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The New York Times has an editorial in its Sunday edition speaking out about a lack of consumer protection in the recently enacted Check 21 legislation.
Banks do not have to gouge their customers just because the law permits it.
CardWeb reports on the increasing inclination of US consumers to pay down their credit card debt and the impact its having on the growth in receivables.
There are approximately 185 million bank credit cardholders in the USA. Of these about 70 million pay-off in full each month, 71 million make more than the minimum required payment, and 44 million make minimum required payments.
Steven Marlin in Information Week reports on the Financial Services Technology Consortium's (FSTC) counterphishing effort. » Continue Reading
The Chicago Tribune carries a Bloomberg story on the potential financial benefits banks will receive as a result of Check 21.
"We'll be able to save a lot of money," said Kennedy Thompson, chief executive of Wachovia Corp., the nation's fourth-biggest bank. "It will eliminate a lot of paper, reduce the huge infrastructure of check processing and all of the transportation of checks."
The US Department of Justice has announced the the arrests of nineteen individuals "who are alleged to have founded, moderated and operated one of the largest illegal online centers for trafficking in stolen identity information and documents, as well as stolen credit and debit card numbers."
Red Herring reports on yesterday's PayPal thank you day -- including the reactions of some PayPal users who remain disgruntled by PayPal's outages earlier this month.
The Federal Financial Institutions Examination Council (FFIEC) has released guidance to US financial institutions regarding their use of free and open source software. » Continue Reading
Today marks an important milestone in the payments industry as the Check 21 Act becomes effective. A great way to learn more about Act is to visit the Check 21 InfoBase for Flash-based tutorials:
The InfoBase contains a training presentation that provides a concise overview of the Act and its implementing regulation, an example of check processing under Check 21, information on consumer compliance and other requirements, and an explanation of the examination concepts for consumer compliance issues.The InfoBase was put together by the Federal Financial Institutions Examination Council (FFIEC).
Robin Sidel reports in this morning's Wall St. Journal (sub. reqd.) on the changes in how checks are being processed. » Continue Reading
Citi has announced the Citi Dividend Merchant Network. Citi Dividend Platinum Select cardholders can earn incremental cash-back rewards averaging 5 to 7% by shopping at merchants in the new merchant network. » Continue Reading
CSO Magazine takes a look at what companies are doing to deal with the onslaught of phishing attacks.
eWeek reports that PayPal will credit its premier and business account members for all transaction fees they pay this Thursday for transactions posted between midnight and 11:59 PM PDT as an apology for the recent outages they've experienced.
Details on the "thank you day" are available on the PayPal site.
Deluxe Financial Services announced today the DeluxeCard Visa Gift Card, "an open-system prepaid card that allows financial institutions to meet growing consumer demand for a versatile payment tool and universal gift solution."
DeluxeCard prepaid cards can be purchased in dollar amounts from $25 to $500. In addition, there is a processing fee of $5.95 for dollar amounts from $25 to $250, and $7.95 for dollar amounts from $251 to $500.
For more information, go to the DeluxeCard web site.
The Association for Financial Professionals (AFP) has released the results of its 2004 Electronic Payments Survey (pdf) covering business to business payments.
Financial professionals identified barriers that obstruct progress toward wider adoption of electronic payments in B2B transactions.In the survey respondents gave nearly equal weight to four major barriers: accounting systems that are not integrated with electronic payment systems; shortage of IT resources; lack of a single standard format for remittance information; and trading partners who cannot send or receive electronic payments with sufficient remittance information.
American Express has shared the results of an identity theft quiz recently used to survey consumers. » Continue Reading
This is London reports on a hearing by the UK's Treasury Select Committee that questioned credit card issuers about their practices of mailing unsolicited cheques to customers.
Ever wonder how your Speedpass actually worked? Heard the hype about RFID and curious to learn more? Check out the article in ACM Queue by Intel's Roy Want titled The Magic of RFID".
Ted Pincus reports in the Chicago Sun-Times on a new book titled Business Evolves, Leadership Endures by Andrea Redmond and Charles Tribbett III, both executive recruiters at Russell Reynolds Associates. » Continue Reading
Visa International has announced that it has formed a two year strategic alliance partnership with database security vendor Application Security, Inc. that includes making a minority investment in the firm. » Continue Reading
Next Estate Communications has announced the addition of loading capability for ACS Ultima Cards at over 35,000 Green Dot Financial Network retail locations. » Continue Reading
ID Analytics has announced the launch of a UK national study of identity risk. » Continue Reading
Thomas Pack writes in Business First about stored value cards.
