Icp Introduction To E Commerce Merchants September2009 Slide Share

Business Review September 2009

Internet Card Present Industries, Inc.
ICP Industries is a Delaware corporation formed in 2008, headquartered in Foster City, California
The company will provide Card Present payment processes and technologies to the ecommerce industry
The ICP management team is composed on card payment and security technology experts
ICP Industries, Inc.

eCommerce – The Problems The Right Solution
91% of all eCommerce transactions are paid using Visa, MasterCard or American Express credit and debit card products
eCommerce merchants pay the highest card transaction rates due to “card not present” network rules and regulations.
eCommerce transaction fraud is over 3 times the rate for in-store retail transactions.

ICP – The Right Solution
Provides PIN based debit – the lowest cost and most secure type of card transaction – to eCommerce Merchants for the first time
Lowers merchant payment acquisition costs
Decreases merchant liability
Reduces chargebacks and criminal consumer fraud
ICP offers eCommerce merchants “ Card Present ” payment No other company can offer this unique combination of value. ICP is the right solution for eCommerce.

Opportunity
Internet based eCommerce is forecast to reach $1.6 Trillion in 2014
Online payments are processed as “Card Not Present” or CNP
Security is the number one concern of online consumers
eCommerce Merchants are actively seeking ways to reduce their payment acquisition costs – often at the expense of consumer preference and convenience
PIN based debit is not an option for eCommerce transactions
Growth and Demand

The ICP Solution - Consumer
Provide consumers with a device that allows credit, PIN based debit card, gift card and non-association branded debit network card transactions to be processed from any personal computer
Secure all personal and financial information in the device itself. Card data is never stored on the PC or in merchant customer profile systems
Manage all de-encryption and transaction processing – providing the merchant only the data needed to close the receivable and ship goods.
Increased Security

The ICP Solution - Merchant
Lowers effective interchange rates
Reduces risk based fees
Decreases merchant liability
Increases payment options
Decreases chargebacks
Reduces PCI compliance obligations
Provides PIN based debit – the lowest cost and most secure type of card transaction – to eCommerce Merchants - for the first time
Reduced Cost and Liability Offer eCommerce Merchants a “ Card Present ” solution

The ICP Solution - Merchant
Card present rates represent an average of 60 basis point reduction against CNP
Even a 10% conversion (your most frequent customers) yields millions in cost avoidance
This does not consider the costs associated with chargebacks, risk management and PCI – which all decrease substantially with the introduction of card present and PIN based debit.
Card Payment: Pay Less – Get More Transaction Example: Annual Savings: Payment Type Transaction Amount Merchant Reduction Merchant Reduction Transaction Cost Savings PIN Debit $250 90 basis points 50% $1.12 Payment Type Annual eCommerce Volume Merchant Reduction (blend average) Merchant Reduction Annual Payment Acceptance Cost Savings Credit/Debit $500M 60 basis points 50% $15,000,000.00

The ICP Difference – Unique Value
Brick and Mortar retailers keep payment acceptance costs down through PIN debit and Card Present rates
In-Store terminals allow consumers to use their preferred payment method, while securing their personal and financial information
eCommerce Merchants currently must choose between lower-cost or consumer preference
Security and Convenience Online ICP is the only company providing core value to both consumers and eCommerce Merchants

ICP Products & Services eDevices
Embedded encryption and security modules
Numeric pads for PIN entry
USB compatible
User authentication
Manufactured by AvaTrac – a global electronics manufacturing leader
PCI PED & PCI DSS compliant
ICP has patented it’s technologies and processes for eCommerce card present transaction management

ICP Products & Services
ICP provides a full complement of payment options to eCommerce Merchants for transactions initiated through ICP’s payment engine, these include:
Credit card
Debit card – PIN based and “as-credit”
Non association branded debit network card (bank card)
Gift card
ACH – recurring and non-recurring direct debit bank transfer
ICP provides a customized integration to merchant shopping cart
ICP provides customized integration to merchant processor and/or acquiring bank
Most importantly – ICP meets the requirements for card present rate capture by assuring that the card, card-holder and merchant are present during the transaction
Online Payment

