The VeriFone EMEA Vision Mr. Chris Lomax Head of Marketing - EMEA

1. The VeriFone EMEA Vision Mr. Chris Lomax Head of Marketing - EMEA Single European Payments Area

2. What does SEPA mean? • SEPA is defined in two ways • Single Euro Payments Area • Single European Payments Area • It is actually both • SEPA definitions are being driven by the EU Commission • Legal and regulatory frameworks • Governance for card payments (and other things): • Through the European Payments Council • Where will SEPA impact? • 25 EU members +

3. SEPA Cards Framework • Documentation can be found at • www.europeanpaymentscouncil.org • The Framework is aimed at building an environment in which there are no technical, legal or commercial barriers to stand in the way of cardholders, banks and merchants choosing and using SCF compliant payment and ATM access card products • Approved Framework published 8 March 2006 as version 2

4. Roles and responsibilities of SEPA banks • Within the Framework in order to be considered “SCF compliant” SEPA banks have to exert their responsibilities under the following roles so that: • As an EPC Member (and/or member of an Association) • SEPA banks commit to: • Implement the dispositions of the Framework • Association members to actively promote this Framework • SEPA banks acknowledge that preventing and fighting card fraud is an underlying objective of this Framework

5. Requirements - Acquirers • SEPA banks who act as acquirers or equivalent processors commit to offer to merchants, from 1 January 2008 onwards, the option to handle payment card transactions generated by one or more SCF compliant card schemes • Banks commit to make available to merchantsinformation on the benefits of accepting SCF compliant cards and actively promote the benefits of migrating to an EMV certified terminal to enable them to accept SEPA cards • SEPA banks commit to ensure that the ATMs they deploy (directly or indirectly) accept SCF-compliant cards of all schemes of which they are participants, and that their card processors support the full compliance for ATMs and PoS

6. Requirements - Cardholder experience • Scheme rules must enable and facilitate for cardholders a consistent service experience throughout SEPA • Where several payment applications are contained in the card and are supported by the terminal, cardholders have the choice of which application to use • Prevalence at PoS for a particular payment application may not be mandated by a card scheme • At a minimum, convenience for cardholders will be defined through consistent experience at point-of-sale, ATMs and unattended terminals • The basic transaction flow will be defined by each scheme • ATMs will offer English as well as the national languages and any other languages regarded as appropriate

7. Interoperability domains • SEPA interoperability must be ensured in these 4 domains: • Cardholder to terminal interface • Cards to terminal (EMV) • Terminal to acquirer interface (protocols or minimum requirements) • Acquirer to issuer interface, including network protocols • Such interoperability will allow the different market options described in this Framework to exist • The Framework does not mandate any market option or infrastructure

8. Certification principles • A common process for the certification of terminals, cards, and network interfaces will be defined • Card schemes commit to support and implement the resulting process • Under this process, any card, terminal, and/or network interface, certified by an accredited body can be deployed and used anywhere throughout SEPA • The entity providing certification services is outside any scheme, and works across schemes

9. Terminal certification • Card schemes commit to make available to SEPA banks and card schemes their terminal security requirements • Card schemes will engage in mutual recognition for type approval • A terminal certified for SEPA transactions by a certification body in one SEPA country can be deployed in any SEPA country for acceptance of SEPA cards across all SCF compliant schemes • There may be no constraining, local requirement • Schemes may continue to perform post-certification approval • Schemes cannot withhold approval to prevent market access

10. Our proposals - SEPA • Single security standard • Need for standardised cardholder interface process • No need for standard host interface message • Absolutely no TMS, or File Transfer standards needed • SEPA should not try to encompass all GIE CB 5.2! • SEPA Governance • The EPC provide the management and guidance • The EPC should open membership to technology vendors • That standards working groups are formed under EPC • Non-competitive environment

