Will Bachman 00:01
Hello, and welcome to Unleashed the show that explores how to thrive as an independent professional Unleashed is produced by Umbrex, which connects you with the world’s top independent management consultants. I’m your host Will Bachman. And I’m here with my guest, Michael Michi porac, who is the SVP of global product strategy at visa. Michael, welcome to the show. Thanks. Well, glad to be here. So Michael, before we dive into detailed questions, you know, some of our listeners are probably aware of it, but just helped me help explain to me, what does visa Do you don’t actually issue cards? Right. So what exactly does does a visa do?

Michael Niczyporuk 00:42
Yeah, it’s a great, it’s a great question. And it’s actually a source of a lot of misunderstanding for people that aren’t kind of close to industry. You know, so there are, you know, over three, I mean, first of all, starting with kind of the facts, you know, there are over 3 billion visa count cards out there in the world. And, you know, it’s pretty miraculous, maybe

Will Bachman 01:04
3 billion, there’s like, what, 7 billion people? Yeah, some people must I mean, and there’s like, you know, the bottom billion and stuff, what, 3 billion cards? Holy, sir, for sure.

Michael Niczyporuk 01:15
No, absolutely, absolutely. Yeah. I mean, there are, you know, there are in fact, 1.7 billion people in the world that don’t have, or even adults in the world that don’t have, you know, even a banking account. And so, you know, as you can surmise, you know, that means that there are a number of us and certainly out, you know, I’d be in this camp who have multiple credit cards, and, you know, multiple visa cards, for sure. But yeah, what’s what’s, what’s remarkable is that, you know, anyone in the world who has, you know, one of these cards, you know, that’s actually been issued by their bank, you know, like a chase, or Standard Chartered or a city or city, or what have you, your credit union, you know, can travel around the world, I mean, not these days, but can travel around the world to anywhere, you know, they could have had the card issue in Malaysia, and then they can travel to Japan, or Czechoslovakia, and they can use that card, and the purchase will kind of go through. And now when in fact, you know, I talked about over 3 billion kind of visa cards issued, on the merchant side, you know, we actually have, you know, have acceptance at over 60 million kind of merchant locations worldwide. So, that’s, that’s a pretty powerful network. And now, the way that it works is, you know, the way that this came to be is that, you know, payments is actually pretty fragmented. You know, where, on the consumer side, you know, we’re on the corporate side, you know, there are banks, you know, who actually issued their credit cards, usually as part of a broader banking relationship, or debit cards or prepaid cards. And then on the other side, well, there are cards that you can use, you know, to kind of pay a merchant, you know, either an online merchant or, or face to face, you know, probably less so, these days in the face to face environment. And, and on the merchant side, well, there’s, you know, the merchant has actually their own bank and their own processor, who helps the process transaction, actually, even on the issuer side, there’s a processor that’s kind of sits between yo visa and, and the issuer. And then what what visa does is, you know, I’d say a number of things, you know, one is, they operate this global network of, you know, 10s of 1000s of financial institutions that are able to move money seamlessly and pretty much in real time, you know, across the world. You know, they set the rules for those transactions, and then they also operate the network that processes those transactions, at least in most of the countries that we operate in. And then, you know, we can get into this a lot more, but, you know, certainly there’s a lot of value that comes from the transaction data itself. And so, of course, Visa sits on a treasure trove of, of transactions. And so there’s a lot of data driven value added services that we can provide kind of leveraging that data, but that’s, that’s kind of a high level view.

Will Bachman 04:25
Very helpful. Tell me about some of those data driven services, those are typically not so visible to consumers, but what sort of services are are those?

