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Tapping into the connected car ecosystem could unlock new opportunities for payment providers
Car manufacturers continue to develop connected consumer experiences, opening up precious new revenue streams and opportunities to improve the customer experience of their marques and foster deeper brand loyalty. Olivier Bessi, Head of Fintech solutions at Star, looks at the opportunities for fintechs in the connected car ecosystem.
The value of in-car payments could reach $86 billion by 2025, up from $543 million in 2020, according to Juniper Research. Car makers are keen to seize the opportunity to drive revenue growth and foster long-term business sustainability, thus becoming active players in the digital economy. How can payment specialists get involved despite not being experts in the automotive space?
Providing drivers with the ability to make payments – for anything from parking, tolls, fuel and food on the go to roadside assistance – directly from the vehicle dashboard, provides a speed and convenience turbo boost that could significantly increase brand loyalty for car manufacturers.
Further opportunities to customers are also available. For example, if a customer has a flat tire and needs roadside assistance but can’t afford to pay for one upfront, providing buy now, pay later (BNPL) solutions as a roadside payments solution could boost subscription-related services and further foster customer loyalty. This innovative approach not only offers immediate financial relief to customers in unexpected situations but also presents an additional untapped revenue stream for car manufacturers, diversifying their service offerings.
Navigating go to market complexity
With no heritage of payment solutions, the payment ecosystem is a complex one to navigate for car manufacturers.
Finding the right financial ecosystem partners will be critical for them as they develop hybrid or capsule solutions for car users; pinpointing use cases that truly enhance the customer experience – beyond the obvious, like paying for tolls and gas.
For example, paying for quick service food, groceries and scheduling and paying car maintenance are all potential applications. Data and AI technology baked into in-car systems could suggest relevant goods and services, anticipate drivers’ needs, and shed light on desires they didn’t even know they had, providing a true open road experience.
Manufacturers may want to build their own in-car systems to empower dealerships and more directly manage the impact the experience has on customer loyalty but building an operating system from scratch, the approach being adopted by Mercedes for example, is an enormous investment.
There is a huge opportunity for fintechs to work together to help manufacturers overcome the multiple hurdles such as compliance with payment regulations and the security of sensitive customer information.
Fintech’s innate understanding of consumers’ payment needs will help manufacturers shape their offerings accordingly and create sensible subscription models that lead them to their endgame.
Where are the opportunities?
Payment providers and fintechs can help car manufacturers with several nuanced, technical aspects beyond building or outsourcing. Keeping the customer as the focal point and devising a holistic approach to payments that enables access to a strong network of partners is crucial.
When it comes to the secure and seamless protection, storage and analysis of customer transaction data for example, they can short circuit the journey to full connectivity and overcome technical and regulatory hurdles such as data encryption and privacy laws, breach prevention measures, adherence to industry-specific regulations like the Payment Card Industry Data Security Standard (PCI DSS), or access to major card schemes as a principal member.
The future customer journey is the endgame to keep in mind for car manufacturers and fintechs alike. Partnering will get you there quicker and deliver a consistent digital payment experience across brands and vehicles, increasing adoption, decreasing confusion and making it easier to onboard new merchants as the retail ecosystem expands.
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Combating Cyber Fraud in the Aviation Industry
Source: Finance Derivative
Written by Andrea Feldman, Senior Cyber Threat Intelligence Analyst at BlueVoyant
Fraudulent cyber-attacks targeting the airline industry are a common issue largely seen coming out of the underground, such as the deep and dark web. According to RSA Security, airlines are the industry most affected by online fraud, accounting for 46% of fraudulent transactions. As a result, the financial costs for airlines are huge with losses due to fraud estimated at 1.2% of the total global airline revenue.
Over the past few years, there has been a significant spike in threat actors targeting the aviation industry worldwide, due to airlines’ increasing reliance on online booking and reservation platforms. These online tools make it more convenient for customers to purchase airline tickets and have become an industry standard. However, it has also enabled fraudsters to exploit vulnerabilities in online systems. The significant disruption and increase in remote work caused by the COVID-19 pandemic has also caused an increase in fraud in recent years.
Analysing Fraud in the Underground Market
Posts offering flight tickets or compromised accounts with frequent flyer miles or reward points at advantageous prices are very common in underground forums, chat platform groups, and even on social media. Threat actors commonly sell flight tickets at reduced prices by using compromised credit cards to purchase tickets. These kinds of posts are frequently seen in the underground market targeting airlines worldwide. Threat actors typically purchase the flight tickets a few hours before the flight, reducing the likelihood of the airline identifying the fraud in time.
Compatible BIN numbers
It is also common to see posts in underground forums where threat actors seek specific credit card BINs that perform well when booking with certain airlines.
Compromised Travel Agent Consoles
Nevertheless, some threat actors obtain tickets by hacking travel agents’ accounts or conducting fake bookings. Examples include threat actors plotting in an underground forum offering access to a travel ticket panel for sale.
