionally operated. And there is a real benefit to banks working with Invapay because it increases cash flow and brings immediate returns to business current accounts.  

I therefore strongly believe that the partnership between traditional banks and innovators such as ourselves will be a win-win for all parties, including the bank’s corporate customer.   

Some say innovators take too many risks, but when the system has been tested by major global companies and indeed even governments, the risks have already been taken. So banks will benefit from the innovator’s agility and speed to market - something they could not achieve quickly on their own.

It has taken time but banks are now realising that innovation can help their corporate customer and increase their own yield by partnering with innovative companies like Invapay. Can you explain why it’s a win - win for all parties?

By their very nature, banks have always been extremely risk adverse. The regulatory environment has also slowed down their approach to implementing change and addressing the real needs of their customers. Banks are recognised for trust and offer the comfort of security. In contrast, innovators are flexible and willing to challenge the status quo. Banks have adopted the Invapay system because this revolutionary approach is a challenge to the way banks have traditionally operated. And there is a real benefit to banks working with Invapay because it increases cash flow and brings immediate returns to business current accounts.  

I therefore strongly believe that the partnership between traditional banks and innovators such as ourselves will be a win-win for all parties, including the bank’s corporate customer.   

Some say innovators take too many risks, but when the system has been tested by major global companies and indeed even governments, the risks have already been taken. So banks will benefit from the innovator’s agility and speed to market - something they could not achieve quickly on their own.

How has payment technology helped developing countries?

Quite simply, payment technology has brought banking to the masses in developing countries.

Mobile and online payments mean that Fintechs, banks and mobile providers are working in partnership to address the issues and provide more innovative, faster and cheaper alternatives to traditional Banks for both local and cross-border banking transactions.

In the African subcontinent for example, only 20% of the population has access to a bank account but over 90% have mobiles phones.  Thanks to advances in payment technology, 90% can now access cutting edge mobile payment transactions at their fingertips, leapfrogging the traditional bank branch and ATM experiences. 

Payment technology is also why Kenya is now virtually a cashless society. 86% of households use mobile phones to make payments. Payment technology is changing lives in developing countries, making banking and payments more accessible to everyone, everywhere.

What are the main challenges your customers face and how do you help solve their issues?

Our customers want solutions to maximise their working capital and to get best use of available credit lines.  The biggest challenge for all companies is supplier acceptance. But we solve this by simplifying everything – the supplier doesn’t even need to know they are being paid by card for example; all the while operating in the FCA regulated environment and the assurance that brings.

Our customers benefit considerably and are able to maximise the use of the financial credit lines buyers have available.  They can also make accelerated payments to suppliers, whatever the size, thereby securing the supply chain.

Invapay has used disruptive innovation and out of the box thinking to break the barriers to adoption, how has this helped the entire payments ecosystem?

As the saying goes: “If you always do things the same, you will always get the same results”. Innovation was needed.  Banks have been working in the way they were designed to do back in the 1950’s. By creating a new B2B payments solution using agile technology, benefiting everyone in the supply chain, Invapay has helped Banks to be prepared for the 22nd century and has improved the entire payments ecosystem as a result.

What are the challenges Start Ups face in the industry?

Start-ups in our industry face many challenges; from truly understanding the market and its needs, to launching at the right time, through to understanding the timelines involved in bringing a product to market. However, I would have to say that one of the biggest challenges is regulation.

I am a firm believer in designing solutions for the customer and then moulding the regulations to fit. We are fortunate in the UK that the FCA is innovative and supports this approach.  They provide testing sand boxes for start-ups, allowing them to test new models and processes.  During my travels across the globe to visit our customers, it is heartening to see local regulators beginning to adopt a similar UK FCA strategy and approach.

The other major challenge of course is the business model itself. In our fast-paced industry, you need to stand out and grab the attention of both your customer and any investors.  A well-researched and compelling value proposition that not only captures the imagination of the target consumer but also gets potential investors to commit to their vision and business plan is essential.

Something to consider is how scalable your business model is and what your routes to market will be to acquire and retain customers.  I’ve been there and I know how hard it is, but get it right and the benefits to all are huge.

What do you think the next “Big Thing” is?

As I mentioned, distributed ledgers which include cryptographic signatures are definitely the future of payments.  They are the next big thing and will move quickly, so the rails, schemes and banks better be in it to win it, or they could soon find themselves left behind.

Fast forward 10 years – what’s your prediction for the future of payments?

Well, a lot can happen in 10 years, especially in an industry as dynamic and fast paced as this one. 

I predict faster, bigger, better, bolder platforms, delivering secure digital payments through traditional partners such as banks, along with other digital services providers such as telco’s and streaming services - providing instant credit availability from both bank and non-bank funding sources.

I’m excited to see where the future takes us.





InvaPay
Invapay is an Optal Group Company Optal