MASTERCARD PRESS RELEASE:

New MasterCard PayPass™ Utilizes Contactless Card Payment Technology

MasterCard Partners with Chase, Citibank, MBNA and Multiple Merchants in an Orlando, Florida Market Trial to Offer Consumers a "Simpler Way to Pay"

Purchase, NY, December 12, 2002 - MasterCard International today announced MasterCard PayPass™, a new "contactless" card payment program that provides consumers with a simpler way to pay. Using MasterCard PayPass, consumers simply tap or wave their payment card on a specially equipped merchant terminal that then transmits payment details wirelessly, eliminating the need to swipe the card through a reader. The new solution is ideal for traditional cash-only environments where speed is essential, such as quick serve and casual restaurants, gas stations and movie theaters.

MasterCard is currently working with leading financial institutions - Chase, Citibank and MBNA - to trial MasterCard PayPass with numerous merchants in the Orlando, Florida area. Consumers taking part in the trial can use the card's "tap & go" feature at participating Orlando merchants, including Boaters' World, Chevron, City of Orlando Parking, Friendly's, Loews Universal Cineplex, Ritz Camera and Wolf Camera. Quick serve restaurants and additional retailers will be added in January. Since the MasterCard PayPass card can be used exactly like existing magnetic stripe cards in addition to the new PayPass feature, consumers can also use it at any of MasterCard's more than 29 million acceptance locations around the world.

"The introduction of MasterCard PayPass is a prime example of MasterCard's commitment to providing our customers and their cardholders with a variety of innovative and secure options to meet their evolving payment needs," said Art Kranzley, chief e-Business officer, MasterCard International. "MasterCard PayPass transactions are simpler and faster than cash, and leverage the high-level security of payment cards, that consumers have come to trust."

The MasterCard PayPass Value Proposition

The strength and appeal of MasterCard PayPass benefits all parties involved in the payments process - cardholders, merchants and financial institutions.

MasterCard recently completed extensive consumer research that indicated 63 percent of consumers surveyed said that they would "definitely" or "probably" use MasterCard PayPass if their bank offered it to them. Also, consumers surveyed who would "definitely" use MasterCard PayPass indicate that it will replace cash in more than half (53 percent) of their future transactions. Consumers' feedback indicated that PayPass is perceived to be "innovative" and "fun to use," as well as an enhancement that "would make shopping less of a hassle."

Among the benefits to consumers, MasterCard PayPass is designed to:

• Provide better record keeping than cash.
• Provide a quick, easy payment method, thereby improving the overall in-store experience
• Increase the feeling of security, as cardholders remain in control of the card during transactions

For merchants, MasterCard PayPass is designed to:

• Be simpler and faster than cash, thereby speeding consumers through the check-out process
• Increase average transaction amounts spent as compared to cash
• Provide a reliable, trusted payment method that works well in "quick pay" environments
• Help attract new customers and increase their loyalty

For member financial institutions, MasterCard PayPass is designed to:

• Increase Gross Dollar Volume (GDV) by attracting payments away from cash
• Open up new acceptance opportunities for "quick pay" environments
• Increase accountholder loyalty for their card programs

How MasterCard PayPass Works

MasterCard PayPass is an enhanced payment card that features a hidden embedded computer chip and antennae. A cardholder simply taps or waves his or her MasterCard PayPass card on a specially equipped merchant terminal. The card then transmits payment details wirelessly, eliminating the need for a cardholder to hand over his or her card for a merchant to swipe through a reader. Account details are communicated directly to the special terminals and are then processed through MasterCard's highly trusted acceptance network. Moments after a consumer taps the terminal with his or her PayPass card, they receive payment confirmation and are on their way.

MasterCard PayPass is built around globally interoperable standards and relies on the ISO Telecommunications Standard #14443 to transmit Track 2 data via radio frequency. In North America, where the majority of transactions are authorized on-line, the payment application data is based on the magnetic stripe information. The card/terminal interaction is based the MasterCard Proximity Chip - Online Profile, which is a subset of EMV/ISO7816 commands.

