1. Welcome to ICBA Community Bank Day Made possible by our generous sponsors

2. Payments Trends & Opportunities for Community Banks Made possible by our generous sponsors Julie Hanson Vice President Card & Payment Products ICBA Bancard and TCM Bank, N.A.

3. Agenda Industry Trends What’s New -Emerging Technologies Opportunities for Community Banks Industry Trends What’s New -Emerging Technologies Opportunities for Community Banks

4. Industry Trends

5. Trend #1 Consumer and FI Confidence Where are we today?

6. Industry Trends #1 - Consumer Credit & Confidence Source: MasterCard-The Consumer Credit Landscape, 2014

7. Industry Trends #1 - Consumer Credit & Confidence Source: MasterCard-The Consumer Credit Landscape, 2014 Bureau of Economic Analysis

8. Industry Trends #1 - FI and Consumer Trends Source: MasterCard-The Consumer Credit Landscape, 2014. 1.Federal Reserve Bank of New York consumer Credit Panel & Senior Loan Officer Survey 2.Equifax 3.Comperemedia Offers (May 2012)

9. Industry Trends Trend #2 Consumers are Omniconsumers

10. Industry Trends #2 – Consumers are Omniconsumers Source: VISA-The 2014 Trends Landscape: The Unpredictable Consumer

11. Industry Trends #2 – Consumers are Omniconsumers Consumers are now more likely to find and buy products online than in a store & smart phones are shopping tools Source: Vantive-Top 10 Payment Trends to Watch in 2014

12. Industry Trends #2 – Consumers are Omniconsumers Source: Vantive-Top 10 Payment Trends to Watch in 2014

13. Industry Trends Trend #3 Mobile is making in roads….

14. Industry Trends #3 – Mobile Inroads Source: VISA-The 2014 Trends Landscape: The Unpredictable Consumer

15. Industry Trends #3 – Mobile Inroads Source: Vantive-Top 10 Payment Trends to Watch in 2014

16. Industry Trends #3 – Mobile Inroads Source: Vantive-Top 10 Payment Trends to Watch in 2014 Mobile E-Commerce Grows Consumers are Open to Mobile Payments The Future

17. Industry Trends Trend #4 Community Banks on Payments

18. Industry Trends #4 – Community Banks on Payments Source: 2013 ICBA Community Bank Payments Survey Which of the following consumer payments products does your bank currently offer or plan to offer?

19. Industry Trends #4 – Community Banks on Payments Source: 2013 ICBA Community Bank Payments Survey Please rate the profitability of your bank's consumer payments product offerings.

20. Industry Trends #4 – Community Banks on Payments Source: 2013 ICBA Community Bank Payments Survey Only 59 percent of community banks say increasing profitability is one of their most important payments strategies, down from 70 percent in 2011. Only 46 percent now look to payments to create new revenue streams, down from 54 percent in the last payments survey. While many banks (55 percent) continue to see payments as a source of efficiency, a greater number now see payments as a way to improve customer service (up 5 percentage points to 52 percent) or create/improve customer access channels (up 9 percentage points to 45 percent). While still seen as the least important strategy by most community banks, some are using payments to penetrate target markets or expand their geographic footprint (both up 4 percentage points over 2011, to 12 percent and 11 percent, respectively). In short, community banks see payments as a way to build lasting customer relationships. Relationship‐builder rather than revenue source