Cash is still king in Poland. But the situation is slowly changing... Payment infrastructure in Poland could be substantially expanded. Will a 50% difference in credit/debit interchange fee (0.3% vs.0.2%) reverse the fall in credit cards in Poland?

1. Inteliace Research
PaymentsinfrastructureinPoland,2014
36,039
33,499
25,950
25,834
25,807
24,786
24,726
24,501
24,471
22,364
21,685
20,450
17,870
17,283
14,833
14,023
9,837
9,731
9,177
9,106
9,057
8,473
7,738
6,407
Finland
Ireland
Italy
Denmark
UK
Cyprus
Greece
Spain
Portugal
Sweden
Croatia
France
EU total
Slovenia
Netherlands
Austria
Poland (Q3 2014)
Bulgaria
Hungary
Czech
Germany
Poland (2013)
Slovakia
Romania
1,540
1,137
1,060
1,009
1,007
970
892
862
856
820
804
766
668
641
539
512
491
488
477
465
439
418
412
337
Portugal
Spain
UK
Germany
Austria
Croatia
France
Slovenia
EU total
Italy
Bulgaria
Cyprus
Ireland
Greece
Romania
Poland (Q3 2014)
Poland (2013)
Hungary
Slovakia
Denmark
Netherlands
Czech
Finland
Sweden
DESPITE RECENT GROWTH, PAYMENT INFRASTRUCTURE IS STIL UNDERDEVELOPPED IN
POLAND
1
ATM (2013, per million inhabitants) POS terminals (2013, per million inhabitants)
EU average:
856
EU average:
17,870
International statistics: ATM and POS networks vs. population
Source: ECB, NBP, Inteliace Research

2. Inteliace Research
PaymentsinfrastructureinPoland,2014
151
176
208
230 243 251 268 281 291 297
33
42
55
68
78
90
105
120
133
155
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014E
*Cards issued in Poland; both local and foreign transactions
**Domestic ATMs only. Transactions include cash withdrawals with foreign cards
Source: NBP, Inteliace Research
CAGR 2005-2014E
(in percent)
VALUE OF CARD PAYMENTS IS RISING RAPIDLY IN POLAND
• Over past 9 years, the
value of cashless card
payments has risen
almost 5 fold. During the
same period, the value of
ATM cash withdrawals has
only doubled.
• The growth in card
payments has been
accelerating recently
which can be an effect of
growing payment
infrastructure.
• A significant reduction
in card interchange fee in
2013-2015 is likely to
result in lower MSC
offered to retailers by
acquirers and to induce a
new wave of growth in
still underdeveloped
acceptance network in
Poland.
2
Combined value of cash withdrawals (ATM) and card payments (cashless)
In PLN billion
+11
17.7 19.3 20.9 22.8 24.2 26.3 28.3 29.9 31.4 34.3
Share of
cashless
payments (%)
+19
+8
184
218
263
298
320
341
373
401
424
452
Card* payments
(cashless)
ATM** cash
withdrawals
After recent regulatory
changes, card
interchange fees were
reduced by up to 87%
within 2013-2015

3. Inteliace Research
PaymentsinfrastructureinPoland,2014
3.3
7.3
9.9
12.7
15.1
13.3
14.3
15.4
16.9
18.3
20.5
22.0
22.8
24.8
26.5
28.2
29.2
0.5
1.0 1.4 1.6 1.8 1.8
2.6
5.0
6.9
8.2
9.8
11.2
9.2
7.3 6.7 6.4 6.3
3.9
8.3
11.3
14.4
16.9
15.1
16.9
20.4
23.8
26.5
30.3
33.2
32.0 32.0
33.3
34.7
35.5
0
5
10
15
20
25
30
35
40
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 14Q3
59.7
39.1
1.3
THE NUMBER OF CARDS ISSUED IN POLAND KEEPS GROWING DRIVEN BY A STEADY
INCREASE IN DEBIT CARDS
Payment cards issued in Poland, 1998 – Q3 2014
in million
Cards issued by brand, Q3 2014
in percent
Source: NBP, Inteliace Research
Other
VISA
Total
Credit &
delayed debit
Debit
3
MasterCard
100%=35.5 million0.92 cards
per capita
• After recent regulatory changes, card
interchange fee was reduced to 0.2% / 0.3%
for debit/credit cards respectively, as of Jan.
1, 2015.
• As a consequence, credit cards are now
more attractive than debit cards, on a
relative basis, for issuers.