The Trionis Switch: Removing the Borders in a SEPA Landscape by Interconnecting Issuers and Acquirers The European payments market continues to go through a period of change. Increasingly card acquirers are looking to process transactions cross-border; issuing banks have card customers in more than one country, and retailers are looking for multi-country card acceptance solutions that are cost-effective for all their outlets, irrespective of country location. All Issuers and Acquirers rely on their domestic networks or on the Visa and MasterCard networks for card transaction processing. SEPA has started to enable issuers and acquirers to opt for alternative channels to switch transactions between domestically and cross border within Europe as they seek simplified transaction processing. Trionis is one of the vehicles to make this happen. The Trionis proposition is that authorisation and clearing/settlement information can be exchanged in a much more cost effective way compared to traditional methods utilised by domestic schemes or the international card networks, through having a single connection for the routing of all transactions irrespective of the brand on the card issued or accepted. For an Issuer and an Acquirer, the business model is to increase overall profitability through costs reduction. Maintaining multiple connections is expensive for parties in terms of compliance and maintenance costs.Through a single connection to Trionis and Acquirer or Issuer can reach multiple schemes; Visa, MasterCard, China Union Pay, American Express, Diners/Discover for ATM and POS transactions.

TRIONIS Background Summary Twelve European retail banking institutions (ranging from BNP Paribas Fortis in Belgium, Swiss Post Finance and Swedbank in Sweden to the associations of savings banks in France, Germany and Spain (all of them also shareholders of Eufiserv) have formed an interbank processing Joint Venture together with First Data to provide European banks with an additional choice in the new and evolving SEPA environment. This Joint Venture is an independent, commercial entity and is called Trionis, headquartered in Brussels A key objective is to allow banks to retain influence and control over pricing and routing of card transactions while keeping processing fees at competitive levels. The charter for Trionis states that the organisation will be in Europe, that all processing and data storage will be in Europe and that settlement will be via the European financial system (to permit Eurosystem oversight). Trionis is brand-neutral and does not seek to manage a payment scheme – as this is considered to be the role of the banks. The Eufiserv ATM scheme was spun off prior to the agreement into a separate company called “Eufiserv Payments” and will be run and owned by a group of banks. (In order to differentiate the Joint Venture from Eufiserv Payments, the new name of “Trionis” was given to the Joint Venture upon closing of the transaction). Trionis operates on commercial principles and is run as an independent business. Unlike other First Data processing businesses that are 100% owned by First Data, bank participation in the ownership structure is seen as important. First Data is both a user and a shareholder of Trionis. However, its stake is limited to 50%. It is anticipated that the shareholding structure may evolve over time as the market develops and certain shareholders (independently of whether or not they do business with Trionis) decide to sell their shares or admit other shareholders. What will not change is the commercial business model of the company. Trionis offers a multi-scheme, single and dual message system, with multiple input and output formats (6, currently rising to 7 in 2011), for both ATM and POS transactions. The system supports bilateral settlement (between 2 banks), closed-user-group settlement (between a community of banks) and multilateral settlement (between all participating banks). The system can support multiple sets of payment rules for interchange calculation and exception item processing. The system can support multi-currency operation giving Trionis the ability to cover the EEA and Switzerland and not just the Eurozone. Trionis can provide issuer and acquirer gateway connections to the VISA and MasterCard networks (as well as to other networks such as China Union Pay, Diners Club/Discover, EAPS and American Express).

The existing networks of Trionis and First Data in Europe will be linked to create a network with significant European coverage by early 2010. It is intended that this network will grow further as additional banks and processors join the network.

Other FDICentres

First DataArgentina

CashCardAustralia

Trionis Network – January 2010

PulseGatewayFirst Data

FD Bratislava

Diners ClubDiscover

Under Development

Other FDICentres

Other FDICentres

Other FDICentres

Other FDICentres

ATM POS and ATM

SwitchTrionis

China UnionPayNetwork

MasterCardNetwork

VisaNetwork

AMEXNetwork

SIBSLisbon

Portugal

SwedbankStockholmSweden

F IHannoverGermany

La PosteBerne

Switzerland

PayLifeViennaAustria

Fortis BankBrusselsBelgium

CECAMadridSpain

MasterCardGateway

VISAGateway

AMEXGateway

CUPGateway

BerlinGroup

Protocol

CNCEParis

France

Bridge Dual message

Single message

e-rsbFrance

Equens IT

VÖB-ZVD

CardProcess

SIA-SSB

BankVerlag

Trionis can be seen as a SEPA-enabler, and one that is compliant with the SCF requirement to separate schemes from processing.

20Copyright 2009, Trionis SCRL. All Rights Reserved.

Features underlying the benefits

Independent of card schemes and processorsCompetitive pricing of switch processing feesClearing options: Real-time (single) or Deferred (dual)Settlement options: Bilateral or centralised, gross or netA choice of technical interface options: User specified interface,Trionis interface, other interface standardsService features tailored to fit user needs: quality, security, change, risk, fraud detection, routing, interchange fees, billingMultiple applications including closed user groups

ATM

POS

Acquiring Processor

TrionisInter-Bank

Transaction SwitchingNetwork Issuing Processor Cardholder

Account Details