Ingenico, the secure payment solutions provider, has been delivering the perfect combination of ease-of use and high performance for over 25 years, building a reputation for providing consumer friendly, highly secure and innovative payment solutions that quite simply ‘get the job done.’ Now in 2010 Ingenico is delivering the latest generation of security-certified and high performance electronic payment solutions and the widest range of value added services, and shaping the future direction of the payment solutions market.
Offering the complete global solution, Ingenico takes banks and businesses ‘beyond payment’ by unlocking powerful customer intelligence from each and every transaction to enable the creation and delivery of a host of unique and differentiating new services – securing brand loyalty and increasing business revenues. Gregor Rankin, Head of Marketing – Northern Europe at Ingenico, spoke to The Grocery Trader.
The Grocery Trader – Gregor, to set the scene, what is your role at Ingenico?
I’m Head of Marketing for the UK, Ireland, Benelux and the Nordic countries, responsible for all our marketing communications and strategy.
GT – Are you personally involved in providing secure payment solutions to customers?
I am, very much so. We work direct with the major retailers: it’s one of the most important aspects of my job to spend time with customers, discussing their needs and helping them formulate their longer-term response on new technologies like contactless.
GT – Who else is in your retail team?
Our Head of Retail Sales is Adam Holt, backed by a team who are very experienced in the retail space. We offer retail solutions in all form factors, including unattended formats. We also have development managers focused on newer business models such as payment PDAs and other fully functional mobile devices.
GT – Can you name any UK or European retailers who are your clients?
We serve most top retailers like Asda, Boots and John Lewis, sometimes via their EPOS providers but often directly. Many retailers are interested in what technology can do for their business, and want to be more hands on. Payment services are the ultimate customer contact mechanism: payment is almost the customer’s final point of interaction with the retailer, so its smooth operation is critical in ensuring the customer leaves the store feeling they have had a good experience – and this is very much what retail is about today.
GT – How do you work with customers to deliver the right solutions for their business?
Many retailers get their payments solutions from their bank, so in that case our commercial relationship is often with the bank: where a retailer has a direct relationship connection with an EPOS supplier, we have a direct relationship with the EPOS software provider, but often engage directly with the major retailers. Further down the Tiers, we’re more likely to work with the banks. Our customer relationships are tremendously valuable in ensuring we achieve focused solutions, which fit the vertical in which they are required. We also provide frontline helpdesk services, so we have a direct connection with a very large number of retailers via that route.
GT – What different payment acceptance devices and supporting applications do you provide, aimed at the retail sector?
From PINPads to PDAs, countertop to contactless, and wired to wireless, Ingenico delivers entry level devices for small merchants, highly sophisticated solutions for retailers and banks, innovative wireless terminals for ‘payment anywhere’, and beautifully crafted designs for when image really matters. From standard payment applications like EMV to private schemes, and vertical solutions to value added services, Ingenico delivers off-the-shelf and bespoke payment applications – fully compliant with local and international regulations – to help brands capture consumer attention and intelligence at the point of sale.
GT – What are your flagship devices and applications in retail?
On the product side we’re looking at retail-focused PINPads, delivering exactly what retailers require: these devices are battle-hardened in multi-lane retail environments, and have a typical five year life cycle, which in practice we expect to far outlive, with performances of up to 500,000 insertions on the smart card readers and a million keypad presses.
Our flagship PINPad historically has been the i3300, which is prevalent throughout retail and is the UK’s most widely deployed PINPad. We have many units that have been working unrelentingly in the field since 2004, but we’re moving forward now, especially in deployment of contactless.
The ML30 Contactless is our most popular contact and contactless card reader, and is available with a colour screen option. Contactless and colour screens are the two biggest current developments in retail EPOS: show a major retailer a colour PINPad with offers on it and they go for it – they immediately understand the huge scope of the opportunity, as do ad agencies and marketers.
GT – Why are colour screens a major development at this particular time?
Advertisers find it hard to get attention these days – TV viewers channel hop and fast forward, on the Internet people have ad blockers, and with magazine ads they turn the page. But while shoppers wait for their card payment to go through, they have to be looking at the device which presents a captive audience for advertising messages, which our card readers’ colour screens enable retailers and brand owners to reach. We have 15 million devices deployed worldwide, which over the next five years will mostly be cycled into colour screens. Colour screens are ideal for branding in the retail organisation. Our Incendo Online platform enables retailers to easily deploy advertising across their estates.
