Step into the world of payment innovation with Pierre Aurel, Chief Product Officer, and Norman Frankel, Chief Growth Officer at Stanchion Payments as they demystify SoftPOS technology - the revolutionary software turning ordinary smartphones into powerful payment terminals.
SoftPOS fundamentally transforms how merchants accept payments, enabling any NFC-capable Android or iOS device to process contactless transactions without specialized hardware. This breakthrough eliminates barriers for small businesses, sole proprietors, and mobile vendors who previously couldn't justify the expense of traditional payment terminals. As Norman reveals, one European bank reported that 25% of all their acquired transactions came from SoftPOS applications just one year after launch - a testament to the technology's rapid adoption.
Security concerns have been meticulously addressed through rigorous standards including PCI MPOC, creating a protected environment for processing sensitive payment data on everyday devices. While implementation requires significant investment from software providers to meet these standards, the end result delivers enterprise-grade security with consumer-grade simplicity.
The technology has found unexpected champions across diverse sectors. Churches embraced it during the pandemic for contactless donations, government mandates in countries like Romania and Greece accelerated adoption for tax compliance, and major retailers including Walmart and Decathlon deploy it for queue-busting and business continuity during outages.
Looking ahead, Pierre envisions improvements in NFC antenna technology to enhance the payment experience, deeper integration into everyday applications, and the blurring of lines between e-commerce and in-person payments. For merchants considering the switch, the benefits are compelling - potential savings of $300+ compared to terminal rental costs, enhanced payment flexibility, and no more missed sales due to uncharged or malfunctioning hardware.
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:01):
Welcome to this special Pulse of Payment series
titled Swipe Right on SoftPauseUnlocking Payment Freedom, a
special six-part series broughtto you in collaboration with
Ingenico, the global leader inpayments.
Softpause is a revolutionarytechnology that lets merchants
accept payments on anysmartphone or device, unlocking
(00:21):
a world of possibilities.
Thank you, commerce forward.
(00:47):
Buckle up and get ready toswipe right on SoftPause and
unlock payment freedom.
Speaker 2 (00:49):
Hello everyone and welcome to the Leaders in
Payments podcast.
I'm your host, greg Myers, andthis is the fourth episode in
our PULSA Payments series onSoftPause, sponsored by Ingenico
.
Today we have two very specialguests Pierre Arel, the Chief
Product Officer at StanchionPayments, as well as Norman
Frankel, the Chief GrowthOfficer at Stanchion.
So, guys, welcome to the show.
(01:11):
Thank you so much for beinghere.
Thank you.
Thank you, greg, good to behere.
So let's go ahead and dive in.
Pierre, if you don't mindtaking this first question, can
you tell our audience a littlebit about Stanchion and what you
do?
Can?
Speaker 3 (01:23):
you tell our audience a little bit about Stanchion
and what you do, sure.
So Stanchion is an establishedbusiness.
It's a global paymentsconsulting business Been around
since 2001.
So solid reputation in theindustry, with offices in
Australia, the UAE, south Africaand the US and a smaller
European presence as well,operated out of the UK.
Historically the business hasalways consulted to banks around
(01:45):
their payment infrastructure,advising banks on how to
modernize and keep their systemscompliant, particularly around
the card systems, so cardswitches and card issuing
platforms.
Over the past five years maybeslightly more Norman we've been
building our own softwareproducts.
And that's come about from aneed, speaking to these banks,
(02:07):
realizing that there's someunmet needs that they have in
their ecosystem where they needthird-party software to augment
that.
And Stanchion's been buildingour payment fabric technology to
overlay on these card systemsand cover those gaps and meet
those needs that customers havebeen telling us.
And that's been kind ofsoliciting feedback from a
(02:29):
worldwide audience, from theMiddle East, from Africa, from
the Caribbean.
And we bring that all into theproduct team where we aggregate
the technologies and take thatproduct to market ourselves,
known as Payment Fabric.
Speaker 2 (02:42):
Okay.
So, pierre, sticking with you,maybe walk us through your
journey in payments and what ledyou to Stanchion.
Speaker 3 (02:49):
Yeah, so I've been with Stanchion almost two years
now, so really maturing thesoftware environment here and
thinking about the strategy andwhat we do, particularly around
soft pause initiatives.
Prior to that, I actually builtwith my team at my previous
company one of the earlier softpause solutions in market and
that began in 2019 and reallyspent a lot of time working with
(03:12):
Visa and MasterCard buildingout the very low level payment
kernels that need to operate ona payment device, then moving on
to the mobile apps and then theprocessing environments, and so
I spent the better part of fourto five years taking
effectively a tech startup tomarket and launching that
SoftPoS solution, and so a lotof scars that I've got to show
(03:37):
from those experiences.
Softpos has really been a laborof love.
I guess it's a challenge, butit's been fantastic working in
the industry and driving thatchange, moving from hardware to
software, and so a lot ofexperience there in terms of the
early days of SoftPoS.
And now Instantium got the viewof how we help these banks
(03:58):
launch more digital issuingproducts, how to digitize cards
into wallets as well as how toaccept digital payments in their
acceptance network, and so weplan on both sides of that card
issuing and acquiring.
Speaker 2 (04:14):
Okay, norman, same question for you a little bit
about your payments backgroundand what led you to Stanchion.
Speaker 4 (04:20):
Thank you, greg.
So I've been in the paymentsindustry for 33 years now a bit
of a veteran and I started inthe city of London with a bank
called NatWest.
Natwest was quite a famousinnovative bank, on both the
issuing and the acquiring side.
One very well-known incubationcompany that came out of that
was indeed WorldPay itself.
(04:41):
So I spent a decade there,really at the end, driving
everything around their digitalchannels, especially mobile, and
also getting involved ininnovative products,
predominantly on the acquiringside more than the issuing side.
And then from there I went intoa large technology firm that was
(05:01):
a world leader in the mobilepayment space and I ran their
global business for wirelessinternet and e-commerce and
mobile commerce and from therewe or I came up with an idea
which the company supported meon.
I took that outside of thebusiness, ran that independently
(05:21):
and spent 10 years growing thatin the customer not present
e-commerce space to do with theprocessing of mobile payments,
and that was one of the earlyexamples of a FinTech which
started back in 2004.
And I was lucky enough to exitthat with a listing on the
Junior Stock Exchange in London.
And then I went to work for awell-known firm called Euronet
(05:45):
and I was helping to open up newmarkets for them across Central
and Eastern Europe, turkey andthe Middle East.
And then from there I've been instanchion now for six years and
I work very closely with Pierredriving the global growth for
our payment fabric technology,which we've used with Ingenico,
for our payment fabrictechnology, which we've used
with Ingenico.
So I've actually worked withthe organization which Ingenico
(06:08):
board, which previously calledFOSS.
I've actually worked with theCEO, brad Hayett, and the sales
director, mike Barnes, for fiveand a half years now.
So Stansion was actually one ofthe very first organizations
that was in the integrationspace, that partnered with
Angelico, and we went on to havesome success which I'm sure
(06:30):
we'll talk about later on.
Speaker 2 (06:32):
Okay, great, Thank you both for sharing that about
your journeys.
So let's get into the meat ofthe conversation, which is
around soft pause.
And for those out there, Norman, this question is for you.
For those out there that maynot know what SoftPos is, can
you give us your definition?
What are some of the benefitsand what makes it different than
traditional POS systems?
Speaker 4 (06:52):
So the first time I spoke five and a half years ago
to Mike about SoftPos, I wasimmediately attracted to it.
It's very simple it's softwareas a point of sale that you
download onto an Android or nowApple iOS device and it turns
that mobile phone, providingit's got NFC capability, into a
(07:13):
fully functioning contactlessacceptance point of sale
terminal.
It's incredibly powerful todrive financial inclusion, and
so we're seeing a lot of smallmerchants who may not want to
carry multiple devices around,such as a mobile point of sale,
and they don't want to keepother devices charged up,
particularly if they're notusing it very often, whereas all
(07:36):
of these merchants have gottheir own mobile phone and they
want to be able to do that.
So today, all of us, when we'reusing our phones, we use it to
take photographs.
We use're using our phones.
We use it to take photographs,we use it to scan documents, we
use it to set alarms, show times.
Today it's very powerfulbecause now, by downloading the
Ingenico softpods solution, thatapp or if it's built as an SDK
(07:59):
into somebody else's app willactually allow that mobile
device to take a contactlessacceptance transaction and it's
really powerful for drivingfinancial inclusion.
