What changed in this filing

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Item 1. Business

2024-02-22 compared with 2023-02-22 · 115 added, 167 removed, 406 unchanged (41% of the section changed)

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General Overview

Euronet is a leading electronic payments processing provider.

We offer payment and transaction processing and distribution solutions to financial institutions, agents, retailers, merchants, content providers, and individual consumers.

Our primary product offerings include comprehensive automated teller machine ("ATM"), point-of-sale ("POS"), card outsourcing, card issuing and merchant acquiring services;

software solutions and cloud based payment solutions;

electronic distribution of electronic payment products;

foreign exchange services and international payment services.

Euronet is a leader in electronic payment and transaction processing solutions for Financial Institutions, Retailers, Service Providers, and Individual Consumers utilizing our global payments network, platforms, and technologies.

Through a collection of diverse technologies and services, our business segments and solutions meet a wide variety of payments requirements and process transactions throughout the world.

We move money in all the ways the world depends on.

With a global footprint we provide compliant solutions that make financial transactions easier, faster, and secure.

Core Business Segments

We operate in the following three segments as of December 31, 2023:

The Electronic Fund Transfer ("EFT") Processing Segment processes transactions for a network of 45,009 ATMs and approximately 613,000 POS terminals across Europe, Africa, the Middle East, Asia Pacific, and the United States.

We provide comprehensive electronic payment solutions consisting of ATM cash withdrawal and deposit services, ATM network participation, outsourced ATM and POS management solutions, credit, debit and prepaid card outsourcing, and card issuing and merchant acquiring services.

In addition to our core business, we offer a variety of value added services, including ATM and POS dynamic currency conversion ("DCC"), domestic and international ATM surcharge, advertising, delivery of non-cash products ("digital content") via ATMs, customer relationship management ("CRM"), mobile top-up, bill payment, fraud management, foreign remittance payout, cardless payout, banknote recycling solutions and tax-refund services.

Through this segment, we also offer a suite of integrated electronic financial transaction software solutions for electronic payment and transaction delivery systems.

Electronic Funds Transfer ("EFT") Segment

Our Electronic Funds Transfer ("EFT") segment meets the needs of financial institutions and consumers through Euronet-owned and outsourced Automated Teller Machines ("ATMs") and Point-of-Sale ("POS") terminals combined with value added and transaction processing services.

We deploy and operate our own ATMs, providing ATM services for financial institutions and providing electronic payment processing solutions.

EFT offers a suite of integrated electronic financial transaction software solutions for electronic payment and transaction delivery systems.

Transactions processed span a network of 47,303 ATMs, as of December 31,2023, and approximately 656,000 POS terminals .

In 2023, the EFT Processing Segment accounted for approximately 29% of Euronet's consolidated revenues.

The epay Segment provides distribution and processing of prepaid mobile airtime and other electronic content and payment processing services for various prepaid products, cards and services throughout our worldwide distribution network.

We operate a network that includes approximately 816,000 POS terminals that enable electronic processing of prepaid mobile airtime "top-up" services and other digital media content in Europe, the Middle East, Asia Pacific, the United States and South America.

We also provide vouchers and physical gift fulfillment services in Europe, gift card distribution and processing services in most of our markets and digital code distribution in a growing number of markets.

In 2022, the epay Segment accounted for approximately 30% of Euronet's consolidated revenues.

The Money Transfer Segment provides global consumer-to-consumer money transfer services, primarily under the brand names Ria, AFEX, and IME, and global account-to-account money transfer services under the brand name xe.

We offer services under the brand names Ria and IME through a network of sending agents, Company-owned stores (primarily in North America, Europe and Malaysia) and our websites (riamoneytransfer.com and online.imeremit.com), disbursing money transfers through a worldwide correspondent network that includes approximately 522,000 locations.

xe is a provider of foreign currency exchange information on its currency data websites (www.xe.com and www.x-rates.com).

We offer global account-to-account money transfer services through our websites (www.xe.com and https://transferxe.com) and xe customer service representatives.

In addition to money transfers, we offer customers bill payment services (primarily in the U.S.), payment alternatives such as money orders, comprehensive check cashing services for a wide variety of issued checks, along with competitive foreign currency exchange services and mobile top-up.

Through xe, we offer cash management solutions and foreign currency risk management services to small-and-medium sized businesses.

We are one of the largest global money transfer companies measured by revenues and transaction volumes.

Our epay segment provides retail payment solutions and delivers innovative connections between the digital content of the world’s leading brands and consumers.

epay has one of the largest retail networks across Europe and Asia for the distribution of physical and digital third-party content, including branded payments, mobile, and alternative payments, partnering with 1,000+ of the world’s l eading brands.

In addition, through our own products, we have leveraged our technology to solve business challenges, delivering scalable solution s to drive efficiency and effectiveness.

Our comprehensive range of consumer products simplifies transactions and provides financial convenience across a wide range of branded payments.

epay operates in 60+ countries .

We operate a network that includes approximately 821,000 POS terminals that enable electronic processing of prepaid mobile airtime "top-up" services and other digital media content.

In 2023, the epay Segment accounted for approximat ely 29% of Euronet's consolidated revenues.

Money Transfer Segment

Our Money Transfer segment provides global money transfers and currency exchange information in retail stores, apps, and websites through Ria Money Transfer, Xe and the Dandelion cross-border real-time payments network.

Euronet’s Money Transfer segment o ffers real-time, cro ss-border payments to consumers and businesses across 198 countries and territories , enabling banks, fintechs and big tech platforms to integrate an international payments solution into their own platforms.

