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The payments industry is undergoing a major overhaul as AI takes center stage. Agentic AI is likely to reshape day-to-day activity in the payments ecosystem, with e-commerce being one of the biggest transformative engines, according to 2025 Global Payments report by consultancy BCG. Over 80% of consumers are expected to use agentic AI in the […]
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Vaidik Trivedi
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The payments industry is undergoing a major overhaul as AI takes center stage. Agentic AI is likely to reshape day-to-day activity in the payments ecosystem, with e-commerce being one of the biggest transformative engines, according to 2025 Global Payments report by consultancy BCG. Over 80% of consumers are expected to use agentic AI in the […]
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Vaidik Trivedi
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The payments industry is undergoing a major overhaul as AI takes center stage. Agentic AI is likely to reshape day-to-day activity in the payments ecosystem, with e-commerce being one of the biggest transformative engines, according to 2025 Global Payments report by consultancy BCG. Over 80% of consumers are expected to use agentic AI in the […]
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Vaidik Trivedi
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Stephanie Schultz, vice president and head of partnerships at Amex Digital Labs at American Express, is focused on building out digital client experiences as part of her innovation and product development strategy heading into 2024.
Throughout 2023, American Express prioritized technology spend, according to the card giant’s third-quarter earnings. Its expenses for the quarter increased 7% year over year to $11 billion, driven by higher technology and personnel-related costs.
As tech spend grew, American Express looked to increase product offerings in tune with client needs and new technological capabilities. For example, Amex explored uses for Web3, teamed up with Square and enhanced digital payment offerings.
In an interview with Bank Automation News, Schultz discussed her development plans for 2024, the Digital Labs product strategy and her approach to leadership. What follows is an edited version of that conversation:
Bank Automation News: What is your focus for product development and strategy for the remainder of 2023?
Stephanie Schultz: As we move through 2023 and into 2024, I am focusing on finding ways to make American Express a more essential part of our customers’ digital lives. We’re dedicated to creating seamless digital payment solutions, elevating membership experiences and actively addressing the emerging needs of our customers.
In today’s dynamic digital landscape, technology is advancing rapidly, and customer expectations continue to evolve. We adopt an ‘outside-in’ approach to guide our strategy and use new technology that solves meaningful problems for our customers to make their lives easier, not harder.
My team specializes in developing innovative products and enhancing membership experiences through strategic collaborations with leading tech companies and startups. Our efforts are concentrated across six critical focus areas including digital payments, e-commerce, future of membership, artificial intelligence, Web3 and other emerging tech.
BAN: What is the AmEx Digital Labs product roadmap journey?
SS: At Amex Digital Labs, our approach to new product development revolves around an inclusive and open forum designed to foster innovation and bring impactful ideas to life. We’ve established a platform where anyone on the team, regardless of their position, can pitch an idea “Shark Tank”-style to our leadership team.
This democratized approach to idea generation has led to more high-quality innovation. We are constantly bringing new products to market, and this open forum acts as a tool to help team members iterate and improve on their ideas and obtain the necessary resources for progression — from a viable business idea to a proof-of-concept, and eventually to a pilot phase, whether that’s with customers or internally across our Amex teams.
Throughout this process, our card members’ needs remain at the center of our learning agenda. We meticulously assess at each stage, evaluating for product market fit and scalability to determine which pilots can evolve into full-fledged product launches.
BAN: How do you determine what fintechs are the right fit for partnerships?
SS: Our team partners with a wide range of companies from fintechs to big tech companies. When considering partnership opportunities, we try to identify distinct offerings that can complement or augment Amex’s existing capabilities within our strategic focus areas.
Equally important is the alignment of core values and priorities. At Amex, our unwavering focus is around our customers. We prioritize partners who share our commitment to creating customer-centric products and are dedicated to delivering exceptional customer experiences consistently.
By fostering partnerships that align not only in technological innovation but also in shared values and customer-centric approaches, we aim to create mutually beneficial collaborations that elevate the experiences of our card members.
BAN: What emerging technologies do you have your eye on?
SS: There are several emerging technologies I am keeping an eye on right now, but one that has particularly captured my attention is Web3. We’ve been actively exploring this space, notable during this year’s U.S. Open Tennis tournament, where we introduced our latest Member Collectibles experience.
