Moving Money & Data Together: Making

Payments Smarter – Not Just Faster

10:30a –

11:45a

Monday

October 21st

AFP 2019

Boston, MA

Fintechs are shifting from startup “disruptors” to

“collaborators” in the financial services industry

A N N U A L G L O B A L F I N A N C I N G T O V C - B A C K E D F I N T E C H C O M P A N I E S ( $ B )

Source: CB Insights

2.63.9

8.2

16.619.6 18.8

40.5

30.2

0

5

10

15

20

25

30

35

40

45

2012 2013 2014 2015 2016 2017 2018 2019 (P)

Rank Company Country Market Cap

1 Microsoft $1.067B UNITED STATES

2 Apple $1.066B UNITED STATES

3 Amazon $856.7M UNITED STATES

4 Alphabet $843.7M UNITED STATES

5 Facebook $525.6M UNITED STATES

6 Berkshire Hathaway $510.6M UNITED STATES

7 Alibaba $510.6M CHINA

8 Tencent Holdings $394.2 CHINA

9 Visa $394.2M UNITED STATES

10 JPMorgan Chase $385.3M UNITED STATES

11 Johnson & Johnson $371.3M UNITED STATES

12 Walmart $346.6M UNITED STATES

13 Exxon Mobil $342.3M UNITED STATES

14 Procter & Gamble $309.8M UNITED STATES

15 Mastercard $303.2M UNITED STATES

16 AT&T $294.4M UNITED STATES

17 Bank of America $291.8M UNITED STATES

18 Taiwan Semiconductor $283.1M TAIWAN

19 Home Depot $282.4M UNITED STATES

20 Verizon $280.3M UNITED STATES

T O P

G L O B A L

P U B L I C

C O M P A N I E S

B Y M A R K E T

C A P

( A S O F 1 0 / 1 6 / 1 9 )

Source: Dogs of the Dow

N I N E O F T H E

T O P 2 0 A R E

T E C H

C O M P A N I E S

Strategic Drivers

Of Bill Pay

Transformation

Consumers are in the driver seat,

and payment behaviors are

clearly shifting toward digital.

Organizations are outsourcing the

compliance burden and pursuing

payment automation.

Banks, billers and vendors are creating

the programmable experience with APIs.

More data fuels consumer insights, and

new touch points create additional data

streams that can be used for insights to

better serve customers.

Real-time payments could

transform bill pay.

Poll 1:

Which type of

organization are

you with?

Answer Choices:

A. Corporate +

B. Bank

C. Provider

Introductions

K I M S I P E S

Director, Treasury

F R A N K D ’ A M A D E O

Director, Treasury Operations

M A N A L T O U K A N

Senior Vice President, Bill Pay

J O E P R O T O

Chief Executive Officer

Top Utility

Companies

in the US

Assets $145B $53.9B

2018 Operating

Revenue$24.5B $12.3B

2018 Net Income $2.6B $1.4B

Employees 30,000 13,685

Owned Generation 51,000 megawatts 750 megawatts

Renewal: Solar,

Wind2900 megawatts 2.6 gigawatts

Service Area 95,000 sq mi 1960 sq mi

States ServedNC, SC, IN,

OH, KY, FL

NY, NJ (17 States

Solar & Wind)

Transmission Lines 31,000 mi 1853 mi

Distribution Lines 280,000 mi 140,585 mi

Electric Customers 7.7 million 3.8 million

Gas Customers 1.6 million 1.2 million

Utility Industry Overview

Customer Pays Bill

Bill Issued

Meter Read

Customer uses

Power

Budget Billing

Pay Online

Pay by Mail

Pay by Phone

Online Access

Paperless Billing

Mobile Alerts & Payments

Automatic Payments

Pay in Person

Utility Payment Channels

• Mail-In - Processing• Internal lockbox

• ICL & ARC deposit and clearing

• Walk-In – 3rd Party Processing• Utilize two 3rd parties

• Electronic settlement

• Electronic Payments – Company & 3rd Party Processing

• One-time and recurring payments

• Multiple payment methods

• Biggest challenge B2B payments Electronic

76%

Mail, 21%

Walk-in, 3%

Electronic, 68.48%

Mail, 27.25%

Walk-in, 4.27%

2018

Payment

Statistics

Check by mail (Lockbox)

% of Payments 27.3% 22.8%

% of Dollars 39.3% 35.0%

ACH Debit (Internet, Phone CSR, IVR and Kiosk)

% of Payments 27.4% 46.2%

% of Dollars 19.9% 40.6%

ACH Credit (External Agents, Home Banking, Consolidators)

% of Payments 22.4% 26.3%

% of Dollars 23.7% 21.0%

Credit/Debit Card

% of Payments 22.9% 4.6%

% of Dollars 17.1% 3.3%

Mastercard Focus: New Payment Flows

With the acquisition of Vocalink, Mastercard is playing a broader role in

the payment ecosystem.

