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Visa and SK Telecom Announce Plans to Launch Mobile Payments Using Universal SIM Card and Over-the-Air Technologies

Visa International and SK Telecom has announced plans to launch what they expect to be the world's first contactless payment application on a universal SIM (USIM(1)) card which is personalized over-the-air (OTA(2)). Visa and SK Telecom plan to implement this large-scale commercial service in South Korea in April 2007 with an OTA solution based on Visa's recently announced mobile platform. The two organizations also agreed to develop new business models and to seek business opportunities overseas by spreading the OTA-based USIM service. Overseas cooperation activities will include efforts to establish global standards for OTA personalization based on the platform being utilized in the Visa - SK Telecom program.

"This collaboration is a significant step forward, especially in a mobile market as advanced as South Korea where consumers are already aware of mobile banking applications and are keen to see utility and services expanded," said Gordon Cooper, regional head, mobile payments, Visa Asia Pacific. "Bringing together one of the world's most innovative mobile operators with a leading global payment network opens up immense opportunities for the mobile payments business globally. Our collaboration is an example of convergence in action with mobile phone subscribers able to make Visa Wave contactless payments at the more than 50,000 contactless readers at merchants in Korea."

The combination of the OTA and USIM technologies is aimed at speeding up the growth of mobile payments in South Korea because of the convenience it offers consumers - fast, secure and direct access to new payment applications. South Korea is an innovative market with close to 40 million mobile subscribers and more than 83 percent penetration for mobile services(3).

"Through an early pilot and close cooperation since 2002, our work with Visa has already brought a great deal of experience in mobile payments," said Joo Sik Lee, senior vice president, SK Telecom. "This year we will see real advancement in bringing mobile payment solutions to consumers. SK Telecom is the leading operator in Korea with about 20 million mobile phone subscribers and increasingly we expect to see high demand of our new USIM-equipped 3G phones that will benefit from this OTA service. A commercially scalable OTA service, modeled on the recently announced Visa mobile platform, is a critical first component of our overall vision for mobile payments - and this project is an important step in moving towards that vision."

Using SK Telecom 3G phones, the launch is planned to initially involve 30,000 SK Telecom subscribers. They will be able to install the Visa Wave contactless payment application directly onto their handsets via OTA without having to visit their bank. The user simply sends a message to the bank requesting the Visa payment application. The bank then sends the application through mobile internet into the secure USIM chip. As the payment application resides on the subscribers' USIM card, they will not be restricted to making payments only from that device. SK Telecom 3G subscribers who wish to change to a new handset need only move the USIM card to the new device.

"Visa's strategy for mobile payments offers new revenue opportunities for mobile operators and merchants not only in Asia Pacific but around the world," said Gaylon Howe, Jr., executive vice president, global strategy, products and innovation, Visa International. "Using SK Telecom 3G phones, the launch is anticipated to be the largest and most significant OTA service in the world, and comes on the back of last month's mobile platform launch as an example of the benefits of bringing together the best of the mobile and payment industries."

Visa's mobile platform is a set of mobile services and enabling technologies that will allow banks and mobile operators to develop new mobile payment services for individual markets. A key component of that platform is the standardization of security requirements for OTA downloads of financial data to mobile devices. SK Telecom's OTA service, provided by Cassis International, is designed to enable Visa Wave contactless payment applications and cardholder account data to be downloaded to consumers' phones securely and reliably. Visa Wave contactless payment removes the need to swipe or insert a smart card into a payment reader. The customer simply waves the card or phone to make a purchase.

Visa and SK Telecom have collaborated on a series of programs to accelerate the growth of the mobile payments business, having initiated the first mobile payments pilot program using EMV-based payment and infrared technology in 2002.

Visa Mobile Market Activities

Visa has been at the forefront of mobile payment innovation since the late 1990s, having completed numerous trials in countries throughout Africa, Asia Pacific, Europe, Latin America, the Middle East, and the United States. In 2006, Visa completed contactless-based mobile pilots in Malaysia and the United States, using near field communication (NFC)-enabled phones, complementing existing programs in Japan and Korea. In addition, Visa has led efforts to encourage cross-industry cooperation and standardization through leadership roles in organizations around the world such as the Mobile Payment Forum, the Near Field Communication (NFC) Forum, GlobalPlatform and EMVCo.

SK Telecom and Mobile Financial Services Activities

SK Telecom has been one of the world's most forward-looking mobile network operators by offering a variety of consumer mobile applications such as mobile banking, online gaming, stock trading, transit and digital TV, and sees Visa payment as a critical function that consumers will want on their mobile phones. Since 2002, SK Telecom has launched the Moneta service with proximity payment service (Moneta Card) on mobile handsets. Since then it has expanded the Moneta service to provide transit application (Moneta Pass), banking transaction (Moneta Bank), and stock trading application (Moneta Stock Trading) and membership application on the handsets. Currently at least 1.5 million mobile phones with Moneta service are in circulation in Korea.

Notes to Editors:

About Visa: Visa connects cardholders, merchants and financial institutions through the world's largest electronic payments network. Visa products allow buyers and sellers to conduct commerce with ease and confidence in both the physical and virtual worlds. Visa is committed to the sustained growth of electronic payment systems to support the needs of all stakeholders and to drive economic growth.

Visa products currently generate more than $4 trillion in sales volume worldwide. Visa has unsurpassed acceptance at more than 24 million locations worldwide including one million ATMs. For more information, visit www.corporate.visa.com.

About SK Telecom: SK Telecom is Korea's leading mobile communications company with more than 18 million subscribers. SK Telecom successfully commercialized the world's first CDMA cellular phone service and launched the world's first synchronized commercial IMT-2000 third generation service. The company is listed on the Korean Stock Exchange, the New York Stock Exchange, and the London Stock Exchange. To learn more about SK Telecom, please visit www.sktelecom.com.

(1) A universal SIM card allows for the storage of multiple applications such as membership, transit and payment.

(2) OTA provisioning is the ability to load applications and data, such as electronic payment, to mobile devices remotely and efficiently using a wireless network.

(3) Wireless World Forum, "World Mobile Penetration Rates," May 2006.

Contacts CONTACT: Visa International Sabine Middlemass +1650-432-8307
Mobile: +1 650-533-4106
globalmedia@visa.com or Visa Asia Pacific Susan Williams +65 6437 5659
swilliam@visa.com or Visa International Asia Pacific (South Korea) Jang Sung Bin +82 2-3111848
SBjang@visa.com or SK Telecom Sindy Kang +82 2 6100 3823
Mobile: +82 11 9113 2344 psyche@sktelecom.com

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