MWC Barcelone 2019 Wearable Payment Summit...

Wearable Token Service Provider (WTSP)

Keynote By Wayne Leung

CEO of Tappy

The $20 billion industry that IoT couldn’t account for.

Over 1 Billion Traditional Watches are sold every year

Traditional Watch Industry

“Prestigious design is the number one motivator driving consumer

purchases”

Design restrictions

Vs

Multiple SKU’s means more choices

Guess Payment Watch Collection Payment Enabled Fitbit Ionic

“Functionality is the number two motivator driving consumer purchases”

Smart Watches

Hybrid Watches

Digital Payments Are Mainstream

EDC – Every Day Carry

New Standards

Universal Passive Provision Unit

Second Factor Authentication

Thank You

Wearable Payment and Data Insights

Robert Morgan, Business Development,

Barclays UK

2 | Mobile Payments MBR

Two-Thirds of All eligible transactions in the UK are now made using contactless

Restricted - Internal

• Over two-thirds of Brits now Tap to Pay on a

daily basis

• Millennial shoppers (aged 18-35) have

embraced contactless payments even more

enthusiastically, with 76% making daily

purchases with their contactless cards

• The total number of contactless cards now

stands at 123.5 million, an annual increase of

3.9%

• There are now over 535k contactless terminals

in the UK

• 2 in 3 UK terminals are contactless

£2.32 £7.74

£25.21

£52.37

£69.03

2014 2015 2016 2017 2018

Source: Dec 2018 Contactless Payment Report

UK Contactless Spend (£bn)


Other markets are even more advanced or at the start of their journey


Wearables payments are a growing trend, as the market matures


Our solution – bPay

What is bPay?

• bPay is an innovative contactless payment solution supported by a digital ecosystem that launched in July 2015

• Our original products included a wristband, fob, sticker and loop, and has grown to include: jewelry, fitness watches, luxury watches,

keychains, and coffee cups

• At the heart of bPay is a pre paid account that works with any Visa ™ or MasterCard™ credit or debit card, registered to a UK address

• You must be 13 years or over to register for a bPay account

• bPay can be used for spend up to £30; wherever you see the contactless symbol – in the UK or when traveling

• You can track spending and top up using the dedicated bPay app or online at bpay.co.uk

• Allows you to add up to 10 wallets (bpay devices) to your bPay account, and control/view your spend

benefits• Speed and ease of use

• No charging required

• Avoid the risk of carrying cash, especially on the London Underground TFL

• Family friendly, as you can register up to 10 wallets

• No charges when using abroad

• Water Resistant


Change your account settings

via the bPay app or at

bpay.co.uk including personal

details and marketing

preferences.

bPay customer journey

You can have up to 10 devices

registered per account.

To register a bPay account

customers can download the

bPay app or go to

www.bpay.co.uk and follow

the instructions.

It’s quick and easy to follow.

Registration involves linking the

bPay account to any Visa or

MasterCard credit or debit card

registered to a UK address.

The card does NOT have to be

Barclays/Barclaycard.

register link to credit or debit card

up to 10 devices

Loading money onto a bPay

account can be done through

individual top ups, or auto top

up, via the free bPay app or

through bpay.co.uk

loading money

With the auto top up feature,

whenever a bPay balance

drops below a set amount,

we’ll automatically top it up.

auto top up

change account settings

You can immediately report

your bPay device lost or

stolen using the bPay app.

lost & stolen


20172015 2016 2018

Our physical product journey – move from proprietary to partner

2012

Festival access Own range Partner products (enabled by smaller flexible chip)


Press coverage


Convergence of Wearables and Data

Wearables can be used by partners to understand their customers in more

detail:

- Spend data for campus type environments

- Spend behaviours for loyalty schemes

- Customer profiling

Enriched with other data sets, wearable customer data can help brands

understand:

- Customer spend geographies

- Competitor benchmarking

- Customer demographics


Insight into real customer spending

and market performance

Tailored Insightsunique to

No one else has such powerful insights into transactional customer data

Our data and models are based upon fact, driven from our relationships with our customersfrom all segments of society. It allows for us to understand consumer behavior across the UK ingreat depth on a timely basis.

ScaleWe have access to the transactions of 17 million customersacross our current account and credit card businesses.

Real DataWe have actual customer geo-demographic and transactionaldata in its truest form.

GranularityWe have the ability to geographically locate 99% of ourtransactions down to a postcode, enabling store level analysis.

TimelyOur insights reflect changing customer behaviour as it hashappened that month: day by day, hour by hour.

Market & Customer Insight: A Wealth Of Real Data


Barclays customers account for between 20% - 25% of Consumer UKcard spendBarclays, being one of the largest retail banks in the UK, has significant coverage of thepopulation’s expenditure. We see a considerable proportion of expenditure, and the scaleand depth of our data allows us to provide with accurate and actionable insights.

Protecting our customers’ privacy is important to us, we always applyanonymization rules to our data.