Like credit or debit cards, they can be used to get money from an ATM or buy something at a store. Like prepaid phone cards or store gift cards, they aren't tied to a person's bank account, and they're preloaded with a specific amount of money. Some can be reloaded when the initial amount runs out.Businesses like them, bankers say, because they help reduce payroll-processing costs. Consumers like them because they're easy to use. Banks like them because they provide another product to sell and help bring in new customers.
Scott McCartney reports in the Wall St. Journal (subs. reqd.) about lobbying by credit card companies for new legislation that would protect them from potential liability if an airline shuts down. » Continue Reading
Diners Club North America CEO M. V. Rajamannar is interviewed on Business Travel News.
Former US national security advisor Richard Clarke spoke to the Smart Card Alliance's fall conference in San Francisco last week. » Continue Reading
In its third quarter financial results reported this afternoon, American Express reported a 16% increase in Amex cardmember spending over the same quarter last year and a 14% increase in discount revenue paid by card accepting merchants. Amex's average discount rate declined 3 basis points from 2.60% to 2.57% as compared to the same quarter last year. » Continue Reading
Denver's Rocky Mountain News takes a look at micropayments. » Continue Reading
Kenneth Harney reports in today's San Francisco Chronicle on a recent Federal Reserve staff research report that discussed how some credit card issuers may be withholding certain information from the national credit bureaus and, as a result, affecting consumers credit scores.
The Fed researchers did not identify the credit card issuers that intentionally withhold customers' limits. But for 46 percent of the consumers in a random sample of 301,000 credit files to be affected by this score-depressing policy, the creditors involved must be numerous, big or both.
The full study is available for downloading online (PDF).
This Sunday several writers chose to write a cluster of stories about how you should be careful using credit cards. Humberto Cruz writes about how credit card rewards can have a downside. He talks about how he uses several different rewards cards to optimize his rebates -- the Chase Freedom card for gas because it's offering the biggest rebate on gasoline purchases, his MBNA World Points card at the local supermarket because of its 5% rebate on purchases of groceries between now and the end of the year, etc. Writing from Rochester, NY, Frank Bilovsky says that the convenience of using credit cards can "bite". He quotes a local book author:
"The ultimate bottom line is if you use a credit card, you are going to buy more than if you don't have a credit card," said Robert Manning, the Rochester Institute of Technology professor and author of the book Credit Card Nation: The Consequences of America's Addiction to Credit. "That ultimately was the selling point to get it into grocery stores."Finally, Michelle Singletary says to be sure to be careful when paying routine household bills with credit cards.
David Vise reports in the Washington Post on Francis Vitagliano and his 401(k) card. Vitagliano worked with an MIT professor, the late Franco Modigliani to patent the idea over ten years ago.
Vitagliano's and Modigliani's patent (5,206,803 - System for enhanced management of pension-backed credit ) has been licensed by ING and is scheduled to be introduced at a conference tomorrow.
The credit card industry is not opposing the card's introduction, in part because the first 401(k) card will be a Visa card. In addition, ING is willing to sub-license the rights to the product to other financial services firms, which means that eventually there may be 401(k) American Express and MasterCards too.
Timothy O'Brien reports in the Sunday New York Times about the biggest case of identity theft ever uncovered in the United States. » Continue Reading
Richard Webb reports in The Age from Australia about consumer credit card debt in that country.
Joan Goldwasser reports on Kiplinger.com about new credit cards targeting high spending individuals.
Google has a couple of interesting job postings up -- one for a Manager, Risk Control, and a second for a Senior Manager, Payment Infrastructure.
Yahoo! has announced that it is closing its PayDirect money transfer service effective November 22, 2004. Yahoo! is no longer accepting any new PayDirect accounts effective immediately. There will be a transition period through May 15, 2005 at which time the PayDirect web site will be shuttered completely.
The Wall St. Journal reported:
"Without a large user base to support PayDirect, the business doesn't scale," said Yahoo spokesman Brian Nelson. "We're discontinuing the service in an effort to focus on the businesses that are core to our future growth."
The National Geographic Channel will be airing a TV special this Sunday, October 24, at 8 PM ET/PT titled "Inside the U.S. Secret Service". » Continue Reading
Ann All reports on ATMmarketplace.com on bank strategies to meet the withdrawal of support for IBM's OS/2 operating system and regulatory mandates requiring triple DES encryption and audio capabilities.
