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Building attractive banking card offers using GlobalPlatform

Building attractive banking card offers using GlobalPlatform Silas Brown EMV Senior Consultant Oberthur Card Systems – China GlobalPlatform Business Seminar Shanghai, China - 20 April 2006 Agenda Your cardholders are different Chip can help build your product portfolio

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Building attractive banking card offers using GlobalPlatform

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  1. Building attractive banking card offers using GlobalPlatform Silas BrownEMV Senior ConsultantOberthur Card Systems – China GlobalPlatform Business Seminar Shanghai, China - 20 April 2006

  2. Agenda • Your cardholders are different • Chip can help build your product portfolio • Differentiation of your products • What can GlobalPlatform bring to your bank? • GlobalPlatform is already helping banks

  3. Cardholder Segmentation “Banks are increasingly recognising that a large proportion of their retail customer base is unprofitable, yet consumes most effort” Different Card Holders require different products Features • Multi-product ownership • Investment and mortgage products • Long term client history • Significant balances 62% 4% 18% 13% • Multi-product • Transactional, card & check • Significant balances • Mortgage 5% 62% 60% 17% 1% • Dual product ownership • Transactional • Check/Credit card -42% • Single product • Transactional, low balance Source: McKinsey % Customers % Contribution to Profit

  4. Issuer Terminal Cardholder The benefits of chip • EMV offers: • Global Interoperability • Fraud reduction • Transaction security • Advantages of offline transactions • Enhanced risk management • Liability shift issues • But what else can chip bring to your bank?

  5. There’s more to chip than EMV Payment Payment Transportation POS ATM/CAT/UPT Phone e-ticket e-purse T&E Services e-commerce Authentication Storage Government Telephone PC Personal Info. Loyalty Mobile TV Set-Top Box PDA (Contactless)

  6. Product differentiation Students “Middle Class” “High End” CustomisedOffer DifferentiatingOffer Low CostOffer

  7. Segment 1: Students • Customer segment • Low revenues & a lot of small expenses; High risk customer but big potential after few years • Looking for “differentiating” “high-tech” products • Need to build a strong loyalty to retain students cardholders after their study • Card Applications • EMV • Loyalty: Quick Services restaurants, Movie chains,… • E Purse or Pre-Authorised: Managed Cash expenditure • Plastic • Fun Design or Customised design • Service • Music or Game CD packed with Card, SMS notice of Card availability, Electronic Fulfilment via Email

  8. Segment 2: “Middle class” customer • Card Applications • EMV • Loyalty: Retail, Petrol Station,… • E-purse or Low-value payment • Plastic • Lively design • Service • Coupons packed with Payment Card • Example with Online Authentication with EMV card • Use of a non-connected reader • Cryptogram generated by card and used as DAP/SecureCode within 3DSecure server architecture • Specific Plastic design (normal/gold/platinum) • Personalisation done by OCS for pilot or backup

  9. Segment 3: High-End User • Customer type • High revenues, highly profitable customer • Many, large expenses • Strong Demand for high-quality service & differentiation • Delivery service :1 day service for card supplying/replacement • Card made especially for the cardholder • Specific differentiating plastic (MasterCard, VISA, or AMEX branded) • Card Applications • EMV, On-line Authentication, PKI, Data Storage… • Additional Service • Smart Card reader with Payment Card, SMS notice of Card availability, Electronic Fulfilment via Email

  10. EE PROM Elect. purse Data Storage Loyalty appli. Data Storage Loyalty appli. Application A Java Interpreter Application B Application A Java Interpreter Application B R O M Operating System Operating System Operating System Operating System CPU + crypto Philips Chip CPU + crypto ATMEL Chip Smart Card A Smart Card B GlobalPlatform Architecture e.g. JavaCard

  11. Why use GlobalPlatform? • Allows post-issuance updates/upgrades • Smart Card Management System • Application hardware independence • “Anytime, anywhere” • Faster time to market • In-house development • No masking delays • One chip card product for multiple product base • Stock control • Personalisation

  12. How GP has helped banks • K&H Bank (Europe) - 2000 • Aim: Use of smart card technology to become #1 bank in Hungary • Products: EMV only, EMV + PKI authentication, EMV + PKI + Loyalty, Employee cards • ICBC (China) - 2005 • Aims: First bank to issue EMV cards in China (technology innovator), card platform to base all product offers and development • Products: Dual-issuance EMV, now looking at Loyalty and Contactless payment • HSBC (Asia) - 2006 • Aims: Obtain a standard card base product for all HSBC operations in Asia, then apply individual country requirements • Products: Dual issuance EMV + Loyalty, studying EMV authentication implementation in UK

  13. Conclusion • Cardholders are different and they expect different products and services • A move to chip should make banking products more attractive and more accessible • GlobalPlatform ensures card product flexibility and enables leverage of existing infrastructure and resources Thank you!谢谢!

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