Messages from a threat actor can include mentions of the fake travel panel and its ability for users to instantly issue plane tickets under any name, on any airline, or to any destination. Furthermore, the threat actor can note that the access originates from a large, legitimate company with many accounts, which increases the difficulty for the breach to be detected.
Compromised Frequent Flyer Accounts
Frequent Flyer programs are also heavily targeted in the underground market as another way to issue fraudulent flight tickets. Threat actors offer compromised frequent flyer account credentials for sale, often at advantageous prices. These credentials, which include frequent flyer miles or reward points, are obtained through fraudulent methods such as phishing or hacking into customer accounts. The attackers then steal points or miles and redeem them for flights or other rewards. Access to the compromised accounts themselves is then sold separately.
Fraudulent activities can lead to financial losses for an airline due to chargebacks, increased operational costs for fraud prevention, and damage to the airline’s reputation.
Mitigation of Aviation Fraud
To combat this kind of fraud, it is crucial to enhance security measures and ensure the effectiveness of fraud prevention systems. Employee training and awareness are also essential components for implementing prevention techniques.
Given that fraudsters continuously adapt their methods, it is important to:
· Regularly review and update fraud prevention policies and procedures to address evolving threats
· Conduct thorough internal audits to identify any gaps or exploits in existing systems and processes
· Stay informed about emerging technologies and industry standards to leverage innovative solutions for fraud prevention
· Enforce Multi Factor Authentication (MFA) for user accounts, and ensure password policies are effective and up to date
· Airlines should be monitoring for phishing websites impersonating them, compromised accounts sold in the underground and other fraudulent activities in the dark web.
As the risk of fraud within the aviation industry continues to pose a threat, organisations must be prepared to implement stringent security measures. Companies should look to partner with cybersecurity partners which offer impersonation and fraud detection solutions. They must also implement dark web monitoring and brand protection services, essential to actively monitoring underground communities. This will enable companies to stay ahead of fraudsters, helping to triage the most serious threats that can otherwise have a severe impact on an airline’s reputation and customer experience ratings in a significantly competitive market.
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Could 3D Solid State Batteries Accelerate the Adoption of Electric Vehicles
As we push towards the goal of net zero by 2025, the era of the internal combustion (IC) engine is drawing to a close.
Although consumer reliance on the humble petrol- or diesel-fueled motor car has been climbing at a steady and predictable pace ever since Henry Ford-style mass production caught on, there has been a modest dent in the demand for traditional vehicles, with nearly one in five cars sold in 2023 being electric.
So will this trend continue to grow? We would argue yes, but putting a timescale on this is a tricky task: the predictability we have seen with IC vehicles doesn’t apply to everything. Not all innovations buck conform to one clearly defined trend. And this appears to be the case with electric vehicles.
With nearly 20% of new cars being electric in some regions, electric vehicles (EVs) are steadily increasing their market share. In fact, in countries like Norway, adoption reached around 80% in 2023. This year, it’s projected that 25% of passenger car registrations will be electric, surpassing 17 million units in global sales. These numbers indicate a significant upward trend in EV adoption, especially in recent years.
Nonetheless, even taking these encouraging figures into account, EVs still only represent a small proportion of all vehicles on the road. This needs to change otherwise there’s a danger that EV adoption could stagnate.
What needs to change to boost EV adoption?
Apart from the natural laws of supply and demand, the main limitations hindering EV development are most notably cost, slower recharge rates and limited range.
This is where batteries come in as the key to addressing these hindrances.
Batteries designed for vehicles focus on overcoming a range of challenges. Weight, cost, and the sourcing of materials are all significant. Beyond these, one factor stands out. With, nearly 50% of consumers claimed they’d need a higher real-world range to consider switching from ICE vehicles to electric cars according to a recent survey by GoCompare – the limitations posed by a battery’s range is a key factor to be addressed.
This means that we are a long way off being reliant on fossil fuels to power our vehicles. However, a solution might be closer than we think.
LionVolt’s cutting-edge battery technology is a driving solution for electric cars and sustainable aviation by creating groundbreaking 3D solid-state technology for next-gen batteries.This new technology could be key to far greater EV uptake at a scale that could set a steep new trend.
What are 3D solid-state batteries, and how do they work?
The key to overcoming the challenges limiting the shift towards electrification are batteries and cells that are much faster to charge than those currently used and can extend range and performance. Central to these developments are advances in lithium-ion batteries.
In terms of range, the science revolves on energy density – how much energy can be packed into each battery for a given weight. To achieve high density, we are seeing a shift to more advanced products from materials commonly used in today’s cells. New anode technologies, including silicon and lithium, will increase today’s range and can be ‘dropped into’ the existing supply chain. To get a significant increase, the production process involves switching the flammable liquid common to old-style batteries with a solid, non-flammable material.
Obvious benefits to drivers and the planet alike range from,faster charging, higher performance, intrinsically higher standards of safety, longer battery life, and radically lowered carbon footprints
The real gamechanger here is extended range: driving ranges upwards of 800 km—or about 500 miles—are no longer the stuff of EV drivers’ imagination and this could be the stepchange we need for mass adoption.
