Making Convenience Secure

Zwipe Investor Presentation Stockholm, 20.09.2019 | André Løvestam, CEO Zwipe’s biometric payment platform is the most widely piloted solution in the emerging biometric payments marketplace

2 How our eco-system operates

Upstream Vendors Technology Providers Card Manufacturers Banks & Issuers Provide components Integrate components & provide card Integrate inlay provided by Technology Request cards for piloting, after & manufacturing manufacturers with an inlay to integrate Providers and supply banks with final successful pilots confirm orders for services as specified into card body form factor live cards for piloting issuing to end customers by Technology Providers

Fingerprint Consumers Sensor manufacturers

Electronics manufacturers A technology innovator & integrator with extensive Electrical intellectual property Components Providers

Card Networks Certify final card once received from card manufacturers

3 With a mission of “Making Convenience Secure”, Zwipe is at the forefront of battery-less biometric authentication

Industry Pioneer With a industry-leading technology platform and strong IP portfolio for biometric payment cards and wearables. Zwipe possesses knowledge and support capability to provide professional services. User experience focused

Simple, frictionless and secure UX with no batteries or fixed power supply necessary with intuitive at home user onboarding

Strong market momentum

With growing commitments from leading industry stakeholders we are partnering with world leading industry partners like Thales, Idemia, G+D, Goldpac, Thomas Greg & Sons and multiple major payment networks

4 Our core technology is at the heart of secure convenience

Zwipe’s technology solution enables battery- less, contactless, ultra-low power, self- contained biometric authentication solutions in constrained environments

Zwipe has a strong IP portfolio covering 31 patent families, of which 8 are granted

5 Diversified and growing customer network Zwipe’s customers include many of the world’s most established providers and card manufacturers

Selected by Giesecke + Devrient to Long standing partnership with Thales (), develop biometric wearable world’s largest card manufacturer

Partnering with Idemia to offer disruptive biometric payments card platform

Longstanding partnership with Hitachi High-Technologies Partnership with TAG Systems, to unlock the fast-mover approach of European-based Challenger Banks Partnerships with Goldpac, XH Smart Technology and Silone Cardtech solidifying ability to Partnership with Inkript, to strengthen service issuers in APAC region Long standing partnership with position in the Middle East, Africa and CPI Card Group, largest Central Asia domestic card manufacturer in Partnerships with AllCard Inc. to the United States address opportunities in the Philippines

Partnership with dz card, strengthening capacity to support issuers in Southeast Asia

Partnership with Thomas Greg & Sons do Brasil, to enable Latin American marketplace

6 Global card expenditure to reach 45 trillion USD by 2023 on back of contactless payments

Source: RBR study Global Payment Cards Data and Forecasts to 2023 7 Adoption of contactless accelerates

8 1EMV, Contactless, and Digital Payments Security (3DS 2.0 and Visa ID Intelligence) The challenge of making convenience secure Remove the unnecessary trade-off between security & convenience

Challenge Zwipe innovation solves the challenge:

Strong adoption of contactless cards, but cardholders still Zwipe solves challenges for several groups have security concerns with contactless…

ForFor the Forthe card For thecard networks theFORcard networks card networks PAYMENT networksZwipe Zwipe Zwipe For ZwipeFor the Forthe banks Forthe banks the banksZwipe ZwipeFORbanks Zwipe ensures ensuresZwipe ensures ensures ForFor merchantsFor merchants FormerchantsFOR merchants Zwipe Zwipe Zwipe Zwipe ForFor consumersFor consumersFOR Forconsumers consumers Zwipe Zwipe Zwipe Zwipe strengthensstrengthensstrengthensstrengthens the theSCHEMES growth thegrowth thegrowth of growth of brand ofbrand of brand visibility visibilitybrand visibility BANKSby visibility byenhancing enhancingby enhancingby enhancing reduces reduces reducesMERCHANTS cashreduces cash handling cash handling cash handling andhandling and and eradicates and eradicatesCONSUMERS eradicateseradicates the the need the need thetoneed useto need use to use to use contactlesscontactlesscontactlesscontactless by byimproving improvingDrivesby improvingby improving top top oftop ofwallet wallet topofEnhances wallet effectsof effectswallet effects and effectsand and and increases increasesincreasesReduces increasescustomer customer customer customer cash,Eliminatescash, orcash, orentercash, enter or aenter or thePIN a enter PIN a PIN a PIN convenienceconvenienceconvenienceconvenience & security& security & security & security reducedreducedreduced fraudreduced fraud fraud fraud throughputthroughputthroughputthroughput contactless and branding and cash SuperiorSuperiorSuperioruse convenienceSuperior convenienceof conveniencePIN convenience. and and and and cashless top of wallet handling, increasedincreasedOffersincreasedincreased security securitya security security transactions by effects. saves consistent, fast improving Reduces fraud transaction and convenient Source: Research, 2018 convenience and and offers time and user security cardholders increases experience. …and banks introduce transaction limits to limit fraud peace of mind customer Peace of mind throughput

9 Biometric authentication is fast becoming a necessity for all devices

…especially for banking and payments

10 10 perceived as delivering superior security

Very Secure Secure Neutral Insecure Very Insecure

BIOMETRICS 49,3 40,6 5,7 4,4

NUMERIC PIN 7,23 52,17 24,6 14,5 1,5

2,84

SIGNATURE 4,36 14,5 46,4 31,9

NO AUTHENTICATION 4,4 13 15,9 66,7

11 Source: VISA Ready for Biometrics Report, AYTM Market Research, April 2018, among pilot participants First-of-its kind Bank of Cyprus and Areeba pilots yielded valuable feedback on user experience and product performance

