1. Mobile payment and Sonera

2. Finland as a Mobile Commerce Lab Mobile penetration 84% - no handset subsidy Hardly at all prepayment subscribers Premium rate services already in use from 1988 Mobile banking already in early 90s Cash is less used in the world - plastic cards instead (debit and credit) no checks Consumers expect new mobile services

3. The evolution path of mobile payment in Sonera Canteen 2000 Café 2000 Parking 1999 Vending 1997 POS 2001 Sonera Shopper

4. Vending Sales by premium rate numbers, billing in mobile phone bill No need for subscription The first application in 1997, now 800 vending machines with mobile payment Good show case for mobile payment Car wash killer application in vending Video jukebox, golf ball machine, soft drink machines, photo booths… From 2002 3rd party as service operator

5. Canteen Buy your lunch by mobile! Sales for subscribers From June 2000 Payment either by credit card or prepaid account Good show case for replacing cash and cards in every day purchase Regular users Sales by calling number + IVR

6. Parking Pay your parking fee by mobile! Sales for subscribers by premium rate number From 1999 in Stockholm, 2000 in Helsinki Payment by credit card Good show case for time based billing The best WIN-WIN -case, so far 3 rd party as service operator

7. Point-of-Sale Pay by mobile all your purchases Sales for subscribers Pilot from February 2001 in Pizza Hut Payment by credit card or from prepaid account One-time pin-code in use (SMS) Good show case for any kind of purchases and the most potential application

8. Mobile Ticketing Sales by mobile phone using location info and end user profiling Integration in existing ticketing systems, control, access, info, reservation Transport Operator in full control of stock and presentation High throughput automatic electronic ticket validation Ticket printing possible European pilot in the summer 2001 Calling number, IVR, SMS, RF in used

9. SONERA SHOPPER Trial from 2001 for restricted user group Subscription needed For any mobile operators subscribers in Finland For any type of handset No more billing in mobile phone bill - Credit card (Visa/Mastercard) or Shopper account (prepaid) Secure payment method

10. Value proposition for the merchant Time savings in payment transactions no need for signing the bill no need for checking the identity More secure cash register environment less cash handling and cash logistics Option for mobile marketing Innovative image

11. Functionality Usability Experience Sonera Shopper for the merchant More efficient payment method The channel between consumer and merchant Payment method

12. Value proposition for the end-user Secure payment method - All purchases are confirmed Convenient payment method - Only one PIN-code to remember - No signing at cashier - No need for cash Service management and reports by SMS or from www.sonera.net

13. Registration

14. Payment Transaction 1. 2. 3. 4. 5. Financial Institution Consumer Sonera 6. Merchant 7. 1. Consumer sends SMS: PAY XXXX to number 13130 2. One-time payment ID as response SMS, valid for next 30 min 3. Consumer tells payment ID to the cashier 4. Payment information is sent from cash register system to Sonera Shopper payment platform (Merchant, payment ID, value of the purchase) 5. According to default payment method billing either from Shopper account or credit card. 6. Sonera Shopper payment platform sends payment confirmation to the merchants cash register system. 7. Consumer receives confirmation of purchase from Sonera Shopper by SMS.

15. The Receipt

16. Sonera Shopper merchants