LionVolts innovations in the battery space address consumer demands for extended range while also offering a safer, more sustainable alternative to traditional batteries.
This lays the foundations for an increased uptake of EVs in the future, but electric cars are not where the innovations end. LionVolt are also developing larger versions of these batteries that have the very real potential of fueling aviation. We could say when it comes to electrification to achieve net zero, the sky’s the limit (no pun intended!).
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The Benefits of EV Salary Sacrifice: A Guide for Employers and Employees
As the UK government continues to push for greener initiatives, electric cars have become increasingly popular. The main attraction for both employers and employees is the EV salary sacrifice scheme.
By participating in an EV salary sacrifice scheme, both employers and employees can enjoy cost savings and contribute to environmental sustainability along the way! This article will delve into the specifics of how these schemes operate, the financial advantages they offer, and the broader positive impacts on sustainability.
We will provide a comprehensive overview of the mechanics behind EV salary sacrifice schemes and discuss the various ways in which they benefit both employees and employers, ultimately supporting the transition to a greener future in the UK.
What is an EV Salary Sacrifice Scheme?
An EV salary sacrifice scheme is a flexible financial arrangement that permits employees to lease an EV through their employer. The key feature of this scheme is that the leasing cost is deducted directly from the employee’s gross salary before tax and National Insurance contributions are applied. By reducing the taxable income, employees can benefit from substantial savings on both tax and National Insurance payments. This arrangement not only makes EVs more affordable for employees but also aligns with governmental incentives to reduce carbon emissions.
For employers, implementing an EV salary sacrifice scheme can lead to cost efficiencies as well. The reduction in National Insurance contributions on the employee’s reduced gross salary can offset some of the costs associated with administering the scheme. Additionally, such programmes can enhance the overall benefits package offered by the employer, making the company more attractive to prospective and current employees.
Benefits for Employees
1. Tax and National Insurance Savings
By opting for an EV salary sacrifice scheme, employees can benefit from reduced tax and National Insurance contributions. Since the lease payments are made from the gross salary, the taxable income decreases, resulting in substantial savings.
2. Access to Premium EVs
Leading salary sacrifice car schemes often provide access to high-end electric vehicles that might be otherwise unaffordable. Employees can enjoy the latest EV models with advanced features, contributing to a more enjoyable and environmentally friendly driving experience.
3. Lower Running Costs
Electric vehicles typically have lower running costs compared to traditional petrol or diesel cars. With savings on fuel, reduced maintenance costs, and exemptions from certain charges (such as London’s Congestion Charge), employees can enjoy significant long-term financial benefits.
4. Environmental Impact
Driving an electric vehicle reduces the carbon footprint and supports the UK’s goal of achieving net-zero emissions by 2050. Employees can take pride in contributing to a cleaner environment.
Benefits for Employers
1. Attract and Retain Talent
Offering an EV salary sacrifice scheme can enhance an employer’s benefits package, making it more attractive to potential recruits. It also helps in retaining current employees by providing them with valuable and cost-effective benefits.
2. Cost Neutrality
For employers, EV salary sacrifice schemes are often cost-neutral. The savings on National Insurance contributions can offset the administrative costs of running the scheme, making it an economically viable option.
3. Corporate Social Responsibility (CSR)
Implementing an EV salary sacrifice scheme demonstrates a commitment to sustainability and corporate social responsibility. This can improve the company’s public image and align with broader environmental goals.
4. Employee Well-being
Providing employees with a cost-effective means to drive electric vehicles can contribute to their overall well-being. With lower running costs and the convenience of driving a new EV, employees may experience reduced financial stress and increased job satisfaction.
How to Implement an EV Salary Sacrifice Scheme
1. Assess Feasibility
Evaluate whether an EV salary sacrifice scheme is feasible for your organisation. Consider the number of interested employees, potential cost savings, and administrative requirements.
2. Choose a Provider
Select a reputable provider that offers a range of electric vehicles and comprehensive support services. Ensure they can handle the administrative tasks and provide a seamless experience for both the employer and employees.
3. Communicate the Benefits
Educate your employees about the advantages of the scheme. Highlight the financial savings, environmental impact, and access to premium EV models. Provide clear guidance on how they can participate in the programme.
4. Monitor and Review
Regularly review the scheme’s performance to ensure it continues to meet the needs of your employees and the organisation. Gather feedback and make adjustments as necessary to enhance the programme’s effectiveness.
Conclusion
The EV salary sacrifice scheme offers a win-win situation for both employers and employees in the UK. With significant financial savings, access to premium vehicles, and a positive environmental impact, it’s an attractive option for forward-thinking organisations. By implementing such a scheme, employers can demonstrate their commitment to sustainability and employee well-being, while employees can enjoy the benefits of driving an electric vehicle at a reduced cost.
Adopting an EV salary sacrifice scheme is a step towards a greener, more sustainable future for everyone.