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Triune Payment Solutions, Inc. | Summary 2
3. Table of Contents
Summary ....................................................................................................................................................... 4
Cash Is King ................................................................................................................................................... 5
Observing the Market ................................................................................................................................... 6
National History ........................................................................................................................................ 6
Geography ................................................................................................................................................. 6
Political Stability ........................................................................................................................................ 6
Technology Infrastructure ........................................................................................................................ 6
Population ................................................................................................................................................. 7
Merchants ................................................................................................................................................. 7
Payment Methods ..................................................................................................................................... 8
Our Strategic View ........................................................................................................................................ 9
Concept ....................................................................................................................................................... 10
Transaction Methods Compared ............................................................................................................ 10
Conclusions ................................................................................................................................................. 11
End Notes .................................................................................................................................................... 12
Triune Payment Solutions, Inc. | Summary 3
4. Summary
The Triune Payment Solutions group offers more than seven decades worth of exceptional executive
management, operational knowledge and technological innovation skills specializing in the creation of
advanced electronic payment solutions for both domestic and international use. The group was
founded for the sole purpose of bringing together diverse and highly talented individuals to put forth
fresh and innovative approaches to monetary payment issues.
In past years this group has been responsible, as individuals and partners, for some of the most
significant technological and innovate business methods currently utilized in electronic payment
systems. This methods and systems include advanced risk avoidance, domestic and international money
transfer, stored value card systems and ecommerce systems.
As Thought Leaders in the electronic payments industry the collective has, for a number of years, had
direct and indirect relationships with a number of Pacific Rim nations including the Philippines. The
group has realized after years in dealing with the top tier Philippine Banks and Philippine governmental
officials that there was an opportunity to create a unique electronic payment system that would
capitalize on the domestic payment issues that were and are prevalent in most Pacific Rim countries.
The first stage of that opportunity has already been seized and through the efforts of Triune Payment
Solutions a robust, effective, risk adverse electronic payment system has been launched with the
cooperation of the Philippine government, banks, technology infrastructure providers and Triune’s
internal resources. We recognize that this first step has started a revolution that will liberate the
domestic Philippine cash payment based economy and move it towards an effective, non-discriminatory
method of commerce that can and will change the economy of the Philippines as well as the potential
impact on the international economy as well.
The following discussion provides our view of the revolution and what impact it will have on both
national and international commerce.
Triune Payment Solutions, Inc. | Summary 4
5. Cash Is King
The historical use of representative money in the many countries of the Pacific
Rim has its roots in the European models of the 18th and 19th centuries. Many
of the current monetary system models have been elevated from the original
use of representative money to fiat money in the late 20th Century. However,
the actual practice of exchange of currency for goods and services has not
changed.
Without providing an in-depth historical lesson on the rise of monetary systems throughout the Pacific
Rim we believe it is sufficient to state that with few exceptions; Australia, New Zealand, Japan, and
Singapore, the remaining nations are mired in a middle ground where the extension of credit and
electronic commerce are either sparse or non-existent. This is not to say that these countries do
practice modern Central banking or have reasonably sophisticated banking systems.
It does reflect on these countries inability to move into the current models of commercial growth
centered on the use of the Internet for
business to consumer trading. It is paradoxical
that in many of these countries the use of
technology is high, particularly in the use of
mobile telephony and participation in the
social use of the Internet as observed in figure
1.
The growth of eCommerce across the
developed world is becoming a major
component in the calculation of the Gross
Domestic Product (GDP) of many countries.
The current GDP contribution of eCommerce /
ITC, as of 2007, to the U.S. economy was
estimated at 3.6 percent.1 As the GDP is an
1 2007 UN Report for Information & Communication internal contribution to a country’s valuation,
Technologies 3.6 percent equates to a very large number as
the total US GDP for 2007 was estimated at
$13,807 Billion Dollars. While the Philippine GDP for that same time period was significantly less ($298
Billion Dollars2). There were no appreciable contributions by the eCommerce sector to the Philippine
GDP. The good news is that the Philippine GDP continued to grow at a 7% rate over the prior year
ranking it as the 37th largest economy in the world.3
The impact of a vibrant eCommerce Industry is obvious when observing the preceding figures. However,
to build such a major contributor to a nation’s economic power requires a number of favorable
conditions to be in place or the opportunity to create those conditions exist within the nation’s
boundaries. The need to move a domestic population from a cash based economy is one of the prime
conditions that needs to be met to insure a proper foundation is created for a thriving eCommerce
Industry to exist.
