Merchant Branded Debit Card

Program Overview

NPCA: Company Highlights

National Payment Card Association (NPCA) was established in October 2004. The company is venture funded with the founders maintaining majority ownership.

The Company headquarters is located in Coconut Creek, Florida.

The Product: Turn-key merchant branded debit loyalty programs Combining payment and rewards on a single plastic

The Systems: Proprietary and are supported by the staff that built them. All source code and IP is owned by the Company

Patent has been issued.

The Customers: Currently provides to national and regional petroleum and convenience store merchants.

Merchant Branded Debit Cards

1. Payment Card– Functions like and electronic check– Branded to merchants specification– Processed via the ACH– Fixed flat fee per transaction– Transactions are guaranteed to merchants (no chargebacks)– Spending limits apply– PIN based

2. Consumer Loyalty– Rewards – Each merchant decides their own discount or reward feature

Why The Program is of Interest to Retailers

• Drive customer loyalty

• Earn additional store visits

• Increase sales

• Differentiate

• Target promotions

• Communicate with customers

• Displace bank card transactions that have higher cost

• Gain added control over cost of payments

• Influence consumer payment behaviors

Offensively Defensively

Strategy

The Value Proposition For Retailers & Consumers

1. Transaction Fees are fixed $.15 per transaction in place of swipe fees paid today for Visa, MasterCard, AMEX, Discover, etc.

2. Used to provide a reward (price rollback at the pump on every transaction) to retailers’ customers who enroll for GasCapRewards Card

3. Reward provides consumers with their reason to carry another payment card in their wallet.

4. Builds loyalty and sales lift

5. Retailers in turn build a customer data base that they can use for offering coupons, promotions, or other forms of communications directly to their customers.

The $ of Customer Value—Case Study

• 51 Locations

• 15,227 cardholders used the card 2nd week of April

• Spent a total of $839,472 • Per store = $16,460

• Average value per customer that week was $55

• Annualized value = $2,866 per cardholder

Client with small number of locations:• Markets actively• Engages employee participation• Focus on enrolling customers• Offers robust per gallon discount

Client with medium number of locations:• Markets actively• Focuses on enrolling customers • Offers robust discount

Client with larger number of locations:• Has existing loyalty program which has caused some consumer confusion at time of enrollment• Offers robust discount rate

Benchmarking Example of 3 NPCA Clients

Cards enrolled drive transactions, not number of store locations.

Locations Monthly Transactions Enrolled Cards

NPCA Sends ACH

Debits

NPCA ACHProcessor

ACHProcessor

Credits Total Purchase

Amount to Merchant’sAccount

ACHProcessor

Sends Cardholder Debits to

Cardholder’s Bank

End of Day End of Month

NPCA InvoicesMerchant NPCA Transaction Fees

Settlement

NPCA Program Management Include: Program Launch

Program Design

Enrollment engine

Transaction processing/authorization

Merchant Account Management

Transaction Guarantee

Communications with customers

Settlement of funds

Cardholder debits via ACH

Consumer portal

Consumer statements

Merchant portal

Call center support

Disputes Handling and Resolution

Regulatory compliance Merchants Pay for Design & Production

of Cards and Collateral

Consumer Experience

Process Overview: Enrollment

Consumers request cardin the merchant’s storeCards are branded to merchant’s specifications

Consumers enroll online:• enter card number• select PIN• provide personal information• provide checking account number

Welcome emailBranded toThe Merchant’sSpecifications.

Note: Paper Enrollment Can Be Supported

NPCA verifies personand checking account before card is activated

Process Overview: Enrollment

Option 1 For Purchases

Merchant routestransaction to

Merchant Acquirer

NetworkHub

Transactionrouted to NPCA for

authorization

Consumer receivesemail verification of transaction

within 2 hours

Sends debit to consumer’schecking account daily via ACH

…Any returns are handled by NPCA

Consumers insert card in POS reader, enter their PIN and receive their reward.

Option 2 For Purchases: Router Solution

Merchant routestransaction to

NPCA

NPCA Router

Transactionrouted to NPCA for

authorization

Consumer receivesemail verification of transaction

within 2 hours

Sends debit to consumer’schecking account daily via ACH

…Any returns are handled by NPCA

Consumers insert card in POS reader, enter their PIN and receive their reward.

Marketing

NPCA Will Design Cards in Partnership with Merchants

Card Design is stepping stone for all other merchant

branding used in the program

• Cardholder emails

• Web-site branding

• POP; other collateral

• There is a one-time fee for design package.

Cards manufacturing is done with third party

NPCA has alliances with several card manufacturers

Cards and Collateral

Card – Front & Back

Process Overview: Card

Consumer Trifold

POP Signage

Web Site

Pole Stand With Brochures

Customer Data Base

• One of the key value propositions for the program. – Name, address, phone number, email address– Shopping behaviors

• Merchants can download the data and use it internally or…

• Merchants can have NPCA execute promotions via email blasts. (fee for service)

Clients can insert coupons into

emails.

“I wanted to take a minute to thank you for this email notification system.

I had never thought about such a service, but it becomes obvious what

an excellent fraud prevention tool it is. Amazingly, no bank I’ve heard of is doing such a

thing.” Cheers!Sean KeatingNitro, WV

Examples of Email Promotions

Promotions: Email Campaigns

Customer Service: Consumer Portal

Consumers can:

• Make changes to their account• View transactions• Report lost cards• Receive statements• Communicate with NPCA customer service.

Customers receive email when theirmonthly statement is available.

Call Center Service

Servicing:

All incoming calls from consumers by phone or online portal

• System-generated email responses for portal

Update customer accounts as needed

Resolves 99.9% of all incoming calls

Monday – Friday from 9:00am to 6:00pm (Eastern)

Online Portal for Merchant Reporting

www.npcmrs.comReports

Daily, weekly, monthly, yearly activity

Who has enrolled

Frequent shopper—who they are and

how much they spend

Enrollment statistics

Mailing list

Program Performance

Merchant Portal & Reporting

Project Initiation Merchant Services Agreements ACH Agreements Information gathering – customer profile, site surveys Coordination of setup of ACH transaction processing Requirements gathering & gap analysis

Project Planning Project schedule Project tasks & issues list

Execution / Monitoring Card design & collateral Regularly scheduled project meetings (NPCA internal) Regularly scheduled project conference calls with clients Project schedule updates Customer approval and sign-off

Project Management Process… Merchant Launch

Peter GuidiVP Sales 293-233-8097 (home)207-318-2874 (mobile)pguidi@nationalpaymentcard.com

Pat MorganDirector of Marketing561-972-7524pmorgan@nationalpaymentcard.com