Latest and Future development of Mobile Payment in Hong Kong

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Latest and Future

development of

Mobile Payment

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About oti

Founded in 1990 (NASDAQ: OTIV). Offices in US, Europe, Africa, Asia

Global provider of cashless payment solutions Experts in secured cashless payment solutions Diversified revenue streams: product sales, recurring revenue and transactional fees Technology supported by expansive IP portfolio of 100+ patent assets

Major Global Partners & Customers

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Cashless payment Eco-System

Existing payment infrastructure Retail and

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oti. cashless payment solutions

Some History….

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Traditional payments Bank Centric

Traditional payments Cash /Cards/Checks/… Financial know-how

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Google Trend…

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The change

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Whoever controls the Secure

Element, controls the transaction SIM-based or phone-embedded SE give MNOs best position to control the financial transaction Google is now bypassing MNOs via Host Card Emulation (HCE) Banks are starting to pilot HCE

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Today

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How to Deliver ?

NFC BLE HCE WiFi QR Code EMV Mobile ???

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Optional NFC Bridging Solutions

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There are few options to NFC-enable existing phone:

Audio-Jack Add-on NFC Insert

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What the industry needs to deliver

Security Ease of use Agnostic to: Apps OS Handsets Payment schemes Infrastructure

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Cross Platform

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Changing Shopping environment : Mobile Devices

PC

In-store

We want it to be SAFE

For us and for our loved ones We want the best deals

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Mobile add-on potential

Mass Transit Credit / Debit Cards

Healthcare card PKI device Agnostic token

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Banking NFC Solutions - Case Study

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Large consortium of banks in Hong Kong recently ordered OTI’s WAVE dongle:

Wish to own the secure element in order to control the financial transactions

Don’t want any dependency on MNOs Want immediate compatibility with all handsets

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Latest and Future Development of Mobile

Payment in Hong Kong

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Mobile Payment – The Hong Kong Experience

Beginning of the journey – November 2012

First mobile credit card payment solution emerged External device specially designed for iphone

Year of Blossom – 2013 SIM card, SD type SE No one for all solution

OS specific (IOS, android) – SD card Telco specific (SIM card)

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Mobile Payment – The Hong Kong Experience

The Requirements

Telco independent Handset independent

One device accommodates multiple issuers oti WAVE

1st_{encounter: Sept 2012}

Formally launched in HK in Sept 2013

Fully addresses telco/handset dependency issues Approved by Master card and Visa

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Which one is better? Really…

From an end user perspective

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How To Improve End User Acceptance

Ease of Use the #1 Requirement

Octopus as benchmark Value added services

Vouchers/ Coupons E-dollars

Reward points Special offers…

TESS – oti approach:

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The User Experience

Two modes of Operation

Standalone Mode

Always On (configurable) -> Easy to Use Default Card

Identical User Experience as contactless card (PayWave, PayPass, QuickPass) with higher security

Connected Mode

Connect to mobile device on needed basis

Select card

Checking transaction log Card life cycle management

Add, Remove, Renew card Value added services

Download, apply vouchers/ coupons Location based advertisements …etc

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What Next?

So far, the focus is on enabling end user for mobile payment What about the merchant???

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Point Of Sale (POS) Ecosystem

credit cards Issuer bank POS Concentrator Acquirer bank Card Association Internet Connection

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Point Of Sale (POS) Ecosystem

credit cards Issuer bank POS Concentrator Acquirer bank Card Association Leased Line

Connection Modem Pool

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Mobile Point Of Sale (MPOS)

Low cost alternative to traditional POS terminal (both hardware and data connection)

Full functions

Mag stripe, Chip and Contactless Chip and PIN, Chip and Sign

Enable merchant to conduct business anywhere, anytime Portable terminal

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Today’s Challenge

34 Merchants Consumers PromoteProducts Increase Loyalty Short Payment Cycle

Optimize Cash Flow

Best Product at the lowest price

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Smart Mobuy & e-Wallet

Smart Mobuy

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Service Modules

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Secure e-Wallet Built-in with Multiple Credit Cards and Certificates

e-Wallet

Daily Deals ` Local Collective Buying in a Secure way

Register

Bargain

Deal

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Activate eWallet Register Smart Mobuy Shop Enroll

User Experience

Email [email protected] Phone No. 852-9876 5432 Password *********

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Three Way Added Value

Merchant

• Low-cost and diverse

marketing channels on a single platform to promote products • Increase customer retention by

a smart loyalty system

• Optimized cash flow with short payment cycle

Consumer

• Secure payment method ensured with double authentications

• Daily and local deals at the fingertip • Reliable merchants verified by third

party organization

• Agreeable user experience to store all the credit cards, membership cards and coupons on a single app

Bank

• Handy Mobile App to promote contactless payment

• Transaction Boost-up via On-line Shopping

• Cost reduction on

administration and paper handling

• Fraud decrease in a secure payment method

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