2014 ma-investment-community-meeting

©2014 MasterCard.Proprietary

2014 Investment Community MeetingSt. Louis, Missouri

MasterCard Incorporated

September 17, 2014


Agenda

September 2014

Page 2

Topic Speaker TimeRegistration 9:30 a.m.

Welcome Barbara Gasper 10:00 a.m.

Advancing Our Strategy Gary Flood 10:05 a.m.

Driving Innovation Garry Lyons 10:35 a.m.

North America Markets Chris McWilton 10:45 a.m.

International Markets Ann Cairns 10:55 a.m.

Financial Perspective Martina Hund-Mejean 11:10 a.m.

Q & A Session Management 11:20 a.m.

Lunch Table Discussion with Management 12:00 p.m. – 1:00 p.m.

Product Experiences 12:00 p.m. – 3:00 p.m.

MasterCard Investment Community Meeting – St. Louis, MO


Lunch Table Discussions

September 2014

Page 3

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2

3

4

IMK UpdateAnn Cairns

Europe UpdateJavier Perez

Merchant RelationshipsDenise Walker

Cost/Value of Card AcceptanceShawn Miles

5

Broadening our Processing FootprintMichael Manchisi

6

US Market UpdateChris McWilton

7 EMV UpdateCarolyn Balfany

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7

3

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4

6

5



Forward-Looking Statements

MasterCard Investment Community Meeting – St. Louis, MO September 2014

Page 4

Today’s presentation may contain, in addition to historical information, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

These forward-looking statements are based on our current assumptions, expectations and projections about future events which reflect the best judgment of management and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by our comments today. You should review and consider the information contained in our filings with the SEC regarding these risks and uncertainties.

MasterCard disclaims any obligation to publicly update or revise any forward-looking statements or information provided during today’s presentations.

Any non-GAAP information contained in today’s presentations is reconciled to its GAAP equivalent in the Company’s periodic SEC filings.


2014 Investment Community Meeting

Advancing Our Strategy

September 2014

Gary FloodPresident, Global Products & Solutions


We Are Executing Our Strategy

September 2014

Page 6

Personal Consumption Expenditure

Cash & Check vs. Electronic Payments“Grow the Pie”

MA Share of Electronic Payments“Grow Share”

Grow the Pie(Chip away at the 85% still in cash / check)

• Facilitate financial inclusion

• Drive small merchant acceptance

• Capture low & high value payments

Grow Our Share(Gain larger portion of the 15% electronic)

• Build competitive advantage through technology & services

• Participate in more domestic transactions



Merchants Help them grow their business, understand their customers, increase their profits

Governments Help drive financial inclusion and transparency

Consumers Help them make the right purchase decisions,get the best deal, make shopping fun

Financial Institutions

Help them delight customers, grow revenues, identify new opportunities

Digital / Tech Players Improve payment experience, drive innovation

Telcos Increase revenue per user, improve stickiness

We Are Focused on Delivering Valueto a Broader Set of Stakeholders

September 2014

Page 7



Two Megatrends Continue to Create Opportunity Across Markets and Segments

Conversion of Cash to Electronic Payments

Convergence ofPhysical and Digital

Growth opportunity is significant; we are well positioned

September 2014

Page 8

DisplaceCash

NewMerchants

New PaymentFlows

NewConsumers

85% of transactionsare cash and check

2.5 billion underservedconsumers globally

Extend acceptance –100 million merchants

Social Disbursements, Bill Pay, P2P, Remittance



Core Products Continue toDeliver Strong Growth

September 2014

Page 9

1H 2014GDV Growth

Market Share Trend

Consumer Credit 11% • Winning share

• Driving preference

• Capturing new payment flows

• Embedding innovation

Commercial Credit 14%

Debit 16%

Prepaid 17%

Strong value propositions engaging stakeholdersSignificant opportunity for continued growth



Differentiated Capabilities Delivering Better Payments Experiences

Safety & Security

Cardholder Solutions

Loyalty Solutions

DataAnalytics

Processing Program Management

Payment Gateway

DigitalSolutions

Labs / R&D

Advisors

Brand & Marketing Platforms

FraudSolutions

September 2014

Page 10

Richer, more compelling product propositions

Broader capabilities toserve stakeholder needs

Deeper customer and consumer relationships

Innovation across thevalue chain



Authentication• Extending SecureCode+• Implementing device recognition• Incorporating biometrics

Superior Safety & Security Drives Brand Preference and Competitive Advantage

September 2014

Page 11

Making MasterCard the safest, simplest and smartest way to pay

Physical Transaction Security• Enhancing global security• Leading the US market in security upgrade• Both chip and contactless

