James Wallis – Vice President, Global Payments Industry

August 2010

Payments

© 2010 IBM Corporation

Building a smarter planet

Key Payments Industry Drivers

 Payments Processing Efficiency

 Corporate Services

 Retail Payments

 Digital Payments

 Payments Risk and Compliance

2 © 2010 IBM Corporation

Building a smarter planet

Reasons to be optimistic…

> 2.5 5.8% $1,264

billion CAGR trillion
Half the world Growth in world The value of
population is GDP2 from 2010 global assets3 will
still unbanked.1 thru 2025 will quadruple by
continue to put 2025.
legacy systems
under stress.

1 - http://financialaccess.org/sites/default/files/110109%20HalfUnbanked_0.pdf
2 - Nominal
3 - Assets = deposits, equity and fixed income

3 © 2010 IBM Corporation

Building a smarter planet

It Is Time To Consider Smarter Payments

Rethink the Develop New

Business Model Intelligence
Simplify & reduce Differentiate
the number product delivery
of payments via analytics &
processing silos. innovation.

Integrate Risk Management

Enable an enterprise view of risk across
payments fraud, financial crimes and
regulatory oversight.

4 © 2010 IBM Corporation

Building a smarter planet

Smarter Payments Is About Enabling The Most

Secure, Efficient And Transparent Processing
Environment Possible

+ + =
Smarter
Instrumented Interconnected Intelligent
Payments

5 © 2010 IBM Corporation

Building a smarter planet

Smarter Payments Delivered

90% 77% $3.5 trillion

Reduction in Increase in In FX trades
manual process processing per day
capacity
Bank of Depository Trust & CLS Bank
New York Mellon Clearing Corporation

6 © 2010 IBM Corporation

Building a smarter planet

Smarter Payments Delivered

10x 35% $400 million

The number Increase in Annual Savings
of credit cards access speed
processed
Large Chinese Rabobank Bank of Russia
Bank International

7 © 2010 IBM Corporation

Building a smarter planet

IBM Banking Industry Framework

Core Banking
Transformation
The payments and
securities domain helps you
Customer
IBM
Banking
Payments progressively transform your
Care and and
Insight
Industry
Framework
Securities payments operations to
become more flexible and
efficient
Integrated Risk
Management

8 © 2010 IBM Corporation

Building a smarter planet

IBM Banking Industry Framework

9 © 2010 IBM Corporation

Building a smarter planet

IBM Banking Industry Framework

IBM Payments
Solutions:
 ISV Applications
 IBM Software
 IBM Services
 IBM Technology

10 © 2010 IBM Corporation

Building a smarter planet

The IBM Banking Framework Delivers Value

 Simplifies infrastructure, reduces

costs, and enables growth
through innovation
 Enables integration of
information and processes
 Technology adapts to changing
business needs
 Drives a greater return on project
investment
 Speeds deployment of value-
added solutions

11 © 2010 IBM Corporation

Building a smarter planet

IBM Centers of Excellence for Payments

Dublin Labs
Poughkeepsie La Gaude Montpellier
Barcelona Beijing Seoul
Silicon Valley Dallas

Sao Paolo

12 © 2010 IBM Corporation

Building a smarter planet

IBM Services
According to an independent marketing intelligence study
conducted by National Analysts Worldwide, IBM Global
Business and Technology Services leads in overall client
satisfaction, surpassing all top competitors on eleven core
service attributes including:

 Overall satisfaction  Innovation

 Value  Leadership
 Reputation  Meeting expectations
 Competitive advantage  Client retention

13 © 2010 IBM Corporation

Building a smarter planet

IBM Services

When comparing IBM to other providers,

survey participants expressed greater
likelihood to:

 Choose IBM if they need consulting

services from a provider in the future
 Choose IBM if they need additional IT
services in the future
 Make the same decision to purchase
services from IBM knowing what they
know now.

14 © 2010 IBM Corporation

 Building a smarter planet

Long Term Vision for Payments

“ Regardless of the economic environment, continued

investment in a long-term IT payment strategy focused on
agility and transparency is imperative if banks are to
maintain a healthy and vibrant payment franchise in the face
of increased competition and regulatory changes. Banks that
succumb to short-term IT cost-cutting measures will struggle
to maintain profitable payment operations and will lose
competitive advantage.”
Gartner:
Banks Must Maintain Their Long-Term
IT Strategy in Payments

15 © 2010 IBM Corporation

15