Better technologies for mobile devices, proliferation of banking apps and increased consumer appetite for staying connected are converging to propel mobile banking penetration. On the technology device front, recent double-digit growth in smartphone adoption has enabled consumers to expand the activities they can perform via mobile phone connections — including banking online. One-half of smartphone owners have banked online with their mobile phones within the past 30 days vs. only 13 percent of those with conventional mobile phones with Internet access. More than one-quarter of U.S. smartphone owners indicate they would be “extremely likely” or “very likely” to use mobile payment during the next year if new technology was available that enabled payment through a contactless reader at point-of-sale. That translates into an estimated 17 million plus consumers who are prepared to exchange their cash-and-card-laden wallets for a different payment method. Smartphone owners who are likely adopters of mobile payments differ in significant ways the general population of smartphone owners.

2. Mobile Banking & Payments:
Consumer Behavior in 2011
Paul McAdam
Senior Vice President
Research & Thought Leadership

3. Research objectives and methodology
• Study Objective:
– Determine the impact of mobile devices on behaviors related to financial
transactions
• Accessing accounts
• Paying bills
• Depositing checks
• Making purchases
• Methodology:
– 60 question online survey of 4,000 adults who own mobile phones
– Split evenly by gender
– Conducted in February 2011
– Sample provided by Survey Sample International
3

4. Profile of the survey respondent pool
Generation Annual Household Income
$90K to $125K +
$125K
Mature
Under
Gen Y*
$30K
$60K to
Baby $90K
Boomer
Gen X
$30K to
$60K
Mean = 45 years Mean = $54,286
Source: FIS Enterprise Strategy, February 2011 4

5. Convergence driving penetration of mobile financial services
• Younger generations dominate
• Device improvements and
additions facilitating mobile
banking
• App proliferation allowing more Consumers
consumers to access mobile
banking
• Large banks are leading the way
• Satisfaction with mobile is Devices Apps
increasing
• Mobile remote deposit and mobile
payments will follow a similar
adoption path
5

6. Gen Y is connected with mobile Internet devices
Type of Mobile Phone Owned Access Internet on Mobile Phone
(base = total sample) Frequently
(base = total sample)
14% 9%
31%
43%* 26% 64%*
32%
47%
37%
36%
66% 22%
54%
13%
31%
21%
Gen Y Gen X Baby Boomer Mature Gen Y Gen X Baby Mature
Boomer
A conventional mobile phone unequipped for Internet access
A conventional mobile phone equipped for Internet access
A smartphone
*Read as 43% of Gen Y own smartphones
*Read as 64% of Gen Y access the Internet on their mobile phones frequently
Source: FIS Enterprise Strategy, February 2011 6

7. 50% of smartphone owners use mobile banking;
they comprise 76% of current mobile adopters
Penetration of Active Mobile Banking Mobile Phone Types among Mobile Banking Users
(base = mobile banking users with Internet connection)
50%*
Conventional mobile phone
with Internet access
24%
13%
Smartphone
76%*
Smartphone Conventional mobile
phone with Internet
access
* Read as: 50% of smartphone owners use mobile banking
* Read as: 76% of mobile banking users use smartphones to access mobile banking
Source: FIS Enterprise Strategy, February 2011 7

8. Mobile banking adoption is fueled by Gen Y and Gen X;
38% of Gen Y uses mobile banking
How Accessed Financial Services Online during Past 30 Days
(base = respondents who bank online)
38%*
22%
5% 5%
3% 3% 3% 2%
1% 0% 0% 0%
Mobile phone Tablet Internet gaming system
Gen Y Gen X Baby Boomer Mature
* Read as: 38% of Gen Y accessed online banking via their mobile phone during the past 30 days
Source: FIS Enterprise Strategy, February 2011 8

