Banking our next ‘Million’ CustomersMobile Money Summit 21 – 22 November 2008

Bank South Pacific

The Need for Change…

•Only 12% of the population have bank accounts

•Only 17% of population have a mobile phone

•Majority of un-banked live in remote areas

•Expensive to establish ‘Bricks & Mortar’ Branches though not out of the question

•Customer growth potential is significant

•Recent experiences

•Account growth has been significant

•Required investment to expand ATM’s and EFTPoS networks

•Significant investment in network infrastructure

Positioning for Growth…

•Installed three new state of the art IBM i570 Servers (K6m)

•Established an in-house capability to manage our computer systems, communications and data networks

•Refreshed all PC’s and servers (K2.5m)

•Undertaken a total revamp of our LAN, WAN and international networks

•Replaced our Teller system and introduced a new ‘One View’ of the customer interface (K17.5m)

•Introduced affordable ‘Smart Banking’

Positioning for Growth…•Investing heavily in specialist IT/EB training for our staff

•Significant investment in Electronic Banking Equipment:

•We now have 150 ATM’s throughout PNG with another 30 on the way (K10m)

•We have over 2,000 active EFTPoS terminals

•We operate 38 Agencies in remote locations

•Launched an affordable Visa Debit Card product which is available to all customers

•The Visa Debit Card will help drive e-commerce in this country

•Launched Business and Personal Internet banking with ability to pay third parties

So…

BSP is strongly positioned to capture future growth

But…

•How do we cope with the increased account base in our branches?

•How do we further support those in remote regions?

•What are the best delivery channels?

•Who might be willing to partner with BSP?

So… (cont’d)BSP is strongly positioned to capture future growth

How…

•Migrate more existing customers into electronic channels

•Provide a simple way for customers to pay into other accounts at either BSP or at other banks

•Provide innovative distribution solutions

•We need fast and reliable networks with an increasing need for greater bandwidth

•We need to ensure that the country has a sound core telecommunications infrastructure

•Phone, Mobile and Data networks need to be expanded to cover a greater proportion of the country

And…

We need to be able to do this in a cost effective way and produce a return for all

our stakeholders

BSP’s Solution…•Further investment in ATM’s for 2009 (+30)

•Focus on Queue waiting times & ATM availability

•Improve customer management and account opening process by leveraging technology used for ‘One View’ of the customer

•Enhance ‘Pay Others’ facility on Internet Banking and add to Phone Banking

•Additional security for Internet Banking via 2FA

•Introduce Mobile phone top-ups from BSP ATM’s

•Introduce new EFTPoS terminals to take advantage of new technologies

AND…

BSP’s Solution…

SMS Banking

and

Mobile Phone Banking

BSP is pleased to announce2 new electronic services to PNG:

BSP’s SMS Banking…

Available on both B Mobile and Digicel NetworksVery simple to useSingle SMS number 16 277 (BSP)Visit Branch to registerOptions available NOW:

Balance enquiry on all linked accountsLast three transactions

Future enhancements:Pay others – BSP to BSP (instant)Pay others – BSP to other Banks (overnight)Bill PayAlerts (Pay deposits, daily balance etc.)

Free registration and outbound SMS. Inbound SMS will be charged by the Carrier

BSP’s Mobile Banking… BSP’s Internet Banking has been completely rewritten to work on

Web enabled Mobile Phones BSP did not short cut by simply saying ‘use our existing site’ No phone specific software required just a mobile browser Very small packet size to increase speed & lower cost of delivery Automatic registration with Internet Banking Options available NOW:

Balance enquiry on all linked accountsTransfers between linked accountsTransaction historyBill Pay (in branch registration)Capability to relay menu choices via wave file (phone will talk to you)

Future enhancements:Share 2FA security with Internet Banking Integration with Internet BankingPay others – BSP to BSP (instant) – in branch registrationPay others – BSP to other Banks (overnight) – in branch registration

Reliant on implementation of GPRS for use on web enabled Mobile Phones

Perfect solution for customers on dial up Internet (IB-Lite)