Elavon Third Party Sales International Opportunities. David McAlhaney (D.Mack) Senior Vice President of North American Third Party Sales, Elavon

Transcription

1 Elavon Third Party Sales International Opportunities David McAlhaney (D.Mack) Senior Vice President of North American Third Party Sales, Elavon

2 A View to Elavon GLOBAL VIEW GDP Growth Credit Card WHAT DOES ELAVON LOOK LIKE? WHY CHOOSE ELAVON? 2

3 GLOBAL VIEW 3

4 Tomorrow Never Dies Country GDP 2011 % of World GDP United States 14,991,300,000, % China 11,301,487,020, % India 4,535,900,626, % Japan 4,325,092,520, % Germany 3,227,443,592, % World GDP and Population Country 2012 Population % of World Population China 1,350,695, % India 1,236,686, % United States 313,914, % Indonesia 246,864, % Brazil 198,656, % Russian Federation 3,203,503,562, % France 2,311,912,992, % Brazil 2,291,153,367, % United Kingdom 2,233,108,624, % Italy 1,982,526,949, % Pakistan 179,160, % Nigeria 168,833, % Bangladesh 154,695, % Russian Federation 143,533, % Canada 34,880, % Mexico 1,911,301,753, % Korea, Rep. 1,482,725,709, % Spain 1,481,582,918, % Canada 1,427,357,403, % U.S. Represents over 18% of GDP and over 4% of the World Population Canada Represents almost 2% of GDP and is 0.5% of the World Population Turkey 1,259,643,766, % Source: World Bank, World Development Indicators 4

5 You Used to Say Live and Let Live % Anticipated GDP Growth Rate Source: ETA US Economic Indicators Report U.S. Federal Reserve Beige Book Indicators 5

6 Why Go Global Less dependence on borders Growth of e-commerce Diversification Leverage technology Quickening pace of new payment forms 6

7 This Ever Changing World Transactions Region % Increase Canada 33% U.S. 44% E.U. 51% Latin America 97% Middle East/ Africa 99% Asia Pacific 105% Growth In Purchase Transactions Worldwide % 100% 50% 0% Transactions Region Rise in (Bil.) Canada 2.4 U.S E.U Latin America 10.4 Middle East/ Africa 2.3 Asia Pacific 26.0 Source: Nielson Report, January 2013 Brand Total (Bil.) Change Transaction Total (Bil.) Change Cards (Mil.) Change Global Cards Visa Credit $3, % % % Visa Debit and Prepaid $5, % % % Visa Total $8, % % % MasterCard Credit $2, % % % MasterCard Prepaid and Debit $1, % % % MasterCard Total $3, % % % Visa and MasterCard Totals $12, % % % American Express Credit $ % % % Diners Club Credit $ % % % JCB Credit $ % % % Source: Nielson Report, February 2013 Union Pay Credit $1, % % % Union Pay Debit $2, % % % Union Pay Total $3, % % % Credit and Debit Totals $17, % % % 7

8 This Ever Changing World Purchase Volume on Payment Cards Worldwide Regional Market Shares by 2016 Brand Total (Bil.) Change Purchases (Bil.) Change Cash Change Total Change Purchase s Change Cards (mil.) Change Visa Credit $1, % $ % $ % % % % American Express Credit $ % $ % $ % % % % Master Card Credit $ % $ % $ % % V % Discover Credit $ % $ % $ % % % % Credit Card Totals $2, % $2, % $ % % % % Visa Debit & Prepaid $1, % $1, % $ % % % % MasterCard Debit & Prepaid $ % $ % $ % % % % Debit Card Totals $2, % $1, % $ % % % % Credit & Debit Totals $4, % $3, % $ % % % 1, % 8