9. More than half of mobile banking users are Gen Y;
Gen X utilization also strong
Mobile phone owners, Smartphone owners and mobile banking users by generation
2%
13% 9% 10% Mature
14%
32% Baby Boomer
34%
31%
Gen X
27%
Gen Y
56%*
43%
26%
Mobile Phone Owners Smartphone Owners Mobile Banking Users
*Read as 56% of mobile banking users are in Gen Y
Source: FIS Enterprise Strategy, February 2011 9

10. Except for checking balances, fewer financial activities
conducted via mobile phone than by computer
Financial Activities in the Last 30 Days Done by Mobile Phone and by Computer
(base = respondents who bank online through device)
88%*
Checked balances in checking / deposit account
91%
Looked at checking / deposit transaction activity or 57%
monthly statements 84%
34%
Transferred funds between accounts at my bank
49%
22%
Accessed credit card or loan account information online
28% Mobile phone
29%
Checked loan / bill payment due dates Computer / laptop / netbook
38%
Transferred money from my account to another person or 26%
organization 41%
Accessed / made transaction in investment accounts 16%
online 14%
*Read as: 88% of consumers banking online through their mobile phones checked their balances in their
checking/deposit account with their mobile phone in the last 30 days
Source: FIS Enterprise Strategy, February 2011 10

11. Satisfaction with mobile banking has risen significantly
Satisfaction with Accessing Bank Satisfaction According to Primary Type of
Account with Mobile Phone Mobile Banking Used
(Top 4 box on 11-point scale) (Top 4 box on 11-point scale)
88%
85%
76% 79%* 78%
70%
60%*
57%
2010 2011 Mobile banking app Text message Mobile Internet browser
2010 2011
*Read as: 60% of mobile banking users in 2010 were satisfied with the experience
*Read as: 79% of mobile banking users who used mobile banking apps to connect with their FIs in 2010 were
satisfied with the experience 11
Source: FIS Enterprise Strategy, March 2010 and February 2011

12. App proliferation supports mobile banking
Penetration of Banking Apps among Those Who Have Downloaded Apps
(base = mobile phone owners who downloaded any apps)
Games 70%*
Social Networking (e.g., Facebook, Twitter) 57%
Entertainment / Music / Media & Video / Comics 55%
News & Weather 49%
Navigation 44%
Communication (e.g., Gmail) 41%
Banking 37%
Sports 28%
Photography 27%
Shopping 23%
Books & Reference 21%
PayPal / other person-to-person payment app 20%
Personalization / Live Wallpaper 20%
Health / Fitness / Medical 20%
Lifestyle 16%
Travel 15%
Business & Finance 14%
Education 14%
*Read as 70% of mobile phone owners who have downloaded apps have downloaded games
Source: FIS Enterprise Strategy, February 2011 12

13. Banking apps are relatively popular among those who have
downloaded apps, even among older generations
Penetration of Banking Apps among Those Who Have Downloaded Apps
(base = mobile phone owners who downloaded any apps)
44%*
34%
26% 26%
Gen Y Gen X Baby Boomer Mature
*Read as 44% of those in Gen Y who have downloaded apps have downloaded banking apps
Source: FIS Enterprise Strategy, February 2011 13

14. The top-10 banks have higher awareness and are capturing
significantly more than their fair share
Where Mobile Banking Users Have Awareness of Whether their FI Offers Mobile
Primary Checking Accounts
4% 5% 2%
8% Other FIs
10%
18% 24%
17% 24%
19% Credit Unions
10% 15%
20% Community and 28%
12% 13%
Small Regional Banks 30%
13% Banks 11 to 50
15%
13%
52% of mobile 52%* Top 10 Banks 50%*
banking users
37% vs. 37% of the
sample 29% 31%
Mobile Phone Owners Mobile Banking Users Yes No Don't know
*Read as: The Top 10 banks capture 52% of mobile banking users
*Read as: 50% of mobile phone owners who are aware their FI offers mobile banking have
their checking account with a top 10 bank
Source: FIS Enterprise Strategy, February 2011
14