11. Impacts of SEPA on acquirers • Acquirer revenues • According to some, these will be reduced • Increased available market • Scheme revenues • According to the schemes, these will be reduced • Competition among acquirers • Will increase across the EU • Probability is that the smaller acquirers will be absorbed • Standardised EFTPoS • National standards will disappear • Migration to a common SEPA standard will be slow but steady • Vendor competition • Numbers of devices will decrease but deals will get bigger

12. Impacts on VeriFone and Our Partners • Single standards across Europe • The highest possible levels of payment security • But no need for many national applications • International acquirers • This could mean fewer customers • But much bigger deals • Internal EU borders will begin to come down

13. Thank You S PA

14. Mr. Dave Talach Head of Product Management VeriFone Software Strategy EMEA VIP Forum 2006 – Athens, Greece

15. Agenda • VFI SW Strategy… • Proactive Development Support and Training • SW Abstraction Model • SW Roadmap • Updated Security • New Advanced Terminal Mgmt Options • Enhanced Product Configurability

16. Development Support Services

17. Development Resources • DevNet • Information portal for your development staff. • Corporate information currently available • Available to all developers with active Verix/Verix V DTK maintenance agreement Benefits: • Access to latest SW releases • Additional technical support • Latest VFI development news • Discussion groups • Automatic email notifications

18. Development Resources • Training • Training required for development support • Trainings offered • Localized training provided by SS&S • Web Based Training • Custom Designed Training & Consultancy • Documentation/Developer Handbooks offered online • Writing & maintaining platform independent source • Introduction to the Ethernet media on Vx570 • Writing a “Power Save Friendly” application

19. SW Abstraction from HW

20. VFI SW Benefits • Enhanced Comm Library Benefits • Provide application portability across multiple Verix V solutions • Application isolation from HW changes • Re-use existing applications to easily enter new markets • Reduce costs and time to market required for new applications • Includes CommServer, UCL, TCP/IP, IPDL

21. VMAC The Verix V VMAC (Multi-App Conductor) simplifies the multiple application environment Benefits: • Manages application selection and device usage • Provides a standard messaging interface • Reduce QA and cert efforts by separating application functionality CDMA HW Ethernet HW WiFi HW GPRS HW

22. Enhanced Comm Software The embedded Verix V TCP/IP Library stack manages your IP enhanced communications Benefits: • Leverage the increasing growth of the IP infrastructure • Maintains data integrity through packet retransmission • Supports industry strength SSL security CDMA HW Ethernet HW WiFi HW GPRS HW

23. Enhanced Comm Software The Verix V IPDL (IP Download) Library implements standard zontalk protocol over IP Benefits: • Complete fast, secure downloads on all enhanced comm media including GPRS • Flexibility in packet size to decrease download times • Supports secure SSL downloads CDMA HW Ethernet HW WiFi HW GPRS HW

24. Enhanced Comm Software Universal Communications Library (UCL) manages the underlying communication with the different physical communication media. Benefits: • Normalized APIs enable device change with minimal application code change • “Smart Linking” feature delivers memory efficiency • Time to market. Applications directly do not have to account for new HW changes. CDMA HW Ethernet HW WiFi HW GPRS HW

25. Enhanced Comm Software Verix V CommServer is VMAC based application which provides a Client/Server based solution for IP communication. Benefits: • Application isolation from physical hardware layer– minimize porting costs and timeframe • Reduces memory size requirements • Provides a UI for configuration, download initialization, and troubleshooting • Maintains constant control of underlying HW communication. CDMA HW Ethernet HW WiFi HW GPRS HW

26. Development Timelines

27. Software Solutions SSL Lib Updates • Migration to most recent OpenSSL version • Features: • Mutual Auth (Server & Client) • Root Cert and Cert Chain Validation • Additional Error Code Reporting • Advanced Encryption Ciphers (3DES, AES, etc.) • Implement SSL call back functionality for VCS • Increased documentation and sample code • Designed to meet MC IP Security Mandate

