Innovation in Payments: Interac

Interview with Debbie Gamble, Chief Officer, Innovation Labs and New Ventures at Interac

What do innovation opportunities in Payments look like in post-COVID world? Highline Beta has put together Crisis Manifesto: Innovation Opportunities in Payments post-COVID report. Today, we talk with Debbie Gamble, Chief Officer, Innovation Labs and New Ventures at Interac about the importance of digital experience and setting up the stage for continued success amidst changes.

What are your thoughts on the changes and trends you are seeing in payments? What specific gaps, blind spots and opportunities has COVID-19 exposed? What existing trends have been accelerating and why?

COVID-19 shone a spotlight on the importance of the digital experience. Suddenly, we weren’t able to conduct business in a face-to-face environment and this allowed us to think creatively about how we could embrace the new normal digitally. 

The digital first mentality is highlighting some of the work we’ve already done at Interac. There are fewer in-person transactions and that kind of digital reality has impacted some of our products. We explored this in an article our team wrote about how COVID-19 is accelerating transformation in digital payments. We’re seeing changes in behaviour: consumers are moving toward the digital experience. 

The other thing I’d say is that COVID-19 has also highlighted the need to authenticate who we are virtually. Whether that’s logging in to apply for government subsidies or to transact in our fully digital reality. We’re acknowledging the need to embrace a digital ID. COVID-19 has accelerated some of the work organizations like Interac have been doing – focusing on digital transactions. As Professor Scott Galloway said of COVID-19 “the future is happening faster” – we’re seeing people who would’ve taken a lot longer embrace change out of necessity.

You have been collecting amazing troves of data at Interac. What are some of the trends in consumer and business behaviour that you’re seeing?

We’re seeing accelerated transformation. As consumers, we’ve been embracing digital since the 90s and 2000s, and now our regular habits like going to the grocery store are being replaced by digital. On the business side, over the last few years, there’s been a focus on moving from analogue to digital and COVID-19 is accelerating that. 

Businesses want to know how to be more efficient and secure online. We’re seeing these trends accelerate across Interac e-Transfers particularly with businesses. We will see more of that in the future especially as there’s a focus on modernising payments. Many businesses still rely on checks so moving into more digital forms of payment will be important. Interac’s latest versions have business details coming through with the transactions. Those kinds of tools and inventory management capabilities are key. Companies like Shopify have done an amazing job there, and so I think we see more of that happening.

What role will creative collaborations between large and small players play in shaping the future of payments on the other side of the pandemic?

The notion of collaboration is core to us and core to many companies. Canada has an incredible startup and scale-up community. It’s important for us to maintain this through the crisis to help companies survive and thrive. It’s a component of the blueprint of moving through the pandemic to the recovery. 

We always want to help scale innovation and bring public/private sectors together at scale. We’re heavily invested in this space. We have partnerships with MaRS, Vector Institute, Communitech in Kitchener and a satellite team there. We hosted a Collision day for digital ID companies with Communitech; acquired the company 2Keys last fall, did proof of concepts in distributed ledger area, are partnering with electro utility and IBM and we help smaller startup companies vet capabilities and ideas.  With Vector and financial institutions, we’re looking at better ways for us to analyse data and solve problems, and on a case-by-case basis though key initiatives: looking at consumer-directed finance (open banking), exploring what the new normal will be and leveraging tech from a connected cities perspective. It’s programmatic and opportunistic. 

What are you seeing when it comes to verticalization in payments, and how do you think this will impact the state of payments in 2020 and beyond?

Online is moving to e-commerce and depending on the scale, various businesses have started to embrace these capabilities applied to payments. Verticalization will continue and it will depend on the level of the business and the organization. Once the business gets large enough to scale, they can think about how to deliver the best experience to their customer. How do you leverage the tech advancements and innovation? We will see more and more of that.

What do you think the medium- and long-term impact will be for the rest of 2020, and how should companies large and small prepare for the road ahead? Has Interac been impacted by COVID-19 and if yes, how? What kind of advice would you offer to the changemakers who are trying to push the industry forward?

Everyone is being affected by the pandemic. We’re all realising that whatever plans we had going into this year have to be pivoted, adjusted and reviewed. This could have potentially long-term effects. 

We have a strong position in the market so we’re looking at the landscape and what new realities it’ll bring. We’re exploring what trends/tech we can use to enable our business strategies and optimise what we’re learning to augment what we have, potentially through partnership.  

Right now, we’re focused on our core business and how we can continue to service our customers in these challenging times and changing market dynamics. We have to anticipate and react to these changes. So for us, it’s a balance; how can you maintain your relevance amidst changes and set the stage for continued success. We’re mindful of levering the situation we’re in. We started the conversation around the new normal and what’s changed: with digital ID, we have a particular focus on bringing new capabilities to market and we’ve been able to do that because of our innovation focus and 2keys acquisition. This is a balance of being sensitive and communicating/engaging with the market, but also proactively ensuring that we keep an eye on the future.

We’re always looking at what we need to do — what was relevant 3 months ago has changed; what it is we need to do for our customers, and our marketplace and how we can continue to cater to that. We’re a Canadian company, we’re only focusing on Canada, and so we want to contribute to the vibrancy and success of Canada’s digital economy. This means collaboration and partnerships, supporting the ecosystem, and investing in innovation.

The future of successful companies will rely on a willingness to embrace strategic alliances, listen to new consumer needs and act decisively in uncertain times. Please read the full Crisis Manifesto: Innovation Opportunities in Payments post-COVID report here.