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« November 10, 2002 - November 16, 2002 | Main | November 24, 2002 - November 30, 2002 »

November 23, 2002

Boston Globe: Consumers caught in debit-credit duel

Scott Bernard Nelson reports on the duel going on between retailers and banks regarding acceptance of debit vs. credit cards.
With as much as $3 billion in annual fees at stake, banks and retailers have decided to take their long-simmering debit card fight to consumers. It all boils down to a question more vexing than ''paper or plastic'': Should you press the ''debit'' or the ''credit'' button when you use your check card? Make the wrong choice, and it could cost you as much as 75 cents extra for each transaction. Make the right one and you might be eligible for frequent flier airline miles, store credit, or cash-back bonuses.
At issue is the cost to the merchant for accepting one version of debit card vs. another. Merchants want to shift consumer behavior to the lowest cost (for the merchant) approach: consumer enters PIN. Card issuers, on the other hand, want consumers to use signature as that generates the highest income to them. Unfortunately, it's basically a zero sum game with the consumer in the middle.

November 22, 2002

Sun-Sentinel: Sunrise firm becomes player in prepaid cash cards

Christine Winter profiles WildCard Systems.
WildCard, founded in 1997 by Gary Palmer and partner Larry Park started as a company that provided "catastrophic cards" for insurance firms. The privately held company, which has grown to 200 employees, is backed by institutional investors, such as Sutter Hill Ventures, Greenwich Street Partners and Bank of America, which also uses Wildcards services for all its prepaid card products. Palmer said the company turned profitable in the later months of 2002, but will not be profitable for the year, though he is projecting that in 2003 the company will be in the black for the full year.

The Age: Vending machines

Allison Jackson reports on the future of the vending industry.
A recent 12-month trial at Sydney's Central Railway Station of vending machines operated by mobile phone led to a 10 per cent increase in sales compared with the coin-only machines. Mr Beder said younger consumers were more at ease with the technology, less concerned about paying a higher price and more likely to consume the products the vending machines sold.

November 21, 2002

CNET: AOL selling prepaid Internet access cards

CNET reports on AOL's new Internet access cards.
"Through research we found that this product appeals to those who don't want a commitment or a monthly fee," said AOL spokesman David Theis. "Some of them may not have a credit card or another billing method or may want to get online less frequently than unlimited usage." The cards are offered in all Target stores, and refill cards can be purchased in all Western Union locations. Starter kits will appear in Office Depot stores starting next month.

AP: Bank of America tests purchase card

Paul Nowell reports on Bank of America's QuickWave proximity payment pilot.
QuickWave is not a credit or debit card, so customers don't swipe it through a machine, punch in a PIN number or sign a receipt. It's connected to customers' bank credit cards or debit cards so the charges show up on their monthly bank statement. Moments after they wave it over the pad, customers get a confirmation and a receipt. "It benefits the customer because it's fast, it's convenient and it's secure," Bank of America spokeswoman Lisa Gagnon said. "They don't have to have cash with them to make a purchase. It helps the merchants because it attracts customers to their stores."

San Mateo County Times: Gift cards catch consumer fancy

Eve Mitchell reports on the surge in gift card usage by American consumers.

November 20, 2002

Radicchio: Why mcommerce is slow in Europe

Radicchio, a non-profit group focused on evangelizing mobile commerce, shares a Financial Times article (PDF) authored by Fiona Harvey on why mobile commerce uptake has been slow in Europe.

November 19, 2002

Visa EU launches Visa Direct

Visa EU has announced Visa Direct, a new cross-border money tranfer service.
The new service is set to revolutionise cross-border payments, enabling Visa‚s member banks to offer a convenient, end-to-end money transfer service to their customers. As it operates across the existing Visa infrastructure it is straightforward and cost-effective for banks to implement. The service precedes the introduction of tighter EU regulation on cross-border transfers. From July 2003 banks within the Eurozone will no longer be able to charge more for low value (below •12,500) EU cross-border transfers than they do for domestic transfers. Visa Direct provides member banks with a ready-made, low-cost means of complying with the new regulations. It also gives them an opportunity to play a part in a European money transfer market worth an estimated •25 billion a year.

November 18, 2002

New Zealand Herald: BNZ to begin issuing American Express cards

Kevin Taylor reports that the Bank of New Zealand will begin issuing American Express cards in addition to the Visa and MasterCard cards it already issues.
The BNZ general manager, credit cards, Pradeep Roy, said American Express had its own brand attraction, particularly among younger people. American Express has 1700 offices worldwide and was supported in 130 countries.

iPIN: New CEO, closes new financing round

iPIN has announced that Alexandre Gonthier, company founder, is taking over as chief executive officer and that it has secured $8 million in its most recent round of funding from Accel Partners, Cardinal Venture Capital, Invision AG, Nexus Group LLC, Sutter Hill Ventures and Verbena Communications.

The Age: MasterCard swipes at RBA

Melbourne's The Age reports on the contention between MasterCard and the Reserve Bank of Australia with respect to the court case on the RBA's reform of the Australian credit card system. READ MORE »

Denver Post: First Data strives to keep fund-transfer dominance

The Denver Post reports on the competitive threats to First Data's Western Union subsidiary.

Australian IT: Skim fraud problem gets worse

The Australian press has been buzzing lately about credit card magnetic stripe skimming. Here's the latest article by Caitlin Fitzsimmons from Australian IT.
"Magnetic stripe cards provide secure authentication between the ATM and the bank host, but the card is just an automated entry of the account details," Mr Fletcher said. "Chip cards hold certain information secret and can authenticate to the terminal and provide data to the host."

New York Times: Credit Cards Seek New Fees on Web's Demimonde

Matt Richtel and John Schwartz report on changes to the credit card association rules enacted last week that apply to so-called "high risk" merchants.
Visa will charge its member banks a $500 registration fee and an annual renewal fee of $250 for each high-risk company they pay a credit-card charge to. Those fees will be passed on, with a markup, to the sites themselves. MasterCard is expected to roll out similar fees, industry analysts say. The sums are insignificant to larger sites, but could well drive smaller sites into the red; tens of thousands of adult sites are home-grown entities, industry experts say.

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