Earnings are a lagging indicator of corporate performance—when you want to see where a consumer-focused company actually is and where it's going, you need to go to the mailbox and look at their marketing material.

Judging from the unsolicited offers Glenbrook's Bryan Derman has been receiving of late, we may be growing late in the days of the great credit card industry. See Bryan's opinion piece "Wither the Empire?" on the Glenbrook website.

eBay's PayPal subsidiary reports that its annual payment volume increased in 2004 to $18.9 billion, a 55% year-over-year increase from the $12.2 billion in 2003. Fourth quarter 2004 volume was $5.6 billion, a 51% increase from 2003 and a 21% increase from the third quarter. PayPal revenue grew to $200 million, up 53% from the prior year and 20% from the prior quarter.

PayPal reported 63.8 million total accounts at the end of 2004, an increase of 58% from the prior year. Active accounts at the end of 2004 were 20.2 million compared to 13.2 million a year earlier.

PayPal's transaction loss rate increased 41% from the third to fourth quarters to 0.31% in the fourth quarter, roughly equal to the same quarter a year earlier.

Complete details are in eBay's earnings press release (PDF) released earlier this afternoon.

The Financial Express reports from India on the growth in plastic card payments in India.

The total spend in India on a payment card is still less than 1% of the country’s percentile. This indicates that the growth potential of the payment card industry is enormous. Around 30 million people are eligible for creditcards and 150 million people are eligible for debit cards.

The Federal Reserve Bank of Phildelphia has published a research discussion paper by Mark Furletti and Stephen Smith analyzing the consumer protections available to credit and debit card users (PDF).

TSYS has announced it has signed an agreement to purchase the 50 per cent equity stake that Visa USA holds in Vital Processing Services.

Formed in 1996 as a joint venture between Visa U.S.A. and TSYS, Vital specializes in attractive, cost-effective, turn-key alternatives for acquirers that outsource their merchant business. Beverly Wells will remain the president, a position she has held since 2003.

An 8-K filing by the company reports that it is paying $95 million for the 50 per cent interest it is acquiring.

Tami Luhby reports in Newsday on American Express' settlement of a lawsuit that challenged Amex's disclosure of its 2 percent fee levied on foreign currency conversion.

The company agreed to pay up to $75 million to U.S. cardholders who made purchases in a foreign currency from Mar. 28, 1997 to Oct. 15, 2004, according to a preliminary class action settlement. In addition, the credit card company agreed to include information about the fees on its monthly statements and other mailings to cardholders.

Simson Garfinkel writes about biometrics in Technology Review.

Congress gave a sizable Christmas present to the nation’s biometrics industry last month. The word biometrics appears 35 times throughout the National Intelligence Reform Act of 2004, and it establishes the use of biometrics for aviation security, creates a “biometric center of excellence,” expands an FBI biometric system for criminal background checks, requires friendly visa waiver countries to add a biometric to their passports, and mandates the collection of “biometric exit data” for people leaving the United States.

Separately, a press release from Food Service Solutions discusses its system to enable K-12 students to pay for their school lunches using their fingerprints.

“Parents didn’t want to doll out $1.60 for their child every day, or give them a $10.00 bill and wonder if they’d ever see the change,” says Pat Anthony, Foodservice Director for the Wilson School District. “Parents wanted to pre-pay for lunch, but keeping track of accounts with paper and pencil was untenable. And we didn’t want to buy into a system where parents would end up taping PIN numbers to their kid’s hands.”

Eric Young writes in the San Francisco Business Times about Bank of America successfully retaining its position as a major sponsor of the San Francisco Giants, edging out Wells Fargo Bank for the deal.

The team also is close to finalizing terms of an extended sponsorship with San Francisco-based Visa USA Inc., sources said.

Arian-Michele Moore from Celent Communications writes about smart card technology adoption in the US Market for Bank Systems & Technology.

Those close to the payments industry and with an eye on the progress of smart technology know that smart cards will one day take over magnetic stripes and revolutionize the payment industry. It is only a matter of when and how. Industry estimates of when smart cards will have a strong US presence range from five to 10 years and beyond. Celent does not expect them to have a significant presence for at least seven years.