Payment terminal maker VeriFone has appointed Paul Galant, previously a Citigroup payments executive, to be its chief executive officer and a member of its board of directors, effective Oct 1.
Galant will be the permanent replacement to longtime VeriFone CEO Douglas Bergeron, who left the company in March amid business struggles and disclosures about possible dealings in Iran. Board member Richard McGinn became CEO on an interim basis.
Galant, 45, was CEO of Citigroup's enterprise payments business since 2010. In that role, he developed digital payment services for Citi's institutional and government clients. He also served as CEO of Citi Cards, heading the bank's North American and International Consumer credit cards business; and also served as CEO of Citi Transaction Services.
"Following an extensive search process, that considered a broad list of highly qualified candidates, Paul was deemed unanimously by the Board to have the best combination of professional experience and leadership skills to continue to capitalize on the solid progress we have made in recent months," said Leslie Denend, VeriFone's interim non-executive chairman, in a Sept. 23 press release. "His experience in guiding businesses through industry change and his track record in multi-channel payment innovation will position the company strategically for continued growth and long-term value creation."
Galant was not available for an interview on Sept. 23, and McGinn is "currently focused on facilitating a smooth transition to Paul," said VeriFone spokesman Andy Payment in an email.
VeriFone's earnings struggled ahead of Bergeron's departure. The company's frustrated customers "have been brutally honest about our lack of partnership," McGinn said during a June earnings call. In September, McGinn said VeriFone was making progress, and the expansion of mobile payments and the EMV migration in the U.S. would help the company's performance going forward.
For Galant in his new role, "this is a turnaround situation," says Richard Crone, a payments consultant. "He's going to have to come up with a formula that allows them to play in the developing payment marketing without placing a heavy dependence on hardware."
VeriFone has developed new products for sound-based mobile payments technology in taxis and bundled payments services. The company plans to add more data analysis capabilities to its network to enable value-added merchant and consumer services. VeriFone earlier sold its Sail mobile payments business, which was targeted to smaller merchants than VeriFone typically serves.
"I am impressed with the progress the company has made during the past year and recognize there is still much work to be done," Galant said in a release. "I am committed to VeriFone's business success and look forward to working with the talented senior leadership team and VeriFone's 5,500 employees worldwide to deliver the quality and innovation that our clients need and the value that our shareholders expect. VeriFone has established a tremendous presence in the payments ecosystem with its managed services, platform software and data analytics offerings across its core global network of more than 20 million devices in 150 countries. This is a strong foundation to build upon, and I look forward to continuing to serve our clients and grow our device and services businesses leveraging new technologies and powering new commerce channels."
The growth of cloud-based mobile payment systems, which rely less on Near Field Communication hardware to execute payments at the point of sale, will also pose challenges for VeriFone, Crone says.
"The wind has been taken out of NFC's sails with the cloud-based payments," he says, adding cloud-based mobile payment systems could affect the EMV terminal upgrades that VeriFone is relying on to boost its recovery.