Michael Niczyporuk 04:36
Yeah, so so there’s, there’s quite a few. So some of the data driven services are, you know, especially as payments is shifting more to digital. And, you know, and I’d say, you know, we can probably get into this more later, but the COVID pandemic is going to accelerate that even further, the move to digital, you know, that opens up the opportunity for Kind of fraud and other other malicious activity. And so some of the core data driven services are actually just minimizing your fraud in the network. And, you know, basically working back from the aspiration that every good transaction is approved, every bad transaction is declined, and there’s zero customer friction, now, we still have a long way to go from that aspiration, but that’s kind of what we’re headed toward, you know, but then there’s also other data services around say, advertising, you know, like, if you think about it, you know, if I knew your purchase history across all of your cards, I would have a pretty good understanding of kind of what you like, what you don’t like, where you hang out, you know, you know, where you might travel, you know, where home might be where work might be. So I kind of have a pretty good kind of purchase graph, you know, for will, you know, it’s probably wouldn’t be too surprised to hear that, you know, there’s a lot of advertisers who would love to have access to that type of data. And so there’s kind of advertising opportunities that certainly present themselves. You know, another application is transaction data, and where you shop and spend, and how you leverage money in general, you know, is also pretty good indicator for, you know, how good you are with finances. And so, you know, a lender, you know, whether a someone, you know, lending money to a consumer or business can use the insights gleaned from those transaction data to to make better underwriting decisions.

Will Bachman 06:43
So those would, I guess, get factored into your credit score, or be something other than your typical, like Pfizer? Or TransUnion? Like credit score?

Michael Niczyporuk 06:54
Yeah, it’s, it would actually be incremental to credit score. And everybody, you know, and I’ve actually had the pleasure of working with three major issuers before I got a visa, and, you know, all of them in some way, already rely on more than just your credit score, you know, or even the data underlying your credit score, to make underwriting decisions for lending. And so this really adds to that capability of being able to leverage, you know, the full scope of insights they’re available from, you know, all the all the visa all the data that visa has

Will Bachman 07:29
no kidding. Now, I imagine that some of this stuff is confidential, but is there anything more you can share about? Like how that works? Like, what, what sort of spinning data about me? Would a lender make decisions based on the is it Yeah, if I go buy a bunch of it, like, basically by product category, like, oh, he buys a lot of books, so he’s probably a relatively, you know, calm, you know, home on Saturday night person, this person goes and drinks at bars a lot. I don’t know, maybe they’re less credit worthy or something? Or is it just is it something else, like the spending the amount that you spend? Or, like, how would those factor into a lending decision?

Michael Niczyporuk 08:12
Yeah, it’s a great question. So Well, as you surmise, there’s certainly a lot of kind of prepared proprietary insights that go into this, that I can’t talk about, but I’ll give you a few examples. One is actually something that I recall back in my Capital One days, and, you know, this is something that, you know, Capital One has been doing for, you know, over 10 to 15 years now, you know, which is, you know, they found that the place where you make your first purchase with the card, actually is a pretty good indicator into kind of your credit risk. So, if your first purchase is, you know, at a day to day category, like grocery store, or a drugstore, you know, or a convenience store or, you know, traditional clothes retailer, in your department store, you know, those people would have lower risk. If your first purchase is, you know, a cash advance, or your first purchase is, you know, something that’s more likely to be a sensible, good, you know, like a, like jewelry, you know, the credit risk goes up. Of course, that’s not the only indicator, but there are, but that in concert with other indicators, you know, can give you clues, you know, there are also other clothes, which is based on the types of things that people buy, and where they shop, it kind of at the category level. And, you know, there are, you know, there are people that, you know, let’s say people that frequent Whole Foods quite a bit, you know, tend to be, you know, tend to lead more healthy lives tend to be more affluent, and that usually correlates with kind of better creditworthiness, and the ability to manage money. You know, I’d say the other thing that’s worth putting Yeah, is that, you know, I’d say, you know, probably, if we kind of looked at these data together and same with your audience, like we, we could come up with a bunch of interesting hypotheses. You know, one of the cool developments in the world of technology is machine learning or deep machine learning where, you know, you don’t have to come in with a hypothesis, you can actually train, you know, software programs to generate those insights, you know, from the data. And that leads to kind of correlations and insights that, you know, go well beyond these kind of category level, you know, and in some cases, kind of very, fairly obvious insights that we just talked about.

Will Bachman 10:40
Wow, that’s so interesting. So, in the old days, banks would just look at does the person, you know, kind of pay their obligations? Do they pay their bills on time? And do they have a good sort of ratio of credit to income? And it sounds now that they actually will look at the kind of stuff you buy and your patterns of spending and see how kind of a stable or steady of a person you are? Just Wow, that that’s fascinating. I didn’t know that.