Triune Payment Solutions, Inc. | Cash Is King/ 5
6. Observing the Market
National History
When considering the necessary precursors to
the birth and growth of an eCommerce based
environment it is necessary to understand the
fundamentals of the existing points within the
Pacific Rim countries that support eCommerce
as a method of creating economic opportunity
and growth. The first is partially based upon
historical precedent in which the nation has a
historical pattern of industrialization and
movement into the post-Industrial age. The
International Monetary Fund (IMF) has
categorized nations meeting these conditions in
the Pacific Rim as having advance economies
and has been previously identified.
2 Pacific Rim Advanced Economies
Geography
It is of interest that these advanced economy countries have, in general, geographically constrained
boundaries which have lead to the growth of the nation. The general lack of contagious land mass is
indeed a barrier to homogenous national growth. The remaining economically non-advanced countries
are subjected to this geographically barrier, particularly the Philippines with over 7,000 islands and
Indonesia with more than 17,000 islands comprising their respective nations.
Political Stability
The continuity of the national policies and the political will to provide governmental assistance to
technological development are essential to the growth of a eCommerce Industry within a nation. In
particular the Philippine government has had a track record of stability from its independence in 1946.
The current Philippine government has provided the necessary incentives for foreign investments and is
actively promoting the growth of eCommerce as a means to assist its people in both educational and
commercial terms. In contrast the Indonesian government that after its independence from Holland in
1962 almost immediately fell into a authoritarian state, limiting its interaction with the Western Nations
which created a lag in development of its economy. After 1998 the Indonesian government has become
more stable and has activity promoted foreign investment and actively promoted eCommerce as a
method to create economic growth.
Technology Infrastructure
A major concern for the development of a strong eCommerce is the ability of a nation to provide a
robust means to facilitate the accessibility of the Internet. Past the underlying telecommunications
infrastructure is the need for reliable and stable co-location facilities and the technical experience to
provide 24 hour support within these facilities.
Triune Payment Solutions, Inc. | Observing the Market 6
7. In the case of the Philippines the nation supports an
extremely robust telecommunications network centered on
the capital city of Manila. From that center a reasonably
reliant network crosses the nation with a fairly high rate of
accessibility.
In addition to a national telecommunications backbone there
are a number of co-location facilities that more than meet the
requirements of Tier One facility using OC192 connections
and the necessary security and redundancy to run domestic
and international based eCommerce systems. Additionally
3 Telco backbones for Pacific Rim the domestic infrastructure supports an estimated 23 Million
individual Internet users as of 2008. Estimated ownership of
personal computers in a household is about 2 Million personal computers.
Population
The population obviously plays a significant role in the ability for a nation to support an eCommerce
Industry. More than half of the current population of the Philippines, some 90 million, resides on the
island of Luzon, which is the focal point of the current economy. The average literacy of the population
is more than 92%. This ties to the high use of technology based communications systems such as mobile
phones and use of the Internet. Currently the estimated purchasing power per capita is about $5,700.
This obviously takes into account the large agrarian economy.
One additional point is that approximately 8% of the population (approximately 7.2 million) lives outside
of the country as domestic labors. Triune has substantial contact with the Philippine Overseas
Employment Administration (POEA) on other projects to assist those living abroad with a reasonable
method of transacting retail and other transactions using stored value products.
This particular population also assists the economy of the Philippines by sending remittances to their
families on a regular basis. Current estimates show approximately $11 Billion dollars sent to family
members in 2007. This is a very important aspect of the economy and should not be overlooked as
helping power an eCommerce Industry.
Merchants
Obviously it is necessary to have a merchant base that is willing to consider or has to some limited
extent utilized the sales channel offered by eCommerce. While involved with other projects in the
Philippines we have uncovered a significant opportunity to bring a large group of brick and mortar
merchants that are willing to engage in this emerging sales channel.
Currently there are a handful of online merchants doing business in the Philippines and for the most
part are faced to those Filipino’s living abroad, primarily in the United States, to have hard goods sent to
family members still living in the Philippines.
These merchants are currently constrained to the use of non-Philippine based payment systems as
merchant acquiring for online transactions has not yet made significant inroads yet. Although dated, a
Triune Payment Solutions, Inc. | Observing the Market 7
8. UN survey4 provides some information as to the spending patterns that have existed and what types of
goods or services are purchased.
90 percent of Internet traffic in the Philippines goes to the USA.
The top five products and services that Filipinos buy online are books (54 %), computer
software (33 %), domain names (31 %), web hosting (25 %) and computer hardware (24
%).
The top five sites Filipinos shop at are Amazon.com (54 percent), eBay (11 percent),
myAyala, Network Solutions (8 percent) each, Barnes and Noble (6 percent) and
Register.com (6 percent).
