Unlocking the cross-border trade opportunity

Damien Perillat, GM Central & Eastern Europe

© 2014 PayPal Inc. All rights reserved. Confidential and proprietary.

Technology should make things

simpler, faster and better

connected – providing more

choices and opportunities.

2

© 2014 PayPal Inc. All rights reserved. Confidential and proprietary.

Global cross-border trade is expected to be a $307

billion market by 2018

3

2013

2018

Cross-border online spend $105B $307B

Number of cross-border shoppers 94M 130M

Number of consumers using mobile

devices to make cross-border

purchases

46M 72M

Source: Modern Spice Routes, PayPal and Nielsen, July 2013

© 2014 PayPal Inc. All rights reserved. Confidential and proprietary.

Cross border commerce is a driving force in today’s

global marketplace

4

North

America Western

Europe

Nordics Central,

Eastern

Europe

Middle

East

Latin

America

Asia

Pacific

2 8 4 3 7 6 7 4 8 5 6 9 9 5 6 10 6 11 4 7

15 3

28

66

38 37 43

57 56

40

62 77

51

63 53

31

52

72

31

49

46 55

61

23

69

26

58 60 50

38 37

56

29 17

43 27

38

64

42

18

64

40 50

38 25

74

US CA UK DE FR IT ES NL CH AT SE NO DK PL RU IL TR UA BR MX AU CN

Domestic only Cross border and domestic Cross border only

56%

A significant proportion of online shoppers claim to make cross border purchases, and almost all cross border shoppers

also shop domestically.

%

Multi-

country

average*

for CB

* Multi-country average not weighted by market size

Self-stated domestic and cross border purchasing in past 12 months

Source: Ipsos MORI PayPal Cross-Border Research 2014

© 2014 PayPal Inc. All rights reserved. Confidential and proprietary.

Top destinations for cross-border shoppers

5

26% U.S.

17% U.K.

18% CN

8% HK

16%

DE

5%

FR

Source: Ipsos MORI PayPal Cross-Border Research 2014

© 2014 PayPal Inc. All rights reserved. Confidential and proprietary.

Fashion is top category shopped globally

6

Top cross-border shopping categories

Clothing, shoes,

accessories (CSA)

31%

Health and

beauty products

16%

Consumer

electronics

21%

Household

appliances

10%

Jewelry and

watches

14%

Travel and

transportation

15%

Source: Ipsos MORI PayPal Cross-Border Research 2014

© 2014 PayPal Inc. All rights reserved. Confidential and proprietary.

Choice and Price are drivers of cross border…

Logistics and Security are the main barriers

7

Top drivers

for cross border purchase

Top barriers

for cross border purchase

Up to 70% Choice

Up to 65% Price

Up to 13% Currency

40% Return costs & easiness

34% Shipping & non-delivery

32% Incurring extra costs

30% Security/ concerns

Up to 5% Send a gift

Top drivers

for cross border purchase

Top barriers

for cross border purchase

Source: Ipsos PayPal Cross Border Reseach, 2013 – CEMEA

consumers

© 2014 PayPal Inc. All rights reserved. Confidential and proprietary.

Cross-Border Commerce: zoom on France

8

23

20

19

11

7

5

5

4

3

3

UK / GB

USA

Germany

China

Hong Kong

Spain

Japan

Italy

Netherlands

Switzerland

31

21

18

16

15

15

14

10

10

8

Top 10 Countries/Regions for Cross-Border Shopping (%) Top 10 Categories for Cross-Border Shopping (%)

Clothing/apparel, footwear and accessories

Consumer electronics, computers/tablets/mobiles &

peripherals

Entertainment/education (physical)

Cosmetics/beauty products

Toys and hobbies

Travel and transportation

Jewellery/watches

Collectibles, memorabilia and art

Household appliances, household goods and furniture

Tickets

Source: Ipsos MORI PayPal Cross-Border Research 2014

© 2014 PayPal Inc. All rights reserved. Confidential and proprietary.

9 Source: PayPal Internal Data Q3 2014

For merchants in France, payments received from abroad with PayPal

have grown 33% YoY YoY Growth Q3 2014 for FR XB received TPV – PayPal Data

US

+19% FR

DEATCH

+56%

UK

+47%

EMEA

+37% 77% of FR int’l

payments from

EMEA consumers

IT

+19%

BNL

+27%

SCANDI

+59%

KEY

Top 5 corridors for XB TPV received in FR via PayPal

Corridors growing fastest in terms of XB TPV received

in FR via PayPal (>40% YoY)

UK

+47% Sending region

Payments to FR merchants, YoY growth Q3 2014 vs

Q3 2013

MEA

+53%

CEE

+41%

Ask Justine for 2014 numbers

© 2014 PayPal Inc. All rights reserved. Confidential and proprietary.

Payment not yet

frictionless

10

© 2014 PayPal Inc. All rights reserved. Confidential and proprietary.

Unmatched global payment footprint

11 Source: ebay investor relations

$228B in Total Payment Volume (2014) : +27%

203 markets served

162M active registered accounts

19M new active digital wallets

20% of PayPal payments made on mobile : +68%

2014 was a year of significant growth

© 2014 PayPal Inc. All rights reserved. Confidential and proprietary.

Buyer protection extended to Free Return Shipping

12

© 2014 PayPal Inc. All rights reserved. Confidential and proprietary.

Merchant cross-border Plug & Play

13

© 2014 PayPal Inc. All rights reserved. Confidential and proprietary.

Ready to unlock the cross-

border opportunity?

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dperillat@paypal.com