Speaker 2 (08:11):
Okay, great.
So, pierre, over to you.
Stanchion is obviously makingwaves in the soft pause space,
so what's the core mission andvision of what you're working on
in this area?
Speaker 3 (08:21):
Yeah.
So if I have to give asimplistic answer, it's about
increasing access to digitalpayments, and so what we do is
we provide an integration layerwithin the banking environments,
but what we want to be is anenabler for solutions like
SoftPos to reach more merchantsso that more consumers can pay
securely with their digitalwallets, their Apple Pay and
(08:44):
Google Pay.
So really we see ourselves asthis enabler to kind of
accelerate those processes andnot let banks get stuck in their
traditional tech or theirlegacy technology stack.
We try and modernize that andleverage partners like Ingenico
to actually drive that change.
So how do we get more accesssafe, convenient access to
(09:07):
digital payments?
Softpause is one of thoseenablers.
Speaker 2 (09:10):
Okay.
So, Pierre, sticking with you.
What are some of the trendsthat are driving adoption of
SoftPause?
Okay, yeah.
Speaker 3 (09:16):
So look, I think everybody in the world has heard
of Apple Pay, right?
So for the past 11 years that'sbeen a big driver of how
consumers want to make payment,simply because it's so simple
and pervasive.
You know once your card'sloaded it's secure.
You use a biometricauthentication and you tap and
go and you can use it on transitsystems, you can use it in
(09:39):
street cafes, you can use itpretty much anywhere globally to
pay.
So digital wallets are a keydriver.
It's the mega trend behind whypeople want to use cards.
It's that convenience.
Right Now, those wallets areonly relevant if you can tap
them somewhere to make thatpayment.
So you need acceptance networks, you need physical POS
(10:00):
terminals, terminals thatIngenico supply.
You know the physical hardwaretop, and now that's been
digitized.
So they've just extended theiroffering from hardware to a pure
software solution.
So I think, based on consumerdemand, there's a need for
increased payment acceptance.
So how do you get more placeswhere you can make that payment,
(10:21):
and SoftPos is one of thoseenablers.
You might argue that COVID was abig driver for contactless
payments, and so you knoweveryone will nod and agree to
that point, but unfortunatelySoftPos missed the boat there.
It was still too early in itsinfancy.
You know there were reallypilot programs being operated
between 2018 and probably 2022,23.
(10:45):
And so it wasn't at any massscale and so SoftPos hadn't seen
the light of day, I'd say, tobenefit from the COVID pandemic,
but certainly it was a catalystfor consumers to digitize their
cards, move them from plasticinto digital wallets, and that's
continued, and so that's thepreferred payment method for
(11:06):
consumers.
Softpos is kind of benefitingfrom that now.
So you're seeing that benefitand in many markets there's a
driver to reduce hardware,because there's a lot of costs
associated with physicalhardware that you need to import
, deploy to merchants andmaintain it.
It's not just drop and go thatdevice.
(11:26):
If it's faulty, acquirers haveto look after it.
So there's a lot of cost andmany acquirers will be looking
to drive down that cost andincrease access.
In other markets they may nothave had that acceptance network
yet.
So, particularly in emergingmarkets, we've seen some kind of
leapfrogging effect where theydidn't have a lot of legacy POS
(11:48):
terminals.
They had no terminals at all.
So it was really cash-basedmarkets or mobile money or
account-to-account.
And so you know, for thosemarkets SoftPos is just a
natural fit now, because if theydidn't have acceptance before.
Consumers want to pay with adigital wallet, roll out softpos
and suddenly you meet that needright, so then merchants can
(12:10):
accept those payments.
So those are the mega trendsthat we see.
You know it's really.
One is cost reduction and theother is just making sure that
payments are safe, convenientfor these consumers.
Speaker 2 (12:23):
Okay, so Norman over to you, and Pierre mentioned
this a little bit, but can yougive us some insights into the
types of businesses andindustries that see the most
significant benefit from softpause?
Speaker 4 (12:35):
So one of the stories that gets the sort of most
amazing feedback when we'representing, especially in Africa
, is how during the COVIDpandemic, particularly in the UK
, there was a lot of referenceto not touching cash, using
contactless acceptance, and theChurch of England was a very
early adopter to allow people topay for their donations when
(12:58):
they went to church on Sundaywith the soft solution, and when
we talk about that in Africa,people's eyes really pop and
they get very interested by that.
I think really the largestnumber of merchants that are
taking it up are at the smallerend.
They may be sole merchants,they may be small restaurateurs,
may have food stalls, they maybe associated with tourism, and
(13:22):
a lot of people will use it inthat context, and they're using
it in that context becausethey're moving around.
They don't want to have seconddevices that they're charging up
.
But it's been very interesting.
For example, in Greece thegovernment wanted to fiscalize
all tax receipts, and so theystarted to tell accountants and
lawyers that they must have apoint of sale terminal to be
(13:45):
able to take card paymenttransactions, and so there was a
rush for people to start usingSoftBoss.
Now they use it on a very adhoc basis, but they needed to do
that in order to comply withthe law In Romania.
About 18 months ago, theRomanian government passed a law
that said that if you've got aturnover of above 10,000 euros,
(14:08):
which isn't very much then itwas mandatory that you offered a
contactless acceptance optionto a customer if they wanted it.
So what happened was that allthese small merchants started
phoning the banks, and this wasa market where the point of sale
was subsidized by the bank tothe merchants.
(14:29):
But now we're talking aboutvery low transaction volumes, so
the banks didn't want toeffectively subsidize that.
They'd already fairly recentlyimplemented soft-boss capability
, so what they did was they justsaid to the smaller merchants
you can go onto our website andstart to download soft-boss
capability, and so that wassomething that really spread
(14:52):
quite quickly.
But it's large enterpriseorganizations that are using it
as well.
So, for example, walmart use it, 7-eleven and Decathlon these
are major retail stores andthey'll use it for everything
from queue busting to when theremay be a cyber attack that
takes out a particular storelocation.
They can carry on trading.
(15:12):
And then yesterday we werepresenting the Ingenico solution
in the Philippines to thelargest e-commerce gateway
processor, and they representboth Courier, which is a cash on
delivery market, as well asinsurance companies, and so
insurance agents have adesperate need to be able to
(15:34):
collect funds and take thosetransactions.
So they're looking at SoftBossas a way of being able to take
those funds as well.
So it's really it crosses manyindustries, but I think the
volume that we're seeing at themoment is in that small merchant
category.
Speaker 2 (15:52):
Okay, so Norman, sticking with you, are there any
use cases or kind of real worldexamples of where this solution
has really transformed abusiness?
Anything you can talk aboutthere?
Speaker 4 (16:03):
So, for example, Stanchion was involved in
deploying the Ingenico solutionin Greece with the largest
acquirer there.
So Uranet is an entity thatbought the largest bank acquirer
because the bank acquirers wereselling off their acquiring
businesses, and so PiraeusBank's acquiring arm was bought
(16:24):
by Euronet and they've deployedthat.
So within Greece, which is amarket that gets a lot of
tourists, there's been a hugevolume of transactions and a
huge volume of merchants thatactively use the app.
During the summer months orduring religious occasions, we
suddenly see spikes of apps thatare suddenly being used in
(16:47):
those instances.
I mentioned Romania earlier.
That's another market that hasgot a very high acceptance rate.
Ing issued a press releaseabout a year after going live
with their soft pause solution,and ing are a large dutch bank
that are present in all of theeuropean countries and in their
(17:09):
press release they said that oneyear after launching soft pause
25 so one in four of alltransactions that they acquire
in romania were initiated from asoft-poss application.
Now that was a case of, if youlike, the government having said
that, they wanted to get moresight of fiscal tax receipts and
(17:30):
therefore they mandated thatevery business with a small
turnover must have the abilityto offer contactless acceptance,
otherwise there was a veryhefty fine for that.
Speaker 2 (17:42):
Okay, great Thanks for sharing those.
So, Pierre, over to you.
I mean, obviously we talk aboutpayments, we have to talk about
security.
So how does SoftPause ensurethat the security of the
transactions are there, and whattype of key compliance
requirements are there?
Speaker 3 (17:58):
Yeah.
So that's a good question, andprobably one of the key factors
that slowed down some ofSoftPoS's progress over the last
10 years has been really, howdo they answer some of those
security questions?
And so it's matured,particularly in the last two
years.