Reuters is reporting from Seoul that South Korea's three mobile operators (SK Telecom, KTF Corp., and LG Telecom) have agreed to setup a joint venture to allow customers to pay for goods using their cell phones. » Continue Reading
Arik Hessenldahl reports in Forbes on the movement of transit cards to smart cards.
Smartcards are a technology I keep hearing about but have yet to encounter in daily life.
The article goes on to discuss the role of Cubic Transportation Systems in deploying smart cards for transit applications.
Tony Adams reports in the Columbus, Georgia Ledger-Enquirer on the decline in TSYS' stock price following its earnings announcement and a conference call with analysts.
Citi Cards is telling cardholders about a new "email security zone" that will be included in every legitimate email it sends them. The purpose of the "zone" is to convince the cardholder that the email is legitimate by including the cardholder's name as well as the last 4 digits of the cardholder's account number at the very top of the body of the email.
Bloomberg reports on American Express' growth under CEO Kenneth Chenault.
Tavia Evans writes in the St. Louis Post-Dispatch about the shift to card-based payments.
Economists long have predicted a cashless society, where digital transactions replace paper money and coins. Now, nearly one in three in-store purchases is made with a debit card, a study by American Bankers Association and Boston-based Dove Consulting shows.
I4 Commerce has announced a new private label credit offering. Ross-Simons, a current Bill Me Later customer, is the first merchant to expand its relationship with I4 Commerce by offering the Ross Simons Preferred Customer Card. » Continue Reading
eBay reported third quarter financial results (PDF) earlier this afternoon including results for PayPal, its payments subsidiary.
Some highlights:
Charles Jade on arstechnica.com covers the recent opening of the new Apple "mini" retail store in the Stanford Shopping Center in Palo Alto. Included is a picture of Apple's new self-service checkout facility. Here's another view. » Continue Reading
The Wharton School's Strategic Management newsletter highlights a talk by Visa International CEO Christopher Rodrigues at a conference last month in London. » Continue Reading
John Ewoldt writes in the Minneapolis Star-Tribune about TCF's new Miles Plus card.
TCF, you have our attention. Whose ears wouldn't perk up hearing about an airline miles credit card without blackout dates?
Reuters reports from Toronto on the cashless society as created by Dexit. » Continue Reading
The BBC reoprts on research by Markus Jakobsson at Indiana University into new kinds of phishing attacks. » Continue Reading
engadget.com reports on MYbi cards -- and a card strap for enabling RFID-based payments intended for use with cellphones.
In a page one story this morning, Glenn Simpson of the Wall St. Journal reports on increasing scrutiny of First Data's Western Union (subs. reqd.) unit.
Moodys reports that US consumers paid back credit card debt at record levels during August.
"The payment rate has increased from its year-earlier levels for the past 15 consecutive months, demonstrating an improvement in cardholders' willingness and ability to make payments on their credit card debts," Moody's said in a statement.
Gartner reports that it believes microcommerce opportunities will generate an estimated $60 billion in revenue per year by 2015 -- using the definition that a micropurchase is a purchase conducted electronically that is valued at less than $5 and where the settlement can be either prepaid, by subscription, on-the-spot, of invoiced. » Continue Reading
In its quarterly earnings report this morning, Wells Fargo Bank reported some interesting statistics about its online Internet-based business:
Keynote has published the initial results for its new Keynote Credit Card Web Transaction Performance Index. The initial results from Keynote's Credit Card Transaction performance index showed a wide range of performance for some of the largest credit card issuers' Web sites. » Continue Reading
Cornerstone Advisors' Tripp Johnson chides the banking industry with his article on the Curb Store National Bank. » Continue Reading
E.piphany announced this morning that its customer relationship management solutions have been helping drive the growth of ING Direct. » Continue Reading
Online Resources Corp. has announced that it has entered into a definitive agreement to acquire Incurrent Solutions, Inc. for $15 million in cash and stock. » Continue Reading
Visa International has announced that dollar value of all purchases and cash withdrawals made with Visa Commercial payment solutions globally reached $200 billion for the year ending June 30, 2004, an increase of 26 percent over the same period last year. » Continue Reading
Steven Marlin writes in Information Week about how Wells Fargo Bank is using its experience with online consumer banking to help its commercial banking customers. » Continue Reading
Metavante announced this morning an agreement to acquire VECTORsgi. » Continue Reading
Starbucks has announced that this month the Starbucks Card, a reloadable stored-value card, will hit $1 billion in total balances loaded since it was launched three years ago. » Continue Reading
GE Consume Finance has announced that it has formed a new specialty retail group to focus on the unique financing and marketing needs of growing, mid-size retailers. » Continue Reading
MasterCard has announced the results of its latest Small Business Economic Spend and Outlook Survey.
