GION - Fintech

La nuova frontiera dei pagamenti digitali

December 12th 2018 - Talent Garden Calabiana Milano

3

▪ 90% Chinese smartphones

▪ 22,000 messagges per day

▪ 200 mln active users who uses WeChat for mobile

payments

▪ +300 mln linked cards

▪ About 1 mln transactions per minute

▪ +300,000 Retail stores accepting WeChat payments

China market: one App fits all

▪ Riksbank works to introduce an e-krona

▪ Payment services: few but relevant solutions, no one owned

by a single bank

▪ During 2016, 77% of Swedes used at least one mobile

payment app

▪ Swish, launched in 2012 by Nordic banks, is the most used

Fintech app in Sweden (67%)

Sweden: towards a «Cashless Society»

Politecnico di Milano, Osservatorio Mobile Payments and Commerce, 2017

6,7 bn€ in 2017

+60% vs 2015

Mobile Payment and Commerce

Digital Payments: Italian market

Politecnico di Milano, Osservatorio Mobile Payments and Commerce, 2017

This document is strictly confidential and privileged. It shall not be disclosed to not authorized person.

Italian C2B payments market is still traditional but Digital

payments are growing

Source: Osservatorio Mobile Payments & Commerce, Politechnic of Milan

72%

28%

Traditional Payments (Cash, SDD, SCT)

Digital Payments

2017 Total C2B Payments In Italy

Cards (Credit,

Debit, Prepaid)

Cards&

Digital

Payments

New Digital

Payments

220

174

46

Digital Payments [€ bn]

Mobile POS7

Mobile Payments

& Commerce

New Digital

Payments

46

1

Contactless18

Ecommerce &

Epayments20~50% Cash

~22% SDD,SCT, Bank check

Total = 800 bn €

This document is strictly confidential and privileged. It shall not be disclosed to not authorized person.

Italians are progressively adopting e-payments, increasing

cards usage and digital payments

Source: Osservatorio Mobile Payments & Commerce, Politechnic of Milan

2030

46

1613

128

141

140

156

159

198

174

220

11,8%

179

168

20162013 2014 20172015

New Digital Payment*Cards (Credit, Debit, Prepaid)

CAGR 2013-17Digital Payments Trend 2013-17 [€bn]

+ 8%

+ 37%

* Includes contacltess cards, mobile POS, ecommerce & epayments (both desktop and mobile) and Mobile proximity payment

Expected 100bn in 2020 for

New Digital Payments

This document is strictly confidential and privileged. It shall not be disclosed to not authorized person.

The competitive arena

PAY

SisalPay today

03

10 BN € TURNOVER, +200 MLN TRANSACTIONS

13 MLN CONSUMERS

PARTNER OF ALL MAIN COLLECTION AND PAYMENT ITALIAN PLAYERS

PAYMENT INSITUTION REGULATED BY BANK OF ITALY

WELL KNOWN AND TRUSTED BRAND

+ 40.000 POINTS OF SALE

This document is strictly confidential and privileged. It shall not be disclosed to not authorized person.

SisalPay evolution

2014/2015 2017 2018

> Cash-less Payments1onSisalPaybill payments

> Omni-channel (SisalPayApp+Web+PoS)

> New Digital Payments App

Yesterday

> Cash-based Retail only business

BUSINESS

DEVELOP-MENT

USER

EXPERIENCE

IT

OPERATIONS

CRMMARKETING

SALES

New team,

new capabilities

Supported by Open Innovation strategy

Exploit digital opportunities to renew the customer experience of our Consumers and

Merchants

This document is strictly confidential and privileged. It shall not be disclosed to not authorized person.

SisalPay App is the first step in digital adoption, enhancing

the retail payments experience

STORE LOCATOR

PROMO AND NEWS

PUSH NOTIFICATIONS

Information about new partners and services

Nearest SisalPay PoSresearch

Additional channel to talk tocustomers with tailored based information (4 DEM/push per month)

“SCATTA E PAGA”

“ARCHIVIA RICEVUTA”

“RICARICA VELOCE”

Bill payments just by scanning the QR or barcode

Payments receipts digitalization by scanning QRcode on physical bill payments receipts

Fast mobile top-up through a QR code to show at the PoS

> Complementary services (e.g. receipt storing)

> Support to PoSoperations (e.g. service providing acceleration)

> Higher visibility and store traffic increase (e.g. Store locator)

Key features

Benefits

For PoS

> Fully omni-channel experience

For Customer

Retail digitalization

SisalPay App provides 1.5 releases per month

+100k users from January

50%!

This document is strictly confidential and privileged. It shall not be disclosed to not authorized person.

Digital Payments App: the new product

SisalPay aims at enlarging its offering with an innovative product: the

new App for digital payments simplifies, digitizes and renews the

payment process

Digital Payments App enhances the retail payment experience with

an innovative acquiring solution

It is not only an App for payments, but a unique purchase and sales

experience

It has no costs for download, registration and transactions, no fix costs

neither subscriptions

This document is strictly confidential and privileged. It shall not be disclosed to not authorized person.

The App aims at exploiting PSD2 cash-less disruptive

opportunity

Traditional and innovative value chain> Two major disruptions in the Italian Payments market:

▪ PSD2 regulation

▪ Launch of SCT Inst

> Impacts on market dynamics:

▪ Digital payments adoption facilitated

▪ Competition increased

▪ Current value chain changed

Context

TRADITIONAL

[Card Based]

> The App innovative model creates a direct link between Merchants and Customers with clear benefits in terms of costs for PoS and securityfor clients

INNOVATIVE

[IBAN Based]

A process that involves multiple actors

A leaner value chain

Customer Card Issuer

Card Scheme

Acquirer Merchant

Customer New Operators (e.g. Satispay)

Merchant

This document is strictly confidential and privileged. It shall not be disclosed to not authorized person.

Bill core values and first results

Useful

Digital payments wallet for Customers (pay anywhere in any moments)

and Merchants (no need to manage cash)

Convenient

No fixed and low variable costs for Merchants

Multi-device, fully integrated

A multi-device system made of a Consumer app, Merchant

app and fully integrated register (for payment acceptance),

Merchant portal and public website

Easy to access, easy to use

Customer-centric user interface with simple and clear

innovative features

Secure and certified

SisalPay product, authorized by Banca d'Italia

Business Accelerator

Better customer behavior understanding, loyalty initiatives and tailored

offering – "Digital Shelf" for Merchant businesses

Launched on September

24th

4,000 registered Consumers

and 30,000 Merchant

No Sisal network in progress

and partnership with first big

Merchants

This document is strictly confidential and privileged. It shall not be disclosed to not authorized person. 14

SisalPay digital strategy key findings

▪ Innovative customer experience

▪ Supporting digitalization for current customer base

▪ New digital-addicted customers

▪ Education to digital transformation for small merchants (proximity relevance)

This document is strictly confidential and privileged. It shall not be disclosed to not authorized

person.

How to compete in this new world?

Startup

Screening

Crowdsourcing/

Call4Ideas

Startup

Adoption & M&A

Corporate

VC/Incubator

Startup

Scouting

Partnership with

Key Innovation Players

Hackathon

Complexity

Innovation Impact

Open Innovation Initiatives

This document is strictly confidential and privileged. It shall not be disclosed to not authorized

person.

Open innovation: an accelerator factor

Collaboration with key

start ups

Innovation boostCompany culture

evolution

Time-to-market

reduction

Dedicated niche

capabilities

Grazie