Michael Niczyporuk 11:09
Yeah, yeah. I mean, yeah, I will clarify that. Still, the credit score, and the things you mentioned around your, your credit scoring history and your repayment history, are all pretty important drivers. And often, they’re actually the biggest drivers of kind of underwriting decision. Especially for people who have already been using credit for a long time. But especially if you’re talking about people who are newer credit, or if you’re a bank that’s looking to underwrite a brand new customer. You know, some of these extra data sources can be you know, even more impactful. Okay.

Will Bachman 11:49
You mentioned Coronavirus, let’s get into that a little bit. What I’m curious the impact on just the payments industry of the Coronavirus. I mean, my, my guess would be that overall spending is is down to some degree, but that the mix of it is probably shifting heavily towards you know, use of cards. I mean, I I took out some cash, you know, when the Coronavirus was getting in March, and I haven’t I don’t think I’ve spent a single single dollar bill since since you know, over two months. What sort of impacts are you seeing and and curious to hear, you know, what, you know, how things may change permanently?

Michael Niczyporuk 12:34
Yeah, for sure. Well, we needless to say, we could probably spend an entire podcast on on just this topic and more. You know, I think, you know, first first, you know, I think it’s important to recognize that COVID-19 is a human and societal problem that is already having profound implications on our lives. Certainly my life, you know, how we work, the role of governments and, and just about everything else. And so the the impacts are going to span across all industries. You know, one thing that I find really striking about the covid 19 pandemic is that it’s forcing so many people to use more digital services for more aspects of their personal professional lives, often for the first time, may we see that in visa data where, you know, through this pandemic, there are 10s of millions of cardholders, yo who have made their first ecommerce purchase

Will Bachman 13:27
yours.

Michael Niczyporuk 13:29
Wow. Well, yeah, what which, which, which, again, is probably a surprise, because, you know, I suspect you and you know, most most of your audience are fairly digitally savvy. And so, you know, we all have kind of Amazon Prime and Netflix, and, you know, we do grocery delivery. But, you know, there are a lot of people that haven’t actually crossed that chasm. Yeah. And so it’s pretty remarkable that, you know, right now, and we’re, we’re seeing that not just in payments, but all financial services and the, you know, all industries. And, you know, I do believe that many people will likely not go back to the analog way of doing things, at least not as consistently. So I think, you know, one thing that we’re going to see is that we’re that we’re experiencing a pretty historical acceleration of digital technology across all industries, and not just financial services. You know, if I focus a bit on payments and commerce, you know, I think while this shift to digital technology is a net win for consumers, you know, it does present a challenge for retailers, you know, particularly the small and medium sized businesses that have been, historically as a group, slow to embrace digital, you know, as a case in point, you know, all of us know, you know, again, they’re very familiar with, you know, e commerce and Netflix and Amazon and eBay and so forth. But it’s still it’s important to realize that even though ecommerce has been going very rapidly and even more so these days, it’s still only represented Only about 50% of retail spending, you know the numbers about the same and glue us in globally. And that’s dominated by the likes of Amazon, Walmart and other large retailers. So most small businesses, you know, most of Main Street, you know, about 75% of small businesses in the US don’t even have an e commerce site, they don’t have the ability to accept payments online. So, you know, there’s a big opportunity to help retailers, especially small businesses cross that chasm and into digital commerce. And our job, not just as visa but as a broader industry is to make those adaptations as easy, seamless and secure and fast as possible. So, you know, while this is obviously a really difficult time for everyone, you know, there’s a lot to be excited about, too, because I think the the shift to digital commerce is a good thing for for everyone, ultimately, and then it’s just our obligation that no one no consumer, no small business gets left behind and that shift.

