Presentation on the emerging trends of mobility and the future of consumer payments and banking. Presented in Amsterdam, Innovation Stream, Nokia World 4 Dec 2007

1. The Convergence of Mobility and Payments
Kahina Van Dyke
Kahina.vandyke@citi.com
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Nokia World 04 December 2007

2. Innovation is at the core of what we do
Our growth has been driven by delivering on untapped market needs
Citi Highlights
1812 City Bank opens for business to serve group of New York merchants.
1894 Becomes the largest bank in the U.S.
1897 First major U.S. bank with foreign department; begins FX trading.
1904 Lead bank for construction of the Panama Canal
1913 First contributor to the Federal Reserve Bank of New York.
1914 Becomes 1st American international bank, with the largest overseas branch
network.
1921 Extending credit to consumers for the first time
1928 First major American bank to offer unsecured personal loans to its depositors.
1929 Becomes the largest commercial bank in the world.
1936 First NYC bank to offer consumer checking accounts with no minimum-balance.
1939 100 offices in 23 countries outside U.S., forming the largest international bank.
1950 Diners Club card – first multi-use charge card
1961 Invents the negotiable certificate of deposit (CD)
1977 Citibank launches Citicard Banking Centers, anchored by ATMs and the
CitiCard. The 24-hour ATMs are for the first time used for more than emergency
cash.
1979 Becomes the world's leading foreign exchange dealer.
1985 Direct Access® in New York links PCs in homes and offices with Citibank.
1986 Introduces touch-screen ATMs in New York City and Hong Kong.
1989 Becomes the leading issuer of securitized credit card receivables.
1992 Citibank, N.A. becomes the largest bank in the United States. Citicorp's global
reach links branches and offices in more than 90 countries.
1993 Becomes world’s largest credit card and charge card issuer and services.
1994 Opens 1st fully foreign owned commercial bank in Russia.
1995 Opens 1st full service China branch in 45 years+ Vietnam and South Africa.
1996 Has most credit cards in Asia.
1998 All Citicorp and Travelers Group divisions merge to Citigroup Inc.
2000 Creates innovation and eBusiness group in CitiCard
2002 Citi introduces Virtual Account Numbers as a core available feature on all US
cards, International rollout of banking Alerts via AMA
2003 Citi Identify theft solutions, 10MM+ Online Banking Users in the US
2006 Citi introduces PayPass New York Metro Contactless, Singapore SMRT
2007 Citi introduces 1st Mobile Banking Applicant and dedicated telecom unit
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3. Mobile Momentum
Numerous developments are driving momentum for mobile financial solutions
Technology and Infrastructure
o Contactless acceptance infrastructure
o 3G and NFC-enabled handsets
Cross-industry partnerships and pilots
o Banks and wireless service stakeholders collaborating in NFC
and Peer to Peer payment pilots
o Banks and transit systems launching new form factor and
payment schemes in major global cities
Customer exposure to new payment methods
o Contactless “revolution” has made customers think differently
about their traditional “debit or credit” card as the primary
access to their funds
o Transit launches have introduced million of urban commuters
to “Tap & Go” behavior
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4. Mobility: What customers want
Customer attitudes vary based on market. Important factors to consider are national
payment systems, online banking adoption & technology infrastructure
5:1
consumers
90% prefer mobile
payments to
of those interested would
pay more for a device with appear on card
payment capability statement, rather
than wireless bill
64% 58%
of consumers of consumers
57% 18-42 would consider 18-42 would
switching carriers consider
are interested in
switching banks
mobile payments
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Source: Fabrizio, McLaughlin & Associates, March 2007

5. Mobility Consumer Trends
Consumer adoption tipping point on the horizon…
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6. Play Ella Video

7. Financial Management: On the Go
Online banking has become core offer in established and emerging markets, we
believe the same / enhanced services will be expected on the mobile device
Account Management
Integrated user interface
Coupons
Delivery of discounts
Alerts/Notifications
Customer set parameters
Two-Factor Authentication
Real time authentication
for online purchases
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8. Payment Disruption Delivers Choice
Contactless is changing the way customers perceive and use payment devices
“Card in Wallet” “Bring my Account “This IS my wallet” and
Anywhere” “Manage my Finances Anywhere”
Market Disruption
Behavior Disruption & Convergence
Value Expansion
Wallet <=> Phone
Customer Learns Tap & Go
No longer requires bricks or clicks.
Traditional Card Form RFID / NFC creates new form
Suite or core banking products
factors to payments
(I.e. debit, credit, ID cards, transit)
In the palm of the customer
RFID Cards Alternate Form RFID NFC Mobile
Key Tag
Citi, NYC
Various
Co-Brand RFID
RFID Watch
Cards
Istanbul, Turkey
6210 NFC Phone
Citi, NYC
RFID Notes: 1) Contactless payment uses ‘RFID’ radio chip to communicate wirelessly with close-proximity merchant terminal, 2) Ticket sizes are 7
limited at present to £10/$25/€15, 3) Visa/ MasterCard agreed global standard communications protocol. Amex equivalent is ‘express pay’

9. Convergence of value will drive adoption
Convergence requires value criteria are met for all stakeholders
Customer
Ease of Use: Intuitive User Interface
Yet feels like a “Bank / Payment” experience
More convenient: No need to carry cash
Financial overview at their fingertips
Freedom from PC or ATM Dependency
Partner: Telco Retailer / Merchant
Service Enhancer Cash management costs reduced
Competitive Differentiator
Higher ticket value than cash
Deeper Customer Engagement
Increase in foot traffic and customer
Explore new business model opportunity throughput
Bank
Deeper engagement
Channel Extension
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Competitive Differentiation

10. Cross-Sector Case Study: Transit & Banking
Leverage of core competencies create sustainable business models &
richer customer value
Consumer Facing Business to Business
Transit Urban
Distribution Financing Processing
Payments Payments
Use Citi products Co-locate Citi Payment
Pay for rides with Finance transit
for all daily branches and processing for
Citi products infrastructure
purchases ATM in stations transit operators
Citibank: Live “Contactless” Pilots with Transit Partners
Washington, DC Metro New York Metro Singapore Metro 9

11. Play A Day in the Life Video

12. Citi Multi-Channel Strategy: Anywhere, Anytime
We will continue to ensure we deliver world class payment and banking services to our
customers that fit their changing needs - across all channels, anywhere, anytime
Citi View:
Leverage technology to provide strategic advantage and market leading value to our customers

Continue pilots in key markets to understand customer behaviour shifts - before they happen

Leverage our ‘innovation’ experience and global technology platforms to leap frog local competition

Deliver same safety and fraud protection on mobile channel as we deliver on all other channels

Explore segments in un-/under banked in emerging economies, i.e ‘send-home’ payments

Continue collaboration with industry leaders in various sectors (transit, telecommunications, quick

service) - critical to customer education and customer adoption 11

13. Thank you, any
questions?
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