There's now an industrystandard and that's known as PCR
MPOC it's an acronym, soobviously I'll delve into that
(18:21):
just now.
But there's a lot of securityelements that need to match what
was there with the hardware.
So when you had physicalterminals you had a certain
protective barrier around thecore data and customers'
information.
Now you move it on to anycommon device.
How do you maintain the samelevels of security?
And so there's been a lot ofwork done there.
(18:43):
The PCI MPOC standard has comeabout from two prior standards
that have been tested andlaunched in market for a number
of years, but essentially thatsecurity framework now allows
for the safe processing of cardata on any mobile phone.
So they call it a COX device, acommercial off-the-shelf device
.
Literally, you can walk intoany retailer, purchase a mobile
(19:06):
phone that's got NFC, installthe app and start accepting
payments.
So that was unheard of 10 yearsago, but that's going to be the
new norm.
So in terms of security, thebig ticket item is always
maintaining this PCI MPOCstandard.
So it's a long journey to getthere A lot of security
requirements, submitting yourapplication to a PCR test lab
(19:29):
where they really pen testeverything about that app that
you code reviews and really pullit apart and tell you
everything you've done wrong.
So for an engineering team it'squite frustrating but at the
same time rewarding to see thatyou are closing out any possible
vulnerabilities in that app.
In addition to that, there's anumber of other standards you
(19:49):
need to maintain.
So PCI DSS is the one that isindustry standard.
Everyone's familiar with thatand that's maintaining a secure
environment and all theprocessing around core data.
There's a new standard calledPCI-SSF and that stands for the
Secure Software Framework.
That consists of two parts.
So if you're a software vendorbuilding a soft-core solution,
(20:12):
you need to also obtain thatstandard and that effectively
makes sure that your wholesoftware development lifecycle
is secure, so that from thestart of planning a change
through to implementation intoproduction payment system,
you've met a whole lot ofcriteria.
And that's really whatseparates the men from the boys
is maintaining that securepractice, not just for one
(20:34):
source but on an ongoing basis.
How are you always compliant?
And then the last one isobviously PCR, pin processing,
because now you're entering aPIN number on the mobile phone
as well.
You've got to protect that.
And as you process that frompoint to point, there's certain
standards that need to bemaintained.
So all of these things come at acost.
(20:55):
You know you're usingindependent labs and it's, at
minimum, a six to 18 monthinvestment of your own time in
meeting these various standards.
So the investment is going tobe significant a couple of
hundred thousand dollars thatany software company needs to
put into this and maintainingthat.
And so I think the disconnectwe see in the industry is people
(21:18):
expect, now that you've gotsoftware should be free, yet you
maintain in the same securityand standards that hardware
manufacturers needed to maintain.
So there's a number of coststhat are put onto these software
vendors which are unseen.
To be honest, the consumer andthe merchant don't care.
All they want is a secureexperience, right, they don't
(21:38):
understand all the complexitybehind it.
So there naturally needs to besome sort of cost recovery to
position this and make sure thatyour solution is differentiated
and better than other productsin market that have not got
these certifications.
Speaker 2 (21:54):
Okay, great.
So let's switch gears a littlebit and talk about your
partnership with Ingenico andmaybe the future of this space.
So, norman, we'll go back toyou.
So, as everyone knows, ingenicohas a long history of being a
major player in the POS terminalmarket.
So how important is yourpartnership between Ingenico and
Stanchion as far as drivinginnovation in the softball space
(22:18):
and kind of that adoption?
Speaker 4 (22:21):
I'd like to think it's a symbiotic relationship
that Stanchion have benefitedfrom the fact that this is an
innovation which people want tohear about.
They still want to hear aboutit.
We've done in excess of 200presentations on the topic and
people are still reallyinterested to understand how
they can deploy it.
These days, the more emergingthe market, the more interested
(22:45):
they are in that solution,particularly in markets like
Asia and now several Africanmarkets.
You've seen new capabilitiescome in, such as QR code
payments, which are a set ofrails that traditionally the
central bank or local governmenthave put in place.
Local government have put inplace and those transactions
(23:09):
they don't run on thetraditional card rails and
therefore organizations likeIngenico partly miss out on some
of that capability.
However, the ability for peopleto take these card transactions
is still important because alot of these emerging markets
rely heavily on foreign directinvestment, business people
coming into market and tourism,where you can't use those QR
(23:31):
code processes very easily.
Pierre mentioned that Stansion'sheritage has been around
organizations that own their ownpayment switch or core
technology and what we do withour payment fabric is protect
that switch and wrap it.
So the role that we've playedwith Ingenico is going out and
(23:52):
talking to those larger bankswhere they have this existing
tech.
Now those organizations mayeither not have skills, they may
not have the time, they mayhave vendors that they rely on
to do change to that platform,which then become cost
prohibitive to make the businesscase take place, and what they
can use is our overlay, which isalready pre-integrated to the
(24:15):
Ingenico environment and to somecore payment switch vendors, in
order to facilitate thatproject moving forwards.
Facilitate that project movingforwards and they can still take
control and take some of thepressure off the core system and
the need to do constantregression testing.
So when you introduce softwareinto an environment as opposed
(24:36):
to hardware, the pace of changeand the pace with which you need
to launch new features issubstantially greater.
And what that does is it putsquite a lot of effort and risk
onto a bank if they're having todo regular change and go
through regular regression testcycles in order to get changes
through.
(24:56):
So our relationship withIngenico, I think, is a good one
.
Ingenico has grown rapidly butwith all of the work that's
going on and with the softwareelement to this, the projects
and the integration of it aresubstantially more complex than
a traditional hardware projectwhere somebody would just buy
the hardware, it would comecertified and off they go.
(25:19):
With a software project,there's a lot of hand-holding,
there's level threecertification that needs to be
done, and there's a lot ofhandholding, there's level three
certification that needs to bedone, and there's a lot of
operational efficiencies thatneed to be done correctly if
you're not going to overburdenthe contact center and
everything else that's going on,and so that's where an
integration partnership, such asthe one that Stanchion brings,
(25:42):
helps create this symbioticpartnership.
Speaker 2 (25:45):
Okay, so Pierre, over to you.
So what are the key factorsthat make a successful
partnership in this soft pauseecosystem, and how does
Stanchion approach this type ofcollaboration?
Speaker 3 (25:57):
Yeah.
So ecosystem is the right wordto use there, greg.
I think the card value chain isquite complex.
You know, you've got the twosides issuing, acquiring you've
got card schemes, you've gotcore banking providers and then
third-party software providerslike ourselves.
So what we look to do isobviously spark some innovation
(26:20):
with customers.
And so you know, we try andprovide a full consulting
experience for the customer.
So it's about sparking thatthought about the art of the
possible.
What could this traditional bankdo with something like Softpops
?
And it's never forced, it'sreally to guide them and say
this is what you could do, theseare your options.
(26:40):
And it's always aboutpositioning the right product
for the right use case.
So that's our consultingheritage that we bring to the
market.
And then there's the productplugging pieces, where it would
be an Ingenico soft postsolution plus our pavement
fabric to streamline theintegration and work that a
(27:01):
typical acquirer or bank wouldneed to do.
So we take away all the painpoints of those integrations and
then we provide the 24-7managed support to give them the
assurance that now you'removing from a hardware world to
a software world.
It's 24-7, right.
So if something breaks, it'snot about the merchant waits for
a new terminal to ship to them,you can fix it there and then
(27:24):
it just requires intervention.
And so collectively, you know,between Energetico and Stanchion
, we've got that end-to-endoffering.
But in terms of collaboratingin the ecosystem, it's about
maintaining certifications thatgive you the accreditation, give
customers confidence thatthey're buying a good product,
and then it's working with thecard schemes to also build up
(27:46):
trust and understanding aboutthis payment method.
Softcourse is relatively new.
You know people don't fullyunderstand it.
They may assume it's a QRscanning app, when it's
completely different.
They might assume it's theApple Pay e-commerce checkout,
which it's not right.
So a lot of people still needto get that understanding of NFC
(28:06):
payments and security thatunderpins it, and so we rely
heavily on Visa, mastercard,Amex, diners, et cetera, to
really create that awareness.
A single vendor voice in themarket is not going to drive
change with merchants and createthat demand for them to sign up
and get a soft-posed solution.