Will Bachman 16:05
Yeah, well, I mean, I know, e commerce, you know, I’ve certainly been buying stuff online, since, you know, the 90s. But, I mean, I will say, you know, that it’s really and while I maybe have used Fresh Direct in New York City a few times to buy groceries, we had never really done a lot of grocery shopping online, but we’ve just been doing instacart for the past two months, and it’s awesome, you know, like, it, we never really did that before, because I don’t, you know, it’s kind of nice to go to the grocery store, pick out what you want. But, I mean, so that’s been for us a big a big change. And I imagine that even people who were, you know, familiar and, you know, used to using e commerce for some things have maybe up there up there e commerce usage in certain categories that they hadn’t ever purchased things before. So, say a little bit more about, you know, what are some things that the payments industry can do for small businesses, and that you see happening to make it easier for a mainstream business or to set up an e commerce capability?

Michael Niczyporuk 17:15
Yeah, for sure. So, you know, first of all, say that, I don’t think this is really a technology challenge, in the sense that technology kind of exists, a lot of this is, you know, what I would call a cold start problem, which is, it’s kind of hard to kind of go from no ecommerce capability to having something, you know, especially since ecommerce is just not core to a lot of retailers, businesses, you know, but I’d say that there are multiple things that we could do, you know, one is, you know, we could make it much easier for those retailers to actually just start accepting payments online, you know, and, you know, that includes everything from integrating that into their CRM system, you know, and making it easy, almost like e commerce in a box, where they don’t have to do you know, much, or any technical integration on their end, and they can get you up and running right away. And there, there are a lot of great solutions out there, you know, from the likes of square and stripe, and others that are, you know, addressing this need and pretty successfully, you know, I’d say, once they do get up and running, I think we can do a better job as an industry of kind of packaging, all the different things that we do that go into a payment transaction, right, if you you know, a company like visa, we have hundreds of products. And for someone that’s not a, you know, an expert in the financial services or payments industry, it could be pretty daunting. So I think we could do a much better job of assembling these products into kind of purpose built solutions, you know, that, that, you know, small businesses kind of can implement out of the box. You know, I do also think that, you know, one of the roles that we provide as a global network operator, you know, it’s just providing trust and reassurance, I mean, a lot of financial services, even if you think about your own finances, like it comes down to trust, I mean, money in a sense, you know, is based on just trust in, you know, the currency itself. And that’s true for the broader financial services system. I think one of the, one of the areas where your visa can add a lot of value is just to bring that trust and shortness to the ecosystem, you know, both from a brand and kind of reliability perspective, you know, but also for things like better disputes management. So, as you might imagine, you know, as commerce shifts to digital, and especially if you have, you know, new consumers who are trying e commerce for the first time and you’re gonna have merchants, they’re trying e commerce for the first time. That, you know, provides the opportunity for, you know, more fraud, like we talked about that needs to be mitigated, but also the opportunity for, you know, kind of ordering errors and shipping errors, and, you know, the product, you know, being damaged, you know, during shipment, or, or someone kind of realizing that, you know, what they ordered actually is not what they expected.

20:22
So,

Michael Niczyporuk 20:22
so the kind of chargeback and dispute process of kind of, you know, rectifying some of those issues, you know, is going to be even more important than so that’s another place where, you know, we use visa, and we as an industry can do a lot to help out.

Will Bachman 20:41
You know, speaking of fraud, who does that? fraud detection, so occasionally use your credit card, and it pops up, this was denied? And then, you know, 10 seconds later, a minute later, you get a text message saying, did you actually try to spend this money? Is that my issuer that’s doing all that analysis? Or is that somehow visa doing it? Or is it combination? Yeah, it’s,

Michael Niczyporuk 21:05
it’s really a combination. So every every issue, or every bank has its own fraud management systems, you know, that they either built in house or kind of outsourced to a third party vendor. And, and you know, that because payments is core to their business, of course, they have a vested interest in, you know, both ensuring a great customer experience, you know, but also making sure that kind of malicious activity or bad actors are, are thwarted, you know, but they can only see their own data, you know, where a visa also comes in is, well, we see the data across our entire network. And so we can see your correlations that individuals banks cannot. And so there’s also fraud management that’s built into, you know, our systems as well, you know, and often what will happen, because the primary relationship between a consumer and, you know, the primary relationship that consumer has is with their bank, you know, often, you know, even if someone like a visa will kind of flag the fraud in the back end, it will be the bank that actually communicates that to the consumer.