ICP Transaction Management Process ICP Processing Online Merchant Consumer makes decision to purchase from eCommerce Merchant Consumer Customer Account configured eDevice sent by Merchant ICP Payment option is presented at checkout Known customer has received ICP eDevice from Partner Merchant Encryption Key certified and eDevice enabled for transaction processing Customer installs and registers eDevice with ICP Device Process Completed Prior to Transaction Consumer selects ICP payment Device is located and identified Transaction information passed from Merchant to ICP Consumer authenticates (PIN entry) on eDevice Consumer swipes card & enters PIN (if debit) eDevice encrypts trans information ICP de-encrypts transaction & assigns fees Requests Auth from Acquirer Transaction is Authorized Notification of transaction authorization sent to Merchant Funds Settlement to Merchant Funds Settlement may occur up to 3 days post-transaction

Market Strategy
In 2008, US eCommerce retailers had:
Over $178 billion in transaction volume
Over 937,000,000 transactions
Per ticket average over $192
6.5% of total retail market but 20% of growth
65% of total in Top 500 retailers
eCommerce retailers are:
Forecast to grow through 2014 by annual volumes greater than 12%
Actively promoting alternative payment schemas to reduce cost
eCommerce Retail

Global Growth Opportunity

Market Strategy
55% of respondents make greater than 50 purchases online per year
54% of respondents purchase from over 10 different online merchants
93% type in their card information during checkout (card not present)
60% are worried about the security of their information online
65% would prefer to swipe their card for online payments
90% purchase traditional retail items online
93% purchase travel online
88% purchase services online
70% pay for government services online
Market Research Source: ICP Industries, Inc. 2009 consumer internet payment survey

Market Strategy Card networks work for the Bank – not the Merchant
Interchange - the percentage of the transaction paid to the financial services firm that issued the card to the consumer.
Processing fees - imposed by the card network and acquiring community
$100 in goods purchased from Retailer.com = 270 basis point interchange (credit card transaction)
$.35 processing fees
Net Settlement to Merchant of $96.95.
Merchant cost of payment acceptance is $3.05
All card transactions are subject to both ‘interchange’ and processing fees. Together these are called the ‘Merchant Discount’.

ICP Management Team Matthew Mullen – Chief Executive Officer Over 18 years with of executive leadership in payment systems and ecommerce solutions development, most recently as Vice President of Emerging Products with Visa. In this role, Matthew led the strategic planning, development and market launch of new products to domestic and international markets. Matthew received a Bachelor of Science degree in Business Information Systems from Northfield University and completed post-graduate studies in Strategy and Innovation at MIT’s Sloan School of Business. Rebecca Cull – Chief Financial Officer Over 20 years in merchant payment processing and credit fraud management including Washington Mutual and Bank America Merchant Services, the fifth largest processor of merchant transactions in the United States. She brings extensive knowledge of the credit card industry and significant experience in SEC reporting for publicly traded companies. Rebecca holds a Masters of Business Administration from Hayward State University and Bachelor of Science degree in Business Administration from the University of California, Berkeley. Alistair Duncan – VP Product & Processing Over 20 years experience in the global payments industry, including roles with Visa International as SVP of business to business payment products and executive leadership positions with leading POS device manufacturers Verifone and Fortronic. In these roles Alistair was responsible for defining and executing standards for device security and acquiring processor integration. Alistair received a Bachelor of Science degree in Computer Science from Strathclyde University in Scotland.

Conclusion Value to the Consumer and the Merchant
eCommerce has not yet reached its full potential.
Identity and transaction fraud remain the number one concern identified by consumers when considering purchasing goods and services over the internet.
Merchants are aggressively pursuing new payment models to reduce their operating cost, at the expense of consumer preference and customer convenience.

Conclusion ICP – The Solution For eCommerce
Highly secured, card present transactions
Patented technologies and processes
Long-term growth market
Knowledgeable and experienced management team
Savings for the merchant
Security for the consumer

Icp Introduction To E Commerce Merchants September2009 Slide Share

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