NFC Mobile Payment Ecosystem & Business Models

Visa Inc.CTST 2009 Conference May 6, 2009New Orleans, LA

Forward-Looking Statements

Today’s presentations may contain, in addition to historical information, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are based on our current assumptions, expectations and projections about future events which reflect the best judgment of management and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by our comments today. You should review and consider the information contained in our filings with the SEC regarding these risks and uncertainties.Visa disclaims any obligation to publicly update or revise any forward-looking statements or information provided during today’s presentation.

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Visa Mobile Strategy

Payment Value-Add

Money Transfer Acceptance

Point of Sale (POS)Mobile Visa payWave payment

RemoteVia IVR, SMS, mobile Internet

Alerts and NotificationsCustomer set parameters; Issuer triggered alerts

Remittances Cross border and domestic

Mobile AcceptanceMobile device enabled to accept Visa payments

OffersMobile offers and discounts

Visa’s mobile strategy extends Visa payment, money transfer, value-added service, and acceptance capabilities to mobile channels

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NFC Payments

Mobile contactless payment uses existing VisaNet infrastructure and is processed like a Visa payWave card transaction

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Mobile POS Pilot in US

United States

• Wells Fargo internal bank employee pilot with live payWave merchants to test OTA personalization and user experience of proximity payments

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Mobile POS Pilot in UK

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UK• Large scale mobile 

payments pilot with mobile operator O2 and Barclays to test the use of mobile phones to pay for purchases, access events and transit

Mobile POS Pilot in Australia

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Australia Program• Australia's fist contactless 

payment trial with National Australia Bank (NAB) using components of Visa mobile platform to assess consumers' and retailers' reaction to mobile payments

Commercial Launch in Malaysia

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Malaysia• Launched world's first 

commercial Visa payWaveService On NFC‐enabled mobile devices in April 2009

• Worked with leading operator Maxis and MayBank, the largest issuer in Malaysia

Eco system

Collaboration within the mobile payments ecosystem continues through various forums, however, no clear business model has emergedKey forums and associations related to mobile payments

• EMVCo• ETSI• Global Platform• GSMA• Mobey Forum• NFC Forum• SmartCard Alliance

standardsbodies

paymentnetworks

banks

mobile operators

vendors

Stakeholders in Ecosystem

Payment Network

There are several stakeholders in the mobile contactless payments ecosystem

Issuer

Credit/debit/prepaid card issuer on mobile

Secure Element Provider

UICC vendors, secure memory card vendors, embedded SE vendors, & chip vendors

Handset Provider

Manufactures NFC enabled handsets

Trusted Service Manager

Facilitates application lifecycle management between mobile operators and issuers and provides

Merchant/ Acquirer

Process transactions and operate contactless enabled terminals at the Point of Sale

Mobile Network Operator

Provides mobile network & potentially rents UICC slots for NFC applications

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Stakeholder Benefits in Ecosystem

Each stakeholder hopes to derive benefits from mobile contactless payments

Issuer Merchant

Mobile Network Operator Trusted Service Manager

Secure Element Provider Handset Provider

• Higher payment volume due to additional transactions resulting from cash displacement 

• Intangible benefits like being first to market, innovator, etc

Benefits • Higher throughput due to convenience and speed• Savings from lower cash handling• Vehicle for sophisticated loyalty programs• Increased differentiation through innovation

Benefits

• New revenues streams (e.g. “rental" fees for hosting payment & non‐payment applications)

• Lower churn due to “stickiness”• Higher ARPU from increased usage• Opportunity for differentiation

Benefits • Fees for over the air services including card issuance, updates and lifecycle managementBenefits

• Higher revenues from increase in chip salesBenefits • Revenues from NFC handset sales• Increased differentiation through innovation

Benefits

Business Model Scenarios

There are various scenarios for a business model between Mobile Network Operators and Banks

• Co-Marketing Model• Software as a Service Model• Content Model

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Summary

NFC Momentum continues to accelerate

Visa launched world’s first commercial contactless payment service on NFC phones in April 2009

Technology is ready, but no clear business model has emerged

Visa acknowledges that there are different business models in different territories and is flexible

Visa Mobile Platform paves the way to commercialization

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