15. Satisfaction with mobile banking is higher among other FI’s
and top 10 banks
Satisfaction with Mobile Banking According to Type of Financial Institution
(Top 4 box on 11-point scale)
87%
82% 80%
77% Avg. = 76%
66%
Top 10 Bank Banks 11 to 50 Community and Small Credit Unions Other FIs
Regional Banks
*Read as: 82% of mobile banking who had their primary checking at one of the top 10 banks were
satisfied with the experience
Source: FIS Enterprise Strategy, February 2011
15

16. Customer Characteristics
Mobile Deposit Capture
Mobile NFC Payments
The Path to Adoption

17. Mobile banking users are connecting to the Internet with
a variety of devices
How Mobile Banking Users vs. Non-users Connect to Internet
(Base = total sample)
100% 99%
96%
42%
23%*
15% 13%
3%
Mobile phone Computer / laptop / Tablet Internet gaming system
netbook
Mobile Banking Users Non-users
*Read as 23% of non-users of mobile banking connect to the Internet through their mobile phones
Source: FIS Enterprise Strategy, February 2011 17

18. Mobile banking users are more likely to connect to banks via
computer alternatives
How Mobile Banking Users vs. Non-users How Mobile Banking Users vs. Non-users
Access Financial Services Online Pay Bills Online
(base = total sample) (base = total sample)
86%*
80%
99%
90%*
42%
9% 8% 7%
5% 1% 1%
1% 1%
Computer / Tablet Internet gaming Computer / Mobile phone Tablet Internet
laptop / netbook system laptop / gaming system
netbook
Mobile Banking Users Non-users Mobile Banking Users Non-users
*Read as 90% of mobile banking users access financial services online through computers
*Read as 86% of mobile banking users pay bills online through computers
Source: FIS Enterprise Strategy, February 2011 18

19. Mobile banking users trade paper for plastic
Average Number of Transactions with Primary Checking Account in Past 30 Days
15.3*
Debit card purchase
12.3
4.4
Preauthorized bill pay
4.5
4.3
Debit card cash back
3.2
Mobile Banking Users
3.4
Electronically transferred funds to another FI
3.3 Non-users
3.4
Wrote a paper check
4.5
3.2
Direct Deposit
2.8
*Read as: mobile banking users made an average of 15.3 purchases with their debit cards in the past 30 days
Source: FIS Enterprise Strategy, February 2011 19

20. Mobile banking users are more oriented toward accessing
online financial services outside of conventional FI’s
60%*
Person-to-person payments (e.g., PayPal)
45%
17%
Personal savings (e.g., SmartyPig)
6%
Personal financial management (e.g., 16%
Mint.com, Geezeo, Yodlee) 3%
11% Mobile Banking User
Quicken Online
3%
Non-user
11%
Online investment advice
4%
Online lending sites (LendingTree, eLoan, 8%
etc.) 2%
Person-to-person lending sites (Prosper, 7%
Zopa, etc.) 1%
25%
None of these
47%
*Read as: 60% of mobile banking users make P2P payments
Source: FIS Enterprise Strategy, February 2011 20

21. Mobile banking users have higher asset balances
than non users
Mobile Banking Users Balance Indices vs. Balance Indices for Non Mobile Users
(within Each Generation)
282
196 196
180 185 177
171
158 151
128* 136 130
Checking accounts Savings / MMDA / CD Brokerage or Retirement /
money market fund college savings
company
Gen Y Gen X Baby Boomer
*Read as: Indexed as 100 equals average for the segment. Gen Y mobile banking users have 28% more
money in their checking accounts that mobile phone owners who have not adopted mobile banking
Source: FIS Enterprise Strategy, February 2011 21

