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SOFTPOS: EVERYTHING KEY PLAYERS NEED TO KNOW ABOUT DEVICES

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By François Drouard, SLM Terminal & Mobile and Emmanuel Desdoigts, Project Manager at Fime

 

SoftPOS solutions harness untapped potential of smartphones and address a wide range of use cases that could change the retail game for merchants and consumers. But the success of this technology rests on more than the app. Merchants need the right foundation to do this properly, the right device.

This is where device manufacturers come in. OEMs are looking to capitalize on the rise of contactless and optimize their devices for this expanding use case on NFC-capable devices. With the convenience of this functionality on their devices, they can differentiate themselves from competitors and broaden their market value to businesses. So, what considerations do they need to make when creating devices intended to accept payments?

 

The power of NFC

SoftPOS (Software Point of Sale) solutions transform a regular smartphone or tablet– known as a Commercial Off-The-Shelf (COTS) device – into a contactless payment terminal. These solutions utilize the device’s embedded Near Field Communication (NFC) capability. As the name indicates, it enables data transfer between two devices which are placed near to each other. As the technology behind contactless payments, NFC has soared in popularity over the past few years. In 2021, nearly all Android phones on the market have NFC functionality, enabling them to perform payments. NFC devices have the following functionalities:

  • Contactless reader mode – which allows the device to accept SoftPOS payments from wearables, cards and mobiles.
  • Contactless card emulation mode – which allows the device to behave as a contactless smartcard to make a payment.
  • Contactless peer-to-peer – which allows the device to communicate with another NFC device.

Designing a device which can perform all of these functionalities well is difficult because the device needs to meet multiple different requirements. One of the reasons it is difficult is that NFC devices are being developed and certified for card emulation mode, which has different requirements to reader mode. For example, in reader mode, the device has to generate the radio frequency field used to communicate with the payment card or device. It can be very challenging for COTS devices to match the performance of a traditional POS, meaning OEMs are playing catch up to compete with traditional POS vendors.

 

Where to tap? 

As with traditional contactless payments, when making a SoftPOS payment the consumer must hold their card, smartphone or wearable near the antenna within the acceptance device. This enables the communication between the two devices. The antenna can be located either at the top, middle, or bottom of the rear side of the device, since it is ideally positioned for ‘card emulation’ mode to make mobile wallet payments. However, there is currently no standard spot for placements of antennas.

To help consumers find the antenna, some solutions show the contactless symbol on the screen of the device or on a sticker on the device which directs consumers where to place their card or device to make a payment.

 

A matter of centimeters = a big difference

Similarly, read ranges differ between SoftPOS and traditional POS terminals. Four centimeters is the maximum distance range defined by EMVCo to be able to read a card or mobile wallet for a legacy terminal, which is Level 1 certified. This can drop to only two centimeters on a mobile device.

These differences between legacy POS terminals and SoftPOS solutions could create confusion for consumers, who are now familiar with where to tap their card or device to make a payment. This could slow down the payment process and cause frustration during the customer’s purchase experience. It is fundamental that manufacturers design their devices with this in mind to make it simple for merchants to accept payments.

 

The compliance conundrum 

As with all payment products, it is important that device manufacturers ensure their solution meets the relevant requirements to enable safe and secure transactions. For contactless payments, this means achieving Level 1 certification in line with the EMV®* Contactless Communication Protocol Specification. Level 1 tests ensure that the contactless device can meet the analog and digital requirements like lower level electromagnetic field and communication protocols, including operating distance tests.

However, although Level 1 certification is important, the hoops you have to jump through to evaluate your device in line with the latest requirements differ between SoftPOS and traditional POS payments. Traditional POS payment terminals are certified in line with the EMV Proximity Coupling Device (PCD) Level 1 requirements. This certification process does not currently apply to SoftPOS payments. Why? Because of the differences between COTS devices and payment terminals, the compliance process has not caught up yet – but this will soon change.

 

When you know. It is easy.

COTS providers can currently seek approval in line with EMVCo’s Early Adopter Programme instead. The pilot testing program evaluates COTS mobile devices with built-in contactless capability for contactless payment acceptance. The evaluation processes available through the program evaluate the performance of these devices, and their interoperability requirements related to read range and user experience needs. Within the Early Adopter Programme, there could be two possible paths:

  • An approval process which details the product’s performance in a formal Letter of Approval (LoA),
  • An evaluation process without a LoA, but with a scoring report about the Level 1 performance of the device, providing an indication of the expected user experience.

