1. Turning Post-secondary Students
into a Business Opportunity
Ryan Kam
UNIVERSITY OF TORONTO ROTMAN COMMERCE

2. Entering the E-Wallet/P2P space ensures first-mover
advantage in a $14b market growing at 62% annually
•Develop business with university/college students
Challenge
•Retain customers post-graduation
•Low disposable income and time
Complication •High price sensitivity
•High brand loyalty
How can banks acquire and retain customers with low
Question disposable income, low disposable time, and high
price sensitivity?
•Exploit growing smartphone segment
•Develop and market E-Wallet/P2P and remote
check deposit solutions
Answer
•Pursue NFC/Contactless POS with caution
•Customer acquisition leading to services
cross-sell
RECOMMENDATION | ANALYSIS | IMPLEMENTATION | RISK | CONCLUSION

3. 194,455 students will graduate from 45 post-secondary
institutions in Ontario this year
Universities Colleges
Universities
Colleges
0% 20% 40% 60% 80% 100%
RECOMMENDATION | ANALYSIS | IMPLEMENTATION | RISK | CONCLUSION

4. Convenience, pricing, and scalability with smartphone
technology are key considerations for successful strategy
Technology junkies
Own/use mobile phone Smartphone share
All 83% 58%
18-29 86% 83%
30-44 89% 71%
45-64 79% 44%
65+ 78% 34%
Source: Packaged Facts August 2012 proprietary
consumer survey
Convenience driven
•Classes, commutes, homework, and
studying monopolize disposable time
Money minders
•Low disposable income
•High price elasticity of demand
RECOMMENDATION | ANALYSIS | IMPLEMENTATION | RISK | CONCLUSION

5. A line extension is necessary to achieve substantial growth
Market Technology
Payment methods Other Growth
penetration scaling
•Debit •Mobile banking
•Credit •Mobile bill
•Visa payWave payment
Existing •Wealth
product management
•Lending
•Deposit taking
•NFC (Near Field •Remote check
Communication)/ deposit
Contactless POS •Mobile financial &
New •E-Wallet/P2P promotional
product •E-commerce/ organization tools
Online payments
RECOMMENDATION | ANALYSIS | IMPLEMENTATION | RISK | CONCLUSION

6. P2P, remote check deposit, and financial & promotional tools
show the greatest growth potential
NFC/Contactless Remote check Mobile financial
E-Wallet/P2P
POS deposit & promotional
Market adoption
Growth
Convenience
Services cross-
sell
•Choice of products with low current market adoption, high growth potential,
and high convenience factor
RECOMMENDATION | ANALYSIS | IMPLEMENTATION | RISK | CONCLUSION

7. E-Wallet/P2P combines high growth and high projected
uptake among post-secondary students
By the numbers Cross-sell with existing products Applications
Used mobile banking in
$13.5b Mobile phone users
All
last 12 months
21%
Total transaction value,
18-29 40%
2012
30-44 24%
45-64 15%
+62% 65+
Mobile Bill Payment,
7%
CAGR, 2012-2015 2012
2.5 42%
Mobile payments
made/month by mobile
payers, 2012
Source: Packaged Facts Mobile and Alternative Payments in Canada, December 2012
RECOMMENDATION | ANALYSIS | IMPLEMENTATION | RISK | CONCLUSION

8. Pent up demand for remote check deposits limited by
regulatory barriers
Heavy adoption in
55% 57% the U.S.
However,
Percentage of Canadians who Percentage of 18-34s open to
deposit at least one check per doing traditional banking Not legal in Canada…
month functions with their smartphone yet.
Source: Packaged Facts Mobile and Alternative Payments in Canada, December 2012
RECOMMENDATION | ANALYSIS | IMPLEMENTATION | RISK | CONCLUSION

9. Risks associated with these products can be mitigated with
minimal effort
Risk Severity Mitigation
1. Competitive analysis
Strategic
2. Customer demand planning
•Slow adoption among consumers
3. Focus groups/product testing
•Competitors and substitutes
(read: ING Direct Cheque-In)
Financial 1. Software implementation best
•Budget and schedule overruns practices
•Scope creep 2. Work breakdown structure (WBS)
Technological
1. Talent acquisition from industry
•Software/hardware performance
leaders
issues
2. Software quality assurance (SQA)
•Integration problems
RECOMMENDATION | ANALYSIS | IMPLEMENTATION | RISK | CONCLUSION

10. Thank you!
Questions?
RECOMMENDATION | ANALYSIS | IMPLEMENTATION | RISK | CONCLUSION

11. APPENDIX
Ontario universities - graduates Ontario universities - graduation rate
Degrees Graduation Average
Year Enrollment Year Enrollment awarded rate Graduation rate
2000-01 274696 2000-01 274696.00 67,690 24.64%
2001-02 289078 2001-02 289078.00 70,096 24.25%
2002-03 313220 2002-03 313220.00 75,531 24.11%
2003-04 348314 2003-04 348314.00 79,854 22.93%
2004-05 365292 2004-05 365292.00 82,147 22.49% 24.18%
2005-06 380326 2005-06 380326.00 88,930 23.38%
2006-07 390710 2006-07 390710.00 101,836 26.06%
2007-08 394595 2007-08 394595.00 99,653 25.25%
2008-09 401314 2008-09 401314.00 98,378 24.51%
2009-10 418565
2010-2011 434441
2011-2012* 454819
2012-2013* 476153 Source: Enrolment, Table 1: Summary of
Enrolments in Ontario Universities, 2000-01 –
* = projected 2010-11, Council of Ontario Universities
2012-2013 University
graduates 115141
RECOMMENDATION | ANALYSIS | IMPLEMENTATION | RISK | CONCLUSION

12. APPENDIX
Ontario colleges - graduates
Year Graduates
2001-02 46820 * = projected
2002-03 49717
2003-04 52265
2004-05 56761
2005-06 59419 Source: Student and Graduate
Profiles: Environmental Scan
2006-07 59029 2012, Colleges Ontario
2007-08 60406
2008-09 59012
2009-10 62842
2010-11 72066
2011-12* 75603
2012-13* 79314
RECOMMENDATION | ANALYSIS | IMPLEMENTATION | RISK | CONCLUSION

13. APPENDIX
RECOMMENDATION | ANALYSIS | IMPLEMENTATION | RISK | CONCLUSION