EMV & Parking – 6 Months On Dave Witts President of US Payment Services Creditcall Corporation May 20, 2016

After 7 Months of Liability Shift, Where Are We With EMV? Processor focus has been on Retail due to high $$ volumes Progress in Unattended (Parking) has been slow Devices with specific processors have been certified for Retail Devices with specific processors are now undergoing certifications for Unattended

Examples of EMV Certifications Today ATTENDED UNATTENDED Globalcom BV1000 in process of EMV certification with First Data, Elavon, Chase Paymentech & Global Payments Ingenico iSelf in process of EMV certification with First Data Ingenico iPP320/350 certified with First Data & Elavon VeriFone VX820 certified with First Data, Chase Paymentech, Elavon, TSYS, and Heartland

October 2015 Has Passed And Compliance is Still Very Low Retail took priority Processors overwhelmed with certifications Overall industry was not ready

Current U.S. Projected Adoption Rates (by end of 2015) 400 million EMV cards issued 59% of retail locations will be EMV-compliant 78,800 EMV chip-activated merchant locations 70% of U.S. credit cards will be issued as EMV cards

Current U.S. Projected Adoption Rates 86% of financial institutions planned on issuing EMV debit cards BY 2015 $3.50 Average cost for issuing a new EMV card $500 Average cost of an EMV-compliant POS terminal Sources: Javelin Research & Strategy, Aite Group, 2014 PULSE Debit Issuer Survey

Current U.S. Statistics Approx. 1.2 billion credit & debit cards need to make the shift and 12 million POS terminals One in four Americans have had personal and financial information compromised risking financial fraud and identity theft - EMV adoption could significantly reduce these risks When the UK implemented EMV nearly 10 years ago, fraud from counterfeit cards declined by 56% Source: Payments Policy Group 1.2Bn

Current U.S. Statistics Consumers will be able to use their chip cards at 50% of merchants by June 2016 At least 90% of merchants will have chip readers by 2017 37% of retailers in the US can process chip- embedded cards Sources: Strawhecker Insights & Smart Card Alliance

Fraud/EMV Security In 2014 more than 30 million Americans were affected by credit card fraud The U.S. is responsible for 47% of the world’s card fraud and 72% of the world’s breaches, while only accounting for 24% of worldwide card volume Source: www.forbes.com 30million

Latest EMVCo Figures *note most recent numbers will be released end of May 2016

Attended (Retail) vs Unattended (Parking/Kiosks) Attended far ahead in EMV certifications over unattended Processor interest – looking at higher risk $$ Device availability (unattended) – not all devices were ready for certification in October 2015, some are still not ready… Big retailers were driving the priority Progress has been slow overall for attended and unattended

Reasons For Slow Uptake Processors not ready / cannot cope with volumes of certifications Certifications taking longer than expected Processors have been slow to respond to questions during certification Devices not ready to be certified High cost to switch over (hardware and certification)

Focus on Unattended (Parking) For Slow Uptake EMV certifications with US processors basically non-existent at this time 1st set of devices are starting certification now with mid-year estimated completion Manufacturers still looking at what devices make sense in their equipment, not many choices to have an off-the- shelf certification

EMV Specification Limiting Some of The Features That Exist in Parking Today Cost to convert/upgrade is high Overall transaction time is slowed down due to interaction with the customer (the swipe is out!) Device availability to start certifications Frustration on not having a solution today due to customer demand Mix of devices that are available to choose from An EMV-ready device is NOT an EMV certified device. Each device has to be certified with specific processors

What Happens During EMV Certification (typically up to 16 months) This is not a project to do on your own as it has many branches to take to find the EMV certified solution

Select an EMV Card Reader – 3 Months A card reader is where a large part of an EMV transaction takes place through a complex dialogue between chip card and reader Integrators must invest time in learning about EMV (e.g. Application Selection, Data Authentication, Online Processing and Issuer Script Processing), transaction flows, transaction logic and exception handling when an inevitable error occurs in the transaction

Processor Interfaces and EMV Messages – 6 Months Different processors require every interface to be modified to support the new EMV data fields and process flows Most interfaces are based on legacy code developed many years ago, the addition of new features such as EMV becomes an increasingly difficult task Processors will have scaled their integration support sufficiently to cope with the mass of other integrators who will be following the same path

Card Brand Certifications – 4 months Once processor interfaces have been updated, the complex task of end-to-end testing and certification begins M-TIP/ADVT/AEIPS/DPAS are the 4 different testing types required Processors have not been able to cope with the volume of certifications required before the October 2015 Liability Shift and continue to struggle now This is NOT a one-time process – it must be repeated every three years when the EMV Kernel certification on the card reader expires.

Terminal Management System – 3 Months It is essential that any EMV solution deployed has access to a TMS platform for efficient and timely deployment of updates Without a TMS platform, there is a risk of having card readers without current software or the latest configuration

? What’s next for EMV in the Parking Market? Certifications will become available in Q2 2016 Most processor certifications should be complete by the end of 2016 Additional devices will be certified by end of 2016 – providing product choice and a more “off the shelf” approach When looking at a “Certified” EMV solution ensure you are not locked into a specific processor, keep flexibility to change processors as the rates can change and reduce your costs ?

President of US Payment Systems If you have any questions, please contact: Dave Witts President of US Payment Systems Creditcall Corporation 315 W 36th Street, New York, NY 10018 USA 609 339 9080 dave.witts@creditcall.com Dave.Witts59 @