Filipino online shoppers spend an average US$522 per year.
Payment Methods
Traditionally payments made for online transactions are
restricted to transaction accounts (credit / debit card accounts) or
via bill payment systems such as PayPal. However, in the Pacific
Rim non-advanced economic nations the possession of such
accounts is highly restricted due to the inability of reasonable
credit risk management and large reoccurring losses due to a high
level of fraudulent activity. The primary associations normally
used, VISA, MasterCard and American Express are not making
their brands readily available in the Philippines as well as the
surrounding nations.
The merchants that do offer other payment methods for online
transactions are very cumbersome and in our view provide a
significant obstacle to the growth of the eCommerce Industry.
Some of the other available online payment options include the
use of a manual bank transfer in which the consumer must provide
proof of funds availability in their bank account prior to the 4 Transaction Cards in Asia Pacific
completion of the sale and shipment of goods. Another option
other than the use of a transaction card is payment thorough Western Union as illustrated in figure 5.
These payment options do not make sense under the current conditions of
economic status if an eCommerce Industry is to move forward. In our view a
new application of a traditional method is necessary to move this Industry
forward.
5 Online Merchant Payment
Options
Triune Payment Solutions, Inc. | Observing the Market 8
9. Our Strategic View
Taking all of the current observations into account Triune has concluded that the failure of eCommerce
Industry growth falls squarely upon the inability of existing payment methods to reach the lowest level
of the national population within the non-advanced economy nations. It is our view that the following
provides the basic reason for the failure of eCommerce to take hold, particularly in the Philippines.
Based upon this very simple observation Triune has elected to further its existing business in the
Philippines to include a new method of generating eCommerce, primarily Business to Consumer,
transactions. In the current state we have created and assisted in the deployment of a payment system
application which is currently running on dedicated servers in a Tier One collocation facility in Manila.
This payment system is supported by one of the largest Filipino-owned financial institutions in the
nation which Triune engaged for this project.
The current application is utilized as a “eWallet” payment system for international online payment
services that courts the consumer that does not wish or cannot use transaction card accounts to
complete eCommerce transactions. The application was designed to support all of the current U.S.
banking standards as well as accommodate the national banking practices and laws of the Philippine
government. It is this application that provides, what Triune, views as a payment method that will
permit the expansion of eCommerce to the vary base of the national population.
The current application, while geared towards use in the International market, is modularized and is
highly adaptable to the few changes necessary to launch it as a domestic product. In the current state
Triune believes that a modified application, existing contacts with multiples of large retail merchants in
the Philippines, the addition of a third factor not previously discussed which is the direct contract with a
group of more than 1,200 existing Filipino outlets where financial transactions are conducted and the
backing of several Filipino financial institutions the growth of a eCommerce Business to Consumer
Industry can and will succeed.
Triune Payment Solutions, Inc. | Our Strategic View 9
10. Concept
The logical extension of the strategic view of Triune is the overarching concept that will define the
payment system for non-advanced economy nations. This concept, while generalized for this discussion,
provides counterpoints to what we feel are failure points in the current available payment
methodologies.
Transaction Methods Compared
Triune Payment Solutions, Inc. | Concept 10
11. Conclusions
This document has attempted to show, at a very high level, how a national economy can be impacted by
the contributions of an eCommerce Industry that is energized existing concepts and components. It only
awaits those who have the ability to mold those concepts into a system that works.
Triune believes that the ability to make online payments easy and safe for all parties involved with the
transaction; the consumer, the financial institution and the merchant presents a valuable opportunity
for those that see the future of eCommerce in the non-advance economy nations of the world outside
of the traditional methods.
Triune has the experience, knowledge and proven ability to provide the innovative systems necessary to
complete such a project and is ready to move forward with the proper partnerships.
Triune Payment Solutions, Inc. | Conclusions 11
12. End Notes
1
Bureau of Economic Analysis, “Downturn in Finance and Insurance Restrains Real GDP Growth in 2007”
http://www.bea.gov/newsreleases/industry/gdpindustry/gdpindnewsrelease.htm
2
Indexmudi, “Philippine Economy”, http://www.indexmundi.com/philippines/economy_profile.html
3
Wikipedia, “Economy of the Philippines”, http://en.wikipedia.org/wiki/Economy_of_the_Philippines
4
United Nations Asian Pacific Development Information Program, “ITC – Profile Philippines”,
http://www.apdip.net/projects/dig-rev/info/ph
Triune Payment Solutions, Inc. | End Notes 12