So either it's regulation thatdrives it, like Norman was
(28:29):
speaking about in Greece andRomania, or it's the winning
demand that gets created by theinterest that he's in a master
car to say you can trust thistechnology, it's easy to use and
let's get you onboarded, and sothere are a number of
partnerships that you need towork on in that ecosystem, and I
(28:50):
think we're trying our best toreally bring all of these
parties together in the marketswe target, and it's just a
matter of time until you buildup that trust and understanding.
Speaker 2 (29:02):
Okay.
So, Pierre, sticking with you,let's talk about the future a
little bit.
Where do you see SoftPause inmaybe five years?
What types of new features andfunctionality do you think are
coming and what will be theimpact of that?
Speaker 3 (29:16):
So it will be better than it is today.
I think that's the first thing.
One of the limitations we'veexperienced with SoftPause has
been largely around the mobiledevice itself.
Devices in some markets shipwithout NFC, which immediately
disqualifies them from beingeligible to use a soft pose
product, and that hindersadoption.
(29:36):
So that's the one factor.
The other factor is the NFCantenna itself that's built into
the device is relatively weak,so it doesn't perform at the
same levels that a traditionalterminal would, which is truly
contactless.
If you go to an Ingenicophysical terminal and you tap,
you can hold your card fourcentimeters above that device
(29:58):
and transact With soft pods.
You've got to actually makecontact.
The card has to touch the backof the phone in most cases.
So it's not truly contactlessand it's a bit of a slow
experience at the point ofcheckout.
Often there's a bit of delayand it's not elegant in terms of
a checkout experience.
So there are initiativesunderway with different device
(30:20):
manufacturers to improve thoseantenna.
So there are a number of trialsgoing on.
So in five years' time I thinkmobile phones will perform at
the level that a traditionalterminal does, or at least as
close to it as physicallypossible.
So I think that's the onefactor that's kind of an
infrastructural piece that needsto happen over the next five
(30:42):
years.
The other is increased trust.
So as people become more awareof it, they experience it once
or twice at their local marketor download it themselves from
their bank or acquire it Overtime.
That's just going to build andso they won't see a need for all
the excess hardware.
They could stick to a softballsolution if that's all they need
(31:03):
.
If you're an e-commercemerchant and you do the odd
in-person sale, soft pause isperfect, right, and I think
we'll see a lot more of softpause embedded use cases, so
being used in self-servicecheckouts at a kiosk or even EV
stations a tap and go type of EVstation scenario.
(31:23):
So I think that's going to berolled out over the next five
years.
The last one, I guess, is a bitmore of the blurring of the
lines between online commerce ore-commerce as we might call it
and in-person payments.
So SoftPos allows anyone toinstall the app on their phone,
right?
You don't have to be classifiedas a merchant or a business, so
(31:46):
individuals that are shoppingcould download onto their phone
a payment app and, when they dothe e-commerce checkout, tap
their card on their own deviceor have an app-to-app type of
interaction where you clickcheckout on your phone, it goes
to Apple Pay, you click pay andit all gets settled.
It's kind of app to app, and Ithink that then blurs the line
(32:09):
of what is e-commerce.
And will you ever need to typeyour car details in online and
be at risk?
So fraud reduction comes intoplay there as well.
Speaker 2 (32:20):
Yeah, that's an interesting one.
I don't know, I'd have to thinkabout that one as far as from a
user perspective, it would bekind of a weird interaction.
But that's that's interestingto think about.
So I'm glad you shared that.
So, norman, as you're thinkingabout merchants and they're
being interested in this, whatadvice do you give them or would
you give them if they'reinterested in a soft pause
(32:42):
solution?
Speaker 4 (32:43):
So, firstly, it's very easy to access it, download
it, install it and use.
So actually there is nothing tolose.
If you're in a merchant in amarket where you're getting
charged by the bank for having aterminal, or you want to take
transactions but you're going toget charged by the bank for
doing that, you'll often findvendors out there with softball
(33:07):
solutions or banks that willallow you to download the app
and only pay when you use theapplication.
So actually in that instance, amerchant could save more than
$300 over, just say, athree-year period from the
rental of a terminal.
If you're in a market where theterminal is subsidized to it,
(33:31):
then we've already seen thatmany merchants, particularly at
the smaller end, they don't havetheir terminals charged up or
suddenly somebody wants to payand then they realize that it's
not charged up or maybe oneisn't working.
In fact, pierre and myself werein the Philippines just a few
weeks ago and Pierre had thatexact issue.
(33:52):
He was trying to buy some goodsfor his children whilst he was
abroad, and this was a largeshop and the large shop didn't
have any POS devices that wereworking and so, unfortunately,
pierre didn't have cash and sothat was a lost transaction,
both for the shop and for hisdaughters.
(34:13):
So by installing this on thephone, it's very easy to make
that available and to be used.
So my advice to merchants istry it.
I had lunch with an entrepreneurwhose wife runs a yoga studio
and he was saying that hiswife's getting more customers
(34:36):
who want to pay with card and soshe signed up with Revolut, but
that comes with a dongle whichshe's also having to use.
But we had a conversation aboutsoft pause and not everybody's
aware of it right now and Ithink, as Pierre mentioned,
that's where the schemes couldhave a big role to play to help
drive awareness of the solution,because it's surprising how
(35:00):
many people are still not awarethat it's out there and it's as
easy to use as it is taking aphotograph on your mobile phone.
Speaker 2 (35:08):
Okay, great.
So, as we come to a close startto wrap up the show, Pierre,
any final thoughts, any keytakeaways you'd like our
audience to take from thisepisode?
Speaker 3 (35:18):
I think the future of softpods is more about that.
It's an embedded paymentexperience, and so it all comes
down to these applicationintegrators what they choose to
do with SoftPos, right.
So how do they bring it alltogether?
Now, the terminology is an SDKsoftware development kit.
That's what SoftPos has beendistilled into, and you can add
(35:40):
that to multiple applications soany existing application can
embed that and have atap-on-phone type of experience.
If you think about the next timeyou need to sign up for Netflix
and you've got a reoccurringdebit order, instead of typing
in all your card information,you could simply tap your card
for that first initialtransaction and that will become
(36:02):
tokenized for all thereoccurring debits.
Short transaction, and thatwill become tokenized for all of
the reoccurring debits, and inthat process you've never shared
your sensitive card details inclear text with anyone.
So it becomes a far more secureexperience for cardholders.
And then downstream you've gotyour reoccurring debits and the
convenience of never worryingabout that, and then I think
(36:24):
it'll also benefit from embeddedloyalty and rewards.
So, as these applicationintegrators that have got
control of what's being soldcompare that with SoftPos, you
know you can start givinginstant rewards and immediate
discounts on the spot.
So I think those are the typesof experiences we're going to
see emerge, with SoftPos beingembedded in more places.
Speaker 2 (36:47):
Okay, Norman, same question over to you.
Any key takeaways you'd like toshare with the audience?
Speaker 4 (36:53):
So, surprisingly, and even though softbuzz has been
available in Europe, for example, for over five years, the stage
of market maturity that we'rein is still very early phase.
I'd still call it phase one aswe move into phase two, which is
beginning to start to bediscussed in some countries.
You're going to start to lookat, as Pierre talked about, this
(37:16):
need to build in additionalapplication capability so, for
example, dynamic currencyconversion, the ability to add
in embedded finance like buy now, pay later, and this provides a
fantastic opportunity for thebanks to make more revenue by
expanding its ecosystem offintech enablement and
(37:37):
capability, but it actuallyprovides a beautiful opportunity
for them to incentivize a wholenew distribution channel in
order to sell additionalservices.
So suddenly, with the rightkind of training, the bank can
begin to put education programson to the merchants and allow
the merchant to participate insome of those buy now, pay later
(38:00):
rewards from it, similarly,with the loyalty and reward
concept that Pierre was talkingabout.
So, with a little bit ofcreative thinking, this can be a
very big win-win ecosystem foreverybody, and help with the
grander goal of financialinclusion.
Speaker 2 (38:17):
Okay, so, Norman.
Final question where can peoplego to learn more about
Stanchion and SoftPause?
Speaker 4 (38:22):
So our website is stanchionpaymentscom.
You can go on there and findinformation, or myself and
Pierre we're regularly travelingso we're often posting on
LinkedIn, so you can find myLinkedIn profile, norman Frankel
or Pierre Harrell LinkedInprofile and you can get more
information there.
Speaker 2 (38:42):
Okay, great.
So, Norman Pierre, this hasbeen a great conversation.
I know our audience is going tolearn a lot from this.
As you mentioned, this is kindof new, so I think this series
is really educating people onsoft pause.
