1. The problem is to explain how the 0.42% revenue as a percentage of TPV (Total Payment Volume) for Year 3 (Y3) was calculated. 2. The formula to calculate revenue as a percentage of TPV is: $$\text{Revenue \% of TPV} = \frac{\text{Revenue}}{\text{TPV}} \times 100\%$$ 3. From the data, for Y3: - TPV = 9000 million PhP - Revenue as % of TPV = 0.42% (given) 4. To understand how 0.42% was derived, we need to consider the components that contribute to revenue and costs as percentages of TPV: - Program Cost of netbank as % of TPV = 0.30% - Servicing/Minimum fees Cost as % of TPV = 1.50% 5. Revenue is generally the net amount after deducting costs from the total fees collected. The fees come from various segments with different fee rates (Gcash Fees) and their proportions of TPV. 6. The segments and their fees for Y3 are: - Wallet to wallet P2P: 5% of TPV, fee 0.00% - P2B (QRPH merchant): 5% of TPV, fee 1.50% - Instapay (Pay Out): 20% of TPV, fee 15.00% - QRPH (Pay Out): 50% of TPV, fee 0.00% - Utilities: 10% of TPV, fee 4.00% - Airtime Loads: 5% of TPV, fee 1.00% 7. Calculate weighted average fee percentage: $$\text{Weighted Fee \%} = 0.05 \times 0 + 0.05 \times 1.5 + 0.20 \times 15 + 0.50 \times 0 + 0.10 \times 4 + 0.05 \times 1$$ $$= 0 + 0.075 + 3 + 0 + 0.4 + 0.05 = 3.525\%$$ 8. This 3.525% represents the gross fee revenue as a percentage of TPV before costs. 9. Subtract the program cost and servicing fees: $$3.525\% - 0.30\% - 1.50\% = 1.725\%$$ 10. The actual revenue as a percentage of TPV is 0.42%, which is lower than 1.725%, indicating other deductions or adjustments (e.g., free transactions under 8k, BSP directives, or minimum fees) reduce the effective revenue. 11. Therefore, the 0.42% revenue as % of TPV in Y3 is derived from the weighted average fees collected from different segments minus program and servicing costs and other adjustments. Final answer: The 0.42% revenue as a percentage of TPV in Y3 is calculated by taking the weighted average of fees from all payment segments based on their TPV proportions, then subtracting program costs and servicing fees, and accounting for other adjustments such as free transactions and minimum fees.