WORLDLINE_REGISTRATION_DOCUMENT_2017

Risk Factors [GRI 102-15] and [GRI 102-11] Risks related to the Group’s business and industry [GRI 102-10]

Risks related to the management of projects to develop new solutions. The Group enters into fixed-fee contracts in relation to the development of new systems. This business entails the risk that development costs and expenses may prove to be much higher than initially anticipated, whether as a result of incorrect initial estimates, the emergence of new and unexpected challenges during the course of the project, or errors in the operational management of the project. In such cases, the Group may not be able to secure an upward revision to the fixed fee, either at all or sufficient to compensate for the increased cost. In such cases, the Group would record a provision, which could have a material adverse effect on its business, financial condition and results of operation. If the Group is unable to effectively respond to competition, demand for its services may be adversely affected and decrease significantly. The Group is exposed to significant competition in the various markets in which it operates. Given the diversity of the Group’s product and services portfolio, the Group’s primary competitors vary depending on business line and product or service type, and range from payment processing providers and acquiring banks, to e-Commerce software providers, payment terminal suppliers, telecommunications and information technology companies and start-ups. Some of the Group’s competitors may have greater ability than the Group does to devote financial and operational resources to the development and marketing of new technologies and services, may offer a wider range of services than the Group offers, may use more effective advertising and marketing strategies to achieve broader brand recognition or merchant acceptance than the Group has or may develop better security solutions or more competitive pricing arrangements. Moreover, competitors may also introduce more innovative programs and services than the Group’s. With respect to its innovative digital and e-Consumer & Mobility services offered through its Mobility & e-Transactional Services global business line, the Group competes with a particularly broad spectrum of strong market participants that extends beyond its typical payment industry competitors, ranging from traditional information technology companies to specialist players and innovative startups. The Group also faces particularly intense competition in its Merchant Terminals business from Ingenico and Verifone, in particular, who maintain a dominant position within the merchant Terminals market. The Group also faces heightened competition in its online and mobile payments businesses, as a wide range of payment platforms offered by an increasing range of players, including banks and telecommunication companies, co-exist in the various markets in which the Group operates. If the Group is unable to effectively respond to competition, demand for its services may materially decrease, which could have an adverse effect on its business, financial condition, results of operations or prospects. Moreover, given the level of competition the Group contends with across the markets in which it operates, the Group faces significant price pressure on its products and services, which could also materially and adversely affect its business, financial condition, results of operations and prospects. In particular, the Group faces potentially increased competition in Belgium due to the opening of the Bancontact payment scheme to other commercial acquirers. Additionally, to the extent that the Group’s competitors or new industry players more effectively capitalize on potential consolidation trends within the currently fragmented payment services industry, particularly in Europe, the competitive landscape, including the nature and scale of the Group’s competitors, may change significantly, possibly reducing certain competitive advantages

clients may be more reluctant to renew their IT hardware and software, which may adversely impact sales of the Group’s product and services upgrades. Furthermore, where the Group provides, and/or develops jointly with, its clients, such as car manufacturers, services and platforms that are then on-sold by its clients to consumers, the Group is dependent on the ability of its clients to effectively market and sell these products to their customers, the success of which the Group cannot control. Furthermore, a renewed economic downturn and the possible imposition of governmental austerity measures or changes in government policies could prompt decreases in government spending, which, given that a significant portion of the Group’s revenue is derived from government clients (in France and the United Kingdom, in particular), could have a material adverse effect on the Group’s business, results of operations and financial condition. More generally, a weakening of the economies in the geographic areas in which the Group operates could increase the Group’s sensitivity to price pressure vis-à-vis its competitors and to potential credit losses, including as a result of default of major financial institutions. Additionally, credit card issuers might reduce credit limits and be more selective with regard to whom they issue credit cards to, resulting in fewer and smaller transactions and therefore lower revenue and earnings for the Group. In the event of a closure of a merchant due to adverse economic conditions, the Group is unlikely to receive its fees for any transactions processed by that merchant in its final months of operation, which would negatively impact the Group’s business, financial condition and results of operations. The Group’s merchant clients and the other participants in the electronic payment system, including payment service providers, are liable for any fines or penalties that may be assessed by the card payment networks. Card payment network standards could require the Group to compensate consumers for services and products purchased but not provided following a merchant’s bankruptcy. In the event that the Group is not able to collect such amounts from payment service providers and other agents, due to fraud, breach of contract, insolvency, bankruptcy or any other reason, the Group may find itself liable for any such charges.

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Worldline 2017 Registration Document