Vocalink designs, builds and

operates industry-leading bank-

account-based payment systems.

Vocalink powers real time payment

systems across the globe.

Mastercard connects

individuals, businesses

and organizations around

the world, creating greater

opportunities for all.

Real-time data & messaging can transform experiences

& drive efficiencies for consumers, banks & billers

Source: ATKearney, Payment System Modernisation

Poll 2:

What percentage

of your consumer

payments are

electronic?

Answer Choices:

A. Over 50%

B. 25% - 50%

C. 25% or Less

Consumer lifestyle trends are more varied than ever –

influencing a shift in payment options & choices

44%

38%

32%

19%

18%

13%

12%

13%

15%

21%

29%

40%

9%

14%

13%

16%

7%

6%

6%

4%

6%

8%

7%

8%

0.50%

0.40%

0.40%

0.30%

Millennials

Gen X

Baby

Boomers

Seniors

Bill Payments Made by Channel by Generation

Biller Website In Person Mail Bank Portal Phone Direct Debit 3rd Party Site

Source: Aite

15B+ US bills are paid every year

Source: Aite

Paid Online,

56%

Paid Offline,

44%

Where Do Consumers Pay Their Bills?

Practitioners must

meet payers where

they are, offering

every channel to

convert more

payments to digital

channels.

Challenge finding a solution that can align consumer

expectations with business needs.

– Bill presentment often separate from payment

– Lack of tools for stakeholder preparedness

• Payer Education

• Impact on Internal Teams

• CSR Training

– How can payment data be used to address this gap?

Key Takeaways

The payment experience is currently fragmented for

both businesses and consumers.

Utilizing the integration of data with real-time tech

transforms AR processes, and offers a superior

experience for payers.

Poll 3:

What percentage

of your corporate

payments are

electronic?

Answer Choices:

A. Over 50%

B. 25% - 50%

C. 25% or Less

A. 25% or Less

B2B Payments

Still Made by

Check

– Systems don’t facilitate straight-through processing

– Business payers are slow to adopt digital channels

– Lack of data standardization

– Accounting systems not designed for payment solutions

Business payments have

numerous pain points

70% of treasury professionals cite a lack of a

standard format for remittance information as a

barrier to e-payments adoption.Source: AFP

Key Takeaways

The use of data in business payments will connect

the silos of the current process, revolutionizing AR

(& AP) functions.

The industry needs to address standards for data for

application across platforms to realize maximum

benefits.

Poll 4:

How important

is RTP to your

organization?

Answer Choices:

A. Critical

B. Important

C. Neutral

D. Not Ready Yet

E. I Don’t Know Enough

Data, Customer Experience, and RTP

– Data is key to improving payments – both consumer & business payers• Personalization of billing and payment process

– AI & ML developments (Voice?)

• Cohesive & consistent billing experience

• Make payments not only faster, but smarter (& strategic)

– Speed to market of RTP rails• The Clearing House Network

• Faster Payments Network (Fed) effect (+/-)

However, there are challenges…

– Lack of complete package of integrated treasury solutions

• Partner products can be silo’d and end up competing

– Risk considerations – ‘Bad Actors’

– Are business payers ready for RTP?

• If not, what are the hurdles?

– There is no ubiquitous solution, applicable to consumer & business payments

• Strategic need to ‘Do it right the first time’

Key Takeaways

Treasury managers need to balance customer expectations with

business needs.

Key to educate and align all internal teams (bill pay, remittance,

benefits, etc.) on processes and goals.

Now is the time to plan how your organization will connect with

RTP rails.

Be thoughtful with finding a solution (or package of

complementing solutions).

Moving Money & Data Together: Making

Payments Smarter – Not Just Faster

Q&A