I love the use cases andsharing those, so thank you both
for being on the show.
I really appreciate it.
I know your time is valuable,so thank you so much for being
here today.
Thank you, Greg.
Speaker 3 (39:02):
Thanks, greg, appreciate it.
Speaker 2 (39:04):
Absolutely, and to all you listeners out there, I
thank you for your time as well,and until the next story.
Speaker 1 (39:10):
Thank you for listening to today's episode.
If you'd like to explore howSoftPause can unlock payment
freedom for your business,please visit businessingenicocom
.
Slash swipe, dash write, dashon dash soft pause.
Welcome to this special Pulse of Payment series
titled Swipe Right on SoftPauseUnlocking Payment Freedom, a
special six-part series broughtto you in collaboration with
Ingenico, the global leader inpayments.
Softpause is a revolutionarytechnology that lets merchants
accept payments on anysmartphone or device, unlocking
(00:21):
a world of possibilities.
Thank you, commerce forward.
(00:47):
Buckle up and get ready toswipe right on SoftPause and
unlock payment freedom.
Speaker 2 (00:49):
Hello everyone and welcome to the Leaders in
Payments podcast.
I'm your host, greg Myers, andthis is the fourth episode in
our PULSA Payments series onSoftPause, sponsored by Ingenico
.
Today we have two very specialguests Pierre Arel, the Chief
Product Officer at StanchionPayments, as well as Norman
Frankel, the Chief GrowthOfficer at Stanchion.
So, guys, welcome to the show.
(01:11):
Thank you so much for beinghere.
Thank you.
Thank you, greg, good to behere.
So let's go ahead and dive in.
Pierre, if you don't mindtaking this first question, can
you tell our audience a littlebit about Stanchion and what you
do?
Can?
Speaker 3 (01:23):
you tell our audience a little bit about Stanchion
and what you do, sure.
So Stanchion is an establishedbusiness.
It's a global paymentsconsulting business Been around
since 2001.
So solid reputation in theindustry, with offices in
Australia, the UAE, south Africaand the US and a smaller
European presence as well,operated out of the UK.
Historically the business hasalways consulted to banks around
(01:45):
their payment infrastructure,advising banks on how to
modernize and keep their systemscompliant, particularly around
the card systems, so cardswitches and card issuing
platforms.
Over the past five years maybeslightly more Norman we've been
building our own softwareproducts.
And that's come about from aneed, speaking to these banks,
(02:07):
realizing that there's someunmet needs that they have in
their ecosystem where they needthird-party software to augment
that.
And Stanchion's been buildingour payment fabric technology to
overlay on these card systemsand cover those gaps and meet
those needs that customers havebeen telling us.
And that's been kind ofsoliciting feedback from a
(02:29):
worldwide audience, from theMiddle East, from Africa, from
the Caribbean.
And we bring that all into theproduct team where we aggregate
the technologies and take thatproduct to market ourselves,
known as Payment Fabric.
Speaker 2 (02:42):
Okay.
So, pierre, sticking with you,maybe walk us through your
journey in payments and what ledyou to Stanchion.
Speaker 3 (02:49):
Yeah, so I've been with Stanchion almost two years
now, so really maturing thesoftware environment here and
thinking about the strategy andwhat we do, particularly around
soft pause initiatives.
Prior to that, I actually builtwith my team at my previous
company one of the earlier softpause solutions in market and
that began in 2019 and reallyspent a lot of time working with
(03:12):
Visa and MasterCard buildingout the very low level payment
kernels that need to operate ona payment device, then moving on
to the mobile apps and then theprocessing environments, and so
I spent the better part of fourto five years taking
effectively a tech startup tomarket and launching that
SoftPoS solution, and so a lotof scars that I've got to show
(03:37):
from those experiences.
Softpos has really been a laborof love.
I guess it's a challenge, butit's been fantastic working in
the industry and driving thatchange, moving from hardware to
software, and so a lot ofexperience there in terms of the
early days of SoftPoS.
And now Instantium got the viewof how we help these banks
(03:58):
launch more digital issuingproducts, how to digitize cards
into wallets as well as how toaccept digital payments in their
acceptance network, and so weplan on both sides of that card
issuing and acquiring.
Speaker 2 (04:14):
Okay, norman, same question for you a little bit
about your payments backgroundand what led you to Stanchion.
Speaker 4 (04:20):
Thank you, greg.
So I've been in the paymentsindustry for 33 years now a bit
of a veteran and I started inthe city of London with a bank
called NatWest.
Natwest was quite a famousinnovative bank, on both the
issuing and the acquiring side.
One very well-known incubationcompany that came out of that
was indeed WorldPay itself.
(04:41):
So I spent a decade there,really at the end, driving
everything around their digitalchannels, especially mobile, and
also getting involved ininnovative products,
predominantly on the acquiringside more than the issuing side.
And then from there I went intoa large technology firm that was
(05:01):
a world leader in the mobilepayment space and I ran their
global business for wirelessinternet and e-commerce and
mobile commerce and from therewe or I came up with an idea
which the company supported meon.
I took that outside of thebusiness, ran that independently
(05:21):
and spent 10 years growing thatin the customer not present
e-commerce space to do with theprocessing of mobile payments,
and that was one of the earlyexamples of a FinTech which
started back in 2004.
And I was lucky enough to exitthat with a listing on the
Junior Stock Exchange in London.
And then I went to work for awell-known firm called Euronet
(05:45):
and I was helping to open up newmarkets for them across Central
and Eastern Europe, turkey andthe Middle East.
And then from there I've been instanchion now for six years and
I work very closely with Pierredriving the global growth for
our payment fabric technology,which we've used with Ingenico,
for our payment fabrictechnology, which we've used
with Ingenico.
So I've actually worked withthe organization which Ingenico
(06:08):
board, which previously calledFOSS.
I've actually worked with theCEO, brad Hayett, and the sales
director, mike Barnes, for fiveand a half years now.
So Stansion was actually one ofthe very first organizations
that was in the integrationspace, that partnered with
Angelico, and we went on to havesome success which I'm sure
(06:30):
we'll talk about later on.
Speaker 2 (06:32):
Okay, great, Thank you both for sharing that about
your journeys.
So let's get into the meat ofthe conversation, which is
around soft pause.
And for those out there, Norman, this question is for you.
For those out there that maynot know what SoftPos is, can
you give us your definition?
What are some of the benefitsand what makes it different than
traditional POS systems?
Speaker 4 (06:52):
So the first time I spoke five and a half years ago
to Mike about SoftPos, I wasimmediately attracted to it.
It's very simple it's softwareas a point of sale that you
download onto an Android or nowApple iOS device and it turns
that mobile phone, providingit's got NFC capability, into a
(07:13):
fully functioning contactlessacceptance point of sale
terminal.
It's incredibly powerful todrive financial inclusion, and
so we're seeing a lot of smallmerchants who may not want to
carry multiple devices around,such as a mobile point of sale,
and they don't want to keepother devices charged up,
particularly if they're notusing it very often, whereas all
(07:36):
of these merchants have gottheir own mobile phone and they
want to be able to do that.
So today, all of us, when we'reusing our phones, we use it to
take photographs.
We use're using our phones.
We use it to take photographs,we use it to scan documents, we
use it to set alarms, show times.
Today it's very powerfulbecause now, by downloading the
Ingenico softpods solution, thatapp or if it's built as an SDK
(07:59):
into somebody else's app willactually allow that mobile
device to take a contactlessacceptance transaction and it's
really powerful for drivingfinancial inclusion.
Speaker 2 (08:11):
Okay, great.
So, pierre, over to you.
Stanchion is obviously makingwaves in the soft pause space,
so what's the core mission andvision of what you're working on
in this area?
Speaker 3 (08:21):
Yeah.
So if I have to give asimplistic answer, it's about
increasing access to digitalpayments, and so what we do is
we provide an integration layerwithin the banking environments,
but what we want to be is anenabler for solutions like
SoftPos to reach more merchantsso that more consumers can pay
securely with their digitalwallets, their Apple Pay and
(08:44):
Google Pay.
So really we see ourselves asthis enabler to kind of
accelerate those processes andnot let banks get stuck in their
traditional tech or theirlegacy technology stack.
We try and modernize that andleverage partners like Ingenico
to actually drive that change.
So how do we get more accesssafe, convenient access to
(09:07):
digital payments?
Softpause is one of thoseenablers.
Speaker 2 (09:10):
Okay.
