Mobile payment and Sonera

1. Mobile payment and Sonera

2. Finland as a Mobile Commerce Lab • Mobile penetration 84% - no handset subsidy • Hardly at all prepayment subscribers • Premium rate services already in use from 1988 • Mobile banking already in early 90’s • Cash is less used in the world - plastic cards instead (debit and credit) no checks • Consumers expect new mobile services

3. The evolution path of mobile payment in Sonera Sonera Shopper POS 2001 Café 2000 Vending 1997 Parking 1999 Canteen 2000

4. Vending • Sales by premium rate numbers, billing in mobile phone bill • No need for subscription • The first application in 1997, now 800 vending machines with mobile payment • Good show case for mobile payment • Car wash “killer application” in vending • Video jukebox, golf ball machine, soft drink machines, photo booths… • From 2002 3rd party as service operator

5. Canteen • Buy your lunch by mobile! • Sales for subscribers • From June 2000 • Payment either by credit card or prepaid account • Good show case for replacing cash and cards in every day purchase • Regular users • Sales by calling number + IVR

6. Parking • Pay your parking fee by mobile! • Sales for subscribers by premium rate number • From 1999 in Stockholm, 2000 in Helsinki • Payment by credit card • Good show case for time based billing • The best WIN-WIN -case, so far • 3 rd party as service operator

7. Point-of-Sale • Pay by mobile all your purchases • Sales for subscribers • Pilot from February 2001 in Pizza Hut • Payment by credit card or from prepaid account • One-time pin-code in use (SMS) • Good show case for any kind of purchases and the most potential application

8. Mobile Ticketing • Sales by mobile phone using location info and end user profiling • Integration in existing ticketing systems, control, access, info, reservation • Transport Operator in full control of stock and presentation • High throughput automatic electronic ticket validation • Ticket printing possible • European pilot in the summer 2001 • Calling number, IVR, SMS, RF in used

9. SONERA SHOPPER • Trial from 2001 for restricted user group • Subscription needed • For any mobile operators subscribers in Finland • For any type of handset • No more billing in mobile phone bill • - Credit card (Visa/Mastercard) or Shopper account (prepaid) • Secure payment method

10. Value proposition for the merchant • Time savings in payment transactions • no need for signing the bill • no need for checking the identity • More secure cash register environment • less cash handling and cash logistics • Option for mobile marketing • Innovative image

11. The channel between consumer and merchant More efficient payment method Sonera Shopper for the merchant Experience Usability Payment method Functionality

12. Value proposition for the end-user • Secure payment method • - All purchases are confirmed • Convenient payment method • - Only one PIN-code to remember • - No signing at cashier • - No need for cash • Service management and reports by SMS or from www.sonera.net

13. Registration

14. Payment Transaction • 1. Consumer sends SMS: PAY XXXX to number 13130 • 2. One-time payment ID as response SMS, valid for next 30 min • 3. Consumer tells payment ID to the cashier • 4. Payment information is sent from cash register system to Sonera Shopper payment platform (Merchant, payment ID, value of the purchase) • 5. According to default payment method billing either from Shopper account or credit card. • 6. Sonera Shopper payment platform sends payment confirmation to the merchants cash register system. • 7. Consumer receives confirmation of purchase from Sonera Shopper by SMS. 3. Merchant 4. Consumer 1. 6. 2. Sonera 7. 5. Financial Institution

15. The Receipt

16. Sonera Shopper merchants