Bringing MasterCard PayPass to Market

The MasterCard PayPass trial program is designed to test the real-world applications of a contactless payment card. This test builds upon the successful employee pilot that recently took place at MasterCard's Purchase, New York headquarters. Initial results from the employee pilot showed that purchase transaction time was reduced by up to 64 percent. In addition, the average transaction amount increased by 10 percent when using a payment card in lieu of cash.

The Orlando trial will test the operational reliability, interoperability, and cardholder and merchant experiences of MasterCard PayPass. Chase, Citibank and MBNA will be re-issuing cards that feature the enhanced payment technology to a sampling of their Orlando-based cardholders. Upon the expected successful completion of the Orlando pilot, MasterCard plans to introduce MasterCard PayPass to additional markets. MasterCard PayPass is MasterCard's global program name and it has already been approved for use in MasterCard's key markets.

MasterCard is pleased to partner with the following companies in support of introducing PayPass: Chip Developer/Manufacturers: Infineon/SC2, OTI Inc./Samsung, Philips Semiconductor/Oberthur; Card Manufacturers: Colorado Plastics Inc., Oberthur USA; Card Personalization Bureaux: First Data Corp, MBNA; POS Providers: C-SAM, OTI Inc., Panasonic, Stella, Verifone, ViVOtech, 3 Form Design; Testing & Compliance: Cadimes, Caradas, Consult Hyperion; Merchant Installation: Edgar Dunn, OTI Inc.

Additional information is available at www.paypass.com.

About MasterCard International

MasterCard International is a leader in global e-business. MasterCard is focused on providing its member financial institutions with customized, meaningful global e-business solutions that connect them to their accountholders. Through its investment in industry innovation, participation in standards development and business alliances, MasterCard is staying in the forefront of technology integration to enable anytime, anywhere payments across multiple channels and various devices. MasterCard's global e-business solutions include Internet security, smart cards, mobile commerce/wireless, business to business electronic commerce, and numerous emerging technologies.

MasterCard International has a comprehensive portfolio of well-known, widely accepted payment brands including MasterCard, Cirrus and Maestro. More than 1.7 billion MasterCard, Cirrus and Maestro logos are present on credit, charge and debit cards in circulation today. With approximately 25,000 MasterCard, Cirrus and Maestro members worldwide, MasterCard serves consumers and businesses, both large and small, in 210 countries and territories. MasterCard is a leader in quality and innovation, offering a wide range of payment solutions in the virtual and traditional worlds. MasterCard's award-winning Priceless advertising campaign is now seen in 90 countries and in 45 languages, giving the MasterCard brand a truly global reach and scope. With more than 29 million acceptance locations, no payment card is more widely accepted globally than MasterCard. For the nine months ended September 30, 2002, gross dollar volume exceeded US$831.7 billion. MasterCard can be reached through its website at http://www.mastercardinternational.com.

This press release contains forward-looking information. Although MasterCard believes that its expectations are based on reasonable assumptions, it can give no assurance that its goals will be achieved. Important factors that could cause actual results to differ materially from the forward-looking information contained in this release include: MasterCard's ability to achieve its strategic objectives; whether the terms of the transactions will be approved by MasterCard members and Europay shareholders; MasterCard's ability to realize the contemplated benefits of the transactions; changing market conditions; and other matters. MasterCard disclaims any obligation to publicly update or revise any forward-looking information.

Click here for a link to the press release at Mastercard web site...

ViVOtech (adapter provider)

“ViVOtech’s innovative radio frequency terminals are specifically designed to fit existing POS systems so merchants can rapidly and cost-effectively deploy MasterCard PayPass.”—  Jorge Fernandes, CEO, ViVOtech

Media Contact:  Carmella Lyman, 530-546-5488 or 775-233-8300

Click here for a link to ViVOtech’s product to see how you benefit from these proximity payment solutions...