"Across the board, MasterCard research shows that small businesses expect 2005 to be a turning point, as many companies increase revenue, add staff and grow," said Steve L. Abrams, senior vice president of Corporate Payment Solutions at MasterCard International. "A full 75 percent expect 2005 to be a better year than 2004 -- a testament to the resilience and spirit of entrepreneurs in the United States."
The federal bank, thrift, and credit union regulatory agencies today announced the publication of a new consumer resource, Protecting Yourself from Overdraft and Bounced-Check Fees. » Continue Reading
TSYS has announced that it has finalized a definitive agreement with JP Morgan Chase to service Chase's combined credit card portfolios. » Continue Reading
Shell Oil has announced a new promotional campaign in partnership with MasterCard. » Continue Reading
Alliance Data Systems has announced that it is acquiring Epsilon Data Management, a provider of integrated direct marketing solutions that combine value-added marketing, transaction, technology and analytical services. » Continue Reading
ComputerWorld posted an update article today on PayPal's on-going system problems. » Continue Reading
The Smart Card Alliance has announced a new report (for sale) titled "Logical Access Security: The Role of Smart Cards in Strong Authentication." » Continue Reading
The Boston Consulting Group has announced a new global study that predicts "a dramatic reduction in the profitability of the payments business at many banks." » Continue Reading
EDS has announced the election of MasterCard CIO W. Roy Dunbar to the EDS board of directors.
I just came across some recent work by Jan Ondrus and Yves Pigneur at the University of Lausanne, Switzerland that brings some new insights to an examination of the mobile payment market (PDF).
USA Technologies and AT&T Wireless have announced an agreement to offer wireless payments. » Continue Reading
Peralte Paul reports in the Atlanta Journal-Constitution on some rethinking being done by frequent fliers about their mileage reward credit cards. » Continue Reading
Reuters reports that PayPal has had intermittent glitches in its system since late last week and is working to get the problems resolved.
The use of stored value debit rewards cards for sales incentives continues to grow. This morning, two new programs were announced - one involving the gaming company Nintendo and the other involving network equipment supplier D-Link. Both are using debit rewards cards as incentives to their sales distribution channel partners. » Continue Reading
The Mail & Guardian Online reports from Johannesburg, South Africa on MasterCard's OneSMART program. » Continue Reading
Heather Havenstein reports on FCW.com about federal directives on electronic credentials and how they could boost adoption of smart cards for authentication. » Continue Reading
Pacific Business News reports on identity theft rates in Hawaii -- particularly affecting senior citizens and their credit cards.
Citigroup's Global Transaction Services unit has announced a new borderless banking initiative intended to provide a suite of white-label Citigroup services to partner banks. » Continue Reading
William Bulkeley writes in today's Wall St. Journal about the increasing use of fingerprint identification for authentication (subs. reqd). » Continue Reading
Retailer Gap Inc. has launched a new cross-brand private label credit card program that lets customers earn rewards from shopping at the Gap, Banana Republic and Old Navy stores. » Continue Reading
First Data Corp. and Drugstore.com have announced they're working together to simplify the processing of Flexible Spending Account payments. » Continue Reading
Lauren Bayne Anderson reports in the Washington Post on merchants who balk at accepting plastic cards for payment and are instead steering their customers to use in-store ATM machines to get cash for payment -- and making additional fee income in the process.
If Ben's took credit cards, it could pay up to 50 cents in fees for a $10 sale, the size of its average bill. Instead, it makes money each time a customer uses an ATM it installed. Industrial Bank supplies Ben's machine, and the restaurant gets 25 cents every time a customer pays a $2 transaction fee to withdraw cash.
NYCE has announced an alliance with Acxsys Corporation, architect of the Interac national PIN-debit services in Canada and major Canadian financial institutions to enable Canadian Interac cardholders to use their PIN debit cards at retailers that accept NYCE cards. » Continue Reading
Robert Gellman writes about phishing in DM News. » Continue Reading
Coinstar has announced the results of its 7th annual National Currency Poll. » Continue Reading
Global Payments has introduced VIP Lightspeed, a new Internet and PC-based platform serving the gaming industry. » Continue Reading
FDC's ValueLink reports on the results of its fourth annual Consumer Insights survey in which 52% of survey participants said they would prefer to give a gift card over cash (38%) or gift certificates (11%). The survey also reported that 64% of adults in the US either purchased or received a gift card in the last twelve months.
