Adherence and Innovation: Payment under New Retails China UnionPay Sept. 28, 2017

1. Market Trend 2. UnionPay’s Adherence 3. UnionPay’s Innovation Content 1. Market Trend 2. UnionPay’s Adherence 3. UnionPay’s Innovation

1. Market Trend Bankcard Consumption Confidence Index 2015-2017.08

Profile of China UnionPay Market Trend: Profile of China UnionPay Upon consent by the State Council and approval by PBOC, China UnionPay was established on March 26, 2002 with a view to addressing online general use of bank cards, especially online general use of non-local interbank use. Main functions： ● Unified platform for online general use ● Unified standards to established brands ● Improve environment and promote development ● Ward off risks and maintain safety ● Safeguard order for sound interaction

Wherever you go, UnionPay your way Market Trend: Profile of China UnionPay Wherever you go, UnionPay your way UnionPay has issued accumulatively over 6 billion cards around the world UnionPay has extended its card acceptance to over 160 countries and regions It covers over 40 million merchants and over 2.2 million ATMs UnionPay had online transfer transaction amount of over 72.9 trillion YUAN in 2016

Boundary of bankcard payment organization 2. UnionPay’s Adherence Boundary of bankcard payment organization No scramble with Issuing institution for accounts No scramble with channels for access No scramble with Acquirers institution for scenarios

3. UnionPay’s Innovation UnionPay Wallet Card products Cloud QuickPass Unified mobile payment entrance Accurate marketing Interbank management of bank cards Equity service Scenario aggregation service Credit point service High-end credit card Asia theme card UnionPay card privilege Commerce card Organization settlement card China travel card QR code payment Mobile PAY HCE SimPay Wearable payment Settlement, Electronic reconciliation Inclusive finance Comprehensive authentication platform Cross border shopping Cloud bill Agriculture-aid service Convenience payment Tax rebate service UnionPay online B2C product of UnionPay online payment 3DS 2.0 Cross-border B2B comprehensive payment service Risk prevention and control Financial technology Data service Prevention and control of transaction fraud risks Prevention and control of individual credit risks Comprehensive authentication of risk data Risk technical capacity output Risk service capacity output Cloud technology service Technical open platform service Smart car payment Safety technical service Innovative application service based on block chain technology Payment marking service Big data service Big data smart decision-making and analysis service EvaData value-added data service Loan based on POS-statement

Small-amount signature-free &password-free payment 3. UnionPay’s Innovation: Cloud QuickPass Small-amount signature-free &password-free payment UnionPay QR code UnionPay QuickPass Financial IC card Capital settlement,Electronic reconciliation

Small-amount signature-free and password-free Preferential policies From April 6, 2017--- Small-amount signature-free and password-free Daily consumption less than 1000 Yuan (including) NFC mobile payment (including offline and online), QR code payment IC card payment for small amount without password or signature Periodical discounting for UnionPay network service fee and issuing bank service fee ￥0 ￥300 ￥1000 We accept We accept

3. UnionPay’s Innovation: New E-wallet Member card and credit points Jointly operate scenario-payment products Bank cards Shopping cards (prepaid cards) Retailer UnionPay Bank Electronic coupon Value-added financial service

3. UnionPay’s Innovation: New E-wallet Retailers control their core information including member information to avoid divulgence Share marketing resources for more privilege for members Expand APP application scope and use-frequency Status change of retailers for value-added revenue

3. UnionPay’s Innovation: Cross-border Payment By integrating individual declaration interfaces of various customs, entry-exit inspection and quarantine and other organs, China UnionPay’s customs declaration service platform provides acquirers and merchants of export and import with unified and standardized order payment information declaration service, so as to meet demand from merchants for quick declaration and sunshine and green customs clearance, allow customs for comparison and inspection on payment flow, order flow and logistics flow of cross-border transactions. Merchants One-point interfacing between merchants and UnionPay China UnionPay’s customs declaration service platform for cross-border e-commerce Order information Logistics information Real name verification Real-time inquiry Push payment information to customs

3. UnionPay’s Innovation: Cross-border Payment “u·Plan” adopts an open model with one terminal connecting to flow entrance including financial institutions, travel agencies and related institutions and the other terminal connecting to global well-known merchants. Both terminals are provided with credit card marketing, data analysis and other value-added service through this platform. Global well-known brands Financial institutions Flow entrance u·Plan Cardholders Acquirers Local merchant Travel agencies Card marketing Value-added service Big data platform Online merchants

Correlation of persons and cards 3. UnionPay’s Innovation: big-data value-added services  Accurately analyzes history consumption habits and consumption ability based on local big data platform for enterprises and in light of big-data products of UnionPay.  Accurately forecast the future consumption trends of members and make breakthrough in providing accurate member marketing for enterprises. Transaction data Consumption trial Correlation of persons and cards Operator data Real-time updating of transaction data Presentation of risk evaluation index Character information associated Make relevance analysis on various character data of members, accurately identify consumption ability of the members Give feedback of UnionPay system transaction data to enterprise system in a real-time manner to assist enterprises in accurate member marketing Provide feedback of various risks and consumption indicators in the form of scores or rates, with wide scenarios.

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