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2014 Discover® Dealer Incentive Program & EMV Update CONFIDENTIAL AND PROPRIETARY ©2014 DISCOVER FINANCIAL SERVICES What You Should Know About Discover® Key Points - For Dealers 1) Discover Acceptance is INCLUDED with Every Acquirer Merchant ID that is issued – by contract 2) Discover rates MUST be competitive with other payment brands – for similar card types – by contract 3) Discover Transactions are INCLUDED in Dealer revenue share from Acquirers 4) Validating Discover Acceptance with a test transaction ensures your merchants can use Discover connectivity to settle PayPal in-store transactions – with other opportunities in development 2 Engage With Discover® Limited Supply of Gift Cards for Qualifying Engaged Dealers 3 Review Dealer Engagement Agreement What Discover wants from Dealers in Engagement Agreement: Agree to Install Discover with 100% of clients on go forward basis Register at Discoversignage.com - deploy signage with new installs Register at DiscoverRewardsProgram.com - Validate installs with test card swipe Agree to fix non-acceptors we identify for a flat fix fee of $150 within 30 days What Dealers get from our Engagement Agreement: $200 gift card as signing bonus $200 gift card $150 per fix for each non-accepting merchant identified by Discover Access to Discover sponsored hardware and software discounts (Pending) Opportunity to voluntarily provide list of non-accepting merchants and sales volume for consideration of additional incentives 4 Additional Revenue Opportunities If you voluntarily provide list of merchants and sales volume that do not accept Discover, we will submit to marketing for consideration of additional incentives using the following schedule: Tier Merchant Volume $ to Dealer 1 $5M+ $2K 2 $1M - $5M $1K 3 $250k - $1M $150 If approved, we will return a summary of your Revenue Opportunity: Merchant Enablement Incentive Opportunity Especially Prepared for: Sample Dealer DN_Identifier MERCHANT_NAME 200 Abel Baking 143 Broadmoor Café 106 China Grill 104 Darcy's Donuts 98 Egg Café ADDRESS1 123 Main Street 124 Main Street 125 Main Street 126 Main Street 127 Main Street CITY Los Angeles PALISADES Brooklyn New York New York ST CA NY NY New York New York ZIP 90014 10964 10965 New York New York Priority Group Incentive to Dealer DMA San Fran / Volume $ 2,000.00 Non-acceptor $ 1,000.00 Non-acceptor $ 1,000.00 Non-acceptor $ 150.00 Non-acceptor $ 150.00 Total Incentive Available $ 4,300.00 Keys to Help You Maximize This Opportunity Promote – So You Can Offer More Opportunities for Merchants Post FREE merchant signage and offer FREE Custom Check Presenters so that cardholders have confidence to use their favorite cards and your merchants can capture additional spend www.DiscoverSignage.com Window Decals Web Banners Check Presenters Store Hours Decal 6 Keys to Help You Maximize This Opportunity Validate – Free test cards and incentives for testing terminals Sales Reps get FREE Test Cards and earn rewards for validating terminal connectivity. Register on-line at DiscoverRewardsProgram.com and receive a unique user ID, password and Discover test card number 7 Discover Network EMV Update Why EMV? …Because it works! Counterfeit fraud in UK: 96M > 43M GBP Networks Drive Change via Compliance Guidelines / “Liability Shift” North America EMV Migration Discover Network North America EMV Acquiring Mandate 10/1/2012 Waive Annual PCI Compliance for Dual EMV/NFC Terminals 1/1/2012 1/1/2013 10/1/2013 1. 50% Data Compromise Relief (MC only) & 2. AMEX Waives Annual PCI Compliance 1/1/2014 4/1/2013 Processor Compliance for EMV Data 10/1/2015 Card Present, Counterfeit Card Liability Shift (except Petro) 1/1/2015 1/1/2016 10/1/2015 1. 100% Data Compromise Relief (MC only) & 2. Payments Hierarchy Begins (MC & AMEX) 10/1/2016 MasterCard extends liability shift for all U.S. ATM transactions 1/1/2017 10/1/2017 Counterfeit Card Liability Shift for Petro Merchants Discover Card Employee Pilot Kick-Off: Sept. 2013 10 Mercury Confidential and Proprietary - For Recipient's Internal Use Only US Issuers Expand Issuing EMV cards U.S. credit and debit card issuers who are issuing or who have announced plans to issue EMV payment cards include: American Express Andrews Federal Credit Union Bank of America Citi Fifth Third Bank Jack Henry & Associates Payment Processing Solutions PNC PSCU Financial Services Silicon Valley Bank Star One Credit Union State Employees Credit Union Travelex Cash Passport United Nations Federal Credit Union U.S. Bank Wells Fargo - EMV migration Forum How Does EMV Work? An EMV card is inserted into a terminal The chip embedded in the card contains an issuer key Using input from the card, the terminal creates and sends a unique piece of data , or “cryptogram” to the issuer’s host during the transaction, validating the card The card is removed when the transaction is completed How Does EMV Align with Mobile/NFC? An EMV chip can be on a “contactless” card where the chip is “tapped” or “held” near the terminal …..or….. A chip can be inside your smart phone and the phone is “waived” near the terminal… Mobile wallets (eWallets) are rapidly growing in number, which multiplies the opportunity for incremental sales for merchants and new revenue options for ISOs Call to Action: Get Your Merchants Ready Your Acquirer is your best resource for Information Sell an EMV contactless enabled terminal. EMV is also a contactless technology and this is the perfect time to upgrade your merchants. Sell IP. EMV dial response times may double, merchants should strongly consider IP and/or wireless technology over dial. Call on your acquirer/processor for education. Learn the brand requirements for ISV/Software merchants. The time to start preparing your merchant is now. Smart Card Alliance EMV Forum (EMF) offers tons of guidance New WG just formed to focus on streamlining ISV/Merchant Certification process Stand By for offers from Discover & BlueStar Only Contracted Dealers Can Participate Thank You! Thank You! Come See Us at Booth #906 15