1. Minimum of 50 customers in any aggregate data.2. Minimum of 5 companies in an aggregated competitor set.3. No one company can have more than 50% market share in the

aggregated competitor set.

Total Unique Customers67

thousand

30 Months

of data

Market & Customer Insight: Data Coverage


Looking to the future – active v passive NFC technology

Passive chips Active chips

• Doesn’t require power

• Less suited to global roll-outs –

requires bank solutions (e.g.

bPay) to be personalised onto

cards

• Can send data only

• Quick to market/testing (could

launch with bPay in weeks)

• Requires power to enable tokens to

be provisioned

• Suitable for global roll-out using Visa

Tokenisation Service (VTS), or

Mastercard Digital Enablement

Service (MDES)

• Requires bank participation in VTS or

MDES

• Can send and receive data


Routes for device manufacturers – other considerations

• Pricing – how to price v non payment equivalents

• Product selection – do you retrofit an existing product, or develop a new model

• Customer awareness and engagement – how to grow awareness of a new spend category

and motivate usage

• Bank/scheme partnerships – bank partnerships to help two way promotion of products

• Regulatory requirements – will differ from market to market. In the UK we need to closely

monitor and approve staff training, POS signage etc…

• End to end payments value chain for your market – chip hardware, scheme, issuing bank,

token service provider, token requestor


Future developments 2: Access control and payment

Holiday parks

Gyms

Sports clubs


Get in touch!

Thank you

The rise of traditional watch brands in digital payments | Wearable trend setter

Our history

October, 2018

• TIMEX GROUP has a long and colorful history.

The company was founded as the Waterbury

Clock Company in Waterbury, Connecticut, USA

in 1854.

• Beginning with clocks, we expanded to pocket

watches then wrist watches. Our portfolio has

grown from basic mechanical movements to

sophisticated analog quartz and category-

defining technology

• With a focus on change and innovation, Timex

continues to draw upon our legacy of watch

making expertise, timeless classic designs and a

commitment to unparalleled quality.

A Rich History Of Innovation

1854

First

Affordable

Clock

1895

First “Yankee”

Dollar Pocket

Watch

1914

First Military-Issue

Watch

1933

Mickey Mouse

Watch at

Chicago Fair

1941

Timers for

Artillery and

Torpedoes

During WWII

1958

“It Takes a

Licking and

Keeps on

Ticking”

1960

First

Affordable

Women’s

Fashion

Watch

1974

First

LCD

Watch

1982

First

Calendar

Watch

1984

First

Affordable

Sports

Watch

1992

First Back-Lit

Watch Face

(Indiglo)

1995

First Wireless

Watch

Connection to a

PC

2004

Introduced

Intelligent Quartz

Movement

2009

Giorgio Galli

Design Lab in

Milan, Italy

2016

Accessible

Smart Analog

Technology

2018

Analogue

bPay launch

Our Brands

Timex is part of Timex Group one of the world’s true watchmakers. Timex Group designs and manufactures

innovative timepieces under well-known global brands. Timex Group sells millions of watches worldwide each year.

8

Why Contactless Payment ?

Context

China – The Cashless Society

USA Is Arguably Behind the Curve – But they are catching up

• Visa expects more than 100 Million Visa Contactless Cards issued

by end 2019

• Chase the #1 credit card issuer is bringing on line millions of Visa

contactless cards in the next few years

• 78 of the top 100 Visa Merchants in the USA already offer Tap and

Pay facilities

Why Would Timex Be Interested in Contactless Payment?

Relevance

Relevance

• Whether it’s a traditional watch or a smart watch, we believe that contactless payment provides a convenience

that people will quickly look to adopt.

• A bridge in some ways towards customers opting to use Time+ features on the wrist

• But also helping to maintain the relevance of traditional watches in the near term

The Start

Thank You

Unlock the NFC power in Wearable Paymentssecuring your digital credentials

Wearable Payment summit

2

Gemalto, always pioneer in payment innovation

With the sponsor of &

1st chip & pin

banking card

2nd generation

Wearables

Gemalto N°1 in market

share of number of

smart payment cards

shipped with 30 million

of cards & modules

produced each month

1990 2000

1st Contactless

payment card

2010

1st generation

Wearables

1st Biometric

payment card pilot

2020

Gemalto is the most

experienced supplier

for contactless

deployments with

more than 550

deployments WW

Gemalto has launched

the highest number of

pilots with Banks WW

with strong usage in

pioneer countries

Source* :

- Payment & Banking Card Technologies / ABIresearch / August 2018

- Number of cards in circulation: IHS - Payment and Banking cards - May 20173

A majority of

Point of Sales

are now equipped

Pay with contactless is the new Norm

Near 50% of cards in

circulation are now

contactless with strong

consumers adoption in

pioneer countries

Creating fantastic opportunities

Payment not

limited to card

format anymore!

Open the door to

imagination and

creativity

And strong growth still

expected in the coming

years following Visa & MC

Mandates.