22. Mobile banking users typically index above average for most
credit and loan balances
Mobile Banking Users Balance Indices vs. Balance Indices for Non Mobile Users
(within Each Generation)
236
176 173
167 167
150 155 158
139 147
122* 126 120 127
68
59 52
17
Major Store-branded Automobile Educational Home equity Other loans
credit cards credit cards loans loans loans (not including
mortgages)
Gen Y Gen X Baby Boomer
*Read as: Indexed as 100 equals average for the segment. Gen Y mobile banking users have 22% more in
major credit card balances than Gen Y consumers who have not adopted mobile banking
Source: FIS Enterprise Strategy, February 2011 22

23. Customer Characteristics
Mobile Deposit Capture
Mobile NFC Payments
The Path to Adoption

24. Lack of awareness and access impede remote deposit usage,
but usage among smartphone owners is significant
Access to Mobile Remote Deposit Application at Use of Mobile Remote Deposit
Primary Checking Account Provider
(base = all mobile phone owners)
No primary Yes, but not 59%
checking available
account for my
5% mobile
Yes phone
7% 6%
No
22%
I don’t 12%*
know
60%* 3%
Among all Among Among
mobile phone smartphone smartphone
owners owners mobile bankers
*Read as: 60% of smartphone users don’t know if their bank has an app for remote deposit of checks
*Read as: 12% of smartphone have used mobile remote deposit capture within the past 30 days
Source: FIS Enterprise Strategy, February 2011 24

25. Mobile banking users are interested in remote deposit
Mobile Banking Users Interested Reasons for Not Using Remote Deposit
in Remote Deposit (base = have access but don’t use)
(Top 2 box on 7-point scale)
I don’t think it is secure 31%*
57%*
Do not deposit enough checks to
29%
warrant having the application
Just haven’t gotten around to
26%
downloading the application
I want a printed receipt for checks I
20%
deposit
Do not have Internet access through
13% 15%
my mobile phone
Takes too long for deposits to clear 8%
Mobile Banking Non-users My financial institution charges a fee
Users 3%
for the service
*Read as: 57% of mobile banking users not currently using remote deposit are interested in remote deposit
*Read as: 31% of those able to use mobile remote deposit don’t use the service because they think it is not secure
Source: FIS Enterprise Strategy, February 2011
25

26. Customer Characteristics
Mobile Deposit Capture
Mobile NFC Payments
The Path to Adoption

27. Mobile banking users likely on the forefront of NFC adoption
Likelihood of Using Smartphone to Pay for Goods during Next Year if Available
(base = smartphone owners)
31%
27%
26%
21%* 21%
11% 12%
9% 9% 9% 9%
7%
4% 4%
Extremely likely Very likely Somewhat likely Neither likely nor Somewhat Unlikely Very unlikely
unlikely unlikely
Mobile Banking User Non-user
*Read as: 21% of mobile banking users with smartphones are interested extremely likely to use them
to pay for goods in the next year if NFC is available
Source: FIS Enterprise Strategy, February 2011 27

28. Presence of readers, security concerns and comfort with
existing payment methods are the primary NFC obstacles
Reasons That Would Prevent Smartphone Owners from Using It to Pay for Goods
(base = smartphone owners)
Stores where I like to shop might not have readers 50%*
35%
Would be less secure than other payment methods 39%
37%
Might not get points for using certain credit / debit cards 26%
16%
I would rather use other payment methods I’m more 24%
comfortable with 37%
Would still have to carry identification 22%
12%
Would be too easy to lose track of how much I spend 21%
13%
Mobile Banking Users
Would still have to carry loyalty cards 18%
10%
Non-Users
I don’t see the value in using it for payments 13%
21%
I only use my phone or other mobile device for calls and / or 10%
email 13%
*Read as: 50% of mobile banking users with smartphones perceive that the lack of readers in stores where
they like to shop could prevent them from using NFC
28
Source: FIS Enterprise Strategy, February 2011

