Frost & Sullivan: Eastern Europe Offers Unique Opportunities for Smart Card Technology in Payment Applications

LONDON, February 9 - Eastern European market characteristics offer unique opportunities for
technology innovators and basic card providers. Poland and other Central and
Eastern European countries with less developed banking systems, labour
markets and IT and communications infrastructures can leapfrog over the
established banking and payment infrastructures present in other parts of
Europe to become more entrenched in smart card based payment methods.

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New analyses from Frost & Sullivan, Leapfrogging Traditional Payment
Methods - Opportunities in Eastern Europe to Deepen Use of Smart Card
Technology in Payment Applications, (www.smartcards.frost.com), find
that Central and Eastern Europe provides growth momentum within EMEA for
smart card payment revenues. The seven-year (2008-2015) compound annual
growth rate (CAGR) in Central and Eastern Europe stands at 12 per cent, which
is more than double that of EMEA at 5.2 per cent. This study focuses on the
opportunities in Poland, Hungary, and the Czech Republic.

"Payment trends in Poland and other Eastern European countries lag behind
other parts of Europe partly due to economic history," says Frost & Sullivan
Analyst Yiru Zhong. "While Eastern European countries have played catch up to
converge towards EU levels, the situation presents an opportunity for smart
card players to help financial institutions in this region to reach out to
the underbanked."

Various stakeholders are keen to take advantage of the under developed
banking infrastructure in order to gain end user touch points. The presence
of non-traditional bank issuers, such as retailers and closed loop
communities, also raises the stakes in the market by actively stimulating end
user demand and habits.

Smart card industry players can tap into the card portion in the short
term and benefit from the low entry barriers for new players to enter the IT
systems and services segment in the medium term. Vendors seeking new entry
should identify credible local partners to establish strong local delivery
capability.

The supplier landscape in Central and Eastern Europe encourages the
coexistence of strong global companies with a vibrant local in-country system
integrators (SI) sector. The successful participant is one who leverages core
expertise with the best product and service fit to local characteristics to
widen and deepen adoption.

"The structural transformation of the payments market offers
opportunities for smart card players who enable the transition from a
relatively low monetisation society to one that relies on smart card
technology," concludes Zhong. "More importantly, this will also allow smart
card players to establish strategic partnerships with local integrators to
guarantee a sustainable pipeline of new businesses in these growth markets."

If you are interested in more information on this study, please e-mail
Joanna Lewandowska, Corporate Communications, at joanna.lewandowska@frost.com
, with your full name, company name, title, telephone number, company e-mail
address, company website, city, state and country.

Leapfrogging Traditional Payment Methods - Opportunities in Eastern
Europe to Deepen Use of Smart Card Technology in Payment Applications is part
of the Smart Cards Growth Partnership Service programme. All research services
included in subscriptions provide detailed market opportunities and industry
trends that have been evaluated following extensive interviews with market
participants.

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       Leapfrogging Traditional Payment Methods -Opportunities in Eastern
      Europe to Deepen Use of Smart Card Technology in Payment Applications

    Contact:
    Joanna Lewandowska
    Corporate Communications - Europe
    P: +48-22-390-41-46
    E: joanna.lewandowska@frost.com

www.frost.com

Joanna Lewandowska of Frost & Sullivan Corporate Communications - Europe, +48-22-390-41-46, joanna.lewandowska at frost.com