By Kelley C. Knutson, Executive Vice President, TSYS International

Who can honestly claim that they once aspired to pursue a career in the global payments industry? Probably — and honestly — very few of us expected to ‘land’ in the middle of this interesting industry, no doubt as a result of the various choices in our careers that have pushed us down one path or another. In many of our cases, we stumbled into this industry and determined it was pretty exciting, always challenging and a business that can really take root in our DNA.

I feel lucky to have been a part of the payments industry for almost 25 years now, and I’ve seen things unfold from multiple perspectives — card brands, global issuers and acquirers, technology start-ups trying to break into the industry and processors or solutions providers. The issues have ranged from mature credit card challenges in the United States and the UK to the anticipated reality of the Single Euro Payments Area (SEPA) in Europe to the emerging markets growth curves in Brazil, India, China and the like.

What never ceases to amaze me is the ever changing and unique nature of this business — striking the right balance between global payments trends and the desire to reflect local banking values. I’ve also seen retail infrastructure challenges, different cultures, best practices and, of course, personalities. At the end of the day, regardless of the underlying changes and market dynamics, it all boils down to replacing cash and checks with a more efficient, easier and economically viable electronic payments medium.

Even though I’ve worked in Europe for 20 years now (after starting off as “just a six-month” international assignment), I still remember some of the early chal­lenges and complexities surrounding moving money across the continent, as well as the challenges faced in using ATMs and finding retailers to accept payment cards. I remember being baffled that each individual country had its own currency, its own debit system and correspondent banking network, with a limited understanding of how global payments should work. The underlying theme always seemed to be, “We do it differently here,” and there was little common ground to be found, back then at least.

When I first came to Europe, it was fairly clear that the barriers that existed would have to come down across bank­ing, retailing and the payments industry as the markets and consumers became more “European.” I’ve been a firm believer in the Pan-European perspec­tive and that the mix of consolidation, centralized operations (to some extent) and a local look and feel could bring economic benefits to the overall European marketplace. While the homogenization of European payments still has a way to go, this journey is something everyone in the industry should be proud to be a part of.

Many of these challenges have fallen away and today there are much closer economic and political ties, with a fair amount of unification amongst the 27 EU countries and their 450 million consumers. However, it’s still refreshing to me to see the culture and languages maintain a distinctly local flavor. (Although let’s not get started about travel and communication, which can still sometimes be a logistical and emotional nightmare.)

I believe the next real wave of change in Europe will come in the areas of debit cards and acquiring. The current European market perspective of national monopolies and oligopolies is not sustainable, and is certainly out of step with the EU’s vision of SEPA and the Payment Services Directive. In some European markets, these models have already been successfully challenged and current market forces should bring about accelerated change in the payments space. The question used to be around when, but now takes into account where and how we move quickly enough to take advantage of the economic and political landscape.

The European markets, along with the United States, are still powerhouses of global electronic payments, account­ing for more than 80 percent of all non-cash transactions. However, the new engines for future growth are the BRIC (Brazil, Russia, India and China) markets where infrastructure, technology and people are responding to significant changes to the electronic payments landscape. These four markets (along with some other emerging markets) are far more sophisticated, creative and influential in trendsetting than many realize.

In Brazil, as an example, innovative enhancements to the point-of-sale environment linking cardholder behavior, loyalty and installment payments are truly impressive and very consumer friendly. Additionally, as we watch India become the world’s leader in mobile phone usage with low fees, don’t be surprised if the next generation of consumers uses their phones instead of payment cards for most purchases. Companies are taking advantage of the local infrastructure as well as trends in how consumers wish to transact their payments.

If there’s one important lesson to be found in the payments world, it’s about being open to different cultures, business models and opportunities. Even after 25 years, I still often remind myself that it’s important to know where you’ve come from, but it’s more critical to know where you’re going (a philosophy that can be applied to the payments world in general, as well as your own career). From my perspective, the global pay­ments industry is an exciting place to be involved with today, and all of us who work amongst it can feel lucky to wake up tomorrow and ask ourselves to dare to dream the impossible in new payment developments.

About Author

Kelley Knutson joined TSYS in 2003, bringing more than 20 years experience in the global payments market and having held a number of leadership roles in the industry. Today he directs the activities of all global operations and locations within TSYS International.