Capitalising on the New Payment Card Landscape

Mr. Perry Ong Advisor, National Cards Group (NCG)

Payment System Forum and Exhibition 2015 Sasana Kijang, Kuala Lumpur

3 November 2015

Agenda

• Flashback

• Watershed Year

• Behavior shift

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Flashback to Payment System Forum 2014

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Evolution of Card Acceptance

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We are here now!

The Revolution Started … Towards a Cashless Society by 2020

800,000 EFTPOS

1 Billion

Debit Transactions

26 Banks, Issuers and Acquirers

5

Merchants, Retailers, Services, Insurance, Wholesalers, etc

Perry Ong, NCG for PSF 2014

NATIONAL CARDS GROUP

Payment Card Reform Framework

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Issued 23 Dec 2014

Source : Payment System Forum 2014

Reform Measures

• Objective & transparent setting of interchange fees

• Empower merchants to accept cost effective cards

Desired Outcome

• Affordable MDR level

• Expanded POS network

Source : BNM PSF 2014

Agenda

• Flashback

• Watershed Year

• Behavior shift

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7

Debit Transactions

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2016 2017 2018 2019 2020 2014 2015

0

100

200

300

400

500

600

700

800

900

1000

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

No of Debit Transactions Actual vs Target

Target Actual

53mil Jul 2015

Target : 1 Billion

43

million

Cards

EFTPOS Progress

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2016 2017 2018 2019 2020 2014 2015

0

100

200

300

400

500

600

700

800

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

EFTPOS Actual vs Target Target Actual

Acquirers’ Task Chip & Pin readiness

with full deployment by Dec 2016

Contactless terminals deployment in progress

MyDebit (MCCS) enabled terminals by 2017

Target : 800,000

256K Jul 2015

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CARD PROGRESS Moving into 2016 on Chip & Pin readiness …..

Watershed year of the Payment Revolution

2016 2017 2014 2015

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17 Q3 17

POS Deployment Card Re-Issuance Communication

NOW

All Issuers & Acquirers Live on

Chip & Pin

100% Cards Re-Issued and Terminals

Upgraded

Full Push for 100% Chip & Pin adoption

Agenda

• Flashback

• Watershed Year

• Behavior shift

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Payment Revolution at Tolls

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All 92 PLUS toll plaza going cashless by 2017

Smoother flow without gates using RFID by 2018

Why the last minute rush to go Cashless?

Surge in Debit Cards in Greece

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Greece’s banking crisis is having at least one positive outcome, and it’s

made of plastic. In a country where cash is king …. about 1 million debit cards have been issued by banks since the government ... Imposed controls on euro bills.

Retailers to Governments

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• Immigration Department to go cashless by end 2015

• To strengthen the department’s integrity

Adoption and Payment Revolution trends from

20% of payment are made by mobile

Roles & Responsibilities

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CONSUMER • Mindset change • Less cash

dependency • Use Card as tool

MERCHANT • Train frontlines • Ask for Card • Display POSM

REGULATORS / GOVT BODIES • Embrace card

acceptance • Promote Cashless • Price in Cash

INDUSTRY / SCHEMES • Intensive

Communications • Coherent &

concerted push for card & POS

• Intro Innovation

Behavior Shift

Issuers Acquirers

Merchants

Consumers

16 Perry Ong, NCG for PSF 2014

Are you capitalizing on the Payment Revolution?

Attracting the 43million cardmembers with more card privileges

Stay relevant with customers’ needs and trends

Enjoying speed of acceptance

Sell more at Lower cost of card acceptance, thus no more surcharge. Lower cost than cash handling

Riding on technology innovation via various acceptance channels

Higher ticket purchase size

Improve safety and reduce risks –lower chargebacks & fraud

Behavior Shift

17 Perry Ong, NCG for PSF 2014

How are you Leveraging on the Payment Revolution?

Safer and faster way to pay

Pay for anything, anytime, anywhere

Enjoy more privileges when you pay by card

The card in your hands is ready !

Embrace the new payment behavior

Issuers Acquirers

Merchants Consumers

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Why Act Now?

43 million Debit Cards

8.3 million Credit Cards

800,000 Merchant Locations

Technology Adoption – HCE / Mobile

Industry / Card Issuers / Acquirers / Schemes + Regulators Push

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CASHLESS

SOCIETY PAYMENTS

FUTURE OF

CASHLESS SOCIETY