So, Pierre, sticking with you.
What are some of the trendsthat are driving adoption of
SoftPause?
Okay, yeah.
Speaker 3 (09:16):
So look, I think everybody in the world has heard
of Apple Pay, right?
So for the past 11 years that'sbeen a big driver of how
consumers want to make payment,simply because it's so simple
and pervasive.
You know once your card'sloaded it's secure.
You use a biometricauthentication and you tap and
go and you can use it on transitsystems, you can use it in
(09:39):
street cafes, you can use itpretty much anywhere globally to
pay.
So digital wallets are a keydriver.
It's the mega trend behind whypeople want to use cards.
It's that convenience.
Right Now, those wallets areonly relevant if you can tap
them somewhere to make thatpayment.
So you need acceptance networks, you need physical POS
(10:00):
terminals, terminals thatIngenico supply.
You know the physical hardwaretop, and now that's been
digitized.
So they've just extended theiroffering from hardware to a pure
software solution.
So I think, based on consumerdemand, there's a need for
increased payment acceptance.
So how do you get more placeswhere you can make that payment,
(10:21):
and SoftPos is one of thoseenablers.
You might argue that COVID was abig driver for contactless
payments, and so you knoweveryone will nod and agree to
that point, but unfortunatelySoftPos missed the boat there.
It was still too early in itsinfancy.
You know there were reallypilot programs being operated
between 2018 and probably 2022,23.
(10:45):
And so it wasn't at any massscale and so SoftPos hadn't seen
the light of day, I'd say, tobenefit from the COVID pandemic,
but certainly it was a catalystfor consumers to digitize their
cards, move them from plasticinto digital wallets, and that's
continued, and so that's thepreferred payment method for
(11:06):
consumers.
Softpos is kind of benefitingfrom that now.
So you're seeing that benefitand in many markets there's a
driver to reduce hardware,because there's a lot of costs
associated with physicalhardware that you need to import
, deploy to merchants andmaintain it.
It's not just drop and go thatdevice.
(11:26):
If it's faulty, acquirers haveto look after it.
So there's a lot of cost andmany acquirers will be looking
to drive down that cost andincrease access.
In other markets they may nothave had that acceptance network
yet.
So, particularly in emergingmarkets, we've seen some kind of
leapfrogging effect where theydidn't have a lot of legacy POS
(11:48):
terminals.
They had no terminals at all.
So it was really cash-basedmarkets or mobile money or
account-to-account.
And so you know, for thosemarkets SoftPos is just a
natural fit now, because if theydidn't have acceptance before.
Consumers want to pay with adigital wallet, roll out softpos
and suddenly you meet that needright, so then merchants can
(12:10):
accept those payments.
So those are the mega trendsthat we see.
You know it's really.
One is cost reduction and theother is just making sure that
payments are safe, convenientfor these consumers.
Speaker 2 (12:23):
Okay, so Norman over to you, and Pierre mentioned
this a little bit, but can yougive us some insights into the
types of businesses andindustries that see the most
significant benefit from softpause?
Speaker 4 (12:35):
So one of the stories that gets the sort of most
amazing feedback when we'representing, especially in Africa
, is how during the COVIDpandemic, particularly in the UK
, there was a lot of referenceto not touching cash, using
contactless acceptance, and theChurch of England was a very
early adopter to allow people topay for their donations when
(12:58):
they went to church on Sundaywith the soft solution, and when
we talk about that in Africa,people's eyes really pop and
they get very interested by that.
I think really the largestnumber of merchants that are
taking it up are at the smallerend.
They may be sole merchants,they may be small restaurateurs,
may have food stalls, they maybe associated with tourism, and
(13:22):
a lot of people will use it inthat context, and they're using
it in that context becausethey're moving around.
They don't want to have seconddevices that they're charging up
.
But it's been very interesting.
For example, in Greece thegovernment wanted to fiscalize
all tax receipts, and so theystarted to tell accountants and
lawyers that they must have apoint of sale terminal to be
(13:45):
able to take card paymenttransactions, and so there was a
rush for people to start usingSoftBoss.
Now they use it on a very adhoc basis, but they needed to do
that in order to comply withthe law In Romania.
About 18 months ago, theRomanian government passed a law
that said that if you've got aturnover of above 10,000 euros,
(14:08):
which isn't very much then itwas mandatory that you offered a
contactless acceptance optionto a customer if they wanted it.
So what happened was that allthese small merchants started
phoning the banks, and this wasa market where the point of sale
was subsidized by the bank tothe merchants.
(14:29):
But now we're talking aboutvery low transaction volumes, so
the banks didn't want toeffectively subsidize that.
They'd already fairly recentlyimplemented soft-boss capability
, so what they did was they justsaid to the smaller merchants
you can go onto our website andstart to download soft-boss
capability, and so that wassomething that really spread
(14:52):
quite quickly.
But it's large enterpriseorganizations that are using it
as well.
So, for example, walmart use it, 7-eleven and Decathlon these
are major retail stores andthey'll use it for everything
from queue busting to when theremay be a cyber attack that
takes out a particular storelocation.
They can carry on trading.
(15:12):
And then yesterday we werepresenting the Ingenico solution
in the Philippines to thelargest e-commerce gateway
processor, and they representboth Courier, which is a cash on
delivery market, as well asinsurance companies, and so
insurance agents have adesperate need to be able to
(15:34):
collect funds and take thosetransactions.
So they're looking at SoftBossas a way of being able to take
those funds as well.
So it's really it crosses manyindustries, but I think the
volume that we're seeing at themoment is in that small merchant
category.
Speaker 2 (15:52):
Okay, so Norman, sticking with you, are there any
use cases or kind of real worldexamples of where this solution
has really transformed abusiness?
Anything you can talk aboutthere?
Speaker 4 (16:03):
So, for example, Stanchion was involved in
deploying the Ingenico solutionin Greece with the largest
acquirer there.
So Uranet is an entity thatbought the largest bank acquirer
because the bank acquirers wereselling off their acquiring
businesses, and so PiraeusBank's acquiring arm was bought
(16:24):
by Euronet and they've deployedthat.
So within Greece, which is amarket that gets a lot of
tourists, there's been a hugevolume of transactions and a
huge volume of merchants thatactively use the app.
During the summer months orduring religious occasions, we
suddenly see spikes of apps thatare suddenly being used in
(16:47):
those instances.
I mentioned Romania earlier.
That's another market that hasgot a very high acceptance rate.
Ing issued a press releaseabout a year after going live
with their soft pause solution,and ing are a large dutch bank
that are present in all of theeuropean countries and in their
(17:09):
press release they said that oneyear after launching soft pause
25 so one in four of alltransactions that they acquire
in romania were initiated from asoft-poss application.
Now that was a case of, if youlike, the government having said
that, they wanted to get moresight of fiscal tax receipts and
(17:30):
therefore they mandated thatevery business with a small
turnover must have the abilityto offer contactless acceptance,
otherwise there was a veryhefty fine for that.
Speaker 2 (17:42):
Okay, great Thanks for sharing those.
So, Pierre, over to you.
I mean, obviously we talk aboutpayments, we have to talk about
security.
So how does SoftPause ensurethat the security of the
transactions are there, and whattype of key compliance
requirements are there?
Speaker 3 (17:58):
Yeah.
So that's a good question, andprobably one of the key factors
that slowed down some ofSoftPoS's progress over the last
10 years has been really, howdo they answer some of those
security questions?
And so it's matured,particularly in the last two
years.
There's now an industrystandard and that's known as PCR
MPOC it's an acronym, soobviously I'll delve into that
(18:21):
just now.
But there's a lot of securityelements that need to match what
was there with the hardware.
So when you had physicalterminals you had a certain
protective barrier around thecore data and customers'
information.
Now you move it on to anycommon device.
How do you maintain the samelevels of security?
And so there's been a lot ofwork done there.
(18:43):
The PCI MPOC standard has comeabout from two prior standards
that have been tested andlaunched in market for a number
of years, but essentially thatsecurity framework now allows
for the safe processing of cardata on any mobile phone.
So they call it a COX device, acommercial off-the-shelf device
.
Literally, you can walk intoany retailer, purchase a mobile
(19:06):
phone that's got NFC, installthe app and start accepting
payments.
So that was unheard of 10 yearsago, but that's going to be the
new norm.
So in terms of security, thebig ticket item is always
maintaining this PCI MPOCstandard.