In 2023, the Money Transfer Segment accounted for approximately 42% of Euronet's consolidated revenues.

Ria Money Transfer, one of the largest consumer remittance companies in the world offers real-time international money transfers with a special focus on emerging markets.

In addition, Ria offers safe and affordable money transfers through a global network of cash locations and online, serving over 20 million customers annually.

Xe offers web and app based currency information and industry-leading consumer and business cross border money transfer services.

Customers can send money, buy property overseas, and execute other international payments via the Xe website or app.

Dandelion is a leading real-time cross-border payment platform;

it offers consumer and business transaction processing and fulfillment with alternative payout channels like bank accounts, cash pick-up and mobile wallets.

Dandelion powers cross-border payments for Xe and Ria, as well as third party banks, fintechs, and big tech platforms.

Historical Perspective

1994 - Euronet was established as Euronet Bank Access Kft., a Hungarian limited liability company.

1997 - Euronet was reorganized in March 1997 in connection with its initial public offering, and at that time, our operating entities became wholly owned subsidiaries of Euronet Services, Inc., a Delaware corporation.

1998 - In December 1998, we acquired Arkansas Systems, Inc.

(now known as "Euronet USA"), a U.S.-based company that produces electronic payment and transaction delivery systems software for retail banks internationally.

2001 - We changed our name from Euronet Services, Inc.

to Euronet Worldwide, Inc.

in August 2001.

2003 - We added a complementary business line through the acquisition of epay Limited (“epay”), which had offices in the U.K.

and Australia.

2007 - We established the Money Transfer Segment after completing the acquisition of Los Angeles-based Ria, one of the largest global money transfer companies measured by revenues and transaction volumes.

2015 - We completed the acquisition of IME (M) Sdn Bhd ("IME") which provided Euronet with immediate entry into the Asian and Middle East money transfer send markets.

We also added a complementary business line through the acquisition of xe Corporation ("xe"), which provides currency-related data and international payment services.

2019 – REN Ecosystem goes live and the migration of legacy software to the REN Ecosystem begins.

Current - Euronet conducts business globally, serving customers in approximately 200 countries.

As of December 31, 2022 we have 13 transaction processing centers, six in Europe, five in Asia Pacific and two in North America.

We also maintain 66 business offices that are located in 43 countries.

Our corporate offices are located in Leawood, Kansas, USA.

Euronet started in Central Europe in 1994 and has grown to become a global real-time digital and cash payments network with millions of touchpoints today, With products and services in more than 200 countries and territories provided through its own brand and branded business segments, Euronet and its financial technologies and networks offer payment transaction services.

Euronet serves clients from 67 offices worldwide.

Business Segment Overview

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Our EFT Processing Segment provides comprehensive electronic payment solutions consisting of ATM cash withdrawal and deposit services, ATM network participation, outsourced ATM and POS management solutions, credit, debit and prepaid card outsourcing, card issuing and merchant acquiring services.

In addition to our core business, we offer a variety of value added services, including ATM and POS DCC, domestic and international surcharge, foreign currency dispensing, advertising, digital content sales at ATMs, CRM, prepaid mobile top-up, bill payment, money transfer, fraud management, foreign remittance payout, cardless payout, banknote recycling solutions and tax-refund services.

In addition to our core business, we offer a variety of value-added services, including ATM and POS DCC, domestic and international surcharge, foreign currency dispensing, advertising, digital content sales at ATMs, Customer Relationship Management ("CRM"), prepaid mobile top-up, bill payment, money transfer, fraud management, foreign remittance payout, cardless payout, banknote recycling solutions and tax-refund services.

We provide these services either through our Euronet-owned ATMs and POS terminals, through contracts under which we operate ATMs and POS terminals on behalf of our customers or, for certain services, as stand-alone products.

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EFT Processing Segment transactions per year

The increase in transactions for 2021 and 2022 is the result of a significant increase in the volume of lower value, digitally-initiated payment processing transactions for an Asia Pacific customer's bank wallet and e-commerce site.

The increase in transactions for the past few years is the result of a significant increase in the volume of lower value, digitally initiated payment processing transactions for an Asia Pacific customer's bank wallet and e-commerce site.

The associated revenue of these lower value, digitally initiated payment processing transactions is lower.

As a result, our revenue growth will not correlate proportionately with the increase in our transaction volume growth.

Our processing centers for the EFT Processing Segment are located in Germany, Hungary, India, China, and Pakistan.

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The direct access fee is added to the amount of the cash withdrawal and debited from the cardholder's account.

We generally receive fees or earn margin from our customers for six types of ATM transactions:

Cash withdrawals;

Cash deposits;

Balance inquiries;

Transactions not completed because the relevant card issuer does not give authorization;

Dynamic currency conversion;

Prepaid mobile airtime recharges and other electronic content.

We generally receive fees or earn margin from our customers for all types of ATM transactions:

Card Acceptance or Sponsorship Agreements

Our agreements with financial institutions and international card organizations generally provide that all credit and debit cards issued by the financial institution or organization may be used at all ATMs that we operate in a given market.

In most markets, we operate under sponsorship by our own e-money or payment service licensed entities.

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We have developed value-added services in addition to basic cash withdrawal and balance inquiry transactions.

These value added services include mobile top-up, fraud management, bill payment, domestic and international surcharge, CRM, foreign remittance payout, cardless payout, banknote recycling, electronic content, ticket and voucher, foreign currency withdrawal and advertising.

These value-added services include mobile top-up, fraud management, bill payment, domestic and international surcharge, CRM, foreign remittance payout, cardless payout, banknote recycling, electronic content, ticket and voucher, foreign currency withdrawal, advertising and tax-refund services.