By completing this evaluation, manufacturers can ensure that their solution meets the relevant EMVCo Level 1 requirements. Unlike the EMVCo Level 1 evaluation for ‘card emulation’ mode, this process is not mandatory for SoftPOS solutions, so merchants should be cautious about which device they select to implement their solutions on. If they are not, they could make themselves vulnerable to loss of revenue and reputational damage. Insecure and malfunctioning payment devices could create extensive problems for big companies that equip their staff with payment acceptance devices, as it could temporarily shut down operations across the world. Merchants should note that as SoftPOS payments utilize a merchant-owned device, they are responsible if payment transactions can’t be made, rather than it being the fault of acquiring banks or terminal suppliers.

 

Putting the pieces together

Multiple factors need to be considered to enable COTS devices to accept payments in a seamless and safe way. From creating your device in line with the technical requirements through to evolving functional evaluation and security considerations. We are seeing an increased interest in SoftPOS solutions, with manufacturers looking for support in solving problems, training teams, tailoring tools and achieving certifications. This interest speaks to the wider momentum behind this technology, and we are excited to enable the industry to develop and deploy SoftPOS solutions swiftly to improve the customer experience.

 

Finance

2021: THE YEAR THE FINANCIAL SERVICES SECTOR WILL ENTER THE ERA OF BOUNDLESS CUSTOMER ENGAGEMENT

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By

Steve Bell, VP EMEA Solutions Consulting, Verint Systems

 

It can feel like businesses lurch from one disruption to another. From macro-economic collapse to aggressive competitors, changes to regulations, political uncertainty, being slow to innovate; all these and more can undo the years of hard work that has been spent building up a viable, profitable company.

Yet dig beneath the surface of those issues, and despite the apparent variations there is a fundamental truth in all of them – that the reason for failure is an inability to change. History is littered with the names of once industry-leading companies that did not change their business model to reflect the evolving needs and demands of the market. Some have gone completely; others are shadows of their former selves.

 

Accelerated consumer demands

It’s likely that we will see more names follow them in the coming months and years. As we’ve seen in previous crises, not even storied banks are too big to fail. The pandemic will be blamed for much of it, and it will be a significant factor. But in all likelihood, all it will have done is accelerated what was already going to happen – just as it has done for digital transformation. We’re at a point now where consumers are expecting much more intuitive experiences and services from the brands they buy from, and that includes financial service providers.

Steve Bell

From new channels and ways of purchasing, to heightened expectations of what good looks like, banks are having to do much more with, in many cases, a workforce that is dispersed, disengaged, and underequipped to meet customer demands.

That means they need to adapt. They need to be able to offer self-service, social-media based customer interactions, mobile, ecommerce, and they need to be able to offer it at the same standard as innovators, all with a remote workforce. It doesn’t matter whether you’re selling mortgages or fridges, whether you’ve been in business 12 months or 50 years – consumers are taking their experiences from other sectors and expecting everyone they interact with to be at the same standard. Put another way, financial service providers are no longer just judged against their sector competitors.

Decision-makers know this – a new study from Verint found that understanding and acting on rapidly changing customer behaviours was a top concern for 71% of financial service professionals. Their top challenges highlighted concerns relating to remote workforces, with maintaining established relationships with clients, a lack of physical interaction between employees and customers and inefficiencies in managing urgent client matters all causes for concern.

 

Ushering in a new era of customer engagement

It all points to creating a new approach to customer engagement. Banks and other financial service providers need to recognise that they have to deliver an always-on experience, irrespective of channel, while at the same time taking into account the fact that their workforce isn’t going to scale to meet the challenge.

What’s the solution? The answer combines culture and technology to create an approach known as boundless customer engagement.

It’s cultural because it demands a mindset change. One that sees the entire organisation as responsible for delivering an exemplary experience, not just customer service, or a subsection thereof. Where key performance indicators and objectives across all functions are dialled into how that department or team supports the delivery of better customer experiences. It’s also about empowering workforces to act appropriately and deliver the best response to customers, allowing the entire organisation to adapt and act faster.

 

Combining technology and culture

It needs to be cultural, because culture defines how the next part is used. Technology is inherently neutral – it is only through its deployment and adoption that it becomes either a force for good or simply a quicker root to short-term margin improvement. If the right cultural mindset is in place, then the technology that underpins it all will deliver boundless customer engagement.

It will do this through enabling the right balance of automation and human touch, allowing teams to scale without leaving customers feeling as if they are at the mercy of an impersonal algorithm. With artificial intelligence, everything from front-end chatbots to back-end knowledge management systems serving up the right information at the right time, can be deployed to meet accelerated customer expectations.

 

2021 – the year of boundless customer engagement

By combining a culture shift with the deployment of technology, financial service providers will be able to break down the barriers that disrupt better customer experiences and meet demand. And they’ll be able to do it without having to massively scale up or put teams under intolerable pressure.

Whatever else happens, the consumer experience in 2021 is going to be one characterised by speed, by intuition, and by a vast array of touchpoints. For financial service providers to be able to deliver on this promise without dramatically undermining their own employees will take a new approach – one that connects the realities of work today with data and experiences to build enduring relationships through boundless customer engagement. In doing so, banks, wealth managers and other finance organisations will drive real business outcomes that cements ongoing performance, irrespective of the wider economic climate.

