Worldline - Registration Document 2016

6

Business Industry andmarket overview

Services for Traditional Merchants

the commercial acquirer would then pay the merchant ● € 99.40 pursuant to terms of their contractual arrangements: in most instances, the commercial acquirer pays the ● merchant within 24 to 48 hours, having deducted from the principal transaction amount a charge comprising the € 0.30 interchange fee deducted by the issuing bank, the € 0.05 card scheme processing fee and its own acquiring fee which might, in the present scenario, amount to € 0.25. The merchant would therefore receive an amount of € 99.40 from the commercial acquirer (in the event the commercial acquirer has outsourced Acquiring Processing services, it would pay approximately € 0.04 per transaction to the provider of such services, which would be deducted from the merchant service charge), various alternative payment arrangements exist between ● commercial acquirers and merchants, depending on the particular terms of their contractual arrangements. In some cases, the merchant receives the full € 100 from its commercial acquirer and receives a bill at the end of the month for the merchant service charge; this is known as the “interchange ++” payment method (generally limited to large-volume customers). In other cases, the commercial acquirer only pays the merchant several days after the transaction (generally for higher-risk transactions); the card scheme would send a bill to the commercial ● acquirer for its card scheme processing fees (in the current example, € 0.05 per transaction), on a monthly basis. The example given is based on a typical card transaction, however, there are other payment methods. For example, another common non-cash payment method in many countries in Europe, particularly in Germany, is payment via direct debit and credit transfer from a consumer’s bank account. As in the card example, many banks also choose to outsource the processing of these payments to third party processors such as Worldline. Non-card-based payments payments) that are increasingly popular. Such methods include: There are a variety of non-card based payments (alternative Sepa Credit Transfer; ● Sepa Direct Debit; ● Instant Payment; ● Account Initiated Payment; ● Online Banking e-payments (OBeP). ●

to provide cross channel sales experiences that allow consumers to seamlessly transition between a retailer’s physical, online and mobile stores. These services may include solutions such as electronic engagement wallet services to capture and leverage consumer data and digital signage and other solutions that bring aspects of the online commerce experience into the retailer’s physical store environment; ● providers assist retailers in designing, implementing and enhancing online and mobile services and integrating them build customer relationships and reward customers for their loyalty, and provide retailers with valuable insights and sales promotion opportunities by leveraging data about customer behavior gathered through the program. In most cases, these programs are based on loyalty cards tied to a specific brand. To help implement these programs and leverage loyalty program data, merchants often turn to outside service providers for assistance in enrolling customers, tracking purchases, analyzing the resulting data and assisting with sales promotion; payment cards used by retailers to extend credit or provide prepaid gift cards to their customers. The largest users of these services are fuel retailers, department stores and consumer electronics retailers. In general, these cards are only accepted as a means of payment by the retailers that have issued them. Many payment service processors that offer issuer processing services also provide card issuing and processing services to retailers. Private Label Card Issuer Services. Private label cards are ● Value-Added Services for Banks Digital Wallet Services. Banks often turn to outside service ● providers for assistance in designing, implementing and running their electronic wallet systems, which allow for online and mobile payments. Digital wallets, combined with tokenization services, are increasingly a must-have service offering for banks as they seek to respond to wallet-based solutions offered by bank and non-bank competitors, and to seize the customer engagement and targeted marketing opportunities electronic wallets offer; Fraud Detection and Prevention Services . The detection ● and prevention of fraud is an ongoing battle across all Omni-commerce Services. Omni-commerce service Loyalty Program Services. Loyalty programs help retailers ● channels and all payment instruments. According to a study by Ovum, investment in fraud will increase by 6.5% annually in the period 2012-2020 (Ovum Payment Technology Spend Forecast); Authentication Services. Authentication service providers ● offer banks solutions to provide more secure methods of authenticating cardholders such as 3-D Secure or biometrics;

6.2.1.2

Other services in and around the

payment value chain

above, the payment services ecosystem also includes a series of “extended” stand-alone or value-added services to traditional merchants and banks designed to help them grow their businesses and generate additional payment transactions. Such services include but are not limited to the following: In addition to the core payment processing services described

36

Worldline 2016 Registration Document