We are committed to the ongoing development of innovative new products and services to offer our EFT processing customers.

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SEPA is an area in which all electronic payments can be made and received in euros, whether between or within national boundaries, under the same basic conditions, rights, and obligations, regardless of the location.

This single, c entralized acquiring platform enables merchants to benefit from cost savings and faster, more efficient payments transfer.

This single, centralized acquiring platform enables merchants to benefit from cost savings and faster, more efficient payments transfer.

Although many European countries are not members of the eurozone, our platform can serve merchants in these countries as well, through our multi-currency functionality.

Software Solutions

S oftware Solutions

We also offer a suite of integrated software solutions for electronic payments and transaction delivery systems.

We generate revenues for our software products from licensing, professional services and maintenance fees for software and sales of related hardware, primarily to financial institutions around the world.

Our software products are an integral part of the EFT Processing Segment product lines, and our investment in research, development, delivery and customer support reflects our ongoing commitment to an expanded customer base both internally and externally.

Our proprietary software is used by our processing centers in the EFT Processing Segment, resulting in cost savings and added value compared to third-party license and maintenance options.

Our proprietary software consists of our legacy ITM software, which we have used and sold to financial institutions since 1998 through our Software Solutions unit, and an innovative switching software package named REN that we released in 2017.

We currently operate REN in our processing center to process payments for our own networks in Europe and we are progressively transitioning all our networks globally to REN.

The private cloud architecture of REN allows us to simultaneously deploy REN across multiple physical locations.

REN is now operated for both internal resources and external customers with the launch of the REN Foundation for Mozambique's National Payments Network in 2020.

REN is scalable and will allow us to offer payment and digital solutions to more third parties.

In addition to payments processing, REN also supports other digital elements, including card issuing for physical and virtual cards, loyalty services, Know Your Customer compliance, real time settlement, inventory management, risk and fraud management and other services.

REN will be used as a platform to connect Euronet assets to offer digital payment solutions, and is currently utilized within the epay and Money Transfer Segments.

Ren Payments Platform

Ren was built from the ground up to operate in the evolving digital payments landscape of real-time settlements and emerging forms of payment, including QR codes, PINs and biometrics.

Ren primarily serves financial institutions, central banks and fintech companies.

It is offered as an on-premise technology where these businesses install the platform in their own data centers or as a software as a service (SaaS) offering where development teams access it in Euronet’s global data centers using APIs.

Versatile, Ren can be used as a payment hub or to deliver core banking functionality such as issuing, merchant acquiring, transaction switching, and ATM management.

For real-time payments, Ren is used by central banks to process transactions and member banks that use Ren to connect their legacy systems to real-time payment networks in their countries.

EFT Processing Segment Strategy

The EFT Processing Segment maintains a strategy to expand the network of ATMs and POS terminals into developed and developing markets that have the greatest potential for growth.

In addition, we follow a supporting strategy to increase the penetration of value added (or complementary) services across our existing customer base, including DCC, surcharge, cardless payment, banknote recycling solutions, tax refund services, advertising, fraud management, bill payment, mobile top-up, CRM and foreign remittance payout.

We continually strive to make our own ATM networks more efficient by eliminating underperforming ATMs and installing ATMs in more desirable locations.

The EFT Processing Segment maintains a strategy to expand the network of ATMs and POS terminals into new and existing markets that have the greatest potential for growth.

We continue to focus on diversifying our business by expanding our market presence and product portfolio, as well as outsourcing opportunities.

In addition, we follow a supporting strategy to increase the penetration of value added (or complementary) services across our existing customer base, including DCC, transaction-based fees, surcharge, cardless payment, banknote recycling solutions, tax refund services, advertising, fraud management, bill payment, mobile top-up, CRM and foreign remittance payout.

We continually strive to make our own ATM networks more efficient by removing unprofitable ATMs and redeploying them to new profitable locations.

We make selective additions to our own ATM network if we see market demand and profit opportunities.

In tourist locations, we also shut down ATMs during the winter season when tourist activity is low.

In tourist locations, we also seasonally deactivate ATMs when tourist activity is low.

In recent years, the need for "all-in" services has increased.

Banks, particularly smaller banks, are increasingly looking for integrated ATM, POS and card issuing processing and management services.

Euronet is well positioned for this opportunity as it can offer a full end-to-end solution to the potential partners.

Euronet is well positioned for this opportunity as it can offer a full end-to-end solution to potential partners.

Additional growth opportunities are driven through financial institution s that are receptive to outsourcing the operation of their ATM, POS and card networks.

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Increasing the number of non-owned ATMs and POS terminals that we operate under management services agreements and continued development of our credit, debit and prepaid card outsourcing business could provide continued growth while minimizing our capital investment.

Complementary services offered by our epay Segment, where we provide prepaid mobile top-up services through POS terminals, strengthens the EFT Processing Segment's line of services.

We plan to continue to expand our technology and business methods into other markets where we operate and further leverage our relationships with mobile phone operators and financial institutions to facilitate that expansion.

In addition, complementary services offered by our epay Segment, where we provide prepaid mobile top-up services through POS terminals, strengthens the EFT Processing Segment's line of services.

We plan to continue to expand our technology and business methods into other markets where we operate and further leverage our relationships with mobile operators, other content providers and financial institutions to facilitate that expansion.

Our EFT Processing business experiences its heaviest demand for cash withdrawals and DCC during the third quarter of the fiscal year, coinciding with the tourism season.

It is also impacted by seasonality during the fourth quarter and first quarter of each year due to higher transaction levels during the holiday season and lower levels after the holiday season.

