CONFIDENTIAL AND PROPRIETARY ©2014 DISCOVER FINANCIAL SERVICES Discover ® Opportunities 2014 Sandy Neddoff General Manager US Acquirer Relations Sandy

CONFIDENTIAL AND PROPRIETARY ©2014 DISCOVER FINANCIAL SERVICES

Discover® Opportunities 2014

Sandy NeddoffGeneral ManagerUS Acquirer Relations

Sandy NeddoffGeneral ManagerUS Acquirer Relations

CONFIDENTIAL AND PROPRIETARY ©2014 DISCOVER FINANCIAL SERVICESCONFIDENTIAL AND PROPRIETARY ©2014 DISCOVER FINANCIAL SERVICES

Discover’s Continued Growth

2

Operating in 185 countries

Access to more than one million ATMS globally

Largest global network1

25MM merchants accepting across the globe

$311B in network volume

47% increase in 30 day active merchants since 20062

1. Retail Banking and Research, The Global Payments Cards Market, August 20132. Switched to open acquirer model in 2006


Notes:(1) The map denotes countries or territories with transactional activity in the last year for Diners Club and/or Discover. (2) Total reflects the number of merchant outlets that accept one or more card brands through December 2013.

North America 9,600,000

Asia Pacific 9,600,000

EMEA 2,600,000

Latin America3,700,000

Total Merchant Locations

25,500,000(2)

• Accepted at over 1 million ATMs

• Operates in over 185 countries / territories(1)

Discover Financial Services Global Acceptance Footprint


$126 billion was spent in the US by International travelers 1

the

Average spend is approx. $1,900 and stay an average of 17 days.

1

1. U.S. Department of Commerce 2013

Help your merchants increase incremental spend.Encourage them to accept our partners

Maximize Sales by Enabling all of Discover’s Global Brands


Discover Delivers - Millions of Loyal, High-Spending Cardholders

2013 Brand Keys Customer Loyalty Engagement Index Report

#1 in Customer Loyalty Award for 18 Years in a row1

Discover is the leading brand in their category for customer satisfaction

and commitment.

Large & Loyal Customer Base2

>40MM+ cardmembers3

Longest cardmember retention 1 in 4 households

Sources: (1) 2013 Brand Engagement Index Report(2) Cardmember Information: Internal Data,

MRI/Simmons/TNS 2013 State of the Card Market(3) Nilson, January 2014


Discover in the News

“The first mobile payments network that spans both millions of users and millions of locations”

– Wall Street Journal

“This reinforces our desire to work with Discover as it shows that you guys are thinking big, taking no prisoners, and doing what’s needed to win. Now that’s a partner I want to work with!”

– Large U.S. Acquirer

“I think it will pay big time to discover Discover”

– Fox Business

“This sets a new paradigm for payments: B2B finance

– Aite Group

“Another pretty clever example of Discover Network in action and further evidence of Discover’s commitment to using its network as a catalyst to innovative payments.”

– PYMNTS.com

“Given the size of the network, the opportunity that is in from of Ariba and Discover is tremendous.”

– Payables Place

“An established payments powerhouse reengineer a popular platform by listening to the consumer.”

– PYMNTS.com

“Discover’s Direct Mail Campaign Brings Fresh Positioning to Credit Card, Connects with Prospects in New Ways”

– Yahoo

“Discover IT is the talk of the town.“

– NerdWallet

6


Overcoming Merchant Objections

Myth Fact

Fees Discover fees are too high.

Discover is a rewards card and too expensive to accept.

Discover partners with us now and is priced equivalent to V/MC

67% of consumers carry at least one rewards card1

On average, rewards cardholders have more than one rewards card2

91% of consumers with a rewards card use it as their primary card2

Monthly spend on rewards cards is more than double than that of non-rewards cards2

Demand/Customer Experience

Not accepting Discover doesn’t hurt my business.

1 in 4 households has a Discover Card2

33% of Discover primary cardmembers have a lower opinion of a merchant3

Accepting Discover means you can also accept Diners Club International, JCB, UnionPay, BCcard, Dina Card and RuPay, serving more customers

Implementation Too complicated to update terminals and use separate statements.

