EE--Ticaret DTicaret Düünyasnyasıında nda GeliGelişşmelermeler

Nur Öztin KurakVisa Europe Türkiye

VP -

Ülke Direktörü13 Ocak 2010

Market Leader in All Key Indicators

+%

1264

million

Total Card Number

+%

1299

billion

TL

Annual Purchase Volume

eCommerce

continues to grow quickly

eCommerce Market

The eCommerce market in Europe is limited by the number of people who have internet access and the number of merchants that offer to sell goods and services online:

• 49%

of people in Europe have access to the internet (in United States, the figure is 75%)

• 64%

of European merchants (more than 10 employees) have a presence on the internet through a website

– Only 26%

of merchants had a facility to for online ordering, reserving or booking

– just 10%

of European merchants have the ability to accept payments online.

People with Internet Access

Country Population (m) No of internet users (m) Proportion of internet users

Germany 82.3 53.2 65%

Turkey 75.7 15.6 21%

France 64.0 33.0 52%

UK 60.9 37.5 62%

Italy 58.1 33.6 58%

Others 239.6 113.8 47%

Total 581 286 49%

USA 304.2 228.0 75%

Number and proportion of internet users in the Europe, 2008 Sources: US Census Bureau

Merchants with Online Presence

Percentage of Enterprises w/ web presence in selected European countries, 2008

Website

Online catalogues Online ordering Online payment

Germany 77 56 32 9

Spain 54 57 23 5

France 54 69 23 11

Italy 58 57 23 6

Poland 57 77 11 8

UK 76 43 25 19

EU27 64 57 26 10

Current Market Value

The European commission estimates that:– the total value of B2C eCommerce in the EU27 in 2007 was €131bn– approximately €455

for each adult

The global online commerce market will be worth over €1 trillion in 2009.

The US is the largest global online commerce market, with transaction values of €195 billion in 2009

Japan and India are the second and third largest markets, with €182bn and €152bn of online transactions respectively.

China and India hold huge future growth potential

(source: Report on cross-border eCommerce in the EU, European Commission, March 2009) Datamonitor.

Who Shops Online?

• It is estimated that 125 million Europeans ordered or purchased goods online in 2008.

• Across Europe, 49% (61.6 million) of people who shop online are between the ages of 25 and 44.

• The 16-24 segment represents 19% of users, while those aged 45 to 54 represent 18% of all online shoppers.

• Only 3% of online shoppers are over the age of 65.

• According to a recent global survey conducted by The Nielsen Company, over 85 percent of the world’s online population has used the Internet to make a purchase, up 40 percent from two years ago, and more than half of Internet users are regular online shoppers, making online purchases at least once a month.

What do people buy online?

In terms of value of spend, research from Euromonitor shows that:

– the biggest category of spending by product type was media products, with €22.4 billion spent online during 2008

– the second two biggest categories were clothing and footwear and consumer electronics, with €13.6bn and €13.3bn respectively spent

More Key Findings

• The global online commerce market will be worth over €1 trillion in 2009.

• The top 20% most active online shoppers account for 80% of total transaction values.

• Credit cards dominate this space, accounting for 45.3% of total transaction values.

• Convenience, not security, is the biggest factor determining consumer choice of payment tools.

The Growth of eCommerce in the future

The growth in eCommerce in Europe is dependent upon several factors: • The growth in the number of retailers offering the facility to buy online. • The growth in the number of retailers offering to deliver goods to other

countries within the EU. • The proportion of consumers with access to the internet. • The confidence of consumers to buy online without security concerns

1,8

1,8

2,9

7,6

83,6

Choice

Speed

Simplicity

Trust

Security

Security on-line is key

Technology that links retailers, cardholders and member banks during the online checkout process to provide proof that a genuine Visa Cardholder and a genuine Visa Merchant are taking part in the transaction

What is Verified by Visa?

A secure online shopping service that• Enhances existing Visa cards to create an even safer

online shopping environment• Uses a personal password to authenticate customer

identity and confirm transactions• Is the digital equivalent of a PIN/signature at point of sale

How does Verified by Visa operate?

• Global programme across the world• Uses 3-D Secure protocol as underlying technology• Designed to work across different channels, including PC,

mobile

Market Insight & Verified by Visa

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AmountCount

eCommerce acquiring across Europe continues to grow….

Source: VisaNet Acquiring Aug 2009

August 2009Amount: $9.4bnCount: 86.2m

VbV acquiring penetration across Europe continues to grow ….

Source: VisaNet Acquiring Aug 2009

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Total VbV as % of total ecom (ECI 5 & 6)

Fully authenticated (ECI 5) as % of total ecom

Verified by Visa issuing volumes….

Source: VisaNet Issuing Aug 2009

39.88%

28.77%

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Total VbV as % of total ecom (ECI 5 & 6)Fully authenticated (ECI 5) as % of total ecom

Verified by Visa Penetration

• Over 50 million cardholders registered

• Over 450 issuers certified for VbV and enrolling cardholders

• Majority of European acquirers VbV capable

• 300,000 online VbV merchants

VbV

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Activation During Shopping

Verified by Visa Acquirer & Merchant Proposition

VbV Commercial Framework

Verified By Visa• Liability shift: Protection for the merchant against

cardholder denying making the purchase. – All ECI 6 (merchant ‘attempted’) transactions benefit from the liability shift except Inter Regional Commercial transactions

• Interchange differential favouring acquirer / merchant

Identified VisaNet EC: Chargebacks Addressed with Authentication

Authentication is expected to substantially reduce or eliminate chargebacks from the following reason codes:• 75, Does Not Recognize• 83, Non-Possession of Card

The actual percent of chargebacks that could be eliminated may be smaller due to errors in using the correct reason code.

Code "Other"22,07%

Code 8363,66%

Code 7514,27%

78% Addressed With Authentication

Merchant / Acquirer BenefitsBenefits:

• Liability shift: Protection for the merchant against cardholder denying making the purchase. Liability shift even if Issuer or cardholder are not participating.

• Ease of use for the cardholders:• Possible reduction in merchant fees.

Some important considerations:• The occurrence of fraud results in financial losses as well as damage to the

brand.• Merchants only VbV does not “kill” fraud. The fraud moves elsewhere.• Both the Issuers and the merchants have a role to play in preventing fraud.• Major VbV merchants fully appreciate that continued fraud prevention is in

their and everybody’s interest. • Therefore, merchants must retain fraud prevention (including CVV2 checking).

ECI Values

ECI 5 – Fully Authenticated VBV Transaction• Card enrolled, authentication process followed and

cardholder authenticated. Liability shifts to the card Issuer.ECI 6 – Merchant-Only VBV Transaction• Merchant offers VbV but card not enrolled in VBV. Liability

shifts to card Issuer.ECI 7 – Unauthenticated Transaction with SSL• Cardholder to merchant connection secured by SSL.

Merchant unable to offer VbV, or card enrolled but VbV authentication process unable to be completed. Transaction liability with Merchant.

ECI 5 and 6 transactions qualify for liability shift.ECI 5 and 6 transactions qualify for liability shift.ECI 5 and 6 transactions qualify for liability shift.

VbV –

ECI Codes

Future trends...

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Choice

Speed

Simplicity

Trust

Security

Future ... Codesure

Pay quickly and easily: Visa payWave on mobile

Send money to any mobil: Peer-to-Peer payment

Buy online with Visa mobile ... easy, quick and secure:Remote Payment