Will Bachman 22:17
Interesting. So, when I get this alerts, sometimes it might be my mother’s my bank, you know, noticed, you know, noticed it, and sometimes it may be visa sent a message to my bank saying this looks suspicious. And then my bank sent me that that alert, saying, you know, this, this is this really you, because maybe visa has seen the same fraudulent, you know, merchant trying to charge, like multiple people with the same, you know, with the same amount, or the same kind of pattern that you’ve detected. And you can notice that when my issuing bank might not notice it.

Michael Niczyporuk 22:59
Yeah, absolutely. Right. And, you know, that actually reminds me, you know, one of the more successful new products that we launched, when I was with with Capital One years ago, is something called second look, I think it’s still called second look where we’re basically, you know, Capital One, as you’re making purchases, you know, they notice things like, know, where, you know, you, you might have a recurring payment with, you know, with your, you know, telco company, and, and first or utilities company, and for some reason, the, you know, the month charge this month, is like way larger than mouth that was charged in previous months, you know, they’ll kind of send you alerts to kind of, say, like, okay, is this is this right? Or if they see two charges, you know, they’ll ask, you know, whether, you know, that was intended, for subscriptions, they’ll say, like, Hey, did you actually intend to keep the subscription? You know, or even, and I get this a lot, because I’m a, I’m a pretty generous tipper. And when I when I go to restaurants, you know, I’ll get a notification, which is like, wow, we noticed that you made a pretty large tip, like, you know, was that really, was he really that good? Or, or was that a mistake? said so there are. So there are a lot of things like that, that actually provide a lot of value and a lot of assurance to consumers that, you know, the broader industry can do. And that in that case, these are services that are provided by Capital One a bank.

Will Bachman 24:30
I see. I’ve got a question for you. And I know I want to get to the future of FinTech. But I have, I have two practical questions. One is you know, when you get a for some reason, either your card is close to expiring, or maybe it got compromised, you have to get a new number a new card. One of the big hassles is then going to all of the different utilities and subscriptions and stuff and and then you know, online vendors where you have your cards stored and changing your number All those different places? Are there some cards now where you can kind of just do that automatically and say, Hello bank, like, please just update all of my ongoing, you know, vendors or merchants with my new number for me. Is there anything like that now or on the horizon?

Michael Niczyporuk 25:19
Yeah, absolutely. So I think it’s a great question. And that’s definitely a major pain point for consumers. By the way, it’s also painful for banks. Because, you know, if, if you use, you know, if you use your card, and especially if you’re trying to use that card for important a large purchase, and it doesn’t work, that creates a, you know, impetus for you to try another card. And, you know, not surprisingly, you know, some, some consumers may actually to go back to using that initial card. So there’s, you know, lost business over the lifetime of the account. And so, you know, the way that we’re attacking this as an industry, and I’d say, we still have a long way to go, is this something called tokenization. You know, which is, you know, if you think about it, like, you know, if you’re someone like me, and I suspect most of your audience is in the same boat, right, we’ve loaded our cards, and Amazon and Netflix and Uber and Lyft, and Airbnb, and probably, you know, instacart, a bunch of other places Exactly. It would be really, like, you know, even before we get to the convenience point, it’s actually kind of insecure, if there are multiple copies of your credit or debit card number, kind of out there. I mean, all those companies have strong security systems. But, you know, having, you know, having the number kind of be replicated across all these different properties creates a higher security risk. And, of course, as you pointed out, well, in case that card actually fails, or is compromised or needs to be reissued or expired, what have you, it’s a big pain points to kind of reload all those credentials into all those different kind of wallets and merchants. So the way that we’re solving that is, is is something called tokenization. A good example of this actually is Apple Pay, or Google pay, you know, if you look at the, the that your credit cards or debit card that’s loaded into Apple Pay, or Google pay, is actually has a different number than your underlying card. And that, and that number is specific to your iPhone or your specific or your specific Android phone. And so, you know, so even if it’s compromised, that can’t be used in, you know, in other channels. And so, you know, our aspiration is that, you know, similar to Apple Pay, and Google pay me on Samsung Pay, you know, all the places where you can keep your credit card or debit card credentials on file, you know, actually are a token that’s associated with your underlying count, but it’s not the underlying count itself. Once that happens, what that will enable us to do is to basically, as soon as a new account gets, you know, provisioned or, or set up, we can proactively, kind of push a brand new token to all the places where, you know, token has been stored. And so from a consumer perspective, would be no friction. And, you know, it leads to, you know, what all of us want, you know, in the world of payments, which is just seamless, you know, uninterrupted experiences.