This experience allowed attendees to collect a total of three free, digital collectibles designed by illustrator Vero Escalante and issued in collaboration with POAP. This marked the first time card members were able to connect their NFT wallet of choice to their Amex account. This linkage enabled card members to unlock exclusive discounts with event sponsor La Roche-Posay, as well as transit and rideshare offers.
Our journey with on-site digital collectibles started at Austin City Limits (Music Festival) in 2022 with collectibles designed by a local artist, Zuzu. We also had an NBA 2K activation in December 2022 which let fans and card members unlock the video game’s digital currency. Additionally, at the U.S. Open golf tournament this past June, we let fans use their digital collectibles to access a website selling custom merchandise from a Metalwood x Hypebeast collaboration.
As we delve deeper into the realm of digital collectibles, we are excited about the potential of Web3 technology to evolve our loyalty and membership experiences.
BAN: How would you describe your leadership style?
SS: Throughout my career journey, I’ve aimed to lead authentically, emphasizing the human aspects that can sometimes get overlooked in a corporate environment. Being genuine and approachable has been fundamental in how I lead. I prioritize creating an environment where each team member feels comfortable coming to me with any challenge, ensuring they know they have my support, no matter what.
Authentic leadership, to me, also means being adaptable. Rather than imposing my personal leadership style, I invest time in understanding each team member’s unique working style and how best to support them. This deep understanding has allowed me to tailor my guidance and coaching. I have figured out what they each need to be successful and how to motivate them individually. This personalized approach has also fostered a tight-knit culture amongst the Labs team, which has been instrumental in enhancing collaboration and driving better outcomes.
Get ready for the Bank Automation Summit U.S. 2024 in Nashville on March 18-19! Discover the latest advancements in AI and automation in banking. Register now.
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Whitney McDonald
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Vaidik Trivedi
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Customers today expect a seamless omni-channel shopping experience with directly integrated payment options. Recently technical progress and the tokenisation of retail payment transactions have enabled omni-channel use cases. In this article we explain how omni-channel payments work in practice and how merchants and corporates are able to benefit from this modern payment solution.
Automatic Tokenisation and Omni-Channel Payments
Modern payments solutions tokenise all transactions to reuse the processed information in future transactions, whether through the same sales channel or others.
Tokenisation describes the encrypting process by which unique identifier replacement numbers are assigned to transactions. If a payment system recognises a token, it decrypts it using the right decryption key to process the data.
Use case 1: A customer buys a product (or service) in a store and pays by card. The payments system tokenizes the transaction based on the transaction reference number. If the customer is not satisfied with the product, returns it a few days later and wants a refund, the merchant or corporate can simply trigger the refund payment to the customer at the push of a button after entering the token. The payments system recognizes the encrypted token and the underlying transaction data.
Use Case 2, click & reserve: A customer selects a product online, triggering a reservation. The customer is satisfied with the look and feel of the product and pays for it in-store. The payment system recognises the underlying transaction data assigned to the token created during the online selection and uses it automatically to process the payment.
Other relevant omni-channel use cases for merchants and corporates include ‘queue busting’, click & collect’, ‘buy instore & pay at home’, ‘instore e-commerce’ and ‘endless aisle’.
As omni-channel use cases rise, corporates and merchants are bound to implement them. Retail payments today are customer-centric and require a modern payments solution.
Due to the seamlessly integrated payment functions within the different distribution/sales channels, retailers and corporates hardly miss out on any sales as their customers have the freedom to shop across channels and to choose how to pay. Additionally, purchase cancellations and time-consuming manual refunds can be avoided.
Automation of accounting and reconciliation to reduce manual processes
Modern retail payments solutions enable merchants and corporates to further automate accounting and reconciliation. This has the following benefits for merchants and corporates:
If modern retail payments solutions are used, all transactions are automatically tokenised. This ensures that omni-channel transactions are consistently correctly flagged and recognised at all times in the reconciliation process and booked directly in the accounting system if they match.
This means significantly less manual search and correction effort for the parties involved, resulting in direct cost savings. Today, some payment providers and acquirers include automated reconciliation solutions to integrate added value.
From simple terminal to future-proof multitalented smart POS device
‘All in one’ or ‘one device strategy’ are increasingly important for merchants with physical points of sale (POS).
Simple terminals to accept cashless payments are being replaced by a new generation of android-based smart devices. These devices enable value added services and deliver an enriched in-store customer experience.