9 Casino Royale 9

10 The World is not Enough Our Market Rankings (by no. of customers) #2 in the United States #3 in Europe 2012 U.S. Acquirers Customers Volume (Bil) (USD) First Data** 2,158,111 $1,599,838.8 Elavon*** 828,047 $254,516.8 Elavon Global Market Mix (volume) Global Payments 629,000 $117,755.2 Intuit 507,401 $31,924.8 Vantiv 399,548 $494,609.6 *Nilson Report, March 2013, total volume **First Data is comprised of First Data, Bank of America, Wells Fargo, SunTrust, PNC & Sovereign/Santander in the US *** Elavon is comprised of Elavon and Key Merchant Services 10

11 EMV REGULATORY Trends in North America 100% penetration of EMV technology is the goal. o Merchants may change providers as technology is upgraded in the next two years. o Short term revenue gain from upgraded technology. U.S. Federal Trade commission is targeting the industry with lawsuits against ISOs based on marketing practices. Uncertainty over Interchange legislation-where will the U.S. Federal Reserve land on Interchange Regulation? Canadian code of conduct-will the U.S. be next? STIMULOUS GOING AWAY SHRINKING SPREADS February American Recovery and Reinvestment Act of o Long term Economic Effects Federal Budget Sequestration o Cuts in Government Spending 11

12 WHAT DOES ELAVON LOOK LIKE 12

13 1.40% 1.20% 1.00% 0.80% 0.60% 0.40% 0.20% 0.00% Diamonds Are Forever North American DIAO Spread 78 Basis Points US 53 Basis Points CDA as of 6/13 U.S. U.S. DIA DIAO Spread Spread CDA DIA Spread CDA DIAO Spread North American Average Annual Volume $300,000 $250,000 $200,000 $150,000 $100,000 $50,000 $0 $242,057 US $211,228 CDA as of 6/13 U.S. Average Annual Volume CDA Average Annual Volume $250 $200 $150 $100 $50 $0 North American Average Ticket Size $84 US $199 CDA as of 6/13 U.S. Average Ticket Size CDA Average Ticket Size $140 $120 $100 North American Revenue Per Customer $80 $60 $40 $20 $0 $90 US $99 CDA as of 6/13 U.S. MSP Revenue Per MID/Month CDA MSP Revenue Per MID/Month 13

14 Nobody Does It Better Elavon North American Third Party Channel CATEGORY Percentage Change U.S. Registered MSPs (Partners) % Canadian Registered MSPs (Partners) % Total Elavon North American Registered MSPs (Partners) % New U.S MSPs (Partners) % New Canadian MSPs ( Partners) % Total New Elavon North American MSPs (Partners) % Sales Volume U.S. $21.2B $23.7B 11% Sales Volume CDA $5.2B $6.1B 17% Total Sales Volume North American (Partners) $26.4B $29.8B 13% U.S. Activated FDDs 26,279 25,868-2% Canada Activated FDDs 10,865 11,423 5% Total North American Activated FDDS 37,144 37,291 1% North American Active Customers 139K 142K 2% 14

15 Nobody Does It Better Elavon North American Third Party Channel CATEGORY Percentage Change U.S. Partner Residuals $87MM $113.7MM 31% CDA Partner Residuals $14.8MM $17.9MM 21% Total North American Active Residuals (Partners) $101.8MM $131.6MM 29% In Year Average Ticket Size for U.S. /CDA $92 / $177 $94/ $188 2%/6% Total Spread U.S. / CDA 92 BP / 55 BP 88 BP / 52 BP -4%/-5% MSP Spread 50 BP U.S. 29 BP CAD 50 BP U.S. 29 BP CAD 0% 0% MSP Revenue/Merchant/Month $86 U.S. $90 CAD $88 U.S. $92 CAD 2% 2% Losses Basis Points 105 BP 90 BP -14% 15

