P O S I T I O N I N G T H E P O S AT T H E M E R C H A N T I N A C A S H L E S S E N V I R O N M E N T Martin Holloway October 2012
W H O I S V E R I F O N E? The leading global provider of technology that enables secure electronic payment transactions VeriFone Systems, Inc. ( VeriFone ), NYSE: PAY Founded in 1981 4,800 staff $1,3 billion revenue in FY2011 Active in over 110 countries No. 1 or No. 2 share in all our markets Terminals installed in over 20 million locations 2
PAY M E N T S VA L U E C H A I N VeriFone touches virtually all elements of the value chain VeriFone Acceptance hardware and software enables merchant s business VeriFone works closely with the payment networks to drive and enforce new security standards. Consumer Merchant Acquirer/ Processor Payment Network Issuer Consumer VeriFone brand is well known by consumers VeriFone Acceptance hardware and software enables Acquirers & Processors business Solutions for Card Issuing and Management Solutions 3
4 W O R L D W I D E L E A D E R I N PAY M E N T S
Global reach Dublin London Warsaw Paris Italy Turkey Spain Russia China India Beijing Hong Kong Taipei Sacramento San Jose Toronto New York Dallas Atlanta Savannah Clearwater Miami Bangalore Manila Honolulu Mexico City Singapore Sao Paolo Australia Buenos Aires Extensive partner network worldwide, plus we have employees in over 40 countries Thousands of channel and distribution partners, including VIPs, ISOs, Integrators, Developers Product Design Centers Platform Software Development Centers Application Development Centers VIPs & Resellers 5
N I G E R I A T O D AY
N I G E R I A T O D AY Nigeria 170 Million people One of the fastest growing GDP s in Africa 20M cards, 40K POS Main use for cards is ATM for Cash Withdrawal, local cards are Debit only Cash-Less Lagos project Introduced by Central Bank of Nigeria (CBN) Objective to increase POS base to 350K over 3 years Objective to increase cards in circulation over 3 years Impose levies for merchants to trade in cash Banks are now expanding to the whole country VeriFone solution for transport system and Telco s Standard repair centre Support and maintenance via our partners Solutions for fuel stations Solutions for mobile operators.( M-wallet) 7
C A S H L E S S B E N E F I T S E V E R Y O N E Benefits for end-users Convenience (carry less cash, pay easily, no trouble to get change) Safer transactions (avoid robberies by carrying less cash) Keep your money safe (e-money is not affected by fire, water or loss) Benefits for the merchants Convenience (carry less cash, get paid easily) Transaction speed (no more cash handling) => sales increase Easy sales tracking (electronic reports) Secure transactions (no need to worry about fake bills or non-funded checks) Benefits for the country Cheaper banking (save cash handling costs) Reduce corruption (transactions tracking) Offer banking services to more people (credits) that will boost the economy Get more income tax to invest in the country development 8
U S I N G P O S TO S T I M U L AT E C A S H L E S S E N V I R O N M E N T: T RADITIONAL BANKING
P O S A D O P T I O N R AT E I N T R A D I T I O N A L B A N K I N G Cards must be widely accepted Thus, POS need to be present in every point of sales But, each merchant is different (standalone, mobile, retailer, ) Offer a solution for each merchant POS must always be available to take a transaction Reliability, maintenance Communication with bank must be reliable and backed up Multiple communication channels Transaction shall be faster than cash handling Performance E-transactions must be trusted Security 10
E A C H M E R C H A N T I S D I F F E R E N T VeriFone has a solution for each merchant Countertop Portable PIN pad VX 520 VX 820 DUET VX 520 GPRS VX 680 VX 820 PP1000se Multimedia Standalone Mobile MX 880 MX 870 QX 1000 PayWare Mobile 11
C O M M U N I C AT I O N S H A L L B E R E L I A B L E A N D B A C K E D U P VeriFone Vx Evolution offers multiple communication features: Dial-up Ethernet GPRS GPRS Dual-SIM Roaming SIM Biometrics Contactless GPRS Dial-up (base) Ethernet (base) 12
13 5 2 0 N O W W I T H B I O M E T R I C S
T R A N S A C T I O N S H A L L B E FA S T VX Evolution offers you the highest performance Industry s first ARM 11 processor Combines security and application processing into one 500 MIP powerhouse Fast and expansive Memory 160MB standard, can exceed 500MB Integration of Proven Technology Enhanced Usability Color and touch screen 14
E - T R A N S A C T I O N S S H A L L B E T R U S T E D VeriFone Vx Evolution range offers best-in-class security: Hardware security: PCI PED 3.x Software Security: VeriShield Retain Data Security: VeriShield Protect End-to-End Encryption Industry Leadership Only HW vendor on PCI SSC 15
