Mobile Interactive Payment with NFC – Tap N Go! A presentation to China Card & Payment Conference 2007 Kelvin Lu, Product Sales & Delivery, Asia Pacific.

April 28, Consumers Are Looking for Everyday Convenience, while businesses are Looking for a Competitive Edge Contactless payments / RFID / MasterCard paypass Mobile payments Biometrics Resulting in a new breed of card products and next-generation payment options:

April 28, MasterCard paypass ™ Making Everyday Fast and Easy What is paypass? paypass is a contactless radio frequency (RFID) payment solution speeds customers through the checkout process and is proven to increase card usage and average purchase amount PayPass cards and devices feature a hidden embedded computer chip and radio frequency antenna How Does It Work? Cardholders tap the paypass card or device (eg. key fob) on a paypass-enabled POS merchant terminal eliminating the need for cardholders to hand over their card for a merchant to swipe through a reader The transaction is processed through the highly-trusted MasterCard acceptance network in the normal manner Seconds later, cardholders receive payment confirmation and are on their way

April 28, paypass Status Around 13 Million Cards/Devices Issued Globally Many thousands of paypass Readers & 46,000 Merchant Locations Globally (as of 4Q06) Regardless of the paypass (Magstripe/MChip) versions, they are all interoperable Major global and local card manufacturers, terminal vendors, other equipment and systems vendors have signed up to support paypass solutions & implementations With major AP project launches, expertise and experience have built up for the support of paypass locally. The Momentum is Building!

April 28, MasterCard paypass and co-branded cards Magstripe paypass cards

April 28, MasterCard paypass and co-branded cards One Smart paypass cards

April 28, paypass Merchants

April 28, Public Transport Vending Machines Parking Continuing to Expand paypass Acceptance Taxis

April 28, Contactless protocol covering payment and non-payment applications Global Footprint – over 13 million paypass cards/ devices worldwide Available across Credit, Debit and Pre-paid (gift Card) functionalities based on EMV standard Flexibility – TWO product versions available in Magstripe or EMV to leverage on existing issuer infrastructure World-wide acceptance & Open standards Fast, secure and low risk through online and offline authorization capability MasterCard paypass – Key Customer Benefits

April 28, Global Interoperability Region-wide presence (Taiwan, Malaysia, Korea, Australia, Japan, Indonesia, China) Very stable and mature product Strong expertise in implementations as well as deep linkages with vendor & channel Product Innovation through Alternate Form Factors (cards, phones, watches, key fobs) NFC, etc. MasterCard paypass – Key Elements of Differentiation

April 28, paypass and NFC Comparison: compatible, not compliant Purpose: NFC device can do paypass PayPass ISO/IEC Digital (software) Analogue (hardware) ISO/IEC PayPass - Mag Stripe PayPass - M/Chip Smart Poster Bluetooth Conf. L2 L1 Digital (software) Analogue (hardware) PayPass - Mag Stripe PayPass - M/Chip Smart Poster Bluetooth Conf. PayPass ISO/IEC 14443ISO/IEC 18092

April 28, Near Field Communication Supports 3 Main Mobile Applications Peer-to-Peer Communication Mobile Payment & Transaction Access to Info On-the- move Passive RFID Tags Secure Smart Card Technology Service Discovery Simple Connectivity

April 28, NOKIA 3220/6131 SAMSUNG D500 Windows OS Palm OS Windows OS NFC PDAS PHONES NFC SD CARD Mobile Devices with NFC will become mainstream within the next 2-5 years NFC Phone In Real Products SAMSUNG Onyx 700 BENQ M 700 Macally eNetMouse + Sandisk SmartMX+Memory Motorola SLVR

April 28, Today’s mobile phones are capable of delivering an enhanced payment user experience through added intelligence and an array of quick, user friendly capabilities Trends to watch: Time-Savings Services that allow customers to take advantage of their “anytime, anywhere” capability have potential, i.e., information, access, value Mobile Commerce: Transforming the payments experience Fun/Leisure Content-related digital goods and services, consumed on the phone itself, i.e., gaming, gambling, music and sports/ infotainment

April 28, Customer / Merchant Marketing Opportunities As traditional acquisition channels dry up, mobile presents a fresh alternative – Co-marketing between Banks and Mobile Operators to offer devices as incentives at acquisition Go after same customers with shared marketing $$$ Recurring payments for Banks Less churn for mobile operators Usage and activation programs have been very effective in Europe Value adds: special offers, coupons, access to unique experiences can be delivered through mobile devices

April 28, Interactive Functionality Delivered by MasterCard Mobile with paypass Search directory, guide & recommendations Shopping Eating Drinking Events Travel Alerts and tailored offers Stores Eating & drinking Exclusive and last minute offers Customizable New applications & services securely downloaded over the air Expired services removed Personalized for individual Banking Robust authentication mechanism to support online banking Purchases At POS using paypass Leverage for increased security Electronic Supply and secure storage of coupons, receipts, rewards, tickets Redemption interface Direct Communication / P2P Contact merchant, issuer through web, voice, text

April 28, New Information Services  MasterCard Nearby TM  Mobile website to drive usage  A directory of MasterCard acceptance locations  Robust data for Restaurants & Movies  Special offers and discounts tailored to the cardholder’s location, spending patterns and personal interests In-Touch Get local city information and offers tailored to your location and your lifestyle simply by setting up the service.

April 28, Smart Posters interaction with NFC phones

April 28, Enabling Technologies MasterCard Mobile Authentication Internet Banking Phone Order Phone Banking

April 28, Smart Posters, e-coupons, Interactive info/data

April 28, “Over-The-Air” Download of payment card  OTA Download of Payment cards into NFC phone Secure Convenient and Fast User Control (in control of request) Mobile Network Bank Issuing Server

April 28, OTA Download of e-Coupon Mobile Network Bank Issuing Server Simple Download Instruction New NFC Phone Mobile User – requesting via simple steps Option Exit ____ViVOwallet___ PayPass card is downloaded into phone

April 28, Smart Column / Service Discovery  Service Discovery Auto Start and “discover” content on Smart Column/Poster Via NFC phone Contents Virtual Money Merchant/Services Partners Contents Smart Column

April 28, Usage of paypass phone to make purchase Mobile User (with downloaded Virtual Money 1 2 Purchase/Redemption Devices Purchases User Select paypass on NFC Phone 3

April 28, Purchase/Redemption Devices Redemption of Coffee e-Coupon Mobile User Date:XXXXXX ID: Exchange for your free cup of coffee Paper Coupon User exchange Paper Coupon at Cafe Free Cup of Coffee User Select Coffee Coupon on NFC Phone

April 28, Contactless payment is the trend and momentum is building. Widespread and suitable paypass merchant acceptance is critical Require different contactless reader products for various acceptance environment. paypass NFC with mobile phone encourages more interactive payment via content/service discovery. paypass Merchants, Telco partners and cardholder can all benefit. Conclusion

Thank you