Thanks to Discover’s partnership with us, your terminal is already enabled to accept Discover

You receive one combined monthly statement, and one point of contact for Discover and V/MC

Sources: 1) The Consumer Payment Strategies Research Program, 2013; 2) TNS’ Consumer Payment Strategies Program Rewards Card Report, 2013; 3) C&R Research, 2013


On Us Pricing Program Overview

Eligible Merchants

Offer Timeframe

Offer Details

No fees on Discover volume

For a full 12 months

Inactive with Discover for more than 6 months

Non-registered

Never active

Now through December 31, 2014!


iPayment Enrollment Process

iPayment submits ALL new enrollments to Discover for 6 month transaction history*

O⃰ If you mention the On Us Program with merchants during the

sales process, please make sure they are aware of the eligibility

requirement: No Discover transactions in the past 6 months.


iPayment Enrollment Process: Eligibility

NO transactions

in past 6 month

s

Transaction history in

past 6 month

s

Qualified

Merchant notified via special

insert in iPayment welcome kit

Ineligible

BAU iPayment experience

Merchants are none the wiser


iPayment Enrollment Process: Welcome Kit Insert


Discover Marketing

Welcome Kit

Discover sends each enrolled merchant a

Welcome Kit

Includes program information, signage, pens

Marketing

Inactive merchants receive targeted marketing

through their 12 months in the program to

encourage activation


Common Merchant Questions & Answers

Questions Answers

What will my rate be after the first 12 months?

Your rates will be comparable to Visa/MC with the same per transaction fee I’m offering for other card types.

How long am I under contract with Discover?

You are not under contract with Discover, only iPayment. To receive the free Discover processing for 12 months, however, you must stay with iPayment during this period.

This seems too good to be true. What am I missing?

This is a great offer and there’s no catch. Discover wants to ensure their card holders can use their cards at more places. This introductory offer helps promote that goal.


Program Resources

www.discoveronus.com/acquirer


Program To Date Results

Enrolled: 11,227

Active: 1,845

On Us Program WINS!

Great job!


Discover Has Powerful Promotions to Grow Merchant Sales

Leverage promotions to assist in securing acceptance and drive incremental volume in key spend categories.


Discover offers free signage and supplies; easy online ordering. For quick access establish

a free link on your customer service site

www.DiscoverSignage.com

Store Hours DecalCheck Presenters

Window Decals

Web Banners

Free Signage and Supplies for Your Merchants


Promote – So You Can Offer More Opportunities for Merchants

Cashier Signage

Cardholder Signage

Window Signage

An all-in-one decal kit; kit includes decals for your merchants cashiers, cardholder display and door/window


Robust Sales Rep Incentive Program to Encourage Enablement and Merchant Awareness

Point-based system will reward sales representatives for successfully selling and testing Discover at the Merchant level

Reps encouraged to have Discover awareness conversation and run Discover test transactions to earn points

Points can be redeemed for hundreds of valuable items such as gift cards, electronics, housewares, jewelry and sporting event tickets


Partnering at a Local Level Provides Additional Assistance

Develop partnerships with Discover Local Market Reps: Access to additional marketing opportunities and special events Tools for sales reps to increase sales, merchant awareness and Discover transaction volume Personal, relevant industry consultation and free signage and supplies

Hawaii

Salt Lake City

Los Angeles

San Diego

Austin

St. LouisCincinnati

Atlanta

Manhattan

Philadelphia

Alexandria

Miami

Baltimore

Las VegasSan Francisco

Chicago

DetroitLong Island

Denver

Cleveland

Columbus


What Merchants are Saying About Discover

1 TNS’ The Consumer Payment Strategies Research Program, 2013 2 C&R Research, 2013

FOR CONTRIBUTING TO OUR SUCCESSDISCOVER THANKS YOU

NEW MERCHANT REGISTRATIONS UP

“We have the opportunity to impact folks directly and give them something that improves their quality of life. People come here for that one-on-one treatment that we’re known for. There’s that loyalty component with Discover customers, so it’s very important for Dunwoody Wellness to be aligned with Discover and have that loyalty as part of our concept. Think about what percentage of your revenue comes from Discover payments. Our business is built on clients having a good experience and coming back over and over.”

Vlad - Owner of Dunwoody Wellness Center

“There was a big demand for it. We cater to a lot of travelers who prefer to pay with Discover. They’re always grateful when they hear we accept it. I think Discover is different because their members get something in return. As a small business owner, it’s nice to see that Discover cardmembers often spend more than other customers do.”

Carolyn – Owner of Sciandrone’s Classic Touch

41%41% of Discover primary Card members consider Discover their primary card 1

33%33% of Discover primary cardmembers whose card was rejected have a lower opinion of a merchant2


Thank you!

Stop by our booth, drop off your business card to qualify for our drawing!

BOSE® QuietComfort® 15 Noise Cancelling® Headphones

Samsung Galaxy Tab ® 3 10.1

Let’s Put the Discover Difference to Work For You!

– Thanks!

Documents

CONFIDENTIAL AND PROPRIETARY ©2014 DISCOVER FINANCIAL SERVICES Discover ® Opportunities 2014 Sandy Neddoff General Manager US Acquirer Relations Sandy