Payments CUSO Presentation February 26 th , 2011 Barry O’Mahony Programme Manager, CUSO ,

1. Best Practice Meeting for Youth Development Payments CUSO Presentation February 26th, 2011 Barry O’Mahony Programme Manager, CUSO ,

2. Contents • Background • What are members saying? • CUSO Project • The Payments Landscape

3. Background • The Economic Environment • Regulatory Change • Opportunity for the Credit Union Movement • The Vision • ILCUnet • ILCUbis

4. ILCUnet – Your Private Credit Union Network ILCUbis - Credit Union Business Intelligence Service Credit Union A Ltd Payments CUSO Credit Union B Ltd SAFE STRONG SECURE Sub Office Credit Union B Ltd Your IT Supplier Service ILCUnet New Services Irish League of Credit Unions

5. Business Intelligence ILCUbis – CU Business Intelligence Service • Tool used to help CUs make Informed Decisions • Lets CUs graphically analyse their performance • CUs can compare their performance against other CUs • Use forecasting tool to see how CU will perform if projections are accurate

6. What are the members saying? Investing in our Future Research – August 2009 highlighted demand for new services “…..members are open to new product and service innovations that meet real needs and enhance already high levels of customer satisfaction” “…in order for credit unions to fully meet the financial needs of members… they need to be in a position to deliver products and services which have become integral to how members manage their financial needs.”

7. CUSO - The Vision The strategic vision for a Payments Credit Union Services Organisation (‘CUSO’) is to provide ALL Credit Unions with the option of access to electronic payments products and services, specifically; • Direct debits; • Credit transfers and standing orders; and • Potentially, debit cards, in a cost efficient manner. 

8. CUSO – The Approval Resolution No. 34 of League AGM 2010 - Payments CUSO Project • Up to €1.55 million contribution from the Irish League of Credit Unions • At least €1.55 million contributed by credit unions in units of €10,000 (or Sterling equivalent) • minimum of 155 credit unions required for funding

9. CUSO The Project A Regulated Entity Enabler for the future A Platform for member services A mechanism to give control to Credit Unions

10. The Structure • Be licensed as a Payments Institution; • Passport into NI once established • Compliance with SEPA and PSD: Single Euro Payments Area Payment Services Directive • A unique development

11. Why CUSO? • Regulatory support • Control over our own destiny • Need to provide a platform for alternatives to cash and cheques • Economies of scale

12. The Payments Landscape • Goodbye cheques? • Cash…..start packing! • Cards • Internet • Mobile payments • Hello virtual money

13. Cash……start packing! • Most expensive mechanism for payments • Cost per Irish household: €1,590pa • €2,370,000,000 cost to the nation every year! • Alternatives increasingly available

14. The Alternatives • Cards: Credit, Debit, Pre-Paid • Chip & PIN • NFC (Near Field Communication) • Internet • Mobile • NFC • Smart Apps • Virtual • Facebook Credits • PayPal

15. Questions “Even the tortoise when he wants to move forward has to stick his neck out a little bit. So let us stick our necks out a little bit and move forward together” Jimmy Johnstone, Chairman NTC