16 Interchange / Dues / Assessments For Your Eyes Only Buy Rate Revenue Share 60/40 -> 70/30 Revenue Share Wallet Buster 50/50 Enhanced Revenue Share 50/50 Clear & Simple 40% Revenue Share Long Term Incentive Program (minimum revenue commitments required) Upfront Payout $0.00 $0.00 $ $0.00 $0 $0.00 Processing Fees Per Item Processing Fees Basis Points $0.03 $0.00 $0.00 $0.00 $0.00 $ % 0.00% 0.00% 0.00% 2.75% Swipe 3.50% Keyed 0.015% Authorizations $ $0.03 $0.03 $0.03 $0.02 $0.29 $0.015 Visanet Auth (if applicable) U.S. MSP Flexible Pricing Programs $0.045 $0.045 n/a $0.045 Application Fee $0.00 $0.00 $0.00 $0.00 Customer Service $3.00 $0.00 $0.00 $1.50 Monthly Fee $3.00 $3.00 $10.00 $1.50 Annual Fee $15.00 $0.00 $0.00 $12.00 Discover Settlement Same as Visa/MC PIN Debit Pass through + tiered auth n/a $0.07 Amex Settlement 30 BP / 36 months 16

17 WHY CHOOSE ELAVON 17

18 The License Definitions of an ISO Visa - Conducts merchant solicitation, sales, customer service, or merchant training activities. MasterCard - An MSP that provides program services, other than transaction and cardholder processing, to a member in support of the member s program. Program services include, but are not limited to, merchant solicitation, cardholder solicitation and customer service. Pay the Registration Fee $5,000 for Visa & $5,000 for MasterCard REGION SPECIFIC Annual renewals are $5,000 for Visa and $5,000 for MasterCard Registration covers (ISO, ESO, MS, IPSP, & TPS for Visa and ISO, TPP, & DSE for M.C.) Elavon Performs Due Diligence Physical on-site review Complete financial review of ISO to include: Current and audited financials, Dunn & Bradstreet report or other applicable checks. Business tax returns Business plan Federal Tax ID (US) or GST# if applicable (Canada) Complete review of ISO current and previous Acquirer business relationships (No Terminations) OFAC check & Background and credit check of principals (No Felony Convictions) Both Parties Enter Into an Agreement The Member must be responsible for all management of all aspects of services performed by ISO and establish and enforce all management and operating policies in accordance with Visa & M.C. Standards. 18

19 The Elavon Advantage Trusted Payments Partner Backed by the strength and financial stability of U.S. Bank Consolidated payments processing: authorization, settlement, funding, statements and support One point of contact for Visa, MasterCard, Discover Network, UnionPay and American Express credit and debit card transactions Absolutely No Liability Elavon assumes the risk so you can focus on your business No minimum revenue commitments Dedicated Support Teams MSP Support Sales Support Boarding Support Relationship Management An MSP Advisory Committee that acts as advocates for our MSPs, providing feedback to Elavon regarding program, product and operations initiatives. Multi-currency processing supports authorization in 90 currencies 19

20 The Elavon Difference Partner Benefits 5 Flexible Pricing Programs You get five (5) pricing programs so that you can choose on a merchant level basis which one works best for your merchant (Buy Rate, Revenue Share, Wallet Buster and Enhanced Revenue Share, Clear and Simple) Long Term Incentive program with deeper discounted pricing 24-hour turnaround times for applications, high approval rates and timely and accurate residual payments A comprehensive PCI Compliance Program that extends financial protection of up to $100,000 to merchants while sharing the revenue earned with MSPs An MSP Pricing Calculator tool that allows you to easily create and review different pricing scenarios The ability to bill your merchants on Net or Gross Billing A National Account Referral program that pays you for referring large, complicated acquiring and payment gateway merchants to Elavon Residuals paid on the 20 th of the following month Benefits At-A-Glance Extensive payment solutions Flexible pricing programs Valuable incentive programs Dedicated support and operations 20

21 All Support Performed In-house Credit/underwriting Customer service Merchant training Voice authorization Chargebacks and retrievals Risk management and fraud monitoring Compliance/quality Equipment deployment and repair 21

22 Questions? Comments! Suggestions! 22

23 Don t let the Skyfall on your Business! Cory Taylor SVP 3rd Party Business Development North America Canada 1 (905) Cory.Taylor@elavon.com 23