This seasonality is increased due to our practice of seasonally deactivating ATMs in tourist locations that experience significantly higher traffic during the summer.

This seasonality is increased due to our practice of seasonally deactivating ATMs in tourist locations that experience significantly higher traffic during their peak tourist seasons.

Seasonally deactivating involves shutting down the ATMs during the slower months and results in lower overall transaction volumes in the EFT Processing Segment during those months.

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No individual customer of the EFT Processing Segment makes up greater than 10% of total consolidated revenues.

In India, Pakistan and Indonesia we have contracts with banks and telecommunications companies that are majority-owned by the government to provide certain ATM driving and transaction switching services, digital content distribution and mobile airtime recharge services.

Additionally, certain government-owned banks are members of our shared ATM network in India and we provide software services to financial institutions partially owned by government-owned banks.

In Austria, Croatia, Cyprus, Czech Republic, Denmark, Egypt, Germany, Hungary, Ireland, Italy, Lithuania, Malta, Poland, Portugal, Romania, Slovakia, Slovenia, Spain and the United Kingdom, we lease land and other property for certain ATM sites from companies that are majority-owned by the government.

In China and Greece, we have contracts with clients and financial institutions that are partially owned by the government.

EFT maintains contract relationships with a number of banks, financial institutions, telecommunications companies, and clients whose ownership includes the government.

Our principal EFT Processing Segment competitors include ATM networks owned by financial institutions and national switches consisting of consortiums of local banks that provide outsourcing and transaction services to financial institutions and independent ATM deployers in a particular country.

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Competitive advantages in our EFT Processing Segment include breadth of service offering, network availability and response time, price to both the financial institution and to its customers, ATM location and access to other networks.

We currently offer prepaid mobile airtime top-up services and other electronic content and payment processing services for various prepaid products, cards and services on a network of approximately 816,000 POS terminals across approximately 358,000 retailer locations in Europe, the Middle East, Asia Pacific, North America and South America.

We currently process and distribute prepaid mobile airtime and other electronic content and payment processing services for various prepaid products, cards, and services on a network of approximately 821,000 POS terminals across approximately 352,000 retailer locations in Europe, the Middle East and Africa, Asia Pacific, North America and South America.

Our processing centers for the epay segment are located in the United Kingdom, Germany, Italy, and the United States.

Since 2003, we have expanded our prepaid business in new and existing markets by drawing upon our depth of experience to build and expand relationships with content providers, mobile phone operators and retailers.

We offer a wide range of products across our retail networks, including prepaid mobile airtime, prepaid debit cards, prepaid gift cards, prepaid electronic content such as music, games and software, prepaid vouchers, transport payments, lottery payments, prepaid long distance and bill payment processing assistance through partnerships with various licensed money transmitters.

We have continued to expand our prepaid business in new and existing markets by drawing upon our depth of experience to build and expand relationships with content providers, mobile operators, and retailers.

We offer a wide range of products across our retail networks, including prepaid mobile airtime, prepaid debit cards, prepaid gift cards, other prepaid electronic content such as music, games and software, prepaid vouchers, transport payments and lottery, and bill payment processing assistance through partnerships with various licensed money transmitters.

Sources of Revenues

The epay Segment generates commissions and processing fees from the distribution of electronic content and from telecommunications service providers for the sale and distribution of prepaid mobile airtime.

The epay Segment generates commissions and processing fees from the distribution of electronic content from mobile operators and other content providers.

In 2023, approximately 67 % of total revenues and approximately 74 % of gross profit for the epay Segment was from electronic content other than prepaid mobile airtime (digital media products).

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Content is generally purchased in two ways:

(1) d irectly online from the content provider using an online payment method, or (2) through physical retail stores, online retailers or other electronic channels, including payment wallets, online banking, mobile applications and other sources.

C us tomers using mobile phones generally pay for usage in one of two ways:

(1) t hrough "postpaid" accounts, where usage is billed at the end of each billing period, or (2) through "prepaid" accounts, where customers pay in advance by crediting their accounts prior to usage.

Although mobile phone operators in the U.S.

(1) directly online from the content provider using an online payment method, or (2) through physical retail stores, online retailers, or other electronic channels, including payment wallets, online banking, mobile applications, and other sources.

Customers using mobile phones generally pay for usage in one of two ways:

(1) through "postpaid" accounts, where usage is billed at the end of each billing period, or (2) through "prepaid" accounts, where customers pay in advance by crediting their accounts prior to usage.

Although mobile operators in the U.S.

and certain European countries have provided service principally through postpaid accounts, the norm in many other countries in Europe and the rest of the world is to offer wire less service on a prepaid basis.

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In addition to the sale of traditional mobile top-up volume described above, we have expanded distribution into digital media products and other value-added services.

We have leveraged our existing technology infrastructure to sell digital media products, which have been sold through our traditional retailer network and new retailer networks such as electronic channels.

We have leveraged our existing technology infrastructure to sell digital media products, which have been sold through our traditional retail network and new retailer networks such as digital channels.

In the U.S., most prepaid digital media content is purchased for gifting;

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Open Loop Gift Cards

Open loop (network-branded) gift cards are prepaid gift cards associated with an electronic payment network (such as Visa ® or Mastercard ® ) and are honored at multiple, unaffiliated locations (wherever cards from these networks are generally accepted).

Open loop gift cards are prepaid gift cards associated with an electronic payment network (such as Visa ® or Mastercard ® ) and are honored at multiple, unaffiliated locations (wherever cards from these networks are generally accepted).

They are not merchant-specific.