29. NFC—advantages outweigh obstacles, especially among
mobile banking users
Benefits of Using Smartphones to Pay for Goods
(base = smartphone owners)
Would not have to carry credit / debit cards 53%*
41%
Would shorten time spent checking out at 39%
the register 27%
Would not have to carry cash 38%
30%
Would help me keep track of my purchases 34%
20%
Would not have to carry checkbook 21% Mobile Banking Users
19%
Would help me to better control my 21% Non-users
spending 11%
Would be more secure than other payment 16%
methods 7%
No benefits 10%
32%
*Read as: 53% of mobile banking users with smartphones perceive that not having to carry credit/debit
cards is a benefit of NFC
Source: FIS Enterprise Strategy, February 2011
29

30. Customer Characteristics
Mobile Deposit Capture
Mobile NFC Payments
The Path to Adoption

31. Plenty of runway ahead
• Continued smartphone and tablet
adoption will fuel growth
• Creating awareness of
accessibility to the financial
institution via mobile phone
• Persuading customers who are
connected to their FIs online to try
mobile banking
• Providing a satisfying user
experience for early and late
majority customers, to encourage
move from trial to adoption
31

32. Smartphone and tablet growth will continue to fuel
mobile banking adoption
U.S. Smartphone Penetration Projection Projected U.S. Tablet PC Sales and Users
(All Subscribers) (All numbers in millions of US adults)
100 60% 82.1
Percentage of Mobile Subscribers (%)
49% 76.1
45%
50% 67.7
80 41%
Mobile Subscribers (M)
38%
35% 40% 50.7
32%
60
29%
27%
24% 30%
22%
42.3 44.0
21% 39.8
40 19% 26.0 35.1
17% 20%
24.1
20 10.3
10%
26 33 37 41 45 49 52 58 63 70 76 83 91
0 0%
Q2 2009 Q2 2010 Q2 2011 Q2 2012 2010 2011 2012 2013 2014 2015
Smartphone Subscribers — Total Table PC Users (US)
U.S. Smartphone Penetration Tablet PC Sales (US)
Source: The Nielsen Company Q2 Mobile Media Marketplace, 2010 Source: Forrester Research eReader Forecast, 2010 – 2015 (US), January 2011
32

33. Lack of awareness impedes mobile banking penetration
Primary Checking Account Providers Offering Mobile Banking
(base = total sample)
Yes
Don't know
49%
44%*
No
7%
*Read as: 44% of mobile phone users don’t know if their bank offers mobile banking
Source: FIS Enterprise Strategy, February 2011 33

34. Disinterest among non-users continues due to a wide range
of preferences and concerns
Reasons for Not Using Mobile Banking
(base = non-users)
I would rather access my accounts online with my computer 38%*
I don’t think it is secure 28%
My mobile phone screen is too small 19%
There is no charge to use my computer 19%
I just haven't bothered to try mobile banking yet 19%
There is no value to banking with my mobile phone 16%
It costs too much to use the data plan on my mobile phone 15%
I’ve tried accessing my bank account online with my mobile phone
3%
in the past, but was dissatisfied
No reason 18%
*Read as: 38% of non-users would rather access their accounts online with their computers
Source: FIS Enterprise Strategy, February 2011 34

35. Mobile banking opportunity
• Moving quickly from early adopters to early majority
• Adoption will continue to grow as smartphone and tablet ownership expands
• Gen Y and X are the primary adopters today
• Mobile is vital to secure their relationships as they move into nesting lifestage
– Mobile apps the price of entry for attracting younger customers
– Higher deposit and loan balances than their non-adopter generational counterparts
– More likely us use debit card, less likely to write checks
– Accessing financial services online via other Internet devices
– Most aggressive users of non-traditional financial services (P2P, PFM, etc.)
– Most likely to use mobile remote deposit and mobile NFC payments
• Easy-to-use mobile banking apps key to increasing penetration among desirable
Baby Boomer segments
35

36. Thank You
Paul McAdam
Paul.McAdam@fisglobal.com