TRANSFORMING THE PAYFLOW GATEWAY 09/06/2012

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1 TRANSFORMING THE PAYFLOW GATEWAY 09/06/2012

2 AGENDA Review of Payflow gateway Preview of upcoming changes Merchant impact Partner impact What you need to do 2

3 REVIEW OF PAYFLOW 3

4 PayPal PAYMENT PRODUCTS Business needs All-in-one payment processing Use PayPal to accept and process credit cards and PayPal payments Payment gateways Use PayPal s gateway and the business s own merchant account to process credit cards and PayPal payment methods. Accept alternate payment methods Add PayPal as a payment method PayPal products that meet these needs PayPal PAYMENTS STANDARD ADVANCED PRO PAYFLOW LINK PAYFLOW PRO EXPRESS CHECKOUT 4

5 PAYFLOW TODAY Payflow Link (hosted solution) Merchants can accept credit cards, debit cards, echecks and PayPal Merchants can customize their checkout page using one of three available templates PayPal hosts the checkout pages, helping merchants simplify PCI compliance at no additional cost Payflow Pro Merchants can accept credit cards, debit cards, echecks and PayPal Merchants host their own checkout pages for complete control of the payment experience Offers the option to simplify PCI compliance at no additional cost 5 MERCHANT ACCOUNT

6 OPTIONAL PAYFLOW ADD-ONS Add levels of fraud protection Basic Fraud Protection is available at no additional cost. Merchants can also add-on Advanced Fraud Protection to target specific threats to their business. Set up recurring payments The Recurring Billing Service lets businesses automatically debit a customer s credit card or PayPal account for subscriptions, membership dues, or installment payments. Enable buyer authentication PayPal supports the Verified By Visa and MasterCard SecureCode programs, providing merchants protection on qualified Visa and MasterCard transactions. Merchants can add this extra security measure to their basic or advanced fraud protection service. 6

7 PREVIEW OF PAYFLOW CHANGES 7

8 New Published Gateway Rates: GATEWAY PRICING CHANGES EFFECTIVE 10/1/12 - The newest version of Payflow Link: No set-up fees No monthly fees Only 10 cents per transaction - Payflow Pro will be available at: Reduced set-up fees Reduced monthly fees Only 10 cents per transaction *Note - New pricing is applicable to U.S. Market only, and is effective on new acquisitions occurring on or after 10/1/12. 8

9 BASIC FRAUD PROTECTION NOW FREE Effective 10/1/12, Basic Fraud Protection will be included free of charge within Payflow Link and Pro products. This pricing will apply to new merchant acquisitions. Revised Published Pricing: 9

10 GATEWAY PRICING CHANGES EFFECTIVE 10/1/12 Published Rates For Add-On Services: 10

11 PAYFLOW LINK MOBILE-OPTIMIZED CHECKOUT PayPal is developing a mobileoptimized checkout experience for Payflow Link. Mobile optimization will go live within the newest version of Payflow Link on 9/25/12. Mobile-optimized checkouts are proven to increase mobile conversion rates, improving merchant sales. 11

12 PAYFLOW LINK EMBEDDED I-FRAME NOW AVAILABLE Benefits Enables greater design customization of the checkout page within a hosted environment Simplifies PCI compliance for the merchant I-FRAME TEMPLATE AVAILABLE WITHIN NEWEST VERSION OF PAYFLOW LINK Provides both PayPal and Bill Me Later as payment options, improving conversions and increasing sales for merchants. 12

13 WHAT IS BILL ME LATER? Bill Me Later is a PayPal service A fast, simple and secure way for consumers to make an online purchase without using a credit card. By simply selecting Bill Me Later on the check-out screen, and if approved, consumers can make a purchase now, and receive a bill later. It s a great way to ease online purchasing hurdles and make online shopping easier than ever Bill Me Later gives customers more payment choices and flexibility Merchants get paid right away * Bill Me Later is subject to credit approval, as determined by the Lender, WebBank, Salt Lake City, Utah.

14 BILL ME LATER GIVING CUSTOMERS MORE PAYMENT CHOICE AND FLEXIBILITY Bill Me Later is now available to any merchant utilizing hosted checkout templates, including the i-frame, within the Payflow gateway. Promotional Financing Available! Marketing a single promotional financing offer to consumers The offer: No payments + No interest if paid in full in 6 months on purchases of $99 or more No credit risk for the merchant Upstream Presentment Coming soon in Q4 Message Bill Me Later financing on the home page and product page to drive consumer awareness while shopping Banners will be provided and hosted by PayPal *Join us for our upcoming Bill Me Later webinar on September 26 th. 14

15 BILL ME LATER INCREASES SPENDING AND REPEAT SALES Bill Me Later motivates savvy customers to spend more, more often In a 3-month period, the Bill Me Later customer spends about 25% more than the average US population* Merchants have experienced double-digit increases in repeat sales after implementing Bill Me Later Build repeat sales and customer loyalty while attracting new customers Average order value increases can grow % for higher-ticket items and % for lower-ticket items 8% Increase % Increase Confidential * Source: Internal and Proprietary Bill Me Later research, conducted in 2011.

