Now More Than 6 Million MasterCard Branded Smart Cards in the Region

Singapore, August 26, 2002–MasterCard International today announced that it has issued more than 6 million MasterCard branded smart cards in Asia/Pacific to date. This is a 65 percent increase in smart card issuance within a span of six months. At the end of 2001, MasterCard issued 3.8 million smart cards in Asia/Pacific. This key milestone demonstrates MasterCard’s continued leadership in driving smart card adoption.

“2001 was the watershed year for chip in Asia where many challenges to chip migration were addressed and financial institutions acknowledged the strong business case for issuing smart cards. We see solid prospects for this year where many of our member financial institutions in the region will begin to reap the benefits of moving to chip. Korea, Japan, Taiwan, and Malaysia have been the major growth markets for chip. There will continue to be an increasing momentum for chip migration regionally and at MasterCard we are ahead of our target for smart card issuance in 2002,” said Jeff Portelli, senior vice president, Product Delivery Group, Asia/Pacific, MasterCard International.

Of the 6 million MasterCard branded smart cards issued in the region, approximately 4 million are cards operating with MULTOS and issued with payment applications. With the 4 million EMV (Europay-MasterCard-Visa) compliant smart cards issued in region, MasterCard remains the leader in Asia/Pacific for EMV-compliant smart cards.

Globally, more than 125 million MasterCard, Maestro, Mondex, and Clip-branded smart cards have been issued worldwide, and more than half of them carry value-added applications like loyalty, digital ID, e-ticketing, e-coupons or personal data storage.

Rules and Guidance for Issuing Smart Cards

To protect members’ investment in moving to chip and to ensure a smooth transition to chip, MasterCard Asia/Pacific has helped its members put rules in place for chip migration, which includes ensuring that new chip card programs are EMV compliant. MasterCard’s Asia/Pacific Board, with representation from members around the region, has adopted guidelines to support chip migration with a view to having most cards migrated and infrastructure in place by 2006.

Support for Members and Vendors

MasterCard works closely with its members and vendors to accelerate chip migration in their markets. In April this year, MasterCard conducted a smart card training workshop in Malaysia for technology vendors to help accelerate the deployment of EMV-compliant smart cards among local banks and technology partners. The workshop was conducted for the first time in Asia/Pacific and MasterCard plans to run similar seminars for members throughout the region. In May, MasterCard launched the industry’s first unified Global Vendor Program that provides vendors with direct access to comprehensive business information and technical support from MasterCard. MasterCard is also the only global payments leader that supports all major smart card operating platforms, allowing members to focus on business decisions rather than technology issues.

Low Cost Multi-Application Smart Cards

Last September, MasterCard announced that more than 1 million MULTOS-based multi-application smart cards have rolled into the region under its US$2.99 chip program. Today, MasterCard sees a 20 percent drop in the price of its US$2.99 chip. MasterCard is dedicated to making it easier and less expensive for members to deploy multi-application smart cards.

Key Smart Card Programs

MasterCard has launched several key initiatives within the first half of this year to accelerate smart card adoption in support of its overall chip strategy. MasterCard recently launched the MC2 card, the first Generation X multi-application smart card in Asia/Pacific. Bank Islam launched South East Asia’s first MULTOS based EMV smart card in Malaysia in June. In April, MasterCard introduced the “OneSMART™ MasterCard™,” a comprehensive approach to smart cards designed to give MasterCard’s member financial institutions around the world the technology choices, marketing support and critical flexibility they need.

“By migrating from magnetic stripe to chip, consumers, merchants and financial institutions will benefit from the dramatic increases in convenience, security and flexibility. MasterCard is leading the way for the deployment of smart cards and will continue to offer cost effective, superior and highly flexible smart card solutions to help ease the chip migration process for our members,” added Mr. Portelli.

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. A corporation with more than 15,000 member financial institutions, 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 Pricelessâ 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 28 million acceptance locations, no payment card is more widely accepted globally than MasterCard. For the six months ended June 30, 2002, gross dollar volume exceeded US$534 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: global economic conditions; MasterCard’s ability to achieve its strategic objectives; the resolution of certain legal proceedings pending against MasterCard; and changing regulatory regimes and market dynamics in certain countries. MasterCard disclaims any obligation to publicly update or revise any forward-looking information.