Smile at the Camera, Your Train Is About to Leave

, by Claudio Todesco
From his position at Mastercard, Bocconi alumnus Michele Centemero can see the future of payments

We are going to pay the subway fare by showing our face to a camera and make purchases online without communicating our credit card number. This is the future of payments according to Michele Centemero, Bocconi alumnus and Mastercard Country Manager for Italy. Fierce fintech companies and menacing tech giants are emerging in the payments business. The only way to deal with this ever changing scenario is to optimize the user experience and strengthen the trust bond with consumers.

What are the specificities of the Italian payments market?
Almost all Italian consumers have a debit card, 35% of them have a credit card too. Italy is one of the biggest markets for prepaid cards worldwide. Italians use them especially for online purchases due to the often oversized perceived risks of transactions over the Internet. The share of cash use is pretty high, 77%, but services for card holders such as food delivery or car sharing are creating a flywheel effect. As a result, the average ticket for purchases made with cards has fallen to 43 euros and one in every two transactions is contactless. We encourage any new user experience on the market, including traveling on the metro by paying with a contactless card in Milan. They contribute to the fall in the share of cash. Our goal is to make consumers' life easier, faster, and safer.

Do you think that plastic cards, signature and passwords will become extinct?
Traditional cards will probably disappear in the long run, but they will always be used as a backup, especially for travelers. The radical change that is coming concerns passwords and signature. They will be replaced by biometric authentication such as voice, eye and fingerprint identification. We recently displayed a new turnstile for transportation fare. The traveler will access bus, metro and railway simply by approaching a camera. We are working on all possible applications of biometrics, a technology that is already available to our main customers.

Is the sixteen-digit number going to disappear?
The number will remain, but it will disappear from the websites where we shop. We will no longer type the number. It will be turned into a token valid only for that specific merchant. Stealing it will therefore be useless. This is a major change that will reduce costs in the event of loss, theft or duplication of the card. Tokenization will significantly boost security.

Mastercard traditionally interacts with banks and merchants. For some time now, new players have appeared on the scene: on the one hand fintech companies, on the other tech giants such as Apple, Samsung and Google. Is this an opportunity or a threat?
The scenario has changed dramatically. In the last few years, our company has become a technology company and about three years ago we have taken away the capital letter C from our logo, from MasterCard to Mastercard, to convey the idea that the card is just one type of payment. We act from an ecosystem perspective. We help fintech and startup companies to connect to our world and simplify user experiences. We also collaborate with tech giants. In a country where cash still rules, the payments market provides everyone with opportunities to grow.

What is happening with the implementation of the EU PSD2 directive on open banking?
PSD2 opens up opportunities for newcomers, but many years will pass before physical and virtual cards will extinct. The cards are very popular in Italy, every Italian has at least one in his wallet. Furthermore, our payment system is considered well-established and safe. Our surveys tell us that only a very small share of consumers are willing to use non-bank payment systems.


Michele Centemero graduated in Business Economics at the Bocconi University in 1999. He looks back to those years with some regret. "I could have done better, but I was distracted by my love for sailing". He likes to tell how the period he spent at Bocconi, which he describes as "the beginning of a wonderful adventure", has ended. He took part in an event for undergraduates, a three-day orientation program with meetings, role playing and an interview with an observer, actually a headhunter. "Right after the event, Reuters called me for an interview. The HR director told me: I see you worked for three years in a banca (bank). And me: well, no, I actually worked in a barca (boat), with an R. He went on with a series of flattering but wrong information that I had to deny. After four years at Reuters, I discovered that I had been noticed during the event at Bocconi and that the interview was a way to put my honesty to a test". Centemero stayed at Reuters until 2005. He worked at PMI Mortgage Insurance Company for three years. In 2008 he joined Mastercard where he held roles of increasing responsibility. "And now, I hope my daughters will choose Bocconi, too".

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