 

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HOW TO UP YOUR EMAIL MARKETING GAME IN THE FINANCIAL INDUSTRY

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By

Sam Holding, Head of International, SparkPost

 

The secret to a successful marketing campaign, no matter the industry, comes down to a well-oiled email programme.

In the financial industry, high volumes of emails are being sent every day, and it is vitally important that customers trust the sender and understand the information that is being shared through the email. And in the financial industry, this is even more true. But ensuring that emails are being received correctly, both in terms of deliverability and content, is much easier said than done. How can organisations ensure that their emails are reaching customers and prospects successfully, and sending the right message?

While financial services firms certainly need to consider the content and branding of their emails, they must also prioritise the foundational elements of email, namely deliverability, in order to make email the ROI machine it can be. That said, deliverability, content, and branding are the combined ingredients necessary for financial services to fully realise the potential of their email programs.

For high volume senders, even a seemingly nominal decrease in deliverability rates can represent a huge decline in how many customers are actually seeing their emails. More than that, with financial institutions, the value of each converted customer can be quite high meaning that even a 1% decrease in inboxing rates can mean major losses. Once financial organisations understand the pounds and pence of deliverability, it’s time to start implementing tactical best practices to avoid the pitfalls of declining deliverability rates.

 

Step 1. Improve your reputation as a sender

For financial organisations, using email to help boost their credibility and reputation is essential. Actions such as sending on new IP addresses with unproven reputations, can seriously impact an organisations reputation with current and potential customers, therefore it is vital that email activity is set up to improve a company’s reputation and not the other way round. It is important that anything considered personally identifiable about a customer (or PII), like their phone number, account number, or address, are properly protected and only shared with the customer themselves. On the other hand, another way to build customer trust is by letting them know information that you will never ask for over email, so that they can easily identify any suspicious communication that occurs, without finding out the hard way.

Also, when it comes to building a solid sending reputation financial firms shouldn’t send too much, too soon, from a new IP address.

 

  1. Relevant email sending is key

Once the more technical aspects of email sending are in place, organisations must next ensure that the content they are sending in their emails is truly relevant to the recipients. No matter how engaging and interesting an email is, if it is not relevant to the recipient, it simply will not yield success. The more relevant the emails are, the more likely they will be well received by consumers.

Financial institutions should be mindful when building lists for sends and use data like past purchases, traffic logs, and on-site search to inform who they’d like to send to, avoiding the temptation to blanket their whole audience with a single email in the name of efficiency. In order to get the most out of email communications, sending highly targeted messages will be much more effective in not only building reputation, but building out a strong and engaged list.

 

  1. Produce high quality content

Once the relevant audiences have been defined through segmentation, the next task is to decide on the content of the emails. When it comes to sending out marketing messages, financial institutions should consider the kind of information their recipients find valuable and produce content that is in line with their needs. One way of ensuring marketing emails resonate with the audience is through promotions. Who doesn’t love a good offer? Customers need to be able to see the value in subscribing to emails, and offering valuable educational seminars and content and special offers tailored to their financial picture via email is a simple way to do that.

Another best practice for financial institutions is to pay close attention to writing great subject lines. Since many customers won’t see more than the first few words — especially on mobile – senders should put the most relevant and targeted terms up-front, making the value to the customer immediately clear. With smart content informed by great segmentation, financial firms can really leverage the power of email in their marketing strategies.

 

  1. Use strong branding to boost integrity

The last foundational ingredient to a great financial services email strategy is branding.

To ensure brand integrity, it is essential that every aspect of an organisation’s messaging — visual identity, voice, value proposition — is consistent and compelling. A common pitfall is to use different systems or third-party providers for automated transactional emails, marketing emails, and other types of messages. This can lead the look and feel of the messages customers receive to vary widely, creating a confusing brand experience. By managing all messages through a single system, financial firms can build a stronger connection with customers and make each email they receive feel part of a coherent and valuable relationship.

As part of a financial services organisation’s branding strategy, it’s a good idea to use the brand name in the “from” field that shows up in the recipient’s inbox. Some marketers use an individual’s name with the belief that it will seem more personal, but this can also make it seem like spam. Instead, use a name customers will expect to see, then stick with it consistently across all emails to build recognition and trust. Using a solid and consistent brand is a best practice for any brand that sends email!

When it comes to your email marketing strategy, different approaches will work for different organisations, and will depend on the intended outcome. For large volume senders, like financial organisations, this is particularly true, and it is even more important that you know why you are sending your email and who it is intended for in order to get the most success possible. By following best practices, and taking care in your approach, email can be the gateway to a higher reputation and more loyal customer base.

 

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