WORLDLINE_REGISTRATION_DOCUMENT_2017

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Worldline positioning and strategy Industry andmarket overview

Loyalty Program Services. Loyalty programs help retailers ● build customer relationships and reward customers for their loyalty and provide retailers with valuable insights and sales promotion opportunities by leveraging data about customer behavior gathered through the program. In most cases, these programs are based on loyalty cards tied to a specific brand. To help implement these programs and leverage loyalty program data, merchants often turn to outside service providers for assistance in enrolling customers, tracking purchases, analyzing the resulting data and assisting with sales promotion; Private Label Card Issuer Services . Private label cards are ● payment cards used by retailers to extend credit or provide prepaid gift cards to their customers. The largest users of these services are fuel retailers, department stores and consumer electronics retailers. In general, these cards are only accepted as a means of payment by the retailers that have issued them. Many payment service processors that offer issuer processing services also provide card issuing and processing services to retailers; Merchant Wallet . Merchant wallet gives the opportunity to ● a merchant to allow its customers to store their payment means (private label card and universal payment cards such as Visa / MasterCard) in a secure container accessible from the merchant mobile application. Merchant wallet also encompasses orchestrator and business rules allowing a full mobile purchasing (payment + hardware management) kinematic for all kind of services in the point of sales (cash register indoor, fuel, car wash & charging outdoor). Merchant wallet is an accelerator for Merchants mobile centric strategies and boosts the usage of their mobile application. It also generates a large range of customers’ data. Value-Added Services for Banks Digital Wallet Services . Banks often turn to outside service ● providers for assistance in designing, implementing and running their electronic wallet systems, which allow for online and mobile payments. Digital wallets, combined with tokenization services, are increasingly a must-have service offering for banks as they seek to respond to wallet-based solutions offered by bank and non-bank competitors, and to seize the customer engagement and targeted marketing opportunities electronic wallets offer; Fraud Detection and Prevention Services. The detection ● and prevention of fraud is an ongoing battle across all channels and all payment instruments. According to a study by Ovum, investment in fraud will increase by 6.5% annually in the period 2012-2020 (Ovum Payment Technology Spend Forecast); Authentication Services . Authentication service providers ● offer banks solutions to provide more secure methods of authenticating cardholders such as 3-D Secure or biometrics;

Various alternative payment arrangements exist between ● commercial acquirers and merchants, depending on the particular terms of their contractual arrangements. In some cases, the merchant receives the full € 100 from its commercial acquirer and receives a bill at the end of the month for the merchant service charge; this is known as the “interchange ++” payment method (generally limited to large-volume customers). In other cases, the commercial acquirer only pays the merchant several days after the transaction (generally for higher-risk transactions); The card scheme would send a bill to the commercial ● acquirer for its card scheme processing fees (in the current example, € 0.05 per transaction), on a monthly basis. The example given is based on a typical card transaction, however, there are other payment methods. For example, another common non-cash payment method in many countries in Europe, particularly in Germany, is payment via direct debit and credit transfer from a consumer’s bank account. As in the card example, many banks also choose to outsource the processing of these payments to third party processors such as Worldline. Non-card-based payments There are a variety of non-card based payments (alternative payments) that are increasingly popular. Such methods include: Account Initiated Payment (SEPA Credit Transfer, SEPA ● Direct Debit, Instant Payment); Online banking e-payments (OBeP). ● In addition to the core payment processing services described above, the payment services ecosystem also includes a series of “extended” stand-alone or value-added services to traditional merchants and banks designed to help them grow their businesses and generate additional payment transactions. Such services include but are not limited to the following: Services for Traditional Merchants Omni-commerce ● providers assist retailers in designing, implementing and enhancing online and mobile services and integrating them to provide cross channel sales experiences that allow consumers to seamlessly transition between a retailer’s physical, online and mobile stores. These services may include solutions such as electronic engagement wallet services to capture and leverage consumer data and digital signage and other solutions that bring aspects of the online commerce experience into the retailer’s physical store environment; Services . Omni-commerce service Other services in and around the payment value chain B.1.1.2

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Worldline 2017 Registration Document