88% 59% 64% 84%

of Bank of Cyprus pilot of Bank of Cyprus pilot of Areeba pilot participants of Areeba pilot participants participants surveyed participants would be ready were satisfied with the user were enthusiastic or would like to have a to pay a premium fee for a enrolment experience interested in biometric biometric in biometric payment card payment cards the future and would recommend it to a friend

Top benefits from Bank of Cyprus exit surveys Top benefits from initial Areeba exit surveys 1. No need to enter PIN & convenience 1. Fast and secure checkout 2. Extra security 2. Making contactless transactions easier 3. Wow Effect/Cool factor 3. Overall more convenient than existing payment methods

12 Positive outlook for dual-interface payment cards

Annual shipments of EMV payment cards Comments Millions 3bn EMV payment cards shipped in 2017, with dual-interface cards representing 46%, expected to increase to over 80% in 2021

4 432 • Annual shipments of EMV payment cards from 2012-2017 had a CAGR of 4 221 20%, with forecasted annual growth of 5% between 2017-2025 4 020 3 828 • Dual-interface cards expected to be the main driver, with a CAGR of 3 647 191 3 473 15.7% between 2017-2025 3 308 3 151 547 3 000 • Annual shipment of dual-interface cards expected to double by 2021 868 VISA & Mastercard industry mandate that all payment 1 323 terminals must accept contactless payments by 2020 1 670 1 620 • As of 31st December 2015, any new deployments of payment cards must 3 637 offer the facility for the client to pay by contactless means 3 100 2 605 Regulatory directives like PSD2 in the EU & Aadhaar in India 1 985 are likely to force the adoption of biometric authentication 1 380 1 481 • By January 2020 all point of sale terminals in and many other markets must offer the facility for the client to pay contactless 2017 2018e 2019e 2020e 2021e 2022e 2023e 2024e 2025e

Contact-based EMV payment cards Dual-interface payment cards

13 Source: Eurosmart, Zwipe. Note: 2012-2018 numbers based on Eurosmart. 2019-2025 numbers based on Zwipe projections, Paymentscardsandmobile.com, Payment Service Directive (PSD2) Growth in contactless drives demand for dual-interface biometric payment cards

Addressable market for biometric payment cards growing fast Case study: Dual-interface cards in the UK

Millions Millions Biometric payment cards in circulations Biometric payment card addressable rate 6 805

*Key determinants of the timing and speed of adoption of biometric payment card will be; i) timing and completion of certification processes and systems for enrolment, ii) the successful execution of pilot programs and consumer acceptance and adoption of the new technology, iii) inlay 130 production capacity, iv) the competitive intensity at every step in the value chain (from technology 120 solution providers to issuers), and vi) manufacturing cost development for biometric cards 4 298 38% 103

82 25% 2 566 59 81% 74% 16% 63% 1 504 38 50% 31 37% 866 23 24% 13 148 370 10% 7 20% 23 61 3% 2 9% 15% 0% 0% 0% 1% 6% 1% 5% 2018e 2019e 2020e 2021e 2022e 2023e 2024e 2025e 2026e 2027e 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Demand from different key players in the payments ecosystem expected to trigger • Gradual adoption due to latent demand and lack of NFC compatible POS terminals exponential adoption of biometric sensors on payment cards: – i.e. consumers did not know or were unaware of their preferences until they got used to • Biometric authentication technology already validated and accepted by the mass market contactless (“tap and pay”) due to smart phones – Today, over 2/3 of payment terminals in stores are compatible with NFC • Card issuers looking for new ways to differentiate and meet evolving consumer expectations • Governments and regulators promoting use of biometric solutions to minimise fraud and identity issues • VISA & Mastercard industry mandate that all POS terminals must accept contactless payments by 2020 in Europe

Source: Edgar Dunn 2018. The addressable market represents the total number of payment cards that could potentially be converted to biometric payment cards according to Edgar Dunn’s analysis. 14 Technology trend for Biometric Payment Cards

• Several initiatives to integrate and consolidate electronics • The market is moving towards passive inlay solutions by 2022-23 with major investments from payment schemes, semiconductor companies, inlay makers and SCMs • A dedicated Secure Element combines functions of Secure Element and Microcontroller (MCU) from today’s designs in one chip ‒ Fingerprint image processing and feature extraction is computationally expensive ‒ Requires a powerful MCU and memory to run generic biometric algorithm • The target is to cut costs compared to today’s solutions

15 Landmark partnership with Idemia

This disruptive biometric payment card platform: • replaces Secure Element, Microcontroller and >30 components with a single chip • offers best in class biometric performance and energy efficiency • enables significant cost reduction and mass volume market take-off • will be piloted H2/2020, with mass volume deployment 2021 • this disruptive technology is expected to play a leading role in the BPC market

This partnership entails: • co-investment in the technology development • Zwipe retains worldwide exclusive distribution rights for the lifetime of the product to all manufacturers of payment cards, wearables and other payment solutions, and also to their suppliers • IDEMIA retains technology ownership and will sell in their cards to financial institutions (embedded in their F-Code biometric payment card offering) • Zwipe will also offer accompanying functionality, and services around the technology platform

16 16 Enhanced security that does not compromise the user’s privacy will enable even greater convenience for consumers…

…not only in payments cards, but also wearables

Zwipe is well-positioned to leverage these opportunities

Fingerprint sensor solution incorporated in a wristband

17 Key medium term financial aspirations

Revenue Annualised revenue of USD 125 million (NOK 1 billion)

Volume Annual sales of 20-40 million embedded systems for dual-interface biometric cards, with expectations to reach cash-flow break-even at these volumes

Price Average sales price in the range of USD 3-4 per unit at full volume

Market position No.1 in the market for dual-interface biometric payments with 30% market share

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