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Delivering Lasting Value in Digital Banking For AllJuly 2014
BANKINGUP
Banking Up at a GlanceWe deliver full checking account capability via mobile and web on top of prepaid foundation
ToBusinesses and Financial Institutions with large audiences of cash-based customers
All consumers regardless of income & bankability
WithHighly scalable & quickly configurable platform in an SSAE-16 / PCI-DSS redundant environment
Team headquartered in New York, and software development in Europe
Achieving1MM accounts since inception, 24-month account longevity, >80% in direct-deposited funds
Scale and innovation trusted by leading issuers like H&R Block
$4.6MM in 2013 revenues
Banking Up Platform
Prepaid (Visa / MC)
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BANKINGUP
Successful Team
Patrice Peyret, CEOSerial entrepreneur with 30 years experience in technology; co-founder and CEO of Mobileway (Sybase); CEO of Integrity Arts (Sun Microsystems); software engineering at Schlumberger, Thomson/RCA and Gemplus
Billions of consumers, devices, messages & value creationCarles Guillot - Chief Service Architect
Justin Surman - CTO
Daniel Clark - Financial Controller
Jon Hennen - Director of Operations
Board with Financial Technology expertiseInvestments in over 50 companies
>$7B in multiple exits to large strategic acquirers
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BANKINGUP
The Challenge of Good Banking For All100MM+ consumers at stake in the US alone
Strivers(under-banked)
54MM• "choose to use“• "financial resetters“• "men at work"
“On The Rise”(mass-banked)
30MM
College Students
11MM• Financially aware now• Reluctant transitionners
“Angry banked”
More MM
Source for all numbers: VISA Feb 2013
Offered the wrongproducts by non-bank market players
Median Survival of cash loaded prepaid cards
1.6mo
Acquisition cost for checking accounts:
$350in branch
$140online
Under-served &over-chargedby banks
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BANKINGUP
$1T Opportunity in the US
$0
$250
$500
$750
$1,000
$1,250
2012 2018
Potential Prepaid-based Accounts 2012 2018Underserved Consumers $649 $778
Mass Banked Consumers $215 $274
College Students $82 $100
Teens $40 $51
$ in Billions
Volume comes largely from cash, checks and money orders
Segment needs differ
All segments strongly prefer to acquire from a financial institution
Sources: Visa Inc., U.S. Prepaid Industry Segment Opportunity Sizing Study, August, 2011; Visa Inc., Segmentation Study of Banked Non-Owners of Reloadable Prepaid Cards, December, 2011
Less than 5% of $1.2T prepaid-based market potential have been penetrated so far
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BANKINGUP
Deposit
PayCardChecksDirect Debit
Solution
SaveRainy Day ReserveCash-back earnedHealth Discounts
CashSalary
ChecksTransfers
Branchless, paperless (but not yet checkless) consumer banking24x7 access via mobile, PC or tablets
Debit card for purchases & ATM access
Direct Deposit via ACH
Deposit checks at Wal-Mart or at home1
Pay anyone with on-demand paper checks
Cash loads at 50,000 retail locations
Based on FDIC-insured, Reg. E protected, no-overdraft prepaid accountsNo check-eligibility verification2
Lower back-end operating costs(“pooled” accounts)Can be Durbin exempt(higher interchange revenues)
1: Requires smartphone with camera2: CHEX system in the US
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BANKINGUP
Address Key Pain-Points
1
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4
5 6
1. Avoid trips to the check casher
2. Receive direct deposits
3. Write checks to your landlord
4. Build a safety net automatically
5. Avoid trips to the phone store
6. Save on everything
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BANKINGUP
Private-Labeled Services for Businesses
Transaction Processor
Co-branded Prepaid 2.0 in-a-box
Payment Network
Issuing Bank
Turnkey• Deposits• Payments • Savings for Customers of the Business
Extended Processing and Risk Services
Bank and Network Management
BINs and Programs Set-up
Compliance, Risk and Settlement
Fee Scheduling& Extended Payments
Portfolio Optimization
Configurable Loyalty Engine
Real-time Reports & Analytics
Consumer Interactions
Web & Mobile Interfaces
Editorial & Marketing Tools
$
Black Lists & Fraud Mgmt.
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BANKINGUP
Extended Processing and Risk Services
Platform Services for Financial Institutions
F.I’sProcessor
Extend prepaid platform to deliver full checking capability with real-time CRM
Network
F.I’sBack-EndSystems
F.I.’sStaff
Bank and Network Management
BINs and Programs Set-up
Compliance, Risk and Settlement
Fee Scheduling& Extended Payments
Portfolio Optimization
Configurable Loyalty Engine
Real-time Reports & Analytics
Consumer Interactions
Web & Mobile Interfaces
Editorial & Marketing Tools
A la carte extensions of F.I.’s processor and integration
with F.I.’s back-end
Most advanced portfolio
management tools
$
Black Lists & Fraud Mgmt.
