#40 – RegTalks with Maria Peralta, Visa

Transcript

Claus: Hello and welcome to RegTalks, the show where we unpack how regulation and technology are reshaping financial services in Asia and beyond. I’m your host Claus Christensen, CEO and co-founder. Today, we are recording live from Money 20/20 in vibrant Bangkok, and we’re shining a spotlight on the heartbeat of every economy: small and medium-sized businesses and how we access payment infrastructure.

My guest today is Maria Peralta, Director of SMB Acceptance Solutions at Visa. Maria’s career has taken her from Latin America to Europe and now Singapore, where she leads Visa’s efforts to bring millions of micro-merchants and start-ups into the digital payments ecosystem across Southeast Asia. Whether it’s acceptance programs that turn smartphones into point-of-sale devices or partnerships with regtech start-ups, Maria is at the centre of it all. Maria, thanks so much for joining today.

Maria: Thank you so much. It’s a pleasure being here and meeting you, of course, and being in vibrant Thailand as well.

Claus: How did you like the event?

Maria: Oh, amazing. I had so many meetings. I’m also part of the Rise Up mentor and leadership program for women in payments, so I’m very glad to be here.

Claus: Yes, Rachel is also part of that, right?

Maria: Yes, exactly. She does a lot in that space, which is very interesting.

Claus: Yeah, I love it here too. Bangkok is always nice. This event is small enough that you can connect with really good people here.

Maria: Yeah, you form deeper connections.

Claus: Yes, you do. I like it. Exactly. There are events like the Singapore FinTech Festival, but then you have 70,000 other attendees.

Maria: That’s the thing.

Claus: Yeah, but it’s exhausting. This is the last day. Oh yeah, we’re both off to the airport after this. Let’s dig into it. Your global payments journey and SMB focus is something I’d love to hear about. It’s always interesting to hear about backgrounds. You’ve worked across multiple regions in Asia. How does that shape your approach as the lead of SMB Acceptance Solutions?

Maria: Yeah, absolutely. Each region is unique and has its challenges and opportunities. I like to compare them in the following way: Latin America has this entrepreneurial spirit and fire, but the infrastructure is sometimes a bit behind. Europe has amazing financial systems, but there is a need for more start-up culture to keep up with tech-savvy customers. I used to live in Germany, and if it wasn’t during COVID, I would still pay in cash in some restaurants—not because I wanted to, but because the merchants were not keeping up.

But now things have changed. I think Asia, or Asia Pacific, is kind of a combination of the two. There’s a lot of digital-savvy customers and even merchants as well, but there’s still a huge unbanked population. It has its uniqueness in that sense. I always say to everybody that I arrived in the big leagues in Asia Pacific. There’s a lot going on, but there’s also a lot of passion and opportunities everywhere.

Claus: I have a similar journey there. I’m originally from Germany, so there’s obviously a connection. I did start a small business there, running a brand.

But to create a bigger business, initiatives like Visa’s Rapid Seller Onboarding can activate new merchants in as little as seven days. What pain points did you target, and which process changes made it possible? How can we get it even faster?

Maria: Yeah, of course. Speed is a must. Definitely, long onboarding processes are one of the key pain points for small merchants. They might not even be able to describe it, but if you think about digital payments—specifically with cards—they will say, “I need to get a bunch of paperwork, I need to go to a branch.” It is very complex. I don’t even know what I need for that particular process.

So Rapid Seller Onboarding comes as a solution for digital onboarding, where we expedite that process by combining a simple process in the background, minimizing interaction, and making it very friendly for small merchants, who, at the end, just want to run their business and hopefully grow it. This has really helped. We have a very interesting use case with Maya in the Philippines. They started using it, and now they’re digitally onboarding their small merchants, and it works.

Claus: Side question to that. Mm-hmm. I believe these SMEs are coming from Europe. We have a different approach. But coming to Asia, I just realize how important they are here. And both in scale, there are so many micro and small businesses, and how important they are for their economy. Absolutely. At scale. Mm-hmm. And there’s a third point: how important they are in lifting people out of poverty or various difficult circumstances. I think that’s a positive thing that you absolutely support.

Maria: Absolutely. If we think about some stats, in Asia Pacific, there are 200 million small businesses, contributing 60% to the GDP and 70% of local employment.

Claus: I did have those because they’re incredible.

Maria: It’s gigantic. So if we’re touching this space alone, we’re helping the livelihoods of many people, many families, and uplifting economies altogether. So, crucial. For now, digital onboarding is our solution. To answer your question about further speed, we’re exploring new things. But this is kind of where we are now, but we’re open.

