SIA Central Europe Focuses on Innovation in Payment Services in Hungary and Other EEC Countries

Budapest - 25 May 2012

Presented in Budapest the main initiatives and projects in the areas of e-payments, mobile payments and NFC (Near Field Communication) technology to consolidate the presence of SIA Group at international level

170 million transactions, of which 105 million relating to banks (almost a third of the total in Hungary) and 65 million relating to loyalty systems, in addition to around 1,500 ATM terminals and 18,500 POS terminals managed in 2011

Net profits at €1.7 million and a growing value of production (+10% on 2010) with a significant quota deriving from new initiatives (22% of the total)

SIA Central Europe is focusing on innovation in payment services, and more specifically on the development of e-payments, mobile payments, NFC (Near Field Communication) technology and convenient, fast solutions that reduce the use of cash and simplify the life of citizens.

These are the main initiatives and projects for Banks and Corporates presented today in Budapest by Massimo Arrighetti, CEO of SIA and Fabrizio Canedoli, CEO of SIA Central Europe during an event dedicated to the latest innovations in the electronic payments sector for the central European region, in particular Hungary, Poland, Czech Republic, Slovakia, Croatia, Austria and Romania, all countries in which the Group aims to consolidate its presence.

It was also the occasion to celebrate the 20 years of activity of SIA Group’s Hungarian subsidiary. The milestones that have characterized its evolution up to today were retraced, starting from 1992 when GIRO Bankkartya Zrt., the national technology operator supporting card issuing and acquiring and settlement of transactions, was established. In July 2007 the company was acquired by SIA, which last year, through a major re-launch, alongside the new name SIA Central Europe, gave it the role of Group Hub in central Europe, focusing the activities on four business macro areas: card processing, management of terminals and value-added services, compliance, and network services featuring high capacity and reliability.

“As SIA Group, we strongly believe that innovation can play a fundamental role in the spread of payment services that are more secure and convenient than cash for citizens – commented Massimo Arrighetti, CEO of SIA. Furthermore, innovation contributes to the growth and competitiveness of banks, corporates and public administration bodies and, in turn, of the entire country. For example, one of the projects we are closely involved in is TARGET2-Securities, for which SIA was granted the Network Service Provider license by the European Central Bank. T2S is the single European platform for the settlement of domestic and cross-border securities transactions and the integration of post-trading infrastructures that will be launched by mid-2015. We are also particularly active in the area of e-payments, for which we are developing services for access to MyBank, the EBA Clearing pan-European initiative for online purchases through the users’ own home banking application, the trial for which starts in Italy at the beginning of June, and which will subsequently be extended to other countries. By the end of the year, we are also planning to inaugurate a new technology hub in Frankfurt, which will go to join the London hub, forming part of the SIA Financial Ring that enables customers to optimize access times to the major European stock exchanges”.

The scenario

Central Europe plays a role of strategic importance for the SIA Group since, according to the latest forecasts, the gross domestic product of EEC countries will grow on average between 2012 and 2015 by more than two and a half times that of the Eurozone (3.9% vs. 1.6%) and almost twice as much compared to the 27 EU countries (3.9% vs. 2%).

In particular, in the case of Hungary and Poland, an increase in card transactions is forecast equal to an annual average of 10% and 5% respectively, and also in the number of payment cards (+9% and +3%).

In Hungary (with around 10 million inhabitants), there are more than 9 million cards in circulation, 65,000 POS and 5,000 ATM terminals, while in Poland (over 38 million inhabitants) there are 33 million payment cards, 250,000 POS and around 15,000 ATM terminals.

Economic performance in 2011

SIA Central Europe closed the 2011 financial year with a net profit of €1.7 million and a growing value of production (+10% compared to 2010), with a significant quota deriving from new initiatives (22% of the total).

At present, the company can count on a portfolio of over 60 clients, confirming its leadership in the payment services sector in Hungary and bordering countries.

In 2011, SIA Central Europe managed a total of 170 million transactions, 105 million of which related to banks (representing almost one third of the total of transactions in the country) and 65 million relating to loyalty systems present in the Hungarian market (in the first four months of 2012 the total of these transactions has already reached a figure of 31 million).

SIA Central Europe currently counts in Hungary around 30% of the ATM market (1,500) and over 28% of the POS market (18,500).

The most innovative projects of the year

At the end of 2011, SIA Central Europe completed the realization of the contactless acceptance network for SPAR Hungary, which is the first retail chain to equip itself with this innovative infrastructure for payments using MasterCard PayPass and Maestro PayPass in “tap&go” mode (without entering a PIN code). This is the most extensive contactless technology network in Hungary (2,500 POS activated in about 3 months at 400 outlets in the country) and one of the largest in Central-Eastern Europe.

SIA Central Europe and Cellum, alongside a number of mobile operators (Telenor and Magyar Telekom) and the Hungarian bank FHB, have developed MasterCard Mobile Service, a new mobile payment service based on the CellPay solution launched last fall. Together SIA Central Europe and Cellum, under a collaboration agreement, will start up innovative m-payments solutions for Financial Institutions in Hungary and other countries.

In the past year, thanks to its ability to innovate, SIA Central Europe has also supported the K&H PayWave initiative, which allowed K&H POS terminals to be equipped with contactless technology and to manage the first payment transactions using VISA PayWave in Hungary.

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