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Open Loop Reloadable

We distribute Visa ® and Mastercard ® issued debit cards provided by Green Dot, NetSpend and other card issuers.

We distribute Visa ® and Mastercard ® issued debit cards provided by card issuers.

We also manage and distribute a proprietary debit card that allows a retailer to issue its own reloadable store-branded card.

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Our POS network is used for the distribution of other products and services, including games and software, bill payment, lottery tickets and transportation products.

Through our Cadooz subsidiary, we also distribute vouchers and physical gifts into the business-to-business ("B2B") channel principally for the purposes of employee and customer incentives and rewards.

In certain locations, the terminals used for prepaid services can also be used for electronic funds transfer to process credit, debit, and prepaid card payments for retail merchandise.

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We provide our prepaid services through POS terminals or web-based POS devices installed in retail outlets or, in the case of major retailers, through direct connections between their ECR systems and our processing centers.

In markets where we operate proprietary technology (the U.K., Germany, Australia, Poland, Ireland, New Zealand, Spain, Greece, India, Italy, Brazil and the U.S.), we generally own and maintain the POS terminals.

In markets where we operate proprietary technology, we generally own and maintain the POS terminals.

In certain countries in Europe, the terminals are sold to the retailers or to distributors who service the retailer.

Our agreements with major retailers for the POS services typically have one to three-year terms.

Our agreements with major retailers for POS services typically have one to three-year terms.

These agreements include terms regarding the connection of our networks to the respective retailer's registers or payment terminals or the maintenance of POS terminals, and obligations concerning settlement and liability for transactions processed.

Generally, our agreements with individual or small retailers have shorter terms and provide that either party can terminate the agreement upon three to six months' notice.

In Germany, distributors are key intermediaries in the sale of mobile top-up.

As a result, our business in Germany is substantially concentrated in, and dependent upon, relationships with our major distributors.

The termination of any of our agreements with major distributors could materially and adversely affect our prepaid business in Germany.

However, we have been establishing agreements with independent German retailers in order to diversify our exposure to such distributors.

The number of transactions processed on our POS netw orks has increased over the last five years at a CAGR of approximately 35.2% as indicated in the following table:

The number of transactions processed on our POS networks have increased over the last five years at a CAGR of approximately 25.2% as indicated in the following table:

(in millions)

epay processing transactions per year

Additional high-volume, low-margin digital media offerings in Asia contributed to an overall increase in processing transactions in 2021 and 2022.

epay Segment Strategy

Mobile top-up transactions are declining in many developed markets and transaction fees for mobile transactions are being compressed by the mobile operators.

epay's strategy is to defend margins in developing markets by providing value added services to mobile operators and to decrease our reliance on mobile top-up by increasing distribution of other electronic content.

New product initiatives focus on products such as gift card malls, prepaid debit cards, transport and electronic content, including music, software and games.

Strategic execution behind new products includes the development of relationships with global consumer product brands.

This strategy leverages the global scale of the epay business allowing global brands to be sold in many or all of the countries in which we have a presence.

epay's strategy is to defend margins in developing markets by providing value-added services to mobile operators and to decrease our reliance on mobile top-up by increasing distribution of other electronic content, expanding epay-own branded content, introducing new solutions to new and existing customers, and focusing on geographic expansion.

Strategic execution behind expansion of digital media electronic content includes the development of relationships with global consumer product brands.

This strategy leverages the global scale of the epay business allowing global brands to be sold in many or all the countries in which we have a presence.

Examples of global brands we distribute include iTunes, Google Play, Sony, and Microsoft.

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The reach, capabilities, and quality of the epay network are appealing as a global distribution channel.

We are one of the largest worldwide multi-country operators, and believe we have a distinct competitive advantage from the existing relationships that we maintain with prepaid content providers and retailers.

We are one of the largest worldwide multi-country operators, and believe we have a distinct competitive advantage with the existing relationships that we maintain with prepaid content providers and retailers.

As the product mix continues to change, the epay business is impacted by seasonality during the fourth quarter and first quarter of each year due to the higher transaction levels during the holiday season and lower levels following the holiday season.

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No individual customer of our epay Segment makes up greater than 10% of total consolidated revenues.

In Germany, e pay has a contract for the technology and distribution infrastructure for six state-owned lotteries, it deploys Know Your Customer (or KYC) technologies on terminals indirectly owned by the Federal Republic of Germany and provides payment processing services for the state of Berlin and the city of Stuttgart, and Cadooz has a contract with Deutsche Bahn, which is majority owned by the German state .

In addition, epay has contracts with Transurban Limited, the largest manager of toll road networks in Australia, Cubic, supporting New South Wales Transport ticketing in Australia, and with New Zealand Transport Authority, which operates all toll roads in New Zealand.

epay distributes mobile top up in post offices in the United Kingdom, which are owned by the government.

epay has contracts in the Middle East for the processing of mobile airtime for companies that are majority owned by the Saudi government and the UAE government, and epay distributes prepaid electronic content through companies that are owned by the Dubai government and Abu Dhabi government.

In India, the epay segment distributes prepaid content through the State Bank of India and distributes telecom airtime on behalf of Bharat Sanchar Nigam, a government owned telecommunications provider based in New Delhi.

There are no other government contracts in the epay Segment.

epay maintains contract relationships with a number of companies, banks, post offices and telecommunications providers whose ownership includes the government.

We face competition in the prepaid business in all of our markets.

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The principal competitive factors in the epay Segment include price (that is, the level of commission paid to retailers for each transaction), breadth of products and up-time offered on the system.

Major retailers with high volumes are able to demand a larger share of the commission, which increases the amount of competition among service providers.

