How to Enhance Your Payment Experience for Improved Customer Satisfaction Utility Payment Conference – October 18, 2017 Dylies King Manager, Customer Accounting Metropolitan Utilities District Barbara Zickler Regional Sales Director Paymentus Corporation

Changing Times 20th Century Sole providers Limited interaction between customer and utility Bill sent, payment received Satisfaction drivers: reliability and cost 21st Century Competition Two-way communication More opportunities for interaction Satisfaction drivers: reliability, cost, security, and customer experience Significant Landscape Changes

Changing Expectations The New Norm – What Customers Now Expect: Omni-channel technology Mobile solutions that allow instant bill access and analysis Bi-directional communication capabilities Self-service for bill payment, new customer activities, notification preferences and energy control choices Proactive notifications Tips for managing and reducing energy consumption SECURITY!

Improving Customer Experience Customers want the same experience/options they have when paying their other bills Offer more ways to pay Give them more options to see their e-bill Make the user experience simple and straightforward Require fewer steps to make a payment and see an e-bill Understand the customer’s preference regarding notifications

Electronic Payment Security Breaches – from malicious hacking, malware, and social engineering attacks – have gone up a mind-boggling 500% in the last four years. 229 days is the median length of an attack before detection. Cost of a Breach is $145 per record.

Key PCI Requirements PCI 3.0/3.1 (2015) Better define the Cardholder Data Environment Encourages the use of network segmentation Annual penetration testing Written responsible party agreements between merchants and service providers Expanded Self Assessment Questionnaires (SAQ)

Key PCI Requirements PCI 3.2 (2017) Expanded existing requirements Added the PCI DSS Supplemental Designated Entities Validation (DESV) criteria as an appendix Focus on security controls being continuously enforced, not just an annual exercise Service providers need to detect and report on failures of critical security control systems Service providers must perform penetration testing every 6 months (previously 12 months) Adds multi-factor authentication as a requirement for any personnel with administrative access to the systems handling card data

PCI Compliance Expensive Cost to Get Compliant Level 1: ~ $2.9m Level 2: ~ $1.2m Level 3 & 4: up to $200k *Source: TrustNet

Reduce your PCI Footprint Use network segmentation to isolate your payment data Removes non-compliant networks, servers and workstations out of the scope of PCI Lowers cost of PCI assessment Reduces the risk of breach

Reduce your PCI Footprint Use an enhanced service provider Handles the full customer experience and all aspects of payment acceptance and security 100% hosted; payment data is completely removed from your network Feature-rich customer engagement Shift risk and liability away from your business and on to your provider.

Metropolitan Utilities District Omaha, Nebraska Fifth largest public gas utility in the United States Serves gas and water to customers in Omaha and nine surrounding communities Our mission is to provide safe, reliable, and cost-effective natural gas and water services to our community. Our History – In 1889 the first water treatment plant was built near the Missouri River by a private company In 1918 the City of Omaha assigned operation of the gas system to the Water District. On March 3, 1921 the name was changed to Metropolitan Utilities District By The Numbers – Natural Gas Customers Served 227,106 Water Customers Served 211,623 Water Hydrants Maintained 26,974 Miles of Water Main 2,904 Miles of Gas Main 2,807 Employees 852

Receivable Redesign Team Timeline June 2013 SAP Conversion Spring 2014 Strategic Plan January 2015 Receivable Redesign Team

Receivable Overview Our receivable system had slowly evolved over time to accommodate new forms and methods of payments. It worked as designed but when we really examined the process we found room for improvement. This realization, combined with new Payment Card Industry (PCI) requirements led to a complete redesign of our receivable process. A main portion of the redesign was to upgrade the existing payment systems. The main goals of the upgrade were: Improving efficiency Enhancing security Optimizing costs

Cost Per Transaction

3rd Party Payment Platform Request for Proposals Sent 13 requests with 7 replies 3 companies made in-person presentations ** Be specific with IT requests Decision Factors Offered the best value for a complete solution Could interface with our existing website and IVR Implementation Selected service provider in June 2015 Started physical implementation in January 2016

Payment Kiosks June 2016 -two bill pay kiosks were added to the lobby of the main office and one was installed in the breezeway of our other location. Benefits – Replaced ½ full time employee Works with Wi-Fi (not hard-wired) 3rd party web-based system so credit card or checking information is not saved on MUD servers Can process checks via ACH transactions Will accept cash if tellers are busy (no change)

SAP Cash Desk In August 2016, MUD implemented SAP Cash Desk to replace the existing cashiering software. The original software was a 3rdparty system with several issues. Benefits – Cash Desk is a module in SAP Real time updates No “delivery” problems or issues with the transport that had previously transferred date to SAP Customized to meet cashiers’ needs and business practices Scanning Checks for Deposit

Interactive Voice Response (IVR) Metropolitan Utilities District The new IVR payment system was implemented in November 2016. We worked thru several issues in the beginning, like not being able to receive international calls and address verification failure, but the work has paid off. Benefits – Customer Service Clerks do not take credit card or bank account number over the phone No dedicated servers to secure sensitive data Liability for PCI security transferred to 3rd party Invisible to Customers 22,500 payments received equaling $306,000 since Go Live

Customer Service Benefits – Gained 5 full time CSRs that were previously dedicated to taking payments on payment computers PCI compliant –CSRs do not have access to credit card information No longer Isolating Credit Card Payment calls Overall less phone calls (VDI) –Poor Call Quality with previous system Cons – Customer does not have a live person Migration to Multimedia Container Format (MCF)

Website Upgrade MUD’s new website, www.mudomaha.com, went up January 1st2017. The new “My Account” feature has replaced the original bill pay option which was outdated and the source of many customer complaints. Original Login and Bill Pay Option

Website Upgrade Current Login and Bill Pay Option

Website Upgrade Benefits – Customers can now pay online with a check in addition to a credit card Card or bank account numbers can be stored for future use. Customers can update personal information such as phone number or email addresses. It is possible for customers to start, stop or transfer service. Overall, less calls to the call center. Cons – Each customer had to create a new login The cost of recurring credit card payments

Receivables Today X X X X X X X Service Provider X X X X

Next Steps Customer Experience Surveys and journey mapping 2 hour appointment windows Invoice Redesign Outbound campaigns for disconnection notices, appointment reminders, and outages Recurring on-line payments

Future of Payments We are quickly moving towards a cashless and cardless economy Between biometric authentication and tokenization, the payment process will soon be 1-click or no-click Predictive analytics will be used to identify delinquencies and potential disconnects before they happen Posting and settlement will occur in real time The internet of things will turn everything from your TV to your refrigerator into a payment channel Voice-based payments are here and soon to be everywhere (pay your energy bill by talking to your watch, car, etc.)

Metropolitan Utilities District Paymentus Corporation Questions? Dylies King Metropolitan Utilities District Manager, Customer Accounting Dylies_King@mudnebr.com 402-504-7179 Barbara Zickler Paymentus Corporation Regional Sales Director bzickler@paymentus.com 505-466-4766