Using modern smart POS devices to accept cashless payments in stores offers the following advantages for merchants and corporates:
real-time software updates through cloud integration. The days when a terminal had to be returned to the payments provider for a software update are over. Thanks to integration, payment providers are always able to automatically provide merchants with the latest terminal software. New features can continuously be added and the internationally valid PCI DSS security certification covers all the security aspects of smart POS devices.
manage Smart POS devices yourself.
Thanks to the Android-based operating system, merchants can manage their smart POS devices themselves and activate and/or change new payment methods, FX currency conversion and other functions, and much more.
use additional applications on the smart POS device, simply.
Additional connectivity to applications such as the POS system for cashing, the warehouse system for querying inventories or the customer relationship management (CRM) system for viewing customer data can be conveniently activated on the smart POS device. This works via an app store, where the corresponding apps can be downloaded to the smart POS device and linked to the main system for use, turning the smart POS device into a mobile control centre and giving the merchant further flexibility.
new instore shopping experience.
Smart POS devices enable a wide range of new use cases, from self-service to close interaction with sellers, Web in-store, Gamification and others.
And now?
The entire retail payments infrastructure is being transformed, creating a multitude of new opportunities to offer cashless payment solutions in the future.
Merchants and corporates are advised to upgrade their payments infrastructure to benefit from optimised operations and reduced manual effort, resulting in overall cost reductions.
Due to the growth in retail payments, the cost structure for merchants has become more important than before. This is therefore the best time for merchants to consider the future Interchange++ cost structure of retail payments.
Read our previous retail payments transformation blog here
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Lena Woodward
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Whitney McDonald
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PayPal Holdings increased its technology and development spend year over year as the company reduced its headcount in January. WHY IT MATTERS: PayPal, one of many tech companies worried about economic uncertainty and a potential recession, reduced its headcount by 7% — 2,000 employees — the company announced last month. PayPal did not specify the […]
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Brian Stone
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Retail payments is undergoing a profound and ground-breaking transformation in Switzerland, which is having a significant impact on consumers, merchants and corporates as well as on banks and payment service providers.
From transaction commodity…
Retail payments are payments made by consumers when purchasing products and services from merchants and corporates.
Cash has long been the undisputed number one means of payment in daily use as well as in the form of foreign currencies for travel and payments abroad. Credit cards were mostly used by consumers for travel activities and were not very popular with merchants due to high commission costs.
Making retail payments was a static and inflexible activity carried out at the end of every purchase.
… to customer centricity
Not any longer!
Retail payments are undergoing a profound and ground-breaking transformation, which has a significant impact on consumers, merchants and corporates as well as on banks and payment service providers.
Digitalisation has taken us into a new era in retail payments, with new payment solutions from payment service providers and changes in consumer behaviour. This has resulted in a dynamic retail payments ecosystem.
Consumers are buying more and more products and services online or via a mobile device or contactless payment. In addition to credit and debit cards, there are alternative, non-card payment methods such as PayPal, TWINT and Klarna.
Contactless payments by card became well-established during the COVID-19 pandemic, especially among consumers who had previously paid by cash.
‘Mobile first’ (retail payments that are made with or on a mobile phone, tablet or smartwatch) is also popular and 15.8%* of all purchases and payment transactions are now carried out via mobile devices. This includes both peer-to-peer as well as business to consumer payments.
New methods for retail payments are not just an issue for merchants, but also for corporates such as insurance companies that take money from customers. A perfect fusion in the purchase process is defined as embedded payments or in-app payments, the payment process that can be processed directly in the app of the merchant or corporate.
Consumers today expect flexibility in the ways that they shop and pay for purchases, whether in-store or online, but they want payments to be fast and simple.
Retail payments are becoming customer-centric, and consumers decide where, when and how they want to pay. Accordingly, retailers and corporates are aligning the shopping and payment experience with what consumers expect.
What now?
Merchants or corporates who receive retail payments and payment service providers need to ensure that their payments systems are modernised to meet current and developing demand from consumers for digital payments.
Due to the growth of retail payments, the cost structure for merchants and corporates has become more dominant as before. Hence, for merchants this is the best moment to consider the future Interchange++ cost structure of retail payments.
*Swisspaymentsmonitor.ch
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Lena Woodward
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