GT – What are your latest offerings for retail, and what benefits do they deliver?
Our new PINPad, the iPP350, is part of a new family of PINPads. Starting with a colour version it comes in colour or black and white, and has the capability of being upgraded to contactless, offering perfect future proofing. Our general advice however is to deploy contactless right now – at least at a hardware level, as it is clear that contactless payment will be practically universal well within the next five years, the typical lifecycle of a device.
Our new Payment Pad iPA280 is the first truly mass-market security-built-in payment PDA, offering full electronic POS functionality and acting as an additional till for card transactions. None of the major payment technology providers offers anything like it. It’s a bi-face device, one side being a retail-ready PDA, the other a PCI PED 2.0 PINPad. It runs Windows Mobile and standard Windows retail applications such as stock check and WMS. It’s easily installed and integrated, and operates as an all-in-one, multi-purpose device in the warehouse and as a mobile device in store for stock checking or queue management. It includes a barcode scanner and printer as well as secure payment, so it can do everything a full EPOS system can do, which makes it ideal for adding seasonal tills to the store, as its footprint is small enough to be deployed anywhere.
Our new iWP range is what we call a WebPOS and it offers the ideal platform for a host of innovative services, including prepaid top-ups and e-tickets, transforming a Point of Sale terminal into a Point of Service, and a Point of Affinity to revolutionise customer relationships through tailored promotions, loyalty programmes and ‘on terminal’ and ‘on POS’ advertising and promotion. In developing these products we have looked at the overall IT needs of the retail sector. For as little as £200 retailers can buy a small electronic cash register, which doesn’t provide them with a lot of value: it doesn’t offer stock checks and won’t accept barcodes. At the top end are large colour touch screen EPOS units costing thousands of pounds. There is also a gap at the lower end for entry level products with colour touch screens, printers with a big till roll and communications connectivity, which work exactly like a high end till. We have addressed this with our entry-level products, which are being widely deployed in Tier 4. Linked to our powerful global Managed Services platform, we offer solutions for everyone.
GT – More payment service providers seem to be offering more managed services than before – why do you think this is?
On the security side, there’s the ‘perfect storm’ of PCI DSS, which comes into force in September. The requirements for compliance are onerous, and businesses prefer to spend their energies on their core business, hence we can help either by completely securing all sensitive card data from the PINpad right through to bank – using End-to-End Encryption or E2EE or by taking payment services from behind the retailer’s firewall and putting them in a PCI DSS-compliant data centre so the retailer doesn’t need to pay the price of handling transaction data securely in house. Furthermore we can combine both of these approaches to offer the ultimate security and simplicity for the retailer.
GT – Can you tell us about the ‘unique and differentiating new services’ you’re developing? Is this related to the loyalty cards we know and love?
Loyalty is one aspect: many major retailers have some form of loyalty scheme to bring them closer to the customer. There is bound to be a way in which we can provide a solution to meet their needs. Our iWP250 WEBPos solution, for instance, will help the smaller retailers implement powerful services such as loyalty and full transaction management with a modest level of investment. As it can operate as a full secure EPOS, it can provide other functionality such as stock management, and also generate additional revenue via value-adds such as Mobile Phone Top-Up.
Our transaction management services can address all the business’s processes, including reviewing all card payments and management of chargebacks. It’s the kind of functionality you’d expect in Tier 1 retail operations. We’re currently working with a number of leading of EPOS software providers.
GT – What specific managed services do you offer?
Our AXIS system offers transaction management, covering the whole payment process, providing a wealth of management information. It’s been installed in France in hundreds of leading retailers and is being rolled out here. Functions include fraud management, reconciliation and management of transactions at point of sale. A standalone system can’t analyse across stores and drill down like this. It also provides a lot of ‘dashboard’ data for senior management.
INCENDO Online is used to deliver our Webstore. The Webstore effectively changes the game in a la carte value-added services. All retailers are looking to create more revenue: this is the perfect way to do it. It simplifies the route to the customer: Incendo’s ‘thin client’ technology means in effect no limit to the number of value-adds your payment devices can support, and on board memory isn’t a factor any more. It offers a maturity and expansion in value added activities that is unique.