16 CONVERT WITH EXPRESS CHECKOUT Standard Checkout vs. Express Checkout Flow STANDARD CHECKOUT Input ID info Input buyer address data Input delivery address data Input payment data Add shipping costs Confirm basket Process payment Complete EXPRESS CHECKOUT Typically six or more data fields and lots of keystrokes Log in to PayPal Review payment Complete One or two data fields and two clicks comscore found that PayPal Express Checkout conversion was 115% higher than standard checkout conversion on the cart page. * PayPal has over 113 million buyers who look for the PayPal way to pay. ** * Study conducted in 2011 by comscore on 15 IR100 retailers. ** There are 113 million active PayPal accounts. Active accounts are those that have had activity in the past 12 months.

17 PAYFLOW FEATURE COMPARISON PayPal hosted checkout? Unlimited customization of online checkout pages? Payflow Link No 3 templates, including embedded i-frame Yes Auto-Enabled Payflow Pro Optional Pro can utilize the hosted templates Accept credit cards, debit cards, and PayPal? Yes Yes Includes Express Checkout and Bill Me Later? Mobile-optimized checkout? Yes Available Optional Available with hosted templates Pre-integrated with leading shopping carts? Yes Yes Simplified PCI compliance? Yes Yes* Accepts card swipe retail transactions? Yes Yes Includes Virtual Terminal? Yes Yes Works with many payment processors? Multi-currency processing? Supports 22 Currencies Supports 22 Currencies International merchant support? Yes Yes Yes US, CA, AU, NZ Yes Yes US, CA, AU, NZ 18 XX * Transparent redirect must be enabled

18 PARTNER IMPACT 19

19 GATEWAY PRICING CHANGES EFFECTIVE 10/1/12 New Published Gateway Rates: New Partner Rates: 20 XX FORMAL NOTICE OF PRICING CHANGES WAS ED TO PAYFLOW PARTNERS ON 8/21/12

20 GATEWAY PRICING CHANGES EFFECTIVE 10/1/12 New Partner Rates for Payflow Add-On Services: 21 BASIC FRAUD WILL BECOME PART OF OUR STANDARD GATEWAY OFFERING AND WILL NO LONGER BE CONSIDERED AN ADD-ON

21 PARTNER BENEFITS Robust gateway functionality New wholesale and referral models now available for the gateway. New rates are applicable to merchants acquired on or after 10/1/12. Revenue share models are now available for Express Checkout and BML. Deliver innovative payment methods to your merchants, improving conversion rates and increasing sales. Improve your organization s bottom line in partnership with PayPal. Key Points - New pricing models are only applicable to partners offering the newest version of Payflow Link. - Organizations must be part of the PayPal Partner Program to be eligible for revenue share on Express Checkout and Bill Me Later. 22

22 WHAT YOU NEED TO DO 23

23 WHAT YOU NEED TO DO FOR THE Product Revenue Share Pricing Changes YOU WILL NEED TO Make sure you are offering the latest version of Payflow Link. If you haven t already done so, join the PayPal Partner Program so you re eligible for revenue share on Express Checkout and Bill Me Later. You may learn more at Contact your Relationship Manager or Account Manager to opt-in. Don t have a Relationship Manager or Account Manager? Contact one of our Associate Account Managers at and enter PIN #507. Contracts Once you ve opted-in to the new rates, PayPal will initiate a contract amendment. Once the contract has been finalized, you can acquire new merchants using the new pricing structure on or after 10/1/ CONFIDENTIAL

24 THE PAYFLOW GATEWAY TOP 5 THINGS TO REMEMBER Payflow is the only gateway that helps your merchants drive incremental sales with Express Checkout and Bill Me Later. Payflow Link No set-up fees or monthly fees, only 10 cents per transaction PCI compliance is available for both Link and Pro at no additional charge. Mobile-optimized checkout will be available in late September for Payflow Link, improving mobile conversion rates. Competitive reseller and referral rates are now available for Payflow. Revenue share models are also being offered on Express Checkout and Bill Me Later. 25

25 THANK YOU