So it's a long journey to getthere A lot of security
requirements, submitting yourapplication to a PCR test lab
(19:29):
where they really pen testeverything about that app that
you code reviews and really pullit apart and tell you
everything you've done wrong.
So for an engineering team it'squite frustrating but at the
same time rewarding to see thatyou are closing out any possible
vulnerabilities in that app.
In addition to that, there's anumber of other standards you
(19:49):
need to maintain.
So PCI DSS is the one that isindustry standard.
Everyone's familiar with thatand that's maintaining a secure
environment and all theprocessing around core data.
There's a new standard calledPCI-SSF and that stands for the
Secure Software Framework.
That consists of two parts.
So if you're a software vendorbuilding a soft-core solution,
(20:12):
you need to also obtain thatstandard and that effectively
makes sure that your wholesoftware development lifecycle
is secure, so that from thestart of planning a change
through to implementation intoproduction payment system,
you've met a whole lot ofcriteria.
And that's really whatseparates the men from the boys
is maintaining that securepractice, not just for one
(20:34):
source but on an ongoing basis.
How are you always compliant?
And then the last one isobviously PCR, pin processing,
because now you're entering aPIN number on the mobile phone
as well.
You've got to protect that.
And as you process that frompoint to point, there's certain
standards that need to bemaintained.
So all of these things come at acost.
(20:55):
You know you're usingindependent labs and it's, at
minimum, a six to 18 monthinvestment of your own time in
meeting these various standards.
So the investment is going tobe significant a couple of
hundred thousand dollars thatany software company needs to
put into this and maintainingthat.
And so I think the disconnectwe see in the industry is people
(21:18):
expect, now that you've gotsoftware should be free, yet you
maintain in the same securityand standards that hardware
manufacturers needed to maintain.
So there's a number of coststhat are put onto these software
vendors which are unseen.
To be honest, the consumer andthe merchant don't care.
All they want is a secureexperience, right, they don't
(21:38):
understand all the complexitybehind it.
So there naturally needs to besome sort of cost recovery to
position this and make sure thatyour solution is differentiated
and better than other productsin market that have not got
these certifications.
Speaker 2 (21:54):
Okay, great.
So let's switch gears a littlebit and talk about your
partnership with Ingenico andmaybe the future of this space.
So, norman, we'll go back toyou.
So, as everyone knows, ingenicohas a long history of being a
major player in the POS terminalmarket.
So how important is yourpartnership between Ingenico and
Stanchion as far as drivinginnovation in the softball space
(22:18):
and kind of that adoption?
Speaker 4 (22:21):
I'd like to think it's a symbiotic relationship
that Stanchion have benefitedfrom the fact that this is an
innovation which people want tohear about.
They still want to hear aboutit.
We've done in excess of 200presentations on the topic and
people are still reallyinterested to understand how
they can deploy it.
These days, the more emergingthe market, the more interested
(22:45):
they are in that solution,particularly in markets like
Asia and now several Africanmarkets.
You've seen new capabilitiescome in, such as QR code
payments, which are a set ofrails that traditionally the
central bank or local governmenthave put in place.
Local government have put inplace and those transactions
(23:09):
they don't run on thetraditional card rails and
therefore organizations likeIngenico partly miss out on some
of that capability.
However, the ability for peopleto take these card transactions
is still important because alot of these emerging markets
rely heavily on foreign directinvestment, business people
coming into market and tourism,where you can't use those QR
(23:31):
code processes very easily.
Pierre mentioned that Stansion'sheritage has been around
organizations that own their ownpayment switch or core
technology and what we do withour payment fabric is protect
that switch and wrap it.
So the role that we've playedwith Ingenico is going out and
(23:52):
talking to those larger bankswhere they have this existing
tech.
Now those organizations mayeither not have skills, they may
not have the time, they mayhave vendors that they rely on
to do change to that platform,which then become cost
prohibitive to make the businesscase take place, and what they
can use is our overlay, which isalready pre-integrated to the
(24:15):
Ingenico environment and to somecore payment switch vendors, in
order to facilitate thatproject moving forwards.
Facilitate that project movingforwards and they can still take
control and take some of thepressure off the core system and
the need to do constantregression testing.
So when you introduce softwareinto an environment as opposed
(24:36):
to hardware, the pace of changeand the pace with which you need
to launch new features issubstantially greater.
And what that does is it putsquite a lot of effort and risk
onto a bank if they're having todo regular change and go
through regular regression testcycles in order to get changes
through.
(24:56):
So our relationship withIngenico, I think, is a good one
.
Ingenico has grown rapidly butwith all of the work that's
going on and with the softwareelement to this, the projects
and the integration of it aresubstantially more complex than
a traditional hardware projectwhere somebody would just buy
the hardware, it would comecertified and off they go.
(25:19):
With a software project,there's a lot of hand-holding,
there's level threecertification that needs to be
done, and there's a lot ofhandholding, there's level three
certification that needs to bedone, and there's a lot of
operational efficiencies thatneed to be done correctly if
you're not going to overburdenthe contact center and
everything else that's going on,and so that's where an
integration partnership, such asthe one that Stanchion brings,
(25:42):
helps create this symbioticpartnership.
Speaker 2 (25:45):
Okay, so Pierre, over to you.
So what are the key factorsthat make a successful
partnership in this soft pauseecosystem, and how does
Stanchion approach this type ofcollaboration?
Speaker 3 (25:57):
Yeah.
So ecosystem is the right wordto use there, greg.
I think the card value chain isquite complex.
You know, you've got the twosides issuing, acquiring you've
got card schemes, you've gotcore banking providers and then
third-party software providerslike ourselves.
So what we look to do isobviously spark some innovation
(26:20):
with customers.
And so you know, we try andprovide a full consulting
experience for the customer.
So it's about sparking thatthought about the art of the
possible.
What could this traditional bankdo with something like Softpops
?
And it's never forced, it'sreally to guide them and say
this is what you could do, theseare your options.
(26:40):
And it's always aboutpositioning the right product
for the right use case.
So that's our consultingheritage that we bring to the
market.
And then there's the productplugging pieces, where it would
be an Ingenico soft postsolution plus our pavement
fabric to streamline theintegration and work that a
(27:01):
typical acquirer or bank wouldneed to do.
So we take away all the painpoints of those integrations and
then we provide the 24-7managed support to give them the
assurance that now you'removing from a hardware world to
a software world.
It's 24-7, right.
So if something breaks, it'snot about the merchant waits for
a new terminal to ship to them,you can fix it there and then
(27:24):
it just requires intervention.
And so collectively, you know,between Energetico and Stanchion
, we've got that end-to-endoffering.
But in terms of collaboratingin the ecosystem, it's about
maintaining certifications thatgive you the accreditation, give
customers confidence thatthey're buying a good product,
and then it's working with thecard schemes to also build up
(27:46):
trust and understanding aboutthis payment method.
Softcourse is relatively new.
You know people don't fullyunderstand it.
They may assume it's a QRscanning app, when it's
completely different.
They might assume it's theApple Pay e-commerce checkout,
which it's not right.
So a lot of people still needto get that understanding of NFC
(28:06):
payments and security thatunderpins it, and so we rely
heavily on Visa, mastercard,Amex, diners, et cetera, to
really create that awareness.
A single vendor voice in themarket is not going to drive
change with merchants and createthat demand for them to sign up
and get a soft-posed solution.
So either it's regulation thatdrives it, like Norman was
(28:29):
speaking about in Greece andRomania, or it's the winning
demand that gets created by theinterest that he's in a master
car to say you can trust thistechnology, it's easy to use and
let's get you onboarded, and sothere are a number of
partnerships that you need towork on in that ecosystem, and I
(28:50):
think we're trying our best toreally bring all of these
parties together in the marketswe target, and it's just a
matter of time until you buildup that trust and understanding.
Speaker 2 (29:02):
Okay.
So, Pierre, sticking with you,let's talk about the future a
little bit.
Where do you see SoftPause inmaybe five years?
What types of new features andfunctionality do you think are
coming and what will be theimpact of that?
Speaker 3 (29:16):
So it will be better than it is today.
I think that's the first thing.
One of the limitations we'veexperienced with SoftPause has
been largely around the mobiledevice itself.
Devices in some markets shipwithout NFC, which immediately
disqualifies them from beingeligible to use a soft pose
product, and that hindersadoption.
(29:36):
So that's the one factor.
The other factor is the NFCantenna itself that's built into
the device is relatively weak,so it doesn't perform at the
same levels that a traditionalterminal would, which is truly
contactless.
