Worldline’s Arnaud Bourboulon participated to the “Visa Ready Summit”, an event for clients and industry leaders in the digital payments area to discuss innovations and emerging opportunities. Below is the transcript of his interview during which he shared Worldline’s insights on why the industry is changing, where it is moving, the scope of Open Payment and, last but not least, recommendations for operators on how to benefit from the changing market trends.
What has been Worldline’s approach to stay ahead of the move to a digital economy?
At Worldline, we like to innovate by mixing our core payment expertise and products with our vertical business expertise, and this is exactly what we have done when it comes to Open Payment. We have combined our 20-year experience in transport ticketing with our 45-year experience in payments for banks and merchants, including issuing multi-channel acceptance and acquiring to create new Open Payment digital ticketing services for transport companies.
Similarly, Worldline is also innovating in the field of In-Vehicle payment by mixing our skills in IoT and connected cars with our payment capabilities to provide new offerings to clients.
Besides transport, we believe that Open Payment will extend to “smart cities” that will use the ID-based solution for car parking, libraries, museums, swimming pools, etc.
How have customers’ expectations change/evolve in the past 5 years? (transit operators, end-users)
Looking at the traditional paper ticketing system, we now see that both private companies and public authorities are moving fast to meet the changing demands of their customers. Customers are increasingly looking for seamless and simple journey alternatives and, at the same time, they are more willing than ever to adopt new and easier payment and ticketing options. This is especially true as the evolution in ticketing means benefits such as avoiding queues to get a ticket, paying the best fare according to usage, having a single ID for multiple services and simplified billing and payment.
At the same time, operators are seeking to optimize their operating costs, generate additional revenues, promote an innovative image and create real customer intimacy. For the operators, this mean moving from a ticket centered approach to a customer centric approach.
For me, it is all about supporting operators in this strategic move.
In your opinion, why haven't more transit operators adopted open-loop payment solutions if it improves customer experience and is more cost-efficient?
The issue arises from the complexity linked to change management or the fear of revenue loss.
Operators may fear the operational complexity and the costs associated with changing their existing validator infrastructure. In parallel, they may also fear that fee capping could end up in less revenues or that moving from prepay to post pay could create cash flow issues.
But the above should not be seen as an obstacle but rather be seen as benefits or competitive advantages.
In our “ultra-connected world”, people expect a more seamless and connected experience therefore implementing digital ticketing will be the smart choice. For operators, if done right, digital ticketing will increase revenues, create brand value and free up employees to focus on riders’ travel experience rather than managing ticket sales.
From your experience, what has been acquirers’ and issuers’ general reaction of as open-loop payments scale?
Globally, their reaction has been very positive, even if some of them have been sometimes slow to implement transit rules. In the end, it is bringing more transactions to their systems by moving from cash to card payments. That is what we are experiencing today with the pilot we are running in Dijon, France with a French bank as an acquirer. And by being an acquirer ourselves in some geographies, we are very happy to see more transactions flowing to our platforms.
In which markets do you see the most opportunities within the next 3 years and why?
Seen from a geographical point of view, Open Payment could apply anywhere. Today, Worldline is focusing principally on geographies where we are physically present. For example, northern Europe is very dynamic, France is showing interesting moves and APAC is as always a front runner.
In terms of market segments, beyond transport, we see tourism as a potential industry for this type of services (e.g. movie theaters, culture, leisure or parking). Generally speaking, any service below 15€ could potentially be easily consumed with Open Payment.
What benefits does joining the Visa Ready for Transit program bring to tech partners?
Worldline was one of the 1st companies to join the Visa Ready for Transit program, when it was launched in November 2017. The Visa Ready for Transit is a certification program that provides standards for open-loop transit payment solutions. Certified solutions will receive Visa Ready status providing awareness and confidence to other stakeholders in the transit ecosystem.
The main benefit for tech partners is the increased visibility through Visa. Also, Visa intends to support business development activities allowing them to deploy solutions faster.
What benefits does joining the Visa Ready for Transit program bring to transit operators?
The program enables operators to offer higher quality, quicker and more impactful services to their customers, through Visa Ready solutions they can trust. But it also allows them access to an environment where operators can influence new Open Payment solutions.
It will also give operators access to tools, standards and technologies that meet the high-quality standards of Visa’s technologies.
How is the Visa Global Transit team using its relationships developed with tech partners and transit operators to improve the customer mass transit experience?
The Visa Global Transit team is putting in place a co-creation environment, where Visa, tech providers like Worldline and transit operators sit together and define the best experience for customers.
This enables the creation of POC (Proof of Concept) – which should then become full-fledged solutions - for transit operators that integrate new and emerging technologies provided by tech partners.
We are working with Visa on many different implementations of the technology.
A few tips for operators thinking about Open Payment:
First, do not forget your own workforce: Your people are the “front of the house”. They need to know and understand the changes and be prepared for how their role will change as a consequence. The change can mean more diverse and interesting roles but, unless you manage this properly and explain it and bring your workforce with you, you will miss a vital ingredient to success.
Second roll-out: Do not rush the roll-out of a new solution. Have pilots that are closely monitored, look at customer behavior and even undertake research into opinions on the change. Give yourself time to refine and make the transition as smooth as possible.
Third - marketing and communication: Invest in a good marketing plan to communicate the change, the benefits and the excitement linked to the change of the transport system.