Claus: A great step anyway. If you can open a business and be able to accept payments within a week, that’s great. Tap to Phone is something that I hear more and more about. It lets street vendors start accepting digital payments in minutes. What challenges do small budget merchants face in the market space, and how is Visa tailoring the solutions to overcome them?

Maria: Yeah, let’s start with the challenges. We have done a bunch of research around this, and some of the things are not payment-related, right? Because when merchants are thinking holistically about their business, we’re talking about increased competition, and they’re kind of, you know, side by side with competitors, the need to make operations more seamless, complex regulations, and navigating that. Monitoring performance is complicated as well. Challenges with cash flow—that’s key. And in general, it’s stressful, especially now with a lot of uncertainty across the economy.

So those are the challenges. I would say they’re even common across regions, right? It’s just the nature of being a small business. But one thing to touch on regarding the topic of Tap to Phone, at Visa, we like to talk about a concept called billions of sellers. We believe that anybody can be a seller, right? It might just be an employee, but you might have a side business, right? We empower that, and then we put on top another layer, which is 6 billion smartphones that have the ability to enable near field communication capabilities.

We have even more than six percent of enabled cards that can pay with contactless technology. So combining all of this, Tap to Phone is kind of ready to solve and allow sellers to accept payments without needing additional devices, right? Which is a financial cost that they don’t want to pay, right? It is new. In some situations, it might be a bit particular to say, “Okay, now my phone can do that,” so it requires some familiarization.

In Europe, it took a while until one day in Germany, I was in a restaurant and I saw the phone, and I said, “Okay, it started.” In Asia, I see it more and more, and we have grown quite a lot. This helps a lot; let’s just reduce costs. That’s the key.

Claus: In the end, it’s probably just inevitable. It’s that trend of having ever more parts of our lives and devices merging into this magical device that we have with us at all times. Next question is about technology partners, which is kind of dear to my heart because we, as a start-up, have been in that space for a long time. We are no longer in that space; we’re much more established now. But in the very beginning, it was always very, very hard to work with larger technology companies like yours due to cultural differences. How does it work for Visa? How do you work with smaller vendors?

Maria: Yeah. Well, I found an interesting discussion at Money 20/20 talking about this very topic. Yes. In the stages that I saw, there was perhaps a regtech or fintech with a more established, let’s say, legacy player. They were all talking about collaboration. I think times have changed. I hope, yes. Or I feel it. I think hopefully next out there.

What I was hearing is that everybody is saying, “We need to combine forces because this is all about win-win cooperation.” So at Visa, we definitely partner with start-ups across all regions to tap into their know-how, knowledge, new technologies, new ideas, and with the humongous reach of our network, combine our efforts and be able to be better together.

So, everybody everywhere—that’s definitely our motto. Wow. I feel it. We have an innovation center where, like last year, there was an accelerator program where we had four start-ups that graduated from that. It’s very exciting to see this kind of work and then actually leave it and then perhaps use their services without knowing it in an everyday situation.

So it happens.

Claus: Brilliant. Do you know of any current programs or something where startups can get in touch with Visa?

Maria: Top of mind, yes. In every session, like this Money 20/20 convention, I talked with many already and just kind of walked around getting inspired. Yes, I think there are more and more events where we can just get in touch. Each region has its own programs. Yes, we did have the accelerator program last year. But yeah, each year we kind of come up with different ways of outreach, even through governments or other sources to kind of support.

Claus: Even to get that sort of visibility is hard for start-ups in the beginning.

You mentioned corporations; Visa connects banks, SVPs, and providers. How do you choose and coordinate partners to make sure their acceptance works smoothly in the end? That’s a tall order if you have different players involved.

Maria: Yeah, definitely. We are working to kind of incorporate them and facilitate cooperation between them. So we act as a network at the end of the day. And we recognize the value of each one of the players within the ecosystem because at the end, as in the biology world, each part of the puzzle plays a role. So we’re very happy to put players together and try to, in the best-case scenario, package different solutions if they touch us in any way. After all, the end goal is the best user experience or the best enablement for small merchants. So whatever comes up as what the users want, what the consumers want, what makes everybody have a win-win scenario, we will support it.

Claus: Is that a general thing in Visa as a company to have that user experience focus?

Maria: Absolutely. Yeah. And more and more so. I think our end goal is always to start with the user experience as a goal and work backwards to see what we need to get to that point. Being part of a network and an ecosystem, sometimes we cannot do it alone, so partnerships are key.

Claus: Right. Fraud prevention is a big topic. Recently, I just prepared for another talk that I had here on stage about AI use for criminals and the new possibilities generative AI gives them as well. For example, in IT documentation at scale, given just publicly available tools, which was very, very difficult before.

