In-store payment

value chain
JANUARY 2015
 Payment ecosystem at a glance

Payment
service
providers Payment related revenues
> 8.5B of banks and schemes
> 310B
Payment
services

POS market: Cards

Terminals
2,5-3 B > 15B
>200B
Terminals Cards

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Ingenico Group Payment Value Chain
 The card present payment ecosystem

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Ingenico Group Payment Value Chain
 The card present payment ecosystem / Key
definitions
Issuer: Card holders bank. Supports transaction financial risk

Acquirer: financial institution responsible for the underlying transactions

(authorization, clearing & settlement) with its merchant-customers.

The Processor is a technical operator providing infrastructure to support acquirer

functions, such as authorization, clearing and settlement services. In practice,
acquirers outsourced merchant acquiring services to processor

Payment Service Provider (PSP) is a company performing all or part of electronic

payment services and potentially including settlement as per Payment Service
Directive in Europe. In the US, settlement is always performed by financial
institutions
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Ingenico Group Payment Value Chain
 The card present payment business model
Pre-processing
Connectivity
Terminal & SW Mngt
Terminal repair
Terminal installation
Payment application

100 98

Processor
0.4
2%* 0.05-0.1

2
Processor

1.5% 1.5

Payment networks

0.1% 0.1

* Average fees. Merchant service fees ranging from 1.5% to 3.5%

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Ingenico Group Payment Value Chain
 The card present payment business model

Merchant Services Processor Acquirer VAS provider

Value Terminal Connectivity Pre- Value-added

chain Hardware Processing Settlement
services processing Services

Revenue Fixed fee % of Monthly fee+

Monthly Monthly Monthly
type One off per transaction Fixed charge /
fee fee fee
transaction in value transaction

Market POS terminal market Transaction services Financial VAS

institutions
mostly

Ingenico
Group
entities

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Ingenico Group Payment Value Chain
 Local and fragmented services as a result of
global and local standards

Global Standards Global Compliance Local Standards/

payment applications

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Ingenico Group Payment Value Chain
Appendix
 Transaction value chain / with a debit card

Service Agreement

Authorisation request Acceptance

Acquirer Agreement
Processor
Forwarding of
approval/decline

Forwarding Forwarding of
of request approval or decline

Approval/decline after
check of spending limit
and/or balance of card
Service Agreement
EPS- account Issuing
Net
Processor
Forwarding of request

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Ingenico Group Payment Value Chain
 Transaction value chain/ with a credit card

Payment with credit card Merchant

Bank

Settlement of card account by way

Settlement with
of charging the current account Turnover Service
merchant account
fee

Charging turnover Forwarding merchant turnover

Payment turnover Cleaning & Payment turnovertz

Settlement

Assessment fees to
Assessment fees to
MasterCard GCMS card organisations
Card organisations
Processing fee Visa Base II
Processing fee
via Issuer Interchange Fee Interchange Fee
Processor via Acquirer
Processor

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Ingenico Group Payment Value Chain