Gregg Marshall, Global Head of Mobile Transaction Services at Western Union, presented on developments in digital cross-border and domestic money transfers. The presentation covered Western Union's current business model, which relies heavily on cash-to-cash consumer transfers. It outlined key strategic growth areas like digital services and partnerships with mobile network operators (MNOs). It also discussed challenges in adopting mobile money transfers and factors contributing to mPesa's success in Kenya, like a hands-off regulator and focus on adoption and customer service. The presentation concluded by stating Western Union's goal of $500 million+ in digital revenue by 2015.

1. Developments in Digital Cross-border
and Domestic Money Transfer
Gregg Marshall
Global Head, Mobile Transaction Services
Mobile Banking and Payments Emerging Asia Summit 2012 – October 9, 2012

2. Continue to expand MNO* Relationships & maintain leadership
Agenda
• Getting Started With Mobile Remittance
• 1. Current state of play in mobile remittance
• Whither digital money?
• Challenges facing the “mobilization” of money
• What’s working and why
• The road ahead viewed from here
• e. Operations
• f. Customer Support
• g. Marketing and Business Development
• 3. The Road Ahead – what’s next and what’s coming

3. Western Union Today
Other: 2%
C2B: 12%
B2B: 2%
C2C: 84%
C2C overwhelmingly cash to cash 3

4. Targeting the Needs of 4 Billion Underserved
Meeting the Needs of 2 Billion Underserved
Higher Net Worth 800M-1B
Underserved 700-900M
Unbanked 1.5-2B
Extreme Unbanked
1.5-2.5B
….and providing financial services to those without access to
traditional banking services
SOURCE: McKinsey & Co., “Half the World is Unbanked”, October 2009; CGAP, “Financial Access” 2009; C.K. Prahalad,
“Fortune at the Bottom of the Pyramid” 2004; Hammond et all, “Purchasing Power at the Bottom of the Pyramid” , 2007;
World Bank 2009 Bottom of the Pyramid population, Company analysis

5. Key Strategic Growth Areas
Global Consumer Ventures
Financial Services
Business Solutions
New products, services
Money transfer, bill pay and electronic channels
Cross-border business payments

6. Retail Agent Partner Network
Agent Location Growth
485,000
200,000
120,000
86,000
1996 2001 2006 2011
Over 200 countries and 16,000 corridors

7. Key Developments
San Francisco WU Digital
 Established base in September 2011
 Digital product and biz dev
 Relocating key competencies
 Hiring new breed of talent
 Expanding operations and
technology capabilities
7

8. Online Money Transfer
Originating business
in 23 countries
$100M+ revenue 2011
Strong margins
Growth accelerating from
single digit to 35% in 2011
Investment focus
8

9. Key Developments
New service for bank account payout
 Launched in December 2011 in U.S.
 Recently expanded to U.K., Australia
 Payout to banks in 38 countries
 Ramping up
 90% new customers/use case
 Expanding to new payout
geographies
ACCOUNT 9

10. Key Developments
Launched proprietary alternative
payment method
 Acquired startup eBillme
 Bank push / cash
 Portfolio of gift card & merchant
for e-commerce
 Activating in the U.S., selected
geographical expansion
10

11. Continue to expand MNO* Relationships & maintain leadership
Mobile Money Transfer
120 + wallet initiatives globally (GSMA)
Approximately 30 partners for WU
All continents
15+ operations live
C2M, M2C and M2M
Established brand and presence
Early stages of a 3-5 year opportunity

12. Western Union, a Branded Hub
Goal of $500M+ digital revenue by 2015

13. Challenges in Mobile
• User Adoption
• People change slowly
• Regulation
• Bank-led models
• Technology
• Weak underfunded vendors
• New business for MNOs and banks
• Lack of critical skills and support

14. What’s working and why?
• mPesa in Kenya
• 14M active users
• 25+% of all payments
in Kenya
• Why?
• Hands off regulator
• Investment in adoption
• Distributor care
• Market dynamics

15. The Road Ahead
and/or
………..

16. Let's talk about it....
Gregg Marshall
gregg.marshall@westernunion.com
©2012 Western Union Holdings, Inc. All Rights Reserved. The WESTERN UNION name, logo, trade name, trade dress and related trademarks and service marks, owned by Western Union Holdings,
Inc., are registered and/or used in the U.S. and many foreign countries. This material is proprietary to Western Union and cannot be used, reproduced, copied, displayed, distributed or used to
prepare derivative works without the prior written consent of Western Union.