Okay. So what tools or best practices do you recommend, especially for small merchants who might be affected by that? Because they don’t know the processes, so anything needs support there.

Maria: Yeah. Let’s start with, like, let’s say the low-code kind of solutions. Yeah. First of all, awareness—cybersecurity awareness—is key. I know small merchants have limited time, but keeping up with trends, like reading up, is important. Governments also offer a lot of common resources and information, so just be open and clear, plan potential scenarios, and inform their staff about potential threats. I think that is very important.

Yeah. Then partnerships are important. I think it’s important to talk to their acquirers, payment facilitators, whomever their bank is. They have information, and they shouldn’t be shy to ask and say, “Okay, what should I be wary about? Is there anything that you have seen in my account behaviour that I could improve?” Let’s just stop and open the conversation.

And I would then close the loop with the products, as part of your question. Yeah. Tokenization—I think it’s such a basic element of all of our products, or many of our products in the front stack that Visa has, but it’s just the fact of protecting data, right? So instead of, let’s say, transmitting a card number with the 16 digits, we’re converting it into something that’s not legible or is much more difficult to intervene or crack. So this is kind of a fundamental, and as I say, a building block of fraud, and small merchants can access it.

So just reach out to your payment facilitator and ask what the options in tokenization are.

Claus: They’re obviously also interested in preventing…

Maria: Absolutely. And it also has not only a protection feature, but it helps improve customer experience in some cases in the e-commerce space. It also works extremely well with other products. It’s like, as I said, a building block. Yeah. And it increases the payment success rate, which is what everybody wants, right? Like, if my user is attempting to buy something, I don’t want to add friction to it. I want it to be as seamless as possible.

And if I’m competing with somebody else, I don’t want them to lose that within that payment flow, become demotivated, and then go with someone else and buy that product, right? Yeah. So in this competitive world, it’s important to have zero friction. That’s right. So tokenization is near and dear to our hearts for sure.

Claus: One really interesting question for me is what’s next? Because this is such a fast-developing world. Do you see any trends that are most exciting for the next wave of small business commerce, and how is Visa positioning your acceptance roadmap?

Maria: Yeah, definitely. Absolutely. I would say every year, and as you go through conventions, there is always a theme. I would say definitely AI and agent commerce are coming on very strong. Mm-hmm. I don’t know if you saw the speaker at the beginning; it was the Reebok in 2020 reopening.

Yes. One of the Reebok builders came from that scenario, but he’s partnering with an AI firm to create and 3D print shoes. It’s all powered by AI, trying to find the best style that we want. So AI is definitely a big topic.

Yeah. So AI is definitely powering a lot of things. As you go through the convention floor, you will see a lot of that. But for us, it is a very big topic. Mm-hmm. So I can announce that on April 30th, we will actually have a product drop. If you look it up, there is a way for you to subscribe to the live stream, and we will be announcing more new products to come. So also on the AI kind of identity—very interesting.

Claus: AI is accelerating all product development, and it’s firing things up a lot. I almost resent having to spend so much time learning and experimenting with new things because on the event I do need to run a business and not just justify my picture.

And then it releases something else entirely with all the three, four models there and it’s random.

Maria: Absolutely.

Claus: I do have one more question that you don’t need to answer for Visa, just on a personal level, but I do ask everybody. Okay, understood. So the idea is, if you woke up as the global regulator, what could change things? Mm-hmm. Is there anything you think you would concentrate on?

Maria: Well, I have seen so many different countries and the different approaches, and to be honest, I am amazed at how all the regulators need to navigate their particularities, and I understand why they’re different. Just cultural differences.

Yeah. Cultural access. Yeah. I think I completely understand that, but personally, I think if there was something that we could do to give more digital access to everybody, I think it would be a key aspect. Yeah. In any way or form, right? Yeah. Because it really enables somebody to be a bit more independent, financially, economically, and perhaps just have a better life. So I think to me that would be a key aspect.

Claus: See, that is a new angle. I’ve had 50 or so.

Maria: Oh really? I wonder if I repeat.

Claus: No, this is a new angle. We had a couple that overlap, actually. We had numerous. Do it a few times. We had the unifying of regulations between blocks and countries and so on, which is unlikely to happen, but this is great.

Maria: Okay.

Claus: Well, wonderful. Maria, this has been wonderful. It was very easy-going. Thank you so much for making the time, even though we are both headed to the airport.

Maria: No, it was amazing. Thank you. And see you soon.

Claus: Thank you for listening to this episode of RegTalks. My name is Claus Christensen, and I’m the CEO and co-founder of the award-winning regtech provider Know Your Customer.

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