Digital Transaction Security• Leading development of tokenization standards• MasterCard Digital Enablement Services (MDES) is in production• Delivering EMV-based security for digital payments



We Are Leading in Digital

September 2014

Page 12

Easier, faster, safer digital transactionsProviding value before, during and after the purchaseMasterCard is playing a bigger role in the payments ecosystem

CredentialManagement

Digitized and tokenized card credentials, distinct from actual card number

Secure digital payment credentials and transactions

MasterPass

Integrated suite of services enabling digital commerce

Enriched and seamlessdigital shopping experience: online, in-store, in-app

Opening MasterCard services and assets to wholesale and retail developers

Open API & Apps

Connect to and benefitfrom creativity ofdeveloper community



We Have Grown Our Processing Capabilities

40 millionCards

43 billionTransactionsSwitched

September 2014

Page 13

5.2 billionTransactionsProcessed

55Countries

As of 2013

Added in 2014

As of June 2014, Annualized As of June 2014, Annualized

As of June 2014As of June 2014



Strong Value Propositionsare Growing Share

September 2014

Page 14

Winning affluent issuer and merchantco-brands around the world

• MasterCard Travel Services• Global Concierge• Luxury Hotel Program• Priceless Cities• Rewards• Benefits and insurance

Exceptional Services forAffluent Cardholders

Affluent

Market share gains acrosssegments and geographies

• Unsurpassed acceptance• Enriched program data• Program analytics and insights• Spending controls• Virtual cards

Leading Payments Solutions forBusiness and Government

Commercial



Converting cash and check to electronic payments

Inclusion initiatives provide entryto a “virtuous cycle” of

government engagement

We Are Driving Financial Inclusion and Opening New Payment Flows to Grow the Pie

September 2014

Page 15

• New industry verticals

• New senders and receivers

• New and expanded acceptance

Engagement basedon thought leadership

Mutually beneficial commercial outcomes

Stakeholder and constituent communications

Enriched policy dialogue

Government Engagement

Financial Inclusion New Payment Flows



Acquisitions Partnerships Innovations

Expanding Footprint

Extending Capabilities

Diversifying Business

Acquisitions, Partnerships and Innovations Extend Our Capabilities and Reach, as Well as Diversify Our Business

September 2014

Page 16




Driving Innovation

September 2014

Garry LyonsChief Innovation Officer


The World Is Changing

September 2014

Page 18



We Created MasterCard Labs toTake Risks, Try Things and Fail Smartly

September 2014

Page 19

Labs asa Service

Startup Engagement

and Acceleration

TechnologyInnovation Management

Incubation



Where are the Labs Today?

September 2014

Page 20




North America Markets

September 2014

Chris McWiltonPresident, North America


North America MarketsRegional Overview

GDV and GDV Growth 1H 2014 (local currency)

North America GDV: 33% of global totalGDV Growth: 9%

2013 PCE Growth (local currency) and Cash Penetration (% of transactions)

North America PCE: 3.4% Cash Penetration: 54%

September 2014

Page 22


Source: PCE – Oxford Economics. Cash Penetration – MasterCard Advisors analysis.


North AmericaStrength Across the Business

Merchant Co-Brand Winning Streak• Merchant expertise in-house• Products and services tailored

for merchants• Strong Issuer relationships

Core Products Drive Revenue• Consumer / Commercial Credit• Debit• Prepaid

September 2014

Page 23



North AmericaSafe / New Ways to Shop

September 2014

Page 24


Safety and Security• EMV• Merchant POS terminalization• Tokenization

Digital Transformation• Apple Pay entry into payments• Strength of MasterCard network


North America Positioned for Continued Growth

September 2014

Page 25


Operate in the world’s largest economy

At the epicenter of payments innovation

North America is mature – but definitely not a slow-growth market

Source of long-term profitable growth for MasterCard



International Markets

September 2014

Ann CairnsPresident, International Markets


International Markets Regional OverviewPage 27

September 2014

GDV and GDV Growth 1H 2014 (local currency)

Latin America (8%)GDV Growth 14%

Europe (30%)GDV Growth 14%

APMEA (29%)GDV Growth 18%

North America (33%)GDV Growth 9%



International Markets OpportunityPage 28

September 2014

2013 PCE Growth (local currency) and Cash Penetration (% of transactions)

Source: PCE – Oxford Economics. Cash Penetration – MasterCard Advisors analysis.Note: Figures exclude China.

