A Small Market Case Study “Discussion of practical issues faced by Electronic Commerce and ICT in developing markets”

Speaker Seth Cechetto Chief Information Officer Maduro & Curiel’s Bank N.V.

Agenda The Market Telecommunications Websites, Shopping Malls Online Applications Security Cell Phones Currency

The Self Service Continuum Electronic Commerce is not just about the Internet. Its all about choosing “self service”. Progress: –Public telephone lines, leased lines to Internet….. –ATM’s, POS, Kiosk, PC’s, Cell Phones, PAD’s, Refrigerator …….

Market Place Population –Aruba: 90,000 –Netherlands Antilles:212,000 Per Capita GDP –Aruba:$22,000 –Netherlands Antilles$11,400

Maduro & Curiel’s Bank N.V. Complexity: –5 islands –4 languages –2 legal jurisdictions Full Range of Products: Loans, Deposits, Insurance, Investments, Trusts, Cash Management, Credit Cards, etc.

Maduro & Curiel’s Bank N.V. Delivery Vehicles: –33 branches –86 ATM’s –4,000 POS Terminals Alternate Delivery: – Internet – Telebanking VRU – Leased Lines

Telecommunications Network International: VISA, MC, Outsourcer. Inter-island: Branches, ATM’s, POS. Local: Branches, ATM’s, POS, 3rd Parties (e.g. banks, utilities) Internet: Website, shopping mall, Intranet, Online Banking, Online Cash Management.

Telecommunication Challenges Small bank with the network complexity of major multinationals. –Issues: Skills, Training, Monitoring Bandwidth may be available but cost is high. –Issues:Need small scale innovation to overcome challenges (Laser, RAN, Satellite, VPN)

Websites Issues: –Leverage examples already on the web. –Don’t try to compete with the major international portals. Add value.

Shopping Mall Issues: –Focus on high volume possibilities in the local market. –Keep it simple (or it will never download). –Need payments in local currency. –The back-end doesn’t need to be all high tech.

Online Applications Developed Country application vendors are in 3rd generation mode. Issues: –Made for Broadband environment (too complex, graphical, irrelevant connectivity). Keep it simple and focused. –Need for access to lower cost developers and application vendors.

Security With Bricks & Mortar, bars and guards can substitute for technology. The Internet unfortunately “levels the playing field” for security. Security Issues: –Standards, policies and procedures (e.g. need pre-packaged generic documentation)

Security cont’d –Need Knowledge and Training at reasonable cost –Need innovative outsourcing possibilities: e.g. cooperative secure server farm. –Leverage International partnerships: e.g. eScotia

It’s a Cell World We estimate that over 80% of Aruba and Netherlands Antilles have cell phones. At the household level its probably 99%. About 4x grater than PC Internet connectivity. “SMS 16 hours per day non-stop”.

It’s a Cell World cont’d How are we helping consumers: –Credit Card and Cheque book notices using –Online real time recharge of cell phone. Issues: –Cell applications and connectivity have much wider consumer potential and benefit.

Currency Challenges International US $ based payments are well established (e.g. credit cards). Local currency options needed to support domestic Electronic Commerce and ICT. Issues: –Local Currency credit and debit cards are essential.

Currency Challenges cont’d –A Local Currency Switch expands availability. –Private sector can provide leadership. Achievements: –Local currency debit and credit cards plus dual currency AMEX Card. –Local currency switch for ATM and POS transactions………. Internet.