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« October 6, 2002 - October 12, 2002 | Main | October 27, 2002 - November 2, 2002 »

October 18, 2002

Don Park: Bill My Phone

Don Park writes about "Bill My Phone", an approach to enable payments to be charged to your phone bill. Seattle-based ECharge tried to do something similar a few years ago (without the 3D-Secure idea). The business issue here is whether the phone companies want to take on this kind of business -- historically, when I've talked to them, they've been afraid of the responsibilities associated with managing credit risks for goods/services other than telephone minutes. Bill Me Later is setup specifically to do real-time credit decisioning -- something the phone companies are clueless about.

CNN/Money: Americans feeling better about online financial transactions

CNN/Money reports on a survey that found that Americans are gradually feeling better about using the Internet for online financial transactions.
More than 31 percent of consumers who engage in online financial transactions trust that their personal information will be safe, compared with 27 percent at the end of 2001. Similarly, the number of people using the Internet for financial transactions rose to 41.5 percent from 38.9 percent at the end of 2001.

BS&T: Check 21 won't be grounded

Ivan Schneider reports on "Check 21", the Check Clearing for the 21st Century Act known formally as H.R. 5414. See also the House Subcommittee on Financial Institutions and Consumer Credit hearing held on Wednesday, September 25, 2002.

October 17, 2002

ZDNet: MasterCard re: Australia - merchant security standards

Iain Ferguson reports on new merchant security standards being piloted in Australia.

ZDNet: Ten predictions from Gartner

Dan Farber reports on ten predictions made by Gartner analysts. Number 7 is particularly interesting:
7. Banks become primary provider of presence services by 2007 Presence services can manage your preferences, personal information and experience on the Internet. Gartner consider what it calls "one-click Internet" as essential to bringing convenience and mobility to the Internet. Microsoft (Passport), the Liberty Alliance, AOL, and Yahoo (among others) are vying for a piece of your presence--if not all of it. But Gartner's Claunch said that the future belongs to independent companies or financial service providers, such as the banks. Banks have had to deal with security, privacy and issues of trust for centuries, and that legacy is a particularly relevant in the digital age. Gartner gives the banks a 70 percent chance of succeeding in the presence business by 2007. I am not sure that we will have the standards and politics worked out by that time, but Gartner predicts that the banks will play a major role and adopt something like Liberty or Passport as the underlying framework for the trust broker business.

October 16, 2002

NPC: Reduces outlook

National Processing, Inc. (NPC) announced earnings this morning. Importantly, the company provided updated guidance for the fourth quarter based upon their outlook for consumer spending. The company also commented on pricing pressures and competition in the industry.
Chairman and CEO Jon L. Gorney commented, "We are operating in an increasingly challenging business environment given the overall sluggish economy and competitive factors. Several factors have modified our view of the Company's near term outlook. We are experiencing weakness in overall volumes, particularly in the retail segment. In addition, our pricing strategy has been to sell a premium service for a premium price and we have been cautious to match current pricing in the marketplace. We did make an adjustment in the second quarter and have actually signed more deals this year than last, although they have been smaller in terms of volumes and margins. We are still seeing significant price compression as we compete for new national business as well as in retaining our existing base of national customers. Also, due to the seasonality of our business, our revenues and profits for the year are heavily dependent on the fourth quarter due to holiday shopping volume. Based on the weakness that we saw in our business in September and bleak economic forecasts for holiday shopping volumes, we are not optimistic about the chances of a robust holiday season."
On a conference call to discuss earnings, management reported they would be putting even more emphasis on regional (vs. national) merchants.

October 14, 2002

Wireless Week: Mobile phones to make credit cards obsolete

It looks like the Korean Ministry of Finance and Economy is serious about enabling competition for online banking services in Korea.
On Tuesday, the Cabinet passed a bill that allows non-financial companies to operate online banking services. The new rules, drafted by the Ministry of Finance and Economy, will be effective from early next year. Among the online financial business areas opened up are electronic money transfers, the issuance of debit cards, and online transaction settlement. The law requires non-financial companies with over 500 million won in capital to register with the Financial Supervisory Commission (FSC) before initiating online banking services. This is expected to encourage the expansion plans of telecom operators into the financial field.

October 13, 2002

National Post: CIBC's American banking folly

Derek DeCloet reports in Canada's National Post on CIBC's foray into expanding its banking efforts in the US. DeCloet reaches some interesting conclusions on why the effort has failed -- including a theory about there being a difference in technology adoption between Canadian and US consumers.

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