NACHA has published a Request for Comment regarding the proposed imposition of network return entry fees for unauthorized ACH transactions.
The fees, estimated to be in the range of between $13 to $18, are intended to shift the cost burden of dealing with such unauthorized transactions from the receiving financial institution to the originating financial institution. NACHA would collect the fees, retain 5-10 percent of the fee amount to support its risk management efforts, and forward the rest to the receiving financial institution.
NACHA requests that all comments on this proposal be received no later than Tuesday, November 30, 2004. Estimates are that this new fee, if approved by NACHA, would be imposed beginning in June 2005.
Reuters reports from Hong Kong that PayPal is hiring in China as it explores an entry into that market. » Continue Reading
Visa has announced the completion of its most complex semi-annual update of the Visa Global Payment Network.
The Wall St. Journal reported on the impact that recent Federal Reserve interest rate increases is having on rates charged to consumers by credit card issuers (sub. reqd).
TSYS has announced the completion of its new European data center. » Continue Reading
Charles Schwab has announced that the Charles Schwab Bank is launching a new rewards focused credit card, the Charles Schwab Bank Visa credit card. The card will allow rewards points to be redeemed to pay for equity trades in Schwab brokerage accounts. Details on the new card are available from the Schwab website.
[Update: Hello Kitty is now offering the Hello Kitty Platinum Plus Visa Credit Card - from Bank of America!]
Sanrio has launched the Hello Kitty Debit MasterCard website. We had a news item here about the launch of the new card earlier this week.
It strikes me that using the term "debit" on this product -- while technically correct and required in the hologram as a result of the merchant settlement -- is a bad marketing choice. What kid knows what debit means? Sounds like a disease. Why not "cash card" or "purse" or some such?
The Office of the Comptroller of the Currency has just published the Fall 2004 edition of its Community Developments newsletter which features "The Power of Plastic" -- highlighting efforts by banks to use technology to reach those Americans who do not have access to banking services. » Continue Reading
American Express Incentive Services has introduced a new cash-based stored value card called IncentiveFunds Select.
IFC Select is essentially "electronic cash" -- a predenominated stored-value card that's accepted virtually everywhere the American Express® Card is welcome, including ATMs. Cardholders enjoy the option of purchasing merchandise or redeeming the card for cash. IFC Select's comprehensive lost or stolen replacement protection, brand prestige and administrative and cost efficiencies are just a few advantages the card offers over traditional cash rewards such as currency or company checks.
ATMmarketplace.com reports on the ATM & Debit Forum held recently in Baltimore.
According to several speakers at a network showcase session that preceded the panel discussion, growth in debit volumes exceeds 20 percent a year. In contrast, annual growth in ATM volumes has slowed to two to three percent.
Kabira, a San Rafael, California network switching software provider, has announced that its zero-latency network switching technology is being used as part of Visa Direct Exchange. » Continue Reading
Joshua Robin writes in Newsday.com about efforts to persuade the New York MTA to replace its current magstripe-based MetroCards with "smart" proximity/RFID-based cards.
The chip in the cards contain an antenna that is powerful enough to be read through clothing and up to a foot away – powerful enough to be read through a purse, said Jae Lande, a spokeswoman for Cubic Corp., a San Diego-based company that makes Smart Cards and MetroCards.
The Boston Business Journal reports that Peppercoin is partnering with Reino Parking Systems to support credit card transactions at Reino's Multispace parking meters.
Federal Reserve Chairman Alan Greenspan addressed the annual convention of the American Bankers Association today. In his speech, he highlighted the health of the US banking industry as well as the contributions that technology and banking consolidation have made to lowering risks. » Continue Reading
The Mail & Guardian Online reports on Johannesburg on three large-scale rollouts of smart cards in South Africa scheduled to begin in 2005.
Circuit City and JP Morgan Chase announced this morning the launch of a new Circuit City Rewards Visa Card. » Continue Reading
The BBC reports on APACS in the UK recommending that banking customers avoid accepting cheques whenever possible and that they use electronic payments instead.
Robert Guy Matthews reports from London for the Wall St. Journal on Visa's new advertising campaign in the Middle East, Africa and Eastern Europe (sub. required). » Continue Reading
