Our Strategy to Create and Roll Out Solutions in the Prepaid Market Section 1
Our Strategy to Create and Roll Contents Out Solutions in the Prepaid Market • Prepaid Market Overview • Our Current Positioning • Our Strategy to Create and Roll Out Solutions • Launch Process and Financial Impacts 2
The Prepaid Market in the Payment Universe Prepaid 0.4 Prepaid market: Debit € 441 billion 3 Credit Cash & 3.9 Equivalent 13.4 Electronic funds transfer Total Payment market: 3.7 € 24.4 trillion Internal source (In € Trillion) Prepaid market is a niche in the overall payment market 3
Prepaid Market Segmentation Prepaid 0.4 Three types of fund loaders Debit 3 Credit Cash & 3.9 Equivalent 13.4 B2B B2G B2C Electronic funds transfer 3.7 • Food Benefit • Food • Gift (single-brand or • Non Food Benefit • Education multi-brand) Dedicated • Expense • Fertilizer • Fuel funds Management • Gift (multi-brand) Two different ways to spend • Un- or Underbanked • General subsidies to • Travel money • Expense • Youth citizen Non • E-wallet management (open- • Gift (open-loop) dedicated loop) • Insurance • Remittance funds • General purpose The prepaid market addresses a large number of segments and types of usage 4
Sizes and Growth Rates of Prepaid Market Segments B2B B2G B2C x Market segment size 2009-2017 expected x growth rate € 318B n € 125B n € 102Bn € 91Bn Dedicated funds (Filtered / Closed Loop) 5% 14% 12% 14% € 25Bn € 79Bn € 123B n € 19Bn Non dedicated funds (Open Loop) 21% 27% 20% 22% € 121Bn € 116Bn € 204Bn € 441Bn TOTAL PREPAID 15% 13% 16% 15% Internal source Six market segments offering high growth potential Dedicated prepaid funds represent more than 70% of the current market 5
Our Strategy to Create and Roll Contents Out Solutions in the Prepaid Market • Prepaid Market Overview • Our Current Positioning • Our Strategy to Create and Roll Out Solutions • Two Illustrations of Recent Launches • Launch Process and Financial Impacts 6
An Offer Organized Around Four Types of Solutions B2B B2G B2C Dedicated 1% 0.6% 98% funds Non 0.3% dedicated 0% 0% funds B2B B2B B2G B2B Employee Expense Incentive Public Social Benefits management & Rewards Programs Quality Food of life Dedicated funds Non dedicated funds Buyer of the Human Finance Marketing Public service Resources Purchasing & Sales authorities Our core business is the dedicated funds B2B market, where we have already developed a wide range of customized offerings 7
A Strong Footprint in the Distribution of Dedicated Funds from Corporate clients Breakdown of x B2B B2C B2G Edenred’s 2010 issue volume by segment 98.2% 1.0% 0.6% IV: 0.1Bn Dedicated IV: 0.07Bn IV: € 13.7Bn Funds Ex : Dote Scuola Ex : TR card 0% 0% 0.3% Non dedicated IV: 0.04Bn Funds Ex : Insurance card, Open loop Travel & Expense card Our expertise: ensure that funds allocated by clients (mainly Corporates and Public Institutions) are effectively used as intended 8
Focus on our Offer in the Distribution of Dedicated Funds from Corporate Clients B2B B2C B2G B2B Dedicated 98.2% 1.0% 0.6% Funds Expense Incentive Employee management & Rewards Benefits Non dedicated 0.3% 0% 0% Quality Funds Food of life 2010 IV breakdown (in %) 78% 9% 8% 3% Dedicated Funds L/L growth rate in 2010 +18% +17% +11% +7% All our offers are growing rapidly 9
Competition in our Core Business: Dedicated Funds from Corporate Clients Employee Expense Incentive Benefits & Rewards management Quality Food of life Global players Wright Express Sodexo Sodexo Sodexo Carlson Marketing FleetCor Continental Chèque Déjeuner (Europe) Chèque Déjeuner (Europe) players Visa Vale (Brazil) Si Vale (Mexico) AXA (France) Grassroots (UK) CTF (Brazil) Qui Ticket (Italy) Good card (Brazil) Local Dexia (France) Motivcom (UK) Cheque de Table (France) Inbursa (Mexico) players VB (Brazil) Computershare (UK) Maritz (US) Valeven (Venezuela) Comdata (USA) Grassroots (UK) Novo Payment (Venezuela) Buen Menu (Spain) Very fragmented and heterogeneous competition, with only two global players 10
