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Chip Education Tour Virtual Stop with Business ForwardAugust 19, 2015
Visa Confidential
| EMV Chip Migration Update2
Notice of confidentiality
This presentation is furnished to you solely in your capacity as a customer of Visa Inc. and/or a participant in the Visa payments system.
By accepting this presentation, you acknowledge that the information contained herein (the “Information”) is confidential and subject to the confidentiality restrictions contained in Visa’s operating regulations and/or other confidentiality agreements, which limit your use of the Information.
You agree to keep the Information confidential and not to use the Information for any purpose other than in your capacity as a customer of Visa Inc. or as a participant in the Visa payments system. The Information may only be disseminated within your organization on a need-to-know basis to enable your participation in the Visa payments system.
Please be advised that the Information may constitute material non public information under U.S. federal securities laws and that purchasing or selling securities of Visa Inc. while being aware of material non public information would constitute a violation of applicable U.S. federal securities laws.
| EMV Chip Migration Update3
Forward-looking statementsand disclaimerThis presentation may contain forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Actof 1995. These statements can be identified by the terms “objective,” “goal,” “strategy,” “opportunities,” “continue," “can,” "will" and other similar references to the future. Examples of such forward-looking statements may include, but are not limited to, statements we make about our corporate strategy and product goals, plans and objectives. By their nature, forward-looking statements: (i) speak only as of the date they are made, (ii) are neither statements of historical fact nor guarantees of futureperformance and (iii) are subject to risks, uncertainties, assumptions and changes in circumstances that are difficult to predict or quantify. Therefore, actual results could differ materially and adversely from those forward-looking statements because of a variety of factors, including the following: macroeconomic and industry factors such as currency exchange rates, global economic, political, health and other conditions, competitive pressure on customer pricing and in the payments industry generally, material changes in our customers' performance compared to our estimates; systemic developments such as disruption of our transaction processing systems or the inability to process transactions efficiently, account data breaches involving card data stored by us or third parties, increased fraudulent and other illegal activity involving our cards; and the other factors discussed under the heading "Risk Factors” in our most recent Annual Report on Form 10-K and our most recent Quarterly Reports on Form 10-Q. You should not place undue reliance on such statements. Unless required to do so by law, we do not intend to update or revise any forward-looking statement, because of new information or future developments or otherwise.
Studies, survey results, research, recommendations, and opportunity assessments are provided for informational purposes only and should not be relied upon for marketing, legal, regulatory or other advice. Recommendations and opportunities should be independently evaluated in light of your specific business needs and any applicable laws and regulations. Visa is not responsible for your use of any studies, survey results, research, recommendations, opportunity assessments, or other information, includingerrors of any kind, or any assumptions or conclusions you might draw from their use. Except where statistically significant differences are specifically noted, survey results should be considered directional only.
| EMV Chip Migration Update4
U.S. EMV Chip Migration Update
| EMV Chip Migration Update5
83% of payment card fraud in the U.S. is counterfeit or card not present fraud
EMV chip, tokenization, and encryption are technologies designed to reduce risk from payment data being stolen and devalue the data if stolen83% of fraud in U.S.
!
