Mobile Momentum - Trends in Consumer Payments

Mobile Momentum @ MasterCard

Kahina Van Dyke

Past, Present & Future State

Page 2November 16, 2010

A strong global network and brandwith robust assets / applications

Building infrastructures and enhancing consumer experiences around the world

Facilitating commerce by drivinggrowth in new markets and segments

Whowe are

What we areworking on

Where weare going

Global E-Commerce Opportunity

Global Online SalesIn USD Billions

Growth rate 07-09

+35%

+20%

+14%

+8%

• Globally E-commerce transactions have grown over 14% per annum overthe past 5 years

• Remarkable resilience in 2009 despite the economic crisis

Source: comScore 2010.Source: MasterCard internal data.

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YTD June 2010Y/Y Growth

66%

34%28%

102%

7%

AP CA EU LAC US

November 16, 2010

Spotlight: Europe eCommerce

Online Retail Spend EuropeEuro Billion

• Half from increased average spend and half from increased consumer adoption• Average annual spend per person is expected to rise from €483 in 2009 to €601 in

2014• Number of online shoppers is expected to grow by 141 million to 190 million by 2014 • Penetration of online shoppers will go from approximately 30% to 50%

Source: Forrester, Western European Online Retail Forecast 2009 to 2014

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Online Retail Spend 2009Euro Billion

200

400

600

800

100 150 200 250

Online shoppers (million)

Ave

rage

onl

ine

spe

nd

per

pers

on

(€)

68

114

20092014

1.51.92.53.1

9.4

17.3

24.7

SWE

NL ES

ITUK GE

France

10% 9% 13% 11% 13% 19% 11%

CAGR ‘09 – ‘14

November 16, 2010

U.S. online and Web-influenced retail sales

Web data powers decisions…

Note: U.S. Online and Web-Influenced Retail Sales as a percentage of Total Sales.Source: “Web-Influenced Retail Sales Forecast,” Forrester Research, December 2009.

Web-influenced retail sales in billions

Online retail sales in billions

U.S. online and Web-influenced retail sales

as a % of total sales42% 46% 48% 50% 51% 53%

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November 16, 2010

MarketPlace (US)

Savings Locator (italy)

inControl(US)

mCompass (South East Asia)

Smart Data & Personalization -> Engagement

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Acceleration of e-Commerce

Rapid adoption of the Internet driving online sales

Leverage social marketplaces and virtual communities

Enhance consumer experience through personalization and relevant real-time data November 16, 2010

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Transition to Mobility.

Source: Arthur D. Little, 2009

2008 2009 2010e 2011e 2012e0

50,000

100,000

150,000

200,000

250,000

300,000

Global Mobile Payments Volume

Overall CAGR68%

November 16, 2010Page 8

Mobile access expected to outpace PC access

Innovate and expand platform with partners

Build capabilities for future demand

Mobile Mix: Global Payments

Ubiquitous part ofconsumers’ daily lives

Transit is an anchorfor everyday spend

2008 2009 2010 2011 20120

50,000

100,000

150,000

200,000

250,000

300,000

Parking & Ticketing

Retail Purchase

Remote Bill Payment

Remittance

TopUp & Digital Content

Global Mobile Payments Volumeby Transaction Type

Consumer experiencesupported by a solid infrastructure

Source: Arthur D. Little, 2009

November 16, 2010Page 9

Mobilizing paymenttechnology enables secure, convenient payments anywhere, anytime shifting control of the payment paradigm to consumers to manage their finances according to their lifestyle.

However…

Mobilizing paymenttechnology enables secure,

convenient paymentsanywhere, anytime—shifting control of thepayment paradigm to

consumers to manage theirfinances according to their

lifestyle.

• New places and ways for mobile users to pay or shop online

• A means to circumvent a lack of traditional electronic payment and e-commerce structures

• An electronic payments growth accelerator that shifts control of payments to consumers

The mobile phone as the preferred personal transaction and information device which provides:

Changing the face of payments..

November 16, 2010Page 10

MasterCard Mobile Payment Products

The Mobile Device: An Evolving Platform for Payments

Fully Integrated PayPass

PayPass Tags Mobile Payments Gateway

Remote P2P and P2M Payments

November 16, 2010Page 11

Transit is a broad sector encompassing road, rail, air and water. Traditionally 100% Cash/Coin – now leading contactless adoption.

Contactless. Evolution or Revolution?

Retail Acceptance

Processing Solution

MasterCardCash

Hybrid-Cards

Co-BrandCards

Ie.SJ Prio Swedish Railways card, Alpha bank Russian metro

card

Ama Mi Prepaid card with Milan transit

application, Postepay with Ravenna transit

application

Deployed with Taiwan transit

Carrefour, Café Nero, McDonalds,

Numerous PayPass Deployments

Commercial trials in NYC; T&C, TFL

November 16, 2010Page 12

Our independence allows us to be different and deliver what our competition cannot

Contactless adoption is not industry specific, or geography specific…

November 16, 2010Page 13

04/08/2023

14

A global truth: Sending money home.

1 World Bank, July 20092 The Aité Group, Competing in Money Transfers: Market Overview, March 2007, Projected estimate by 2010 in USD.3 Koncept Analytics, Global Money Transfer (Remittance) Market: An Analysis, May 2009

billion global cross-border

money transfer volume1

$18.3billion in

estimated global money

transfer revenue2

200+million foreignworkers

worldwide3

$200Average money transfer value

per transaction globally2

$433

Cross-Border P2P

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Empowered customers want control.

PersonalizedControls

Real-TimeAlerts

Single-UseNumbers

MasterCardinControl

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Our independence allows us to be different and deliver what our competition cannot

A virtual card which the customer sets the limit and the expiration date.

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In conclusion…

Innovation is our DNA... We will stay ahead and react quickly as opportunities emerge. The customer experience will rule the adoption curve.. Test and learn.

The future is now... Capabilities evolving exponentially at different rates around the world due to diversity in infrastructure. We need to meet the global demand for safety and speed.

Collaborate to compete... We will continue to drive partnership models across multiple stakeholders to lead global commerce development.

“It is not the strongest of species that survive, nor the most intelligent, but the one most responsive to change.”

– Charles Darwin

November 16, 2010Page 17