If you go to an Ingenicophysical terminal and you tap,
you can hold your card fourcentimeters above that device
(29:58):
and transact With soft pods.
You've got to actually makecontact.
The card has to touch the backof the phone in most cases.
So it's not truly contactlessand it's a bit of a slow
experience at the point ofcheckout.
Often there's a bit of delayand it's not elegant in terms of
a checkout experience.
So there are initiativesunderway with different device
(30:20):
manufacturers to improve thoseantenna.
So there are a number of trialsgoing on.
So in five years' time I thinkmobile phones will perform at
the level that a traditionalterminal does, or at least as
close to it as physicallypossible.
So I think that's the onefactor that's kind of an
infrastructural piece that needsto happen over the next five
(30:42):
years.
The other is increased trust.
So as people become more awareof it, they experience it once
or twice at their local marketor download it themselves from
their bank or acquire it Overtime.
That's just going to build andso they won't see a need for all
the excess hardware.
They could stick to a softballsolution if that's all they need
(31:03):
.
If you're an e-commercemerchant and you do the odd
in-person sale, soft pause isperfect, right, and I think
we'll see a lot more of softpause embedded use cases, so
being used in self-servicecheckouts at a kiosk or even EV
stations a tap and go type of EVstation scenario.
(31:23):
So I think that's going to berolled out over the next five
years.
The last one, I guess, is a bitmore of the blurring of the
lines between online commerce ore-commerce as we might call it
and in-person payments.
So SoftPos allows anyone toinstall the app on their phone,
right?
You don't have to be classifiedas a merchant or a business, so
(31:46):
individuals that are shoppingcould download onto their phone
a payment app and, when they dothe e-commerce checkout, tap
their card on their own deviceor have an app-to-app type of
interaction where you clickcheckout on your phone, it goes
to Apple Pay, you click pay andit all gets settled.
It's kind of app to app, and Ithink that then blurs the line
(32:09):
of what is e-commerce.
And will you ever need to typeyour car details in online and
be at risk?
So fraud reduction comes intoplay there as well.
Speaker 2 (32:20):
Yeah, that's an interesting one.
I don't know, I'd have to thinkabout that one as far as from a
user perspective, it would bekind of a weird interaction.
But that's that's interestingto think about.
So I'm glad you shared that.
So, norman, as you're thinkingabout merchants and they're
being interested in this, whatadvice do you give them or would
you give them if they'reinterested in a soft pause
(32:42):
solution?
Speaker 4 (32:43):
So, firstly, it's very easy to access it, download
it, install it and use.
So actually there is nothing tolose.
If you're in a merchant in amarket where you're getting
charged by the bank for having aterminal, or you want to take
transactions but you're going toget charged by the bank for
doing that, you'll often findvendors out there with softball
(33:07):
solutions or banks that willallow you to download the app
and only pay when you use theapplication.
So actually in that instance, amerchant could save more than
$300 over, just say, athree-year period from the
rental of a terminal.
If you're in a market where theterminal is subsidized to it,
(33:31):
then we've already seen thatmany merchants, particularly at
the smaller end, they don't havetheir terminals charged up or
suddenly somebody wants to payand then they realize that it's
not charged up or maybe oneisn't working.
In fact, pierre and myself werein the Philippines just a few
weeks ago and Pierre had thatexact issue.
(33:52):
He was trying to buy some goodsfor his children whilst he was
abroad, and this was a largeshop and the large shop didn't
have any POS devices that wereworking and so, unfortunately,
pierre didn't have cash and sothat was a lost transaction,
both for the shop and for hisdaughters.
(34:13):
So by installing this on thephone, it's very easy to make
that available and to be used.
So my advice to merchants istry it.
I had lunch with an entrepreneurwhose wife runs a yoga studio
and he was saying that hiswife's getting more customers
(34:36):
who want to pay with card and soshe signed up with Revolut, but
that comes with a dongle whichshe's also having to use.
But we had a conversation aboutsoft pause and not everybody's
aware of it right now and Ithink, as Pierre mentioned,
that's where the schemes couldhave a big role to play to help
drive awareness of the solution,because it's surprising how
(35:00):
many people are still not awarethat it's out there and it's as
easy to use as it is taking aphotograph on your mobile phone.
Speaker 2 (35:08):
Okay, great.
So, as we come to a close startto wrap up the show, Pierre,
any final thoughts, any keytakeaways you'd like our
audience to take from thisepisode?
Speaker 3 (35:18):
I think the future of softpods is more about that.
It's an embedded paymentexperience, and so it all comes
down to these applicationintegrators what they choose to
do with SoftPos, right.
So how do they bring it alltogether?
Now, the terminology is an SDKsoftware development kit.
That's what SoftPos has beendistilled into, and you can add
(35:40):
that to multiple applications soany existing application can
embed that and have atap-on-phone type of experience.
If you think about the next timeyou need to sign up for Netflix
and you've got a reoccurringdebit order, instead of typing
in all your card information,you could simply tap your card
for that first initialtransaction and that will become
(36:02):
tokenized for all thereoccurring debits.
Short transaction, and thatwill become tokenized for all of
the reoccurring debits, and inthat process you've never shared
your sensitive card details inclear text with anyone.
So it becomes a far more secureexperience for cardholders.
And then downstream you've gotyour reoccurring debits and the
convenience of never worryingabout that, and then I think
(36:24):
it'll also benefit from embeddedloyalty and rewards.
So, as these applicationintegrators that have got
control of what's being soldcompare that with SoftPos, you
know you can start givinginstant rewards and immediate
discounts on the spot.
So I think those are the typesof experiences we're going to
see emerge, with SoftPos beingembedded in more places.
Speaker 2 (36:47):
Okay, Norman, same question over to you.
Any key takeaways you'd like toshare with the audience?
Speaker 4 (36:53):
So, surprisingly, and even though softbuzz has been
available in Europe, for example, for over five years, the stage
of market maturity that we'rein is still very early phase.
I'd still call it phase one aswe move into phase two, which is
beginning to start to bediscussed in some countries.
You're going to start to lookat, as Pierre talked about, this
(37:16):
need to build in additionalapplication capability so, for
example, dynamic currencyconversion, the ability to add
in embedded finance like buy now, pay later, and this provides a
fantastic opportunity for thebanks to make more revenue by
expanding its ecosystem offintech enablement and
(37:37):
capability, but it actuallyprovides a beautiful opportunity
for them to incentivize a wholenew distribution channel in
order to sell additionalservices.
So suddenly, with the rightkind of training, the bank can
begin to put education programson to the merchants and allow
the merchant to participate insome of those buy now, pay later
(38:00):
rewards from it, similarly,with the loyalty and reward
concept that Pierre was talkingabout.
So, with a little bit ofcreative thinking, this can be a
very big win-win ecosystem foreverybody, and help with the
grander goal of financialinclusion.
Speaker 2 (38:17):
Okay, so, Norman.
Final question where can peoplego to learn more about
Stanchion and SoftPause?
Speaker 4 (38:22):
So our website is stanchionpaymentscom.
You can go on there and findinformation, or myself and
Pierre we're regularly travelingso we're often posting on
LinkedIn, so you can find myLinkedIn profile, norman Frankel
or Pierre Harrell LinkedInprofile and you can get more
information there.
Speaker 2 (38:42):
Okay, great.
So, Norman Pierre, this hasbeen a great conversation.
I know our audience is going tolearn a lot from this.
As you mentioned, this is kindof new, so I think this series
is really educating people onsoft pause.
I love the use cases andsharing those, so thank you both
for being on the show.
I really appreciate it.
I know your time is valuable,so thank you so much for being
here today.
Thank you, Greg.
Speaker 3 (39:02):
Thanks, greg, appreciate it.
Speaker 2 (39:04):
Absolutely, and to all you listeners out there, I
thank you for your time as well,and until the next story.
Speaker 1 (39:10):
Thank you for listening to today's episode.
If you'd like to explore howSoftPause can unlock payment
freedom for your business,please visit businessingenicocom
.
Slash swipe, dash write, dashon dash soft pause.
Popular Podcasts
Stuff You Should Know
If you've ever wanted to know about champagne, satanism, the Stonewall Uprising, chaos theory, LSD, El Nino, true crime and Rosa Parks, then look no further. Josh and Chuck have you covered.
24/7 News: The Latest
The latest news in 4 minutes updated every hour, every day.
The Joe Rogan Experience
The official podcast of comedian Joe Rogan.