Next on the list, our Terminal Management system controls payment applications, EMV software, configurations such as receipt strings and supported card types, and allows direct support and control of retailers equipment via a help desk.
Our final Managed Service is communications, a key component of which is the Ingenico GPRS SIM, for mobile devices. It’s our own SIM card, with management information, assessing remotely whether a device is going over the preset data limit. It offers the added security of the SIM card only operating with the specific terminal it is registered for and, as we have a private domain on the GPRS network, transaction data is transmitted securely into our private network as soon as it hits the GPRS service provider.
All these services are brought together in our ePortal, providing a window into all management information and controls for all our services.
GT – Where and when was Ingenico founded?
Jean-Jacques Poutrel and Michel Malhouitre founded Ingenico in 1980 in France, one of the leading countries in adoption of smart cards. By 1984 we had the first dual magnetic stripe and smart card terminal, and we’ve a huge list of firsts since then and are proud of our history of innovation – we’ve really shaped the secure payments industry. Among many other achievements, we produced the world’s first Bluetooth payment terminal, allowing for secure ‘payment at table’ in hospitality and provided the world’s first integrated contactless PINpad. This is a form factor that will become the de-facto standard in UK retail in the next year or so.
GT – How big is Ingenico?
We are the no.1 player in the secure electronic payments industry by market share. With over 15 million terminals deployed across 125 countries, we are the first choice for retailers, banks and payment service providers wishing to assure payment, increase their service offerings and revenues at the Point of Sale.
GT – Where do you carry out your development and manufacture?
We carry out practically all our hardware R&D in Valence, France and most Managed Services R&D is undertaken in Paris. We source and manufacture worldwide, including China.
GT – Do you have worldwide links with any other hardware or software suppliers?
We are one of the founders of the Secure POS Vendor Alliance (SPVA), set up to address security issues which we thought were too important for a proprietary approach. We sat down with our key competitors, including Verifone and Hypercom and formed SPVA to enhance security measures and defend merchants and issuers against fraud and risk. It’s a forum for the industry to raise the bar while ensuring a common approach, which will ultimately benefit all users of secure card payment technology. The SPVA now also includes ATOS, Chase Payment Technology, THALES and TLS, among others.
We’re also key members of the Electronic Protocols Application Consortium, one of 23 organisations involved in fleshing out protocols for the Single European Payment Area.
GT – How big are you here, in terms of installations and so on? Which other markets besides retail are you active in?
We’ve installed many hundreds of thousands of devices in the UK, in both the integrated and non-integrated environments, and everywhere that secure card payment is required, especially hospitality, and transportation.
GT – Where is your UK office?
We’re based just north of Edinburgh, in Dalgety Bay, Fife. We also have a large help desk at Northwich, Cheshire, and offices in Guildford and in Dublin, Ireland.
GT – What’s different about the UK as a market?
The UK leads the way in various aspects of payment solutions and is a sounding board for all developed economies in terms of contactless. Some countries like Turkey have deployed contactless already, but the UK will accelerate in line with the usual expectation of the UK as a leader.
GT – What is the state of play in the electronic payments industry with regards to maintaining and improving security?
PCI-DSS as a standard is with us already, and leading organisations and the vast majority of other organisations are very advanced in their strategy in this area. PCI-DSS brings in end to end encryption for the entirety of the back office, and emphasises the benefit of managed services: encrypting sensitive card information at the point of capture into our data centre or at the retailer reduces the scope of what’s required. PCI-DSS means secure payment integrated with a secure till: in the ‘banking’ environment, as in Tier 4 retailers, data doesn’t go over the retailer’s till at all.
GT – What are the security benefits of your solutions?
While all manufacturers need to meet the minimum security standards in order to sell their products, we seek to exceed them and we have more Common Criteria approvals for our card terminals and PIN Pads than anyone else, so our customers have a wider range of products suitable for the UK market.
GT – We’re hearing a lot about contactless payment cards at the moment. Who is driving it?
