From your point of view, what are the trends you are observing in the Italian payments sector? What value can OpenWay create for it?
I see two co-existing trends. Italy is known for large payment players who achieved scale through consolidation. It is not finished yet, as true giants are being created now. At the same time, new start-ups are appearing on the market. They are small but keep on challenging the status quo.
OpenWay can offer solutions to both very large players and start-ups.
For big players, we have more than ten years’ experience of successfully migrating huge organizations in Europe from legacy systems. Our track record includes projects with equensWorldline, SIX Payment Services, Nets, Raiffeisen and others.
For start-ups, we bring value as an experienced partner. Rather than developing things themselves, they can rely on our WAY4 solutions and create unique business cases. An example is Credorax, who migrated from a third party processor to our WAY4 platform – and has grown 10 times within three years.
For the large-scale projects what are the most important factors to consider?
Choosing the right platform is important, for large and small players alike. To move the company’s capabilities to a different level, ensure that you do not replace “like for like”. And think about consolidating the different parts of the infrastructure. Simple, online, holistic – keep your solution like that.
Huge projects bring huge risks. You need to decide early if you go alone or with an integrator. OpenWay has experience working with integrators on huge projects, even for state-owned financial institutions. Recently, National Bank of Greece has received an award as the best IT project for digital transformation on WAY4. This project was implemented by OpenWay and Accenture together.
“Big bang” data migration can be harmful for large institutions. You have to minimize the impact on your end customers. We apply the rollback strategies, parallel runs and all these instruments that help.
Regarding payment revenues, what are the strategies to grow?
Indeed, it is very important to find new revenue streams, particularly for issuers as card interchange fees are declining.
One potential area for new business models is around data. Collecting data is hard because of GDPR. We utilize data that runs alongside a payment transaction. If you want to help merchants personalize their promotions, WAY4 can process transaction data up to level III and track the customer payment history. Using this data, it calculates bonus points, applies discounts and targeted offers.
You can create more of a closed-loop and semi-closed-loop schemes to add value to your merchants, while become more independent of the large payment schemes and retaining more of the interchange.
Consider new strategies such as offering consumer loans at the Point of Sale. This could actually help you bypass constraints of the schemes, while still working together with retailers and helping them to grow their business.