Source: Visa Fraud Reporting System (FRS) and Enterprise Data Warehouse (EDW); CY 2013; U.S. domestic Visa debit and credit
| EMV Chip Migration Update6
Fraud Landscape Today
Source: VisaNet CY 2014, US Acquired/US Issued. Visa Fraud Reporting System (FRS) and Enterprise Data Warehouse (EDW); CY 2014; U.S. Issued / U.S. Acquired
Total fraud by type Card-present fraud
EMV chip will significantly reduce card-presentcounterfeit fraud
Other8%
Card not present
50%
Lost/Stolen
9%
Counterfeit
33%
Other17%
Lost/stolen17% Counterfeit
66%
Counterfeit fraud represents 66% of domestic card-present fraud and has grown 27% from 2013 to 2014
| EMV Chip Migration Update7
VCAS
• Dynamic, risk-based authentication
• Reduces friction at the POS
Fighting fraud from every angle
Lost and Stolen
Counterfeit
Card Not Present
EMV
• Creates a unique cryptogram for each transaction
• Not a silver bullet
Tokenization
• Replaces PAN with unique digital alias
• If payment token is used as the PAN, it will be identified as stolen and rejected
PIN
• Fraudster must know PIN for card to work
• Static data set
EN
CR
YP
TIO
N
REA
L-T
IME P
RED
ICT
IVE A
NA
LYT
ICS
Mobile proximity
eCommerce
****
Biometrics
• Enhances cardholder verification
• Reduces friction at the POS
3D SECURE
33%
50%
9%
Source: Visa Fraud Performance Benchmarking. Data refers to U.S. fraud CY 2014 US Issued/US Acquired. Remaining percentage fall under “Other” fraud types. U.S. Fraud by Type (% = share of total)
| EMV Chip Migration Update8
What is EMV chip card technology & Why does it matter to your business?
• EMV chip or “smart” cards are credit, debit or prepaid cards that have an embedded microchip
• Microchip generates a dynamic one-time use code (a cryptogram)
• Prevents the data being re-used to create counterfeit cards
| EMV Chip Migration Update9
How does EMV chip technology work?Because the cryptogram changes with every transaction, even if the card data is stolen, the information can’t be used to create counterfeit cards because the cryptogram would have already “expired”
Card number Name Expiry Service
code
CVV
(STATIC)
4 0 0 0 1 2 3 4 5 6 7^ J OHND O E^ 0 1 2 0 1 2^1 0 1^ 2 1 7^…
Card number Name Expiry Service
code
iCVV
4 0 0 0 1 2 3 4 5 6 7^ J OHND O E ^ 0 1 2 0 1 2^ 2 0 1^ 3 8 6 ^
Cryptogram
(DYNAMIC)
1 5 1 8 7 3 2 83 1 0 2 8 2 9 18 2 1 8 4 3 8 49 1 0 6 3 1 4 28 5 6 3 8 6 0 91 5 7 4 3 0 1 7 ^…2 4 8 0 1 8 0 31 5 1 8 7 3 2 83 1 0 2 8 2 9 18 2 1 8 4 3 8 49 1 0 6 3 1 4 28 5 6 3 8 6 0 91 5 7 4 3 0 1 72 4 8 0 1 8 0 34 3 1 2 3 6 8 93 6 7 9 4 5 1 03 4 9 1 5 2 3 85 8 3 6 8 1 2 7
Card number Name Expiry Service
code
iCVV
4 0 0 0 1 2 3 4 5 6 7 ^ J O H N D O E ^ 0 1 2 0 1 2^ 2 0 1 ^ 3 8 6 ^
Cryptogram
(DYNAMIC)
1 5 1 8 7 3 2 83 1 0 2 8 2 9 18 2 1 8 4 3 8 49 1 0 6 3 1 4 28 5 6 3 8 6 0 91 5 7 4 3 0 1 7 ^…2 4 8 0 1 8 0 31 5 1 8 7 3 2 83 1 0 2 8 2 9 18 2 1 8 4 3 8 49 1 0 6 3 1 4 28 5 6 3 8 6 0 91 5 7 4 3 0 1 72 4 8 0 1 8 0 34 3 1 2 3 6 8 93 6 7 9 4 5 1 03 4 9 1 5 2 3 87 3 2 5 6 0 0 3
| EMV Chip Migration Update10
The benefits of EMV chipSecurity, innovation and acceptance
Enhanced security – fraud
reduction
Enhanced international acceptance
Paves the way for secure mobile
payments –tokenization
Moves U.S. closer to
dynamic data authentication –devaluing data
Cardholders still protected with
zero liability
1 2 3 4 5
| EMV Chip Migration Update11
Visa U.S. EMV chip roadmap
• In August 2011, Visa led the industry by setting a plan to move the U.S. toEMV chip technology
• Successful globally, liability shifts have been the primary tool used to encourage both issuers and businesses to adopt EMV chip technology
Acquirer EMV Chip POS
ProcessingMandate
Acquirer EMV Chip ATM Processing
Mandate
POS Liability ShiftU.S. domestic and
cross-border