While the card schemes such as MasterCard and Visa are leading the way, it takes banks and retailers to perform the implementations. Without doubt the UK’s biggest proponent of contactless payment is Barclaycard. We’re proud to be helping Barclaycard deploy contactless as they are renowned innovators too. Contactless credit and debit cards in the UK are merely the latest development of the contactless technology landscape, in which we have a long track record. We have been developing systems from the ground up since 1995, when we developed ASCOM contactless cards. We introduced the world’s first terminal certified for contactless payment in 2003 and have always used our own technology to implement contactless, whereas all our major competitors buy in components to achieve compliance with the standards.
GT – How far have contactless cards got, in terms of adoption by multiple grocery retailers?
The UK Card Association estimates one in six cardholders will have a contactless card by the end of the year and this proportion is likely to accelerate rapidly. Many retailers are starting to strategise for contactless and many industry experts indicate 2010 will be the tipping point. This is a consumer-driven technology: cardholders love it and appreciate its simplicity and the reduced queuing. Tier 1 retailers are driven by convenience; hence there will be an explosion in their adopting it over the next 12 months.
Everyone planning to invest in updating their EPOS technology should be looking at contactless. Also, the expansion of Oyster-like transport cards across the UK will add revenue for retailers: following on, NFC phones will soon operate as contactless payment devices but we need a mass market deployment of the contactless PINpads in retail first. Adoption will then accelerate and roll out will commence at a small scale for NFC in the next two or three years. This is something retailers need to be aware of, as the maximum contactless transaction threshold of £15 will not be relevant once NFC comes along as the phones can operate as your full credit card but in a contactless mode. The other major point is that contactless offers retailers reduced time at the point of sale, hence the recent rapid adoption by a number of fast food and convenience outlets.
GT – What do you see as the biggest factors driving adoption of your solutions?
On the hardware side, with the UK Contactless rollout well underway, we’re seeing a lot of interest as we’re obviously the leaders in Contactless, with a long history of developing successful solutions ourselves rather than having to go to OEMs for the technology, as all our major competitors do. Additionally we continue to innovate to bring new products to market such as the iPA280, our Payment PDA. This is a perfect example of our overall product philosophy – bringing to market truly vertical solutions that meet our customers’ exact needs. The product is perfect for retailers as it can replace their existing PDA technology for stock checking, warehousing and so on, while also being approved for Chip and PIN and Contactless payment. It has a wide range of connectivity, a barcode scanner and a printer so it really can operate as a full EPOS. It is perfect for queue management as it can be brought out of the stockroom and be placed on the counter, or used on the shop floor using minimal real estate while operating with all the functionality of the retailer’s till.
On the services side we see a huge interest from retailers for solutions that can simplify their businesses by moving functionality and/or sensitive data currently in the back office into our PCI DSS approved data centres. Our End-to-End Encryption (E2EE) and Transaction Management solutions offer retailers a significantly reduced PCI DSS scope with a pre-certified end to end solution, a reduction in capital expenditure and the ability to accurately plan costs as your business grows. Retailers prefer to focus on their business and their customers rather than manage payment solutions and our managed service approach fits that desire very well.
GT – Where do you see Ingenico’s business going from here?
We’re the world number 1 in the secure electronic payments industry, with more than 15 million payment terminals in live operation around the world, and we’re expecting further growth as we’re now providing faster, more innovative, more secure technology than any of our competitors. Innovation is at the heart of our business and is crucial in allowing our customers to extend their offerings outside of conventional payment to include contactless solutions, prepaid services, ticketing and more in-depth loyalty programmes. Quite simply, our ever-expanding solutions portfolio enables customers to go ‘Beyond Payment’, to build their brands, generate increased customer loyalty and deliver greater revenue opportunities.
We have a strong lead in the industry right now with our new Telium 2 technology, which provides much better performance and greater reliability than anything else in the market today. Ingenico also has the broadest contactless range in the industry, which is clearly an important factor for retailers who need to remain adaptable to their customer’s needs. Further to this, we’re providing enterprise level secure payment solutions that allow our customers to control the payments while we look after inherent complexity in running PCI DSS compliant infrastructure. In short as the industry security bar is raised ever higher, Ingenico will continue to grow as we continue to provide solutions which exceed industry requirements while solving our customers, and in many cases our customers’ customers’ needs.