Major retailers with high volumes can demand a larger share of the commission, which increases the amount of competition among service providers.

We are seeing signs that some mobile operators are expanding their distribution networks to provide top-up services on-line or via mobile devices, which provides other alternatives for consumers to use.

Money Transfer Segment

We provide global money transfer services primarily under the brand names Ria, IME , AFEX, and xe.

Ria and IME provide consumer-to-consumer money transfer services through a global network of more than 522,000 locations and our websites riamoneytransfer.com and online.imeremit.com.

We sent money transfers from approximately 120 countries, with money transfer delivery completed in 158 countries.

We provide global money transfer services primarily under the brand names Ria, xe and dandelion.

Ria provides consumer-to-consumer money transfer services through a global network of more than 580,000 locations and via our website riamoneytransfer.com.

We send money transfers from approximately 136 countries, with money transfer delivery completed in 175 countries .

The initiation of a consumer money transfer occurs through retail agents, Company-owned stores or online, while the delivery of money transfers can occur with bank correspondents, retailer agents or from certain ATMs.

Our websites allow consumers to send funds online, using a bank account or credit or debit card, for pay-out directly to a bank account or for cash pickup.

Our websites, and mobile wallet apps, allow consumers to send funds online, using a bank account or credit or debit card, for pay-out directly to a bank account or for cash pickup.

In addition, we provide global account-to-account money transfer services under the brand name xe.

We offer money transfer services via our website (www.xe.com) and through customer service representatives.

We offer money transfer services via our website (www.xe.com) and xe app and through customer service representatives.

xe also provides foreign currency exchange information on its currency data websites (www.xe.com and www.x-rates.com).

Through xe, we offer cash management solutions and foreign currency risk management services to small-and-medium-sized businesses.

Lastly, under the brand "Dandelion", Ria offers payment processing services to third-party partners.

Dandelion is a leading real-time, global cross-border payment platform;

it offers consumer and business transaction processing and fulfillment with alternative payout channels like bank accounts, cash pick-up and mobile wallets.

Dandelion powers cross-border payments for xe, Ria, as well as third party banks, fintechs, and big tech platforms.

We monitor the number of transactions made through our money transfer networks.

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Senders can track the progress of their transfers through Ria's customer service representatives, and funds are delivered quickly to their beneficiaries via our extensive payout network, which includes large banks and non-bank financial institutions, post offices and large retailers.

Our processing centers for the Money Transfer Segment are located in the U.S., the U.K., New Zealand, and Malaysia.

We are one of the largest global money transfer companies measured by revenues and transaction volumes.

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Sources of Revenues

Revenues in the Money Transfer Segment are derived through the charging of a transaction fee, as well as a margin earned from purchasing foreign currency at wholesale exchange rates and selling the foreign currency to customers at retail exchange rates.

Revenues in the Money Transfer Segment are primarily derived through the charging of a transaction fee, as well as a margin earned from purchasing foreign currency at wholesale exchange rates and selling the foreign currency to customers at retail exchange rates.

Sending agents and receiving agents for consumer-to-consumer products each earn fees for cash collection and distribution services.

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Money Transfer Products and Services

Money transfer products and services are sold primarily through three channels:

at agent locations, Company-owned stores and on internet enabled devices at riamoneytransfer.com and xe.com.

Money transfer products and services are sold primarily through the following channels:

at agent locations, Company-owned stores, mobile apps, TeleRia phone, and on internet enabled devices at riamoneytransfer.com and xe.com.

In an online transaction, customers send funds, using a bank account or credit or debit card, for pay-out at most of our agent locations around the world or directly to a bank account.

Through our TeleRia service, customers connect to our call center from a telephone available at an agent location and a representative collects the information over the telephone and enters it directly into our secure proprietary system.

As soon as the data capture is complete, our central system automatically faxes a confirmation receipt to the agent location for the customer to review and sign and the customer pays the agent the money to be transferred, together with a fee.

The agent then faxes the signed receipt back to Ria to complete the transaction.

Through our Walmart-2-Walmart Money Transfer Service, which allows customers to transfer money to and from Walm art stores in the U.S., our Ria business executes the transfers with Walmart serving as both the sending agent and payout correspondent.

Ria earns a significantly lower margin from these transactions than its traditional money transfers;

however, the arrangement adds a significant number of transactions to Ria's business.

The agreement with Walmart establishes Ria as the only party through which Walmart will sell U.S.

domestic money transfers branded with Walmart marks.

The agreement is effective until April 2026.

Thereafter, it will automatically renew for one year terms unless either party provides notice to the contrary.

The agreement imposes certain obligations on each party, the most significant being service level requirements by Ria and money transfer compliance requirements by Walmart.

Any violation of these requirements by Ria could result in an obligation to indemnify Walmart or termination of the contract by Walmart.

However, the agreement allows the parties to resolve disputes by mutual agreement without termination of the agreement.

In addition to money transfers, Ria also offers customers bill payment services, payment alternatives such as money orders, comprehensive check cashing services for a wide variety of issued checks, along with competitive foreign currency exchange services and mobile top-up.

These services are all offered through our Company-owned stores while select services are offered through our agents in certain markets.

Ria money orders are widely recognized and exchanged throughout the United States.

Our check cashing services cover payroll and personal checks, cashier checks, tax refund checks, government checks, insurance drafts and money orders.

Our bill payment services offer timely posting of customer bills for over 8,800 companies, including electric and gas utilities and telephone/wireless companies.

Bill payment services are offered primarily in the U.S.

xe offers account-to-account international payment service to high-income individuals and small-and-medium sized businesses, complementing our existing consumer-to-consumer money transfer business.