AFD Liability Shift
ATM Liability ShiftU.S. domestic and
cross-border
April 2013 April 2015 October 2015 October 2017
Note: AFD = automated fuel dispenser
| EMV Chip Migration Update12
EMV liability shift for counterfeit fraud
U.S. Card Terminal Liability
Today Mag stripe only Mag stripe only Issuer
After
October 1, 2015
for POS
After
October 1, 2017
for AFD & ATM
Mag stripe only Mag stripe only Issuer
Mag stripe only EMV chip Issuer
EMV chip Mag stripe only Acquirer
EMV chip EMV chip Issuer
There is no EMV liability shift on
contactless or lost/stolen fraud transactions
Note: Other non-counterfeit related dispute rights may still apply
| EMV Chip Migration Update13
U.S. EMV Migration − Client readiness report
Sources: Current cards based on MARS data through June 30, 2015; credit / debit card forecast per Aite Report – EMV: Lessons Learned and the U.S. Outlook (June 2014); activated terminal forecast per Payment Security Taskforce Acquirer projections press release (October 2014) ¹Forecast based on information currently available to Visa. Actual results may vary significantly.
• 117.1 million EMV chip cards issued, 78.1 million of which are credit
•Over a quarter of US credit cards have a chip on them today
Credit
• 39 million EMV debit cards issued; a 33% increase from May to June.
• Debit issuance continues to outpace credit issuance. 7 of the top 10 Visa debit issuers are now issuing EMV debit cards
Debit
• A number of standalone EMV terminals are now capable of routing PIN debit EMV transactions using the common debit AID
•Domestic EMV PV increased 42% from $1.3B in May to $1.9B in June
Acquirers / Terminals
• • 247 thousand EMV chip activated merchant locations, a 15% increase from May to June
• Visa has partnered with a number of merchants to deploy point-of-sale decals to help train customers on how to conduct chip transactions
Merchants
U.S. EMV Chip Migration Forecast1
By the End of 2015
Credit cards 70%
Debit cards 41%
Activated terminals 47%
| EMV Chip Migration Update14
EMV Chip Resources to Support You
| EMV Chip Migration Update15
Visit www.visachip.comOnline destination for businesses, consumers, issuers and acquirers
visachip.com/issuervisachip.com visachip.com/card visachip.com/merchant visachip.com/acquirer
| EMV Chip Migration Update16
Cardholder education
• Turnkey collateral and educational content for issuers
• Chip educational videos
• Search and Social campaigns
Card
activation
sticker
Search campaign
Issuer email
| EMV Chip Migration Update17
Implementation toolkitOnline implementation toolkit and resources to ensure a seamless migration to chip technology
• Chip technology overview
• 10-Step Implementation Guide
• Educational resources • Information graphics
• Videos
• FAQs
• Online staff training module
• Customer-facing POS decals
www.visachip.com/businesstoolkit
| EMV Chip Migration Update18
Online staff training module
Access the staff training module at
www.visachip.com/businesstoolkit
| EMV Chip Migration Update19
Customer-facing POS decals
3”x 2” Small Decal
5.5” x 4.5” Large Decal
Order the customer-facing POS decals at
www.visachip.com/businesstoolkit
| EMV Chip Migration Update20
Information graphic (Infographic) seriesCommunicate chip technology through visual learning tools
1. Get to know liability shift
2. EMV chip card overview
3. Ways to use a chip card
4. Understanding cardholder
verification methods
Find the Infographic series at
www.visachip.com/businesstoolkit
| EMV Chip Migration Update21
Ready to begin?Follow these steps to start your migration to chip technology
Visitwww.visachip.com/businesstoolkit
Meetwith your acquirer or card processor
Trainyour point-of-sale employees
1
2
3
| EMV Chip Migration Update22
Visa is here to support you