A Small Market Case StudyDiscussion of practical issues faced by Electronic Commerce and ICT in developing markets

SpeakerSeth CechettoChief Information OfficerMaduro & Curiels Bank N.V.

AgendaThe MarketTelecommunicationsWebsites, Shopping MallsOnline ApplicationsSecurityCell PhonesCurrency

The Self Service ContinuumElectronic Commerce is not just about the Internet.Its all about choosing self service.Progress: Public telephone lines, leased lines to Internet..ATMs, POS, Kiosk, PCs, Cell Phones, PADs, Refrigerator .

Market PlacePopulationAruba: 90,000Netherlands Antilles:212,000Per Capita GDPAruba:$22,000Netherlands Antilles$11,400

Maduro & Curiels Bank N.V.Complexity: 5 islands4 languages2 legal jurisdictionsFull Range of Products: Loans, Deposits, Insurance, Investments, Trusts, Cash Management, Credit Cards, etc.

Maduro & Curiels Bank N.V.Delivery Vehicles:33 branches86 ATMs4,000 POS TerminalsAlternate Delivery: Internet Telebanking VRU Leased Lines

Telecommunications NetworkInternational: VISA, MC, Outsourcer.Inter-island: Branches, ATMs, POS.Local: Branches, ATMs, POS, 3rd Parties (e.g. banks, utilities)Internet: Website, shopping mall, Intranet, Online Banking, Online Cash Management.

Telecommunication ChallengesSmall bank with the network complexity of major multinationals.Issues: Skills, Training, MonitoringBandwidth may be available but cost is high.Issues:Need small scale innovation to overcome challenges (Laser, RAN, Satellite, VPN)

WebsitesIssues:Leverage examples already on the web.Dont try to compete with the major international portals. Add value.

Shopping MallIssues:Focus on high volume possibilities in the local market.Keep it simple (or it will never download).Need payments in local currency.The back-end doesnt need to be all high tech.

Online ApplicationsDeveloped Country application vendors are in 3rd generation mode.Issues:Made for Broadband environment (too complex, graphical, irrelevant connectivity). Keep it simple and focused.Need for access to lower cost developers and application vendors.

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e-Scotia

PKI Single Infrastructure, Many Uses

Digital Assets

PasswordManagement

Digital Signatures

New Markets

Wireless

Trusted Security Solutions

SecurityWith Bricks & Mortar, bars and guards can substitute for technology.The Internet unfortunately levels the playing field for security.Security Issues:Standards, policies and procedures (e.g. need pre-packaged generic documentation)

Security contdNeed Knowledge and Training at reasonable costNeed innovative outsourcing possibilities: e.g. cooperative secure server farm.Leverage International partnerships: e.g. eScotia

Mobile Financial Transaction Revolution

Sources: McKinsey & Co., European Commission, DG XIII, Nokia, Ericsson, Visa, EITO, and Meridien Research

Mobile telephones will outnumber all other access devices, with over 1.2 billion mobile phones by 2003

Wireless penetration exceeds PC penetration in every market

Mobile phone issuance is growing more rapidly than credit cards

Wireless Device Use is Increasing Dramatically

Its a Cell WorldWe estimate that over 80% of Aruba and Netherlands Antilles have cell phones.At the household level its probably 99%.About 4x grater than PC Internet connectivity.SMS 16 hours per day non-stop.

Its a Cell World contdHow are we helping consumers:Credit Card and Cheque book notices using www.HEPA.an.Online real time recharge of cell phone.Issues:Cell applications and connectivity have much wider consumer potential and benefit.

Currency ChallengesInternational US $ based payments are well established (e.g. credit cards).Local currency options needed to support domestic Electronic Commerce and ICT.Issues:Local Currency credit and debit cards are essential.

Currency Challenges contdA Local Currency Switch expands availability.Private sector can provide leadership.Achievements:Local currency debit and credit cards plus dual currency AMEX Card.Local currency switch for ATM and POS transactions. Internet.