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BANKINGUP
Clients Portfolio of Accounts
AccountsOpening Costs
Banking UPShare of
interchange Private Label Deployments
Accounts Revenues
Businesses
PlatformServices
Accounts Operating Costs
Financial Institutions
Private LabelDeployments
Platform Services
revenues: ≈1% of POS payments (interchange) + monthly, ATM and support service feescosts: processing, Bank BIN & network, support, optional share of interchange to Client
revenues: set-up fee + recurring operating fee + per-account monthly success feecosts: platform hosting & monitoring, program management service bureau staff
Business Model
Interchange & Fees
Processor & Bank BIN
Outreach to Consumers
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BANKINGUP
Exemplary deployment (UPside Visa® Card)
Virtuous Market Player
Industry Validation
• Low price ($0 -$4.99/month) / rich features
• Best Life Time: 24 months• Best direct deposit
performance: >80% in $• 4-time winner of Paybefore
magazine awards
• First to implement CFSI’s prepaid fee box
• First “Compass Principles” Champion
• “Project Catalyst” partnership with CFPB
• VISA’s top innovating partner• Powering H&R Block’s 3MM
Emerald MasterCard®• Wal-Mart’s first deployment
for Rapid Reload®
The Metrics Of Success
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BANKINGUP
H&R Block uses Banking Up to:• Communicate and let their franchisees
communicate with customers via the card account online dashboard (whenever people check their balance and statements)
• Increase the longevity of accounts through key services: pay rent and bills with paper checks and top-up prepaid cell phones
• Measure & analyze the behavior of customers via our real-time CRM service
Case Study:
1in7Americans file taxes with H&R Block at 11,000retail tax offices
3MMEmerald Prepaid cards issued / year to receive tax refunds
+100% year over year users
+ 40% direct depositors
+ 80% re-loadersMeasured in May 2013
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BANKINGUP
Competition
Basic or partial service
Full DDA service
Proprietary Processing
Adapts to LegacyBack-Ends
2
1 Now part of FIS 2 Acquired by Google3 Acquired by BBVA
1 3
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BANKINGUP
Who’s Interested?
5th US TV NetworkReaches 93.8MM households. 1.8MM daily average viewers
US Largest Prepaid Network25MM subscribers; most are under-banked
#434 of Fortune 500Serves 14,000 Financial Institutions in 110 countries
4000
GOOD
THRU 03/16DEBIT
CARDHOLDER NAME
4000 1234 5678 9010
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BANKINGUP
PooledPeer-Lending
Platform
First-to-Market with “Financial Services Ladder”Give Access to Credit and Help (re)build FICO Scores
Secured Credit Card where security deposit = prepaid savings purse
Unsecured Credit Card = 2nd-step upgrade from secured card
Prepaid Card = “everyday payments”. Always safe. (Secured) Credit Card = “credit building payments”. Use with caution.
Prepaid and Credit cards remain entirely separate for compliance with CFPB & Treasury rules
Help (re)build a Safety NetIncentivize savings with higher-than-market interest rates
Partner with Peer Lending platform with insurance protection to generate the required interest rate
Deposit
Pay
Save
Prepaid Card
Borrow
SecuredCredit Card
Security Deposit
Deposit
Pay
Save
Prepaid Card
Un-securedCredit Card
Decisioning
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BANKINGUP
Addressing Industry-wide Problems with PartnersKeep un-banked employees away from check cashers
Make both Direct Deposit & Checks easy to accept by un-banked employees
Employer Portal inviting Employees to self-enroll in GPR Card + install a Mobile Deposit Capture App
Better for Employees: use with multiple jobs or when changing job
Better for Employers: no change to payroll system, no regulatory worries
Potential partners: IDology, Ingo Money, prepaid card providers (H&R Block, TracFone, Univision…)
Don’t leave the un-banked out of the Affordable Care ActFast payment-enablement of ACA applicants with online & mobile prepaid card sign up combined with in-store pick up at nearest participating retailer
Potential partners with retail card distribution capabilities: H&R Block, Blackhawk, Incomm…
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BANKINGUP
Funding
$4.3MMSeries A
$6MMSeries B led by CoreVC
Next: extension of Series BFund expansion of platform for new vertical markets
EBITDA positive by end 2014
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BANKINGUP
Unique Opportunity$1T Opportunity to serve everyone online + mobileSolution delivers great value regardless of asset and income level
Multi-channel distribution: banks, employers, insurances, other F.I.’s
Product validated by direct-to-consumer model; scales with private label partners
Proven platformLeverages online & mobile Internet, Visa and EFT networks
Expandable with fast iterations and open published APIs
Chosen by large US issuer for its consumer financial services
Proven consumer-facing business modelSpend <$25 to generate >$120 life-time revenue on >$4,500 gross deposits
Increase lifetime value with single-minded focus on expanding customer relationships
Proven teamSuccessful repeat entrepreneurs
Experts in consumer & financial services technologies
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BANKINGUP
Banking Up55 Broad Street, Floor 7New York, NY 10004
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