P O S S H A L L A LWAY S B E AVA I L A B L E VeriFone Vx Evolution range is built to last Reliability & consistency customers have come to expect Made with highest grade components Leveraging VX proven platform A level of reliability seldom offered by competition Keypads tested to over 1M key presses Smart card readers that perform up to 500k insertion Withstands one million card swipes Thick, durable plastics Metal tear bars Qualified and trained Nigerian partners that deliver fast and reliable maintenance 16
U S I N G P O S TO S T I M U L AT E C A S H L E S S E N V I R O N M E N T: POS WITH ADDED VALUE
A D D E D VA L U E POS can be used to provide other added value services than transactions: E-topup / E-voucher Reload your mobile phone account at any merchant store Bill payment Pay your electricity bill at any merchant store Loyalty programs Pay with your credit card and earn loyalty points 18
U S I N G P O S TO S T I M U L AT E C A S H L E S S E N V I R O N M E N T: BANK THE UNBANKED
E - PAY M E N T I N A F R I C A T O D AY 10% people banked in Africa Main challenges: Accessibility, Affordability, Availibility (technology) 50% owns a mobile phone Can be shared between family / friends / community Good news: We have a solution for you to invest in both card acceptance AND mobile wallet! 20
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22 V E R I F O N E M - C O M M E R C E E C O S Y S T E M
D I G I C E L C A S E S T U D Y http://www.youtube.com/verifonemobilemoney 23
24 T V C 1 : M O B I L E M O N E Y L A N D S C A P E
25 T V C 2 : C O N TA C T L E S S, N F C PAY M E N T
26 T V C 3 : I R, B I O M E T R I C, C O N TA C T L E S S, N F C, PAY M E N T
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29 S U P P O R T M O B I L E M O N E Y G R O W T H
30 Support Mobile Money Growth
31 Support Operational Efficiency
V E R I F O N E M O B I L E WA L L E T S E R V I C E S Ideal for emerging markets! 32
VeriFone Mobile Money In summary
G O I N G F U R T H E R : NFC BRINGS VALUE TO CASHLESS PAYMENTS
N F C : W H AT S T H E D E L AY? Mobile payments that use the handset as a payment card have not picked up globally with few exceptions. Why? Chicken and the egg problem: Retailers and merchants are reluctant to build an acceptance infrastructure before user rollout Lack of NFC support in mobile phone devices there are very little NFC devices out there Lack of knowledge and trust in the security in the technology Penetration of Telcos to the payment industry requires know how or cooperation with existing payment players 35
N F C : F R O M PAY M E N T S T O A D D E D VA L U E NFC opens endless opportunities to connect virtual goods with the merchant POS, e.g. coupons, location-based promotions, loyalty and more The web coupons providers seek ways to craft the linkage between the web to the storefront Acceptance with NFC at the point-of-sale is key to bridging between the web virtual world to the physical storefront Internet 36
N F C M O B I L E PAY M E N T S Set to change the way we transact... NFC phone shipments could approach 120 million units by 2012 1 in 6 users worldwide will have a NFC-enabled phone by 2014 By 2015 NFC technology will be the most used solution for mobile payments 85% of payment terminals shipped worldwide will be contactless-enabled in 2016 37
T U R N P O S I N T O P O I Point of Interaction Point of Intelligent Checkout + Knows who you are (opt in) + Know where you are + Knows your coupons + Is trusted, safe, secure + Single user interface + Clean seamless experience = Intelligent Checkout 38
N F C I N T H E U S V e r i F o n e & G o o g l e w a l l e t VeriFone and Google came together to make phone payments a reality by enabling several major retailers with Google Wallet technology 12 of the 14 retailers at the launch were enabled by VeriFone 39
I T S A L L A B O U T A D O P T I O N A F I N A L T H O U G H T
41 O T H E R T H I N G S F R O M V E R I F O N E
R E C Y C L E R T H E AT M C O S T PA R A D Y G M MXATM - RECYCLER CONVENIENCE RETAIL ATM Lower cost comparing to existing high-end recycler ATMs Intelligent software with front end or integrateable into existing legacy Hosts For Convenience Retail or Corresponding Banking locations 42
A D O P T I O N A N D W A Y S T O S T I M U L A T E A C A S H L E S S S O C I E T Y Change the perception of POS at the merchant The POS can earn us money and create wealth in the value chain 43
A D O P T I O N A N D W A Y S T O S T I M U L A T E A C A S H L E S S S O C I E T Y Chicken or Egg???? Technology first, incentives to adopt Cash or Card Wallets are cash, and can be represented on Cards Banked or unbanked Convergence of transacting Where to start? Its started Cashless Lagos. 44
T H A N K Y O U!