Europe 3.2%Cash Penetration 77%

APMEA 5.1%Cash Penetration 93%

Latin America 11.5%Cash Penetration 92%

North America 3.4% Cash Penetration 54%



IMK Continues to Grow SharePage 29

September 2014

Offering differentiated products & services

Winning new business with traditional partners

Reaching the underserved throughfinancial inclusion

Working actively with governments

Building value-added serviceswith merchants

Expanding acceptance footprint

Investing in the future



EuropeWinning with Differentiated Products and Services

Page 30

September 2014

Advisors• Leading with services• Optimisation and tailored solutions

Innovative Partnerships• Live and scaling with eNett• Signed and developing with Basware

Extending Processing Assets• Increasing presence in high-growth markets• Simplifying digitisation



Latin AmericaBuilding for the Future from a Solid Core

Page 31

September 2014

Solid Base• Strong banking and growing government

businesses• Scaling the market in Mexico

And room to grow:• Colombia – 10% PCE is electronic• Peru – banked population is only 30%• Brazil – electronic PCE: 20% in 2009

27% in 2013

Mobile• Live and scaling, launching and signing



Asia PacificNew Customers through Government Engagement and Financial Inclusion

Page 32

September 2014

Spotlight on: India

Partnership with National Skill Development Corporation (NSDC) and Central Bank of India• Debit solution for trainees• >200,000 cards issued to date• 150 million youths by 2022

UID Programme• Completed integration• Will support electronic-KYC

Government Engagement• Purchasing cards with governments of

Hong Kong, Singapore and Philippines• Key renewals with government-owned

banks in China

Financial Inclusion• First HomeSend partnership in Asia• Issuance with largest Islamic non-bank

savings institution in the world



Middle East AfricaDriving Business Expansion through “The New”

Page 33

September 2014

New Geographies• 62 of 69 countries• Pan-regional wins

New Customers• Governments as key change agents• Driving scale at the core

New Consumers• From unbanked to affluent• 22% year-on-year growth in cards

New Products & Services• Market-wide mobile ecosystem• Dubai processing hub



Regulatory UpdatePage 34

September 2014MasterCard Investment Community Meeting – St. Louis, MO



Financial Perspective

September 2014

Martina Hund-MejeanChief Financial Officer


Topics for Today

2014 Outlook

Capital Planning

M&A Activities

Long-Term Outlook

September 2014

Page 36



Processed

Q2 Jul / Aug

12% 12%

10% 8%

15% 15%

12% 11%

16% 15%

2014 Business Drivers

As-Reported

Growth Q1 Q2

Worldwide GDV 14% 13%

US GDV 9% 9%

Rest-of-World GDV 16% 15%

Processed Transactions 14% 12%

Cross-Border Volume 17% 16%

July/August growth trends same or slightly better than previously reported through July 28th

September 2014

Page 37



2014 Financial Outlook

Net Revenue

Operating Expense

Tax Rate Approximately 32%, with potential for some improvement

Full-year growth rate in the low teens, including impact of acquisitions

Full-year growth rate at the lower end of 3-year range

FX ImpactEuro and Real net neutral

Underlying local currencies have 1 ppt headwind on net revenue

September 2014

Page 38



Capital Planning – Priorities

StrongBalance Sheet

Preserve strong balance sheet, liquidity and credit ratings

Long-TermBusiness Growth

Investments in organic opportunities and M&A

Return Excess Cashto Shareholders

Continue to return excess cash with bias towards share repurchases

September 2014

Page 39



$1.8 $2.4 $2.8 $3.1$0.1

$0.3$0.3

$0.4

$1.9

$2.7$3.1

$3.5

2012 2013 1H 2014 ThroughAugust 2014

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

$ in

bill

ions

Share Repurchase & Dividends

Share RepurchaseDividends

Return of Capital – Historical Perspective

September 2014

Page 40



M&A Strategy Execution

Capability Enhanced AcquisitionProcessing Provus, ECS

Mobile Technology C-SAMLoyalty Pinpoint

Personal payments HomeSend JV

2013-2015 Performance Objectives

EPS dilution Impact of about 5 cents for both FY2014 and FY2015

Exclude new M&A activity

September 2014

Page 41



Longer-Term2013 – 2015 Performance Objectives*

Net Revenue Growth

Operating Margin

Earnings Per ShareGrowth Rate At least 20% CAGR

Minimum 50% annually

11-14% CAGR

* On a constant currency basis and excluding future acquisitions

September 2014

Page 42




Question & Answer Session

September 2014



Final Thoughts

September 2014

Gary FloodPresident, Global Products & Solutions


Some Final Thoughts

September 2014

Page 45

Growth opportunity is significant

Shift to digital is changing payments landscape and creating opportunity

Delivering solutions to a broad set of stakeholders

Acquisitions and partnerships extending capabilities and reach

Innovating to accelerate growth

Safety & Security underpins everything we do

Strategy execution is on target



2014 Investment Community MeetingSt. Louis, Missouri

MasterCard Incorporated

September 17, 2014

Documents

2014 ma-investment-community-meeting