Will Bachman 28:43
That would be awesome. I almost had my power shut off, because I just, I just got a bill for my utility bill was 20 $800. Because, and they said, We are shutting off your bill. It also said due to Coronavirus, we’re not shutting off your bill. So like the same things that final notice, but also Oh, well, don’t worry, we’re not shutting out. But it was 20 $100 because like, I don’t know, months ago, my credit card changed and I had never updated con ads. They had gone for about five, six months, without me paying Well, they were about to shut it down. So the tokenisation is definitely I’m looking forward to that. Another question before we get into the future of FinTech is when when is the right age to get a credit card for your kids to help them start building credit and, and what’s Yeah, I’d love to hear about, you know, like, how you should go about doing that.

Michael Niczyporuk 29:38
Yeah, I mean, I personally do believe that. Learning how to learning how to manage finances, how to keep up how to keep and maintain a budget, how to borrow responsibly, you know, are actually things that, you know, all of us you know, should be learning more of, and you know, and I And I wish there was a way to kind of, you know, increased education level, you know, of all kind of consumers, I think, I think like all things that are kind of good learn habits, I think it’s actually important to start those habits early. And that that can start with things like you, one of the one of the things that we’re working on as industry is kind of family card functionality, you know, which is, you know, you, you know, you know, as a 14 year old can’t apply for their own credit card. But they can get access to a credit card, you know, that’s in their parents name. And, and you can, you know, set controls around that, so that, you know, there’s no weekly spending limits, or Daily Spin on limits. So there’s restrictions on where that card can be used. And yeah, which is definitely reassuring to the, to the parents, and, you know, that that provides a kind of vehicle and on ramp for, you know, for people to really learn these skills young, you know, because, you know, as I’m sure you kind of realize, you know, building credit and building a credit history, yeah, it was means that, you know, you’ll be able to get better rates on your auto loans and mortgages in the future. And so it’s just something that’s going to last a lifetime.

Will Bachman 31:24
Helpful, helpful to know, love to hear your thoughts on sort of future of tech, some of the FinTech, some of the, you know, developments maybe over the past year that are too, and that you’ve thought were really interesting, or some of the things that you see on the near horizon.