28. Verix V SW Tools Roadmap Q1 ‘06 Q2 ‘06 Q3 ‘06 Q4 ‘06 Q1 ‘07 Oct/Nov Feb/Mar July/Aug Jan Apr/May Verix / Verix V SSL NETDIAG TOOL ECL Component VSNMP Lib VVCS UI AutoDL AutoDL SSL NETDIAG TOOL • Verix V • FER/BER Reporting • RSSI • Printed report for Signal Strength, Battery, Connection Type, etc. • Enable Dial Support • Support for multiple TMS systems • Enhanced scheduling support • Port to Verix V • Priority: (1)Verix V (2)Verix • Migrate to most recent OpenSSL version • Add SSL policies • Implement SSL call back functionality in VCS • Server & Client Auth, Root Cert Validation, and Cert Chain Validation, Error Code Reporting • Meets MC IP Security Mandate VCS UI VSNMP Lib • Modifiable UI based upon preset options • Verix V SNMP - Lib Protocol only

29. MM/DD/YY HH:MM Gift Card EasyID Other F1 F2 F3 F4 F5 F7 F8 F6 Software Solutions VMAC Enhancements • VMAC Menu Configurability • Rearrange order • New “Other” menu • Remove menu items and address by “hotkey” • Enhanced VMAC reporting • New Device report – Display and Print Owners

30. Software Solutions VTMA IP • VTMA modified to support IP-based Remote Diagnostics and Information Collection • Works in conjunction with current VeriCentre value-add modules • VTMA IP enable your 3rd party applications to monitor preset list of items

31. Verix V SW Tools Roadmap Q1 ‘06 Q2 ‘06 Q3 ‘06 Q4 ‘06 Q1 ‘07 Oct/Nov Feb/Mar July/Aug Jan Apr/May VTMA VMACComponent V/VMAC V/VMAC V/VMAC V/VMAC VTMA v602 • Verix, then Verix V • Daylight Saving • Configurable Menu • Application Registration Enhancements • Configurable LOGSYS file • Configurable DevMan resource file • VMAC reporting enhancements • Increase record size • Verix V, then Verix • LOGSYS enhancements – logging binaries and lost messages. • Config table for multi-language support • Verix V, then Verix • Logo support • PC Tool – Trace log files • Verix V, then Verix V • IP enable Remote Diagnostics and Information Collection.

32. Software Solutions AutoDL • Automate IP and Dial terminal initiated downloads • Configure download schedule through VeriCentre • Supports multiple TMS hosts AutoDL 2.0Select Option VC Profile SetupCommon SettingsChk for UpdatesLog HistoryChange PasswordAbout AutoDL 2.0 VC PROFILE 1192.168.1.89 VC PROFILE 2192.168.54.31 Add VC Profile Delete VC ProfileExit Any App A Updates? App A Dld Schedule App A Dld Request App A Dld

33. VeriCentre Roadmap Q1 ‘06 Q2 ‘06 Q3 ‘06 Q4 ‘06 Q1 ‘07 Oct/Nov Feb/Mar July/Aug Jan Apr/May Download Automation Program Developments VC 3.0 WebConsole Download Automation VC 3.0 • $Custom to raised by EMEA • Automated Terminal Initiated Download • Scheduling and load balancing • Needs to support Dial comm • Differential Download • Portfolio Manager App Support • Extend Automation to code base • Download Authentication • Monitor Enhancements • Database Tuning • Terminal Manager • Download Logs • Install program enhancements WebConsole • SoftPay Assist functionality

34. Updated Software Security Architecture

35. Software Solutions WPA (WiFi Protected Access) • Increased WiFi wireless data security adds: • Authentication - PSK or pre-shared key • Enhanced encryption - longer key length • WEP+SSL or WPA security meets Visa and MasterCard regulations • Supported on next gen portable WiFi terminal (Vx670)

36. Thank you