DinaCard SYSTEM Two Years Later

1. National Bank of Serbia DinaCard SYSTEMTwo Years Later September, 2005

2. PRINCIPLE OBJECTIVES IN THE FIRST TWO YEARS OF OPERATION(THE SYSTEM WAS LAUNCHED ON OCTOBER 8, 2003) Summary • To include all banks in the DinaCard system • Оf 38 operating banks • 37 banks have signed the agreement, 1 bank is in the joining stage • To develop an acceptance network in a short time period • 34 banks accept DinaCardat 22,500 points of sale and close to 600 ATMs • To issue the largest possible number of DinaCard cards • 34 banks have so far issued 1.6 million DinaCardcards • To provide a substitute for the deferred payment cheque • In all, over 3 million cards issued in Serbia

3. OBJECTIVEI – to include all banks in the DinaCard system • 37 banks of 38 operating entities have signed agreements • The only bank that has remained outside the system is in the phase of negotiations and is expected to join the system by end-October • The development of the system is modeled on large European national systems such asCarteBleue in France or Europay Austria

4. OBJECTIVEII – to develop an acceptance network in a short time period • The largest national acceptance network, approaching European standards in scale • 22,500 points of sale at which payment can be made by using a card (5,000 at end-2003). • Croatia: 35,000 (30,000 at end-2003) • Bulgaria: 10,000 points of sale • Close to 600 DinaCard ATMs (around 150 ATMs at end-2003) • Plans for further network development (payment by mobile phone, the Internet)

5. OBJECTIVEIII – to issue the largest possible number of cards • Over 1.6 million DinaCard cards issued • All clients of the Postal Savings Bank holdDinaCardcards, to be used for payment and cash withdrawal at all ATMs with the DinaCard acceptance mark • Plan: end-2005 – over 2 millionDinaCard cards • In all, over 3 million cards have been issued nationally (DinaCard 1.6 million, VISA 1.2 million, MasterCard 300 thousand, others 300 thousand)

6. Number and Structure of Monthly Transactions in the DinaCard System • The number of transactions with all cards (DinaCard, VISA, MasterCard, YUBA, Diners)will exceed 30 million (4 transactions per capita) in 2005, which is a more than tenfold increase over the past 2 years

7. Monthly Turnover in the DinaCard System

8. OBJECTIVEIV – toprovide a substitute for the deferred payment cheque • Over 20 banks issue DinaCard 3,6,12 credit cards • Banks have stepped up the issuing of VISA and MasterCard credit cards as well • DinaCardcredit card is available to a wide population, with affordable interest ranging from 1 to 1.8% monthly

9. Share of Credit Card Turnover in the DinaCard System August 2005: DinaCard 3,6,12 account for 19% of turnover (monthly growth of over 100%)

10. Plans • To additionally accelerate the issuing of DinaCard credit cards as cheque substitutes • To expand the acceptance network to include kiosks, taxi services, and enable payment via mobile phone and the Internet • Co-branding negotiations with international systems

11. Useful Information • www.nbs.yu/serbian/news/anketa_poslovanje_sa_platnim_karticama.pdf • www.dinacard.nbs.yu