Michael Niczyporuk 31:42
Yeah, for sure. So, you know, we touched upon just the growing the growth of digital the growth of technology, and payments, and really all financial services. And we were talking about the covid 19 pandemic. But really, that’s a trend that’s been going on in financial services, payments, and really the whole world for, you know, for a while now, you know, which is, you know, I started out by strongly believing that the technology will profoundly change all industries, and also create new industries, not just financial services. Now, financial services, and certainly payments within that, arguably especially amenable to technology driven innovation, because financial services already are, or should be software and data. And suddenly, that’s just software and data, well can be sold, delivered in service digitally. And so that’s we’ve been seeing across all financial services, you know, the reinvention of every financial service, you know, whether it’s investing, or saving, you know, or payments, or insurance, you know, through software that’s digitally delivered, you know, think mobile banking, or some of your favorite FinTech apps, you know, whether Venmo for peer to peer payments, or Robin Hood for investing, you know, or use an international example, and paisa in Kenya, that enables 10s of millions of people who otherwise don’t have access to a bank, to send, receive and borrow money, you know, just from their mobile phones. Now, when I talk about the move to digital, I don’t mean just delivering the same product or service that was already available in the bank branch or over the phone, and just making it accessible on a website or through a mobile app. Of course, that’s where things usually start. Just like, you know, if you think back, the first advertising internet kind of looked a lot like newspaper ads, except on a web site. The real magic happens when we reimagine each financial services for service from a customer centric lens, you know, taking full advantage of the capabilities of the new technology and medium. And so, you know, at a high level, as I think about some of the things that will happen, you know, as financial services gets reinvented digitally, I think we’ll see, you know, at least four things. One is just the explosion of really simple, really compelling real time experiences, you know, on a bedrock of security and privacy. So, leading technology companies and fintechs will continue to set a high bar here for convenience and value. And because like we talked about, all financial services are based on the foundation of trust, security, and privacy will, will remain table stakes. The second thing we’ll see is, you know, expanding access to demand for financial products and services across the whole world. So, you know, talked about this before, but globally, there are, you know, 1.7 billion adults that remain unbanked, you know, that is, they don’t have an account at a financial institution, or even a mobile money provider, and many others, you know, even if they have an account, they’re underserved. And so that creates a tremendous opportunity. And really, I would argue a societal obligation to make financial services more inclusive. The third thing we’re seeing is, and this mirrors trends and just a broader technology world, which is financial infrastructure itself, the underlying core infrastructure that runs all payments and banking is becoming both modernized and democratized. Yeah, with growing adoption of cloud application programming interfaces, or API’s, and open financial services, and financial services infrastructure gets componentized and accessible via API’s in the cloud, what we’re already starting to see is that financial services will unbundle into more purpose built solutions, you know, such as the ability to pay with installments at the point of sale, using the firm app, or making peer payments using Venmo. At the same time, those components can also be reassembled, the more integrated digital experiences, you know, I’d say the leading prototypical examples of that are the so called Super apps that we’re seeing, you know, particularly in Asia, you know, so for example, Ali pay and WeChat, in China, you know, they bundled together payments and banking, along with messaging and social media, and marketplaces, and e commerce, and even a range of services like ride hailing, you know, all within a single app. So we’re gonna see more and more of that. And then finally, you know, we talked about this already, but I think it’s worthwhile reiterating, which is just the growth in data and more powerful ways, you know, such as deep machine learning, to use data to bring more intelligent, more personalized experiences to financial services, because every time you interact with a financial service that creates new data, every time you’ve moved money, execute a trade or make a purchase, that creates new data. So that’s, that’s a lot of data that can be used to make better decisions or generate better insights. So those are the those are the big trends, you know, happy to go in more detail into kind of, you know, specifics, but you know, I think net net, you know, all of this will be a huge win for consumers, ultimately for, for society. And, you know, and that visa, we’re pretty blessed to be in the middle of a lot of these innovations that are happening across the world.

Will Bachman 37:29
For the folks in the world that do not have financial services today don’t have a bank account, I think you mentioned 1.7 billion people. What are the barriers to have to being banked? And what what do you see as some of the things, you know, how might those future state financial services look like for those who are currently unbanked?

Michael Niczyporuk 37:55
Yeah, so, so a few things. So one is, actually, even before banking, there’s a kind of a digital identity or identity issue, which is, you know, there are many people across the world, particularly in developing and emerging economies, you’re where they actually don’t have a nationally issued identifier, so they have no way to really prove who they are. So giving them a digital identity they can use is really kind of step one, for them to take advantage of, you know, everything digital, and certainly banking and payments within that. You know, I think once we get into once someone has an identity, then I think the other barrier is, well, you know, and in the US, we’re blessed with, you know, a branch on every corner, although I think, you know, those branches are gonna continue to sit out. But, and, and there’s kind of pretty good mobile banking, infrastructure, but you know, there, there are parts of the world where banking is not that accessible. And so, you know, hence, you know, the MPs example, I mentioned before, where, you know, giving people the ability to kind of bank and move money from their mobile accounts, you know, is, you know, is a pretty important innovation. You know, even more broadly, you know, I think we can make it much easier for someone to open a bank account. I mean, there are a lot of markets, we’re still in part because of technology, but even more so because of regulation. You know, there’s actually regulations that requires you to open certain accounts in person. And so, you know, there’s an opportunity to ease those regulations so that people can actually verify their identity and open account, you know, completely digitally. And, you know, there’s also an opportunity to make, you know, finding Services just more affordable. You know, there are, you know, there’s still fees and kind of other barriers to entry like that, that, you know, are our key people, you know, especially lower income people kind of from taking full advantage of financial services. You know, and that’s, and I’d say the other one is, you know, it’s like, you know, if you think about most consumers, these days, they, they lead pretty broad digital lives, you know, that span, everything from e commerce to, you know, food delivery, and grocery delivery to Netflix, and, you know, the whole assortment, you know, and also people spend a lot of time on Google or Facebook, or WeChat, or WhatsApp, what have you, I think the next shift that we’re gonna see, which, you know, sometimes it’s called Open banking is, you know, gosh, wouldn’t be wonderful if you know, you, as a consumer could actually interact with your bank in the channel of your choice. And that doesn’t mean going to even the bank’s mobile app. And so, you know, we’re starting to see that more and more, you know, especially in places like China, and Asia, where you’re actually consumers, you know, like the, you know, the WeChat example, or the, or the Ali pay example, consumers can actually access banking, you know, right from the place where they already manage, you know, a large chunk of their digital lives.

