Pam Joseph | Executive Profile | ATLANTA TREND
A Pioneer in Payments
By Karen Rosen
Pamela Joseph has been at the vanguard of the payments industry since debit cards were introduced in the mid- 1980s. Back then, the front line was the checkout line.
“We would stand in supermarkets and pay people $1 if they would just use their debit card,” Joseph, Vice Chair, Payment Services, at U.S. Bancorp, recalls of her first banking job with Wells Fargo three decades ago.
“It was interesting to learn about people’s habits,” adds Joseph, the highest-ranking woman at U.S. Bancorp and No. 4 on American Banker’s most recent list of the“25 Most Powerful Women in Banking.”
“Even today if you’re standing behind somebody that’s writing a check, they will tell you it’s the easiest way to pay for something. So it’s really hard sometimes in the payment spectrum to get people to change behavior.”
The newest frontier is mobile payments. Joseph is again leading the charge, but with incentives more enticing than $1 bills. These include real-time coupons and discounts from merchants. Joseph’s division, which is known for its innovation, is also testing watermarks in newspapers, magazines and on television that allow people to “wand” their smartphones over them for instant purchases.
Joseph says with a laugh. “I enjoy payments because there’s always change, and the change always gravitates to whatever’s happening in technology.”
And whatever’s happening in payments is usually happening in Georgia. According to the Technology Association of Georgia (TAG), Atlanta is a global hub with annual revenue exceeding $20 billion from more than 70 companies focused on the payments industry.
“Just about everybody that’s anybody in payments is located here,” says Joseph, who estimates that 60-70 percent of all merchant payment transactions flow through the state.
U.S. Bank is the nation’s fifth largest bank with assets of $353 billion and revenue of $16.5 billion. As of the end of 2012, Joseph’s division represented about $5 billion in revenue (about 26 percent of the company's revenue), 33 percent of its pre-provision income, 11 percent of its loans and 35 percent of its fee income. Payments revenue is divided between Retail Payment Solutions (59 percent), Corporate Payments Systems (11 percent) and Global Merchant Acquiring (30 percent).
Joseph, who is also chairman of Atlanta-based payment solutions provider Elavon, a wholly-owned subsidiary of U.S. Bancorp, has taken on a prominent role across the industry as well.
She is on the Federal Reserve Bank of Philadelphia’s Payments Advisory Council, co-chairs the Card Policy Council for the American Bankers Association and is part of The Clearing House, composed of the 20 largest banks and 10 largest issuers, which is currently working on new security around card payments.
Joseph is also part of a group trying to address gaps in regulation “to try to bring all of our friends into our world,” she says of other payment processors that are not banks. “The consumer doesn’t necessarily differentiate between a card that might be regulated and one that isn’t.”
This month, Joseph will be honored by the Technology Association of Georgia’s FinTech group with a Lifetime Achievement Award.
“I think what I will end up being proudest of is my effort to support and help other women that really want to get into senior leadership,” says Joseph, who founded a group called “Women Leaders in Action” that focuses on networking, leadership training and mentoring.
“I’ve really tried to get women to help each other,” she says. “As you work your way up through an organization, you find fewer and fewer women. The idea is to help women from a leadership perspective make sure that they have the right training and the right toolset to continue to get ahead.”
The group, which has grown from 26 to 59 senior women within payment services at the bank, has also bonded through philanthropic work to improve educational opportunities for women and children in Africa.
Joseph is chairman of WLA Kids, which began in 2010 and raises about $400,000 a year. The group makes trips to Swaziland and Kenya and has supported more than 500 children with school fees. Recently, they brought donated laptops to 13 students going to university.
“It’s very hands-on, very grass roots,” Joseph says. “Every trip we take eight to 10 women from the leadership group. Over seven days they really get a chance to work together on something that makes everybody feel good.”
The Chicago native had no career trajectory mapped out when she graduated from the University of Illinois with a degree in business administration. She simply wanted better weather.
During the worst winter in state history, Joseph says, “One day it was 60 below zero, so they closed the university (first time in 100 years) and I just decided I’m moving to California. Even if it’s just for one year, I’m leaving.”
Two weeks after graduation, Joseph moved to San Francisco with $500 in her pocket. She quickly secured a job with Del Monte as a brand assistant on canned peas.
“For about a year and a half I knew everything you could ever know about peas and I decided I never wanted to be that involved in one product in my life,” she says.
Joseph’s work included focus groups and plant tours. While minding her peas and queues, she was also learning Marketing 101.
Joseph moved on to Wells Fargo, which was hiring people with a background in consumer packaged goods.
“Banking had just gone through deregulation and so they really wanted to understand how to market to consumers,” she says. “It was fun. It was very exciting because a lot of what I learned very quickly at a food company you just reapplied to a banking environment.”