The infrastructure is in place in many countries and growing quickly in new territories such LATAM or ASIA :


4

1st generation of wearables showed great opportunities to

Boost contactless adoptionAwareness Usage Adoption

Enrich Image and brandingBe seen as innovative


Target specific customersYoungsters, Sportsmen & -women, Kids…

Support Cashless events & environmentsFestivals, stadiums, amusement parks

5

How to extend these wearable opportunities ?

_ _ _ _ _ _ _ _

I want a fashion device

I can wear everyday

everywhere

I love my favorite

« TIMEX » brand, I do not

want another watch

I do not wish another

account or bank than the

one I already have

Payment feature

integration should

remain simple

Payment feature in my

device should be

country-agnostic


Payment feature in my

device should be

bank-agnostic

Bank–driven

deployments

February 2019Making Payment Fun!6

Driver from events &

cashless environments

Boom of

Day-To-Day

Usage


Payment Wearables ecosystem is

now ready for market extension Combining ..

large variety of devices

– fashion oriented

High secured banking

platforms certified through

multiple schemes

Payment schemes

an accessible payment

solution

7

Enabling an accessible payment solution

Tokenization-capable

Current end user banking credentials are securely digitalized in the wearable banking chip.

Banking credentials in the wearable are managed independently from your current card.


oken

8

Field proven banking chip reused for wearables

Adapted for unconnected wearables & for

an easy integration : FlexiTag

For invisible technology in fashion/luxury

devices

Opening the way to various integrations

Adapted SE for events/banks-driven

usecases : MiniTag, MicroTag, Sticker

Manually unplugged and inserted in the

device by end user

Handled by end user OR delivered already

integrated inside low-cost wearable devices

Reliable & fully certified ; up to date java technology.

Will benefit from coming biometry technology on card

Different choices of inlay form factors design

Inheriting from high-runner banking platform


9

A safe & convenient wearable

payment expansion


2nd generation EMV banking chips

_ _ _ _ _ _ _ _

Boom of Day-To-Day

Usage

Tokenization

scheme services

Safe is

your card

…

… Safe will be

your wearable !

Thanks for your attention

Wearable Payment summit

Making Convenience SecureBiometric authentication | Digital Identity, Security & Fraud

Our core technology is at the heart of secure convenienceZwipe’s technology solution enables

battery-less, contactless, ultra-low power,

self-contained biometric authentication

solutions in constrained environments

26 February 2019 Strictly Confidential

The challenge of making Convenience Secure Remove the unnecessary trade-off between security & convenience

Challenge Zwipe innovation solves the challenge:

For consumers Zwipe eradicates the need to use

cash, or enter a PIN

Superior convenience and increased security

For merchants Zwipe reduces cash handling and

increases customer throughput

For the card networks Zwipe strengthens the growth of contactless by improving convenience & security

For the banks Zwipe ensures brand visibility by enhancing

top of wallet effects and reduced fraud

FOR PAYMENT

SCHEMES

Drives

contactless and

cashless

transactions

FOR

BANKS

Fraud reduction

Offers

consumers

peace of mind

Preferred

method of

payment









FOR

CONSUMERS

Convenience

Peace of mind









FOR

MERCHANTS

Speed

Revenue









Strong adoption of contactless cards, but cardholders still have security concerns with contactless…

…and banks introduce transaction limits to limit fraud

Zwipe solves challenges for several groups

Source: Fingerprint Cards Research, 2018 3

Biometric authentication is fast becoming a necessity for all devices

• When looking at banking and payments, fingerprint authentication is moving from mobiles to payment cards to wearables and other devices

The world wants Fingerprint Biometrics

• Major recent market surveys point tothe fact that people in differentregions around the world are tired ofPINs and Passwords

• Those surveyed believe thatbiometrics, fingerprints especially, aremore secure, easier to use and fasterthan PINs and passwords

Biometrics perceived as delivering superior security

6Source: AYTM Market Research, April 2018, among pilot participants

31.9%

66.7%

4.4%

46.4%

15.9%

5.8% 14.5%

14.5%13.0%

40.6%24.6%

4.4%4.4%

49.3%

52.2%

7.3%2.9%

Numeric PINSignature

100.0%

No authentication

1.5%

Biometrics

100.0% 100.0% 100.0%

Very insecure NeutralInsecure Secure Very secure

Customer ratings of perceived security among pilot participants

7

Biometrics could be key to attracting millennial consumer interests

• Biometrics is increasingly being utilized not just for security but for driving convenience

• Millennials have shown preferences to utilize means of authentication that are more convenient

• The use of fingerprint biometrics is increasingly seen as the most convenient means of authenticating yourself

Wearables face challenges to widespread adoption

1. Payment credentials need to be done in a safe and secure manner, from provisioning to usage

2. Availability of contactless EMV POS terminals

3. Customer authentication limits use cases to transactions below transaction limits


Making wearables more secure through biometrics addresses existing obstacles to widespread adoption


Merging our technological strengths can help unlock a massive market opportunity

Find out more about us at zwipe.com

MWC Barcelone 2019 Wearable Payment Summit...

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