Will Bachman 41:31
Tell us a little bit about your career. So you’ve had, you’ve worked at some really iconic institutions, Capital One, city, USA, which I’m a huge fan of, I’m a USA customer. And now visa, tell us about some of the things you’ve kind of learned along the way.

Michael Niczyporuk 41:50
Yeah, it’s, it’s a, it’s a great question. I, you know, I’ll back up if it’s okay. Which is, you know, I’ll say that, you know, I got into financial services, payments, kind of by accident. First, you know, if I go all the way back, I was born in Krakow, Poland, and into what might be considered to be a physics family. You know, my dad was a physicist, both my grandparents on my mother’s side were physicists in Russia. And in fact, my older brother got a physics degree from MIT. So, when I was five years old, I naturally decided, like, you know, any five year old would to become a physicist. And that’s something that I did until I was about age 30. You know, I then made the conscious decision to switch careers, and start out in consulting, you know, with the corporate executive board, you know, which has since been acquired by Gartner. And actually my first two clients, as it turns out, we’re actually a credit card company and a property and casualty insurer, both of which have been acquired since now. But then I’d say my financial services education really took off, when I joined the Corporate Strategy Team at Capital One, you know, where I learned much of what I still know today about credit cards, payments and kind of corporate strategy. And I also ended up building and managing the Digital Strategy Team of Capital One, as we were transforming the company to embrace digital. So that was a really exciting time where I think we broke a lot of ground. You know, I then moved on to city to lead global strategy for their credit card and payments businesses. And also, while I was there helped to launch a new business unit called city FinTech, that’s focused on mobile first banking and investing. You know, then I moved on to USA to serve as their chief strategy officer, you know, like you said, really phenomenal organization that really cares for their members, and orients everything they do around just what’s the right thing for the member, and then also is a great opportunity for me, because USA is a remarkably diversified institution that, you know, provides a broad array of insurance products, you know, and investing and wealth management products, and banking and payments. And so kind of seeing all that kind of from a wide lens was, was definitely an education for me. And then the brings me to today where, you know, I’m currently a senior adviser to visa, you know, leading their strategy to really improve existing payments products and create new ones.

Will Bachman 44:26
Fantastic. Well, Michael, thank you so much for joining today. Obviously, people can find visa online, any links that you’d like to share that we can include in the show notes for people to find you if they wanted to follow up? Um,

Michael Niczyporuk 44:42
I’d say the best place would be LinkedIn. And certainly, you know, if you want to connect and start conversations there, I’m more than happy to as hopefully is here. Hopefully, as you can tell, I’m pretty passionate about this space and happy to exchange thoughts and ideas and definitely enjoyed this conversation. I appreciate your help. on your show,

Will Bachman 45:00
fantastic Michael unqiue that link in the show notes. And for anyone who listened this far, if you’ve been thinking about rating the show, giving it five stars on iTunes. Now it’d be great time it helps other people discover the show. And if you weren’t gonna give it five stars and just don’t bother, Michael, thanks for joining. My pleasure.