These services are all offered through our Company-owned stores while select services are offered through our agents in certain markets.

Under the brand "Dandelion", Ria offers payment processing services to third party partners.

The Dandelion cross-border payments platform provides financial institutions, fintechs such as digital wallets and banks, and enterprise software companies access to Euronet's money transfer network through an API connection.

This enables these companies to build financial solutions with real-time payment capabilities to the more than 550,000 cash locations, and more than 6 billion bank and digital wallet accounts the Euronet money transfer network reaches.

xe offers an account-to-account international payment service to high-income individuals and small-and-medium sized businesses, complementing our existing consumer-to-consumer money transfer business.

xe has a multi-channel platform which allows customers to make transfers, track payments and manage their international payment activity online or through a customer service representative.

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The Money Transfer Segment maintains correspondent relationships with a number of financial institutions whose ownership includes governments of the correspondents' countries of origin.

Those countries include Armenia, Austria , Bangladesh, Belarus , Belgium , Benin, Bhutan, Bolivia , Bosnia-Herzegovina, Botswana , Burkina Faso, Burundi, Cameroon , Cape Verde , Chad , Costa Rica, Cote d'Ivoire, Cuba , Djibouti, Dominican Republic, Ecuador, Egypt, El Salvador, Eritrea, Ethiopia, Fiji, Gabon, Gambia, Georgia, Ghana, Guatemala, Guinea, Guinea - Bissau, Honduras, India, Indonesia , Italy , Jordan , Kenya, Kyrgyzstan, Laos , Liberia, Madagascar , Malaysia, Mali, Mauritania, Mauritius, Mexico, Moldova, Morocco, Myanmar, Niger, Nigeria, Pakistan, Philippines, Poland, Romania, Russia, Rwanda, Saudi Arabia, Serbia , Senegal, Sierra Leone, Sri Lanka, Suriname, Tanzania, Thailand, Togo , Tunisia, Turkey, Uganda, Ukraine, Uzbekistan , Vietnam, Yemen, Zambia, and Zimbabwe .

Our primary competitors in the money transfer and bill payment business include other large money transfer companies and electronic money transmitters, together with hundreds of smaller registered and unregistered money transmitters, as well as certain major national and regional banks, financial institutions, and independent sales organizations.

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This may allow them to offer better pricing terms to customers, agents, or correspondents, which may result in a loss of our current or potential customers or could force us to lower our prices.

In addition to traditional money payment services, new technologies are emerging that compete with traditional money payment services, such as stored-value cards, debit networks, web-based services and digital currencies.

Our continued growth also depends upon our ability to compete effectively with these alternative technologies.

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The more significant of these laws and regulations are discussed below.

Noncompliance with these laws and requirements could result in the loss or suspension of licenses or registrations required to provide money transfer services through retail agents, Company owned stores or online.

For more discussion, see Item 1A - Risk Factors.

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We monitor our business for compliance with applicable laws or regulations regarding financial activities.

Certain of our European product offerings, including in particular, our money transfer services, merchant acquiring and bill payment products, are regulated payment services requiring a license under the Second Payment Services Directive, or PSD2 , which replaced the Payment Services Directive, or PSD, effective January 13, 2018.

Key changes made by PSD2 include:

creation of two new payment service types, extension of PSD rules on transparency to additional transactions not previously covered by PSD;

enhanced cooperation and information exchange between authorities in the context of authorization and supervision of payment institutions and electronic money institutions;

and increased obligations around the management of operational and security risk and the notification of incidents, increased obligations relating to complaints handling and additional requirements regarding payment security.

PSD2 as implemented in some member states also resulted in some of our European licensed institutions needing to go through a re-authorization process.

PSD2 requires a license to perform certain defined "payment services" in a European Economic Area (“EEA”) Member State and such license may be extended throughout other Member States of the EEA through passporting of the license (either on a freedom of service or freedom of establishment basis).

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We have payment institution licenses in the U.K., France, Germany, and Spain and are complying with these requirements.

Traditionally, we passported our U.K., German and Spanish payment services authorizations to several Member States.

We passported our U.K., German, and Spanish payment services authorizations to several EEA Member States.

As a result of Brexit, our U.K, payment institution is no longer capable of passporting its license into the EEA and the relevant EEA business was transferred to our other licenses prior to the end of the Brexit transition period.

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The e-money license imposes certain requirements similar to those of the payment services license, including minimum capital requirements, consumer disclosure and internal controls.

Prior to the end of the Brexit transition period, our e-money license was passported into over twenty-five EEA Member States.

As a result of Brexit, we have restructured the regulated services provided by our U.K.

e-money institution in the EEA Member States and transitioned them to our other payment service licenses that can still operate in the EEA.

The e-money institution will continue to operate in the U.K.

Money Transfer and Payment Instrument Licensing

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Our operations involve the collection and storage of certain types of personal customer data that are subject to pr ivacy and security laws in the U.S.

In the United States, we are subject to the Gramm-Leach-Bliley Act ("GLBA") and various state laws including California Consumer Privacy Act ("CCPA"), which requires that financial institutions have in place policies regarding the collection, processing, storage and disclosure of information considered nonpublic personal information.

Laws in other countries include the E.U.'s General Data Protection Regulation (2016/679) ("GDPR"), which became effective fr om May 25, 2018, as well as the laws of other countries.

In the United States, we are subject to the Gramm-Leach-Bliley Act ("GLBA") and various state laws including California Consumer Privacy Act ("CCPA"), which require that financial institutions have in place policies regarding the collection, processing, storage, and disclosure of information considered nonpublic personal information.