She worked her way into credit cards and eventually debit cards. When Wells Fargo and other large banks in California started Interlink, the first debit network on the West Coast, Joseph ran debit and helped merchants become equipped to take pin codes.
After nine years, Joseph came on board the mother ship. VISA was looking for someone who understood debit, and Joseph became director of new market development.
At that time, VISA was a not-for-profit organization, “so it was a very unique experience,” Joseph says. “It was really a big advertising and marketing company. You actually drove the VISA brand and the image and worked with all the banks to get them to deliver the product to the end user.”
After a couple of years at VISA, Joseph and her husband, who was getting ready to retire, sought a better environment to raise their young children.
They chose Atlanta, and in July 1994, Joseph joined Nova Information Systems, a start-up in existence about a year, as senior vice president of product and marketing. (In 2007, Nova changed its name to Elavon. “We were going into Spain when we realized we had the wrong name,” says Joseph. Nova translates into “no go” in Spanish.)
“I said, ‘You know what? I’m going to give it a shot and see how it goes and if it doesn’t work out, I’m in Atlanta, which is a payments hub.’”
It worked out. In 1996, the company went public on the New York Stock Exchange. Joseph eventually became CIO, COO and then President. In 2001, NOVA was sold to one of its customers, U.S. Bank.
“ I thought, ‘Oh, I’m not working at a bank again,’” says Joseph “and so here I am in 2013 -- still at a bank.”
Looking back on her days at Wells Fargo, she says, “I didn’t mind banking, but in the end the regulation at times can unfortunately stifle your ability to innovate. And when you’re in payments, it’s about innovation. “
Today, her team voluntarily takes all new initiatives to the regulators for approval before bringing them to the marketplace. “From start to finish, there are so many more steps along the way,” she says.
Competing entities, from PayPal and Google to Global Payments, TSYS (Total Systems of Columbus) and First Data, are not regulated to the extent banks are, so they have fewer resources devoted to compliance.
“Compliance is not a bad thing,” Joseph says, “it’s just that you go from a fairly regulated environment with maybe too little oversight, and then the pendulum swings and we’ll be heavily regulated. Hopefully we’ll find that middle ground.”
Georgia’s delegation to Congress is trying to help out, Joseph says. When she spoke to U.S. Rep. Tom Price a couple of years ago, she says he was “really good about starting to get the folks in Georgia and at the federal level to understand just how important the payments industry is here.”
The office of Gov. Nathan Deal and the Georgia Department of Economic Development are also involved in promotion. With such a deep talent pool, the state is attractive to existing companies and new ones in payments services.
Earlier this year, Elavon created a group of programmers for mobile called “the Grove,” with 55 new employees. U.S. Bancorp’s total staff in Atlanta is close to 700.
Joseph says moving to mobile is a “chicken and egg” situation. “You can create the ability to pay on the phone, but now you have to get the whole merchant community to be able to accept payment from phones,” says Joseph, who admits she wrote a white paper in the 1980s predicting the end of the checkbook in five years.
Apple is not yet on board for contactless mobile payment since it has not put a contact-less chip in its iPhones. “I think people are leery to march down a road until they know exactly what the standard is going to be,” Joseph says, noting that her husband’s Betamax wound up in the garage.
She expects mobile to take off in about two years, with young people gravitating quickly, but other consumers holding back. “People are excited about mobile, but it really isn’t hard to swipe a card,” says Joseph. “We really have a good payment infrastructure -- it’s very fast, everybody understands it. And so moving to phone is a disruption.”
But the possibilities it brings are impossible to ignore. Joseph’s team is working with the publisher of a style magazine to bring the watermark technology to market by early next year.
“Instead of tearing things out of magazines if there’s something you like, you can just buy it instantaneously,” Joseph says.
Besides its pioneering work in mobile, U.S. Bancorp is also focusing on the international marketplace. They are acquiring merchants in 26 countries and just launched Brazil.
About five years ago, Joseph says, “We had a goal that by 2015 a third of our business would be international.” They represent 24 percent of total revenue right now and she’s confident they will hit their target.
Joseph also is a member of the board of directors of Paychex, Inc. (small business payroll) and Centene Corporation (healthcare services).
She lives in Roswell with her husband and 11-year-old son and they also have two sons in college.
While Joseph has come a long way since canned peas, she believes she could have been as happy in condiments as she is in payments.
“I always thought when I was at Del Monte, if I could just have ketchup, I could do so much,” Joseph says wistfully. “If they had given me ketchup, I might still be selling grocery items instead of working in banking.”
And she would have been just as successful. “We’d be putting ketchup on everything.”
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