Competition in Prepaid Market’s Other Five Segments B2B B2C B2G • Blackhawk (USA – Gift Closed loop) Dedicated Funds More than 90% managed by public institutions, except in the • InComm (USA – Gift Closed USA loop) • JP Morgan (USA) • Sodexo (France) • Cheque Dejeuner (France) • Account Now (USA – • NetSpend (USA – General UUB) purpose) Non dedicated Funds • Net1 (South Africa) • Galiléo • Green Dot (USA - Multi (USA – UUB) products) • Payoneer • Paypal (USA – Internet (USA – UUB) Wallet) • Citi prepaid • Western Union (USA – services (USA-Business Remittance) Expenses) • Wirecard (Germany – • American Express General purpose) (USA-Business Expenses) • Moneygram (USA – Remittance) Mainly US players focused on local B2C non dedicated funds market 11
Prepaid Market’s Ecosystem • Ceridian • ADP • Paychex • VeriFone • WageWorks • Ingenico • Oberthur Payroll • Gemalto company POS / • Carrefour Retailer • Card Tesco • manufacturer Wal-Mart • Auchan Prepaid • Citi prepaid services Services (ex e-count) • Comdata (Ceridian • Visa Payment Payment subsidiary) • MasterCard scheme • processor Metavante • American Express • Tsys • Discover • First Data • GIE Carte Bancaire • CARDnet Loyalty Bank or • Airplus marketing Acquirer • Aeroplan • Parago • • Affinion loyalty partner Redecard / Cielo • (payback card) Atos A large number of players in the prepaid market’s ecosystem, with no specific focus on B2B prepaid services 12
Conclusion Edenred’s positioning Prepaid Market A large and fragmented Edenred is the clear market, worldwide leader more structured in in Employee Benefits and dedicated funds, a major player in other with high growth potential corporate prepaid in every segment solutions A strategy favoring organic growth in all continents with a strong focus on B2B 13
Our Strategy to Create and Roll Contents Out Solutions in the Prepaid Market • Prepaid Market Overview • Our Current Positioning • Our Strategy to Create and Roll Out Solutions • Launch Process and Financial Impacts 14
Our Strategy to Create and Roll Out Solutions expertise Strong B2B B2G B2C World leader in corporate benefits A C Dedicated Incentive funds D & Rewards Public Social B Programs Expense Management Non dedicated funds B Expense Management Leverage our worldwide leadership position in the large Employee Benefits market to develop fast-growing adjacent segments 15
Roadmap by Type of Solution (1/2) A B B2B B2B Employee Benefits Expense Management Accelerate the conquest of new growth Strengthen our leadership territories based on our Latin American by rolling out solutions experience Latin America: Emerging countries: Strengthen our leadership position in Fuel Develop solutions helping governments and and Fleet expense management and roll out corporates to spread the benefits of new solutions in Travel & Entertainment economic growth more equitably Europe: Developed countries: Roll out customized solutions in Travel & Create customized solutions for corporates, Entertainment expense management, as an end-users and governments in response to added-value alternative to corporate cards identified sophisticated needs 16
Roadmap by Type of Solution (2/2) C D B2B B2G Incentive & Rewards Public Social Programs Expand our offer to public institutions in Roll out solutions in our main countries countries where Edenred is already to enhance our offer to stakeholders present Provide the following value-added services to our stakeholders, Roll out solutions to Public institutions, on top of our Gift programs : by leveraging our existing B2B platforms - Recognition and affiliated networks - Incentive - Loyalty - Promotion, Saving & Discount 17
Expand Our Leadership in Employee Benefits A Meal and Food Quality of Life Our existing solutions Green/Culture/ Childcare/ Meal Food Transportation Gift as of 2010 Sport/Holiday Home services Belgium Brazil France Italy Mexico UK 69 solutions worldwide as of 15 16 9 4 18 7 2010 11 solutions launched in 2011 or 3 0 1 1 4 2 under development worldwide After 50 years of steady growth, still many opportunities in our core business 18
Illustration of New Benefits A 11 solutions launched in 2011 or under development worldwide Meal and Food Quality of Life Ticket Restaurante (Mexico – March 2011) Ticket Transporte (Spain – June 2011) H1 2011 Ticket Plus (Gift in Germany – Dec. 2011) H2 2011 Mind & Body (Finland, New country – Nov.2011) and 2012 Ticket Regalo (Chile – Nov. 2011) Ticket Family (Italy – Jan. 2012) 19
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