Laws in other countries include the E.U.'s General Data Protection Regulation (2016/679) ("GDPR"), as well as the laws of other countries.

The GDPR establishes stringent requirements for the collection and processing of personal information of individuals within the E.U.

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Any failure on our part to meet the requirements of the GDPR could result in the imposition of fines and penalties that could affect our financial results.

We comply with the GLBA and state privacy provisions.

We comply with the GLBA and applicable state privacy provisions.

In July 2020, the European Court of Justice invalidated the EU-US Privacy Shield as a lawful mechanism for transferring personal data to the US as a result of concerns related to surveillance by law enforcement agencies and a lack of judicial redress by individuals in the EU (known as the "Schrems II" decision).

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Intellectual Property

Each of our three operating segments utilizes intellectual property which is protected in varying degr ees by a combination of trademark, patent and copyright laws, as well as trade secret protection, license and confidentiality agreements.

The brand names of "Ria," "Ria Financial Services," "Ria Envia," "xe," "AFEX," "IME," derivations of those brand names and certain other brand names are material to our Money Transfer Segment and are registered trademarks and/or service marks in most of the markets in which our Money Transfer Segment operates.

Consumer perception of these brand names is i mportant to the growth prospects of our money transfer business.

Each of our three operating segments utilizes intellectual property which is protected in varying degrees by a combination of trademark, patent, and copyright laws, as well as trade secret protection, license, and confidentiality agreements.

The brand names of "Ria," "Ria Financial Services," "Ria Envia," "xe," "Dandelion," derivations of those brand names and certain other brand names, and related logs, are material to our Money Transfer Segment and are registered trademarks and/or service marks in most of the markets in which our Money Transfer Segment operates.

Consumer perception of these brand names and logos is i mportant to the growth prospects of our money transfer business.

We also hold a U.S.

patent on a card-based money transfer and bill payment system that allows transactions to be initiated primarily through POS terminals and integrated cash register systems.

With respect to our EFT Processing Segment, we have registered or applied for registration of our trademarks, including the names "Euronet" and "Bankomat" and/or our blue diamond logo, as well as other trade names in most markets in which these tra demarks are used.

With respect to our EFT Processing Segment, we have registered or applied for registration of our trademarks, including the names "Euronet" and/or our related logo, as well as other trade names in most markets in which these tra demarks are used.

Certain trademark authorities have notified us that they consider these trademarks to be generic and, therefore, not protected by trademark laws.

This determination does not affect our ability to use the Euronet trademark in those markets, but it would prevent us from stopping other parties from using it in competition with Euronet.

We have registered the "Euronet" trademark in the class of ATM machines in Germany, the U.K.

and certain other Western European countries.

We have registered the "Euronet" trademark in the class of ATM machines in Germany, the U.K., and certain other Western European countries.

We have filed pe nding applications and/or obtained patents for a number of our new software products and our processing technology, including certain top-up services and DCC services.

With respect to our epay Segment, we maintain registered trademarks for the "epay" brand and logo in the U.S., U.K., E.U.

(through a Community Trademark application, which provides enforceability of the epay trademark in all member states of the European Union), Brazil, Singapore, India, Australia and New Zealand.

(through a Community Trademark application, which provides enforceability of the epay trademark in all member states of the EU), Brazil, Singapore, India, Australia, and New Zealand.

We have filed trademark applications for additional iterations of the "epay” brand in India, which are pending.

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BROWN, Chairman, Chief Executive Officer and President.

Brown is one of the founders of Euronet and has served as our Chairman of the Board and Chief Executive Officer since 1996, and has served as President since December 2014.

He also co-founded our predecessor company in 1994.

Brown has been a Director of Euronet since our incorporation in December 1996 and previously served on the boards of Euronet's predecessor companies.

Brown founded Innovative Software, Inc., a computer software company that was merged in 1988 with Informix.

Brown served as President and Chief Operating Officer of Informix from February 1988 to January 1989.

He served as President of the Workstation Products Division of Informix from January 1989 until April 1990.

Brown was a founding investor of Visual Tools, Inc.

Visual Tools, Inc.

was acquired by Sybase Software in 1996.

Brown received a B.S.

in Electrical Engineering from the University of Missouri - Columbia in 1979 and a M.S.

in Molecular and Cellular Biology at the University of Missouri - Kansas City in 1997.

Brown co-founded Euronet in 1994 and has served as its chief executive officer ever since.

He is chairman of Euronet’s board of directors and the Company’s President.

An accomplished entrepreneur with 30+ years of combined experience in the computer software and digital payments business, he is actively involved in Euronet's day-to-day operations while overseeing the company’s business strategy, financial performance, and growth across all markets.

Brown’s guidance has been instrumental in developing Euronet’s global cash/digital payments network and diverse products and services that provide Euronet with resiliency to changing market conditions and continual year-over-year growth in the global payments marketplace.

Following early successes in his career with Kansas City-area companies Informix and Visual Tools, Mr.

Brown founded Euronet in 1994 in Budapest, Hungary, by installing the first independent, non-bank-owned ATM network in Central Europe.

Guiding the company through several strategic acquisitions and technology endeavors since then, Mr.

Brown has grown Euronet to approximately 10,000 employees and 67 offices worldwide.

He has also brought financial inclusion and convenience to businesses and consumers through a payments network spanning 200 countries and territories.

A lifelong Kansas Citian, Mr.

Brown is an active supporter and past and present board member of many Kansas City-area charities.

WELLER, Executive Vice President, Chief Financial Officer.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business