Best wishes for a very Happy New Year and a great 2005 from all of us at Glenbrook Partners!

Caroline Mayer reports in the Washington Post on a lawsuit brought by the Minnesota attorney general against Capital One.

The ads suggest that Capital One's cards, unlike its competitors', would bear interest rates that remain at 4.99 percent, the lawsuit said. However, it alleged, for many consumers, the interest rates went up -- in some cases they could have increased to 25.9 percent -- if they were just a day late in paying their bills or if they exceeded credit limits.

Joseph Menn reports on Microsoft's announcement that it is abandoning its efforts to persuade others to adopt its Passport service.

Passport probably drew few new customers to Microsoft products. But it was initially seen as strategically important because it could have helped the Redmond, Wash.-based company put itself in the middle of most electronic transactions.

Because it would keep track of credit card numbers and passwords as people moved from Web site to Web site, Microsoft had predicted that Passport would smooth the way for widespread use of Web services based on a person's identity instead of those linked to information stored on a specific PC.

Bankrate has announced the results of its annual New Year's Resolution poll.

According to a national survey conducted by Roper for Bankrate, 36% of Americans polled are focused on weight loss as opposed to 31% who are concerned with eliminating outstanding debt. This is a significant change from the 2003 poll in which 37% of those polled were more concerned about their debt, while only 29% were concentrating on losing weight. In fact, this is the first time in the three years that Bankrate has conducted the survey that Americans have chosen weight loss over controlling debt as their New Year's Resolution.

VeriSign has announced some of the results its payment processing unit saw during the 2004 holiday shopping season.

"The 2004 online holiday shopping season has proved highly successful, with virtually every indicator showing growth. From spikes in merchant categories to new shopping phenomena like 'Black Monday,' we continue to observe the impact the online marketplace has on traditional shopping-behavior patterns," said Trevor Healy, vice president of payment services, VeriSign.

"Through the online data we collected, we have seen clear changes in consumer behavior such as accelerated weekday shopping activity, more confidence in buying digital goods from e-commerce sites, an increase in gift-certificate purchases as well as the direct impact of shipping lead times on sales."

Alex Falk reports in the Financial Times that UK consumer spending using plastic cards will for the first time exceed the use of cash.

"The key driver has been the introduction of debit cards," said Apacs' Jemma Smith. "We're seeing a generation of middle-aged customers coming through who have grown up with both debit and credit cards."

Borzou Daragahi reports in the New York Times on how banking in Iraq is slowly reviving.

The revival is being led by some private Iraqi banks that have begun using new economic rules, harnessing the surge of reconstruction money and, in some cases, forging foreign partnerships.

Information Week reports on the growth in online sales this holiday season.

Online sales using Visa-branded cards for the week ended Dec. 26 reached $1.8 billion, up 58% over the same period last year, while the number of online transactions reached 24 million, up 43% from a year ago, according to Visa USA's SpendTrak report.

For the week ended Dec. 19, Visa's online sales were $2.7 billion (up 39%) and online transactions were 34 million (up 34%). Similar increases were recorded for preceding weeks.

The BBC reports on the January 1st shift in liability for fraud on card transactions in the UK -- from card issuer to merchant if the merchant hasn't implemented the new chip and PIN acceptance technology.

"Many retailers have made a business decision not to convert their tills to chip and pin," says Bob Jarrett, professional services director for the British Shops and Stores Association (BSSA) which represents 4,200 shopkeepers. "Some of our members simply do not do enough business on cards to warrant going to the expense of changing their tills," he says.

Krysten Crawford writes on CNN Money about fees associated with certain pre-paid gift cards.

It's the dirty little secret of select gift cards: activation charges, monthly service fees, unreturned balances, and expiration dates that can render worthless Grandma's new and much-welcomed form of expressing love.

SmartMoney.com profiles Scott Bilker of Barnegat, NJ who holds 80 credit cards with more than $300,000 in total available credit. Bilker operates the web site DebtSmart.com.

Ron Lieber reports in the Wall St. Journal about the upcoming pitches consumers will be receiving for American Express cards.

Banks like the idea of issuing AmEx cards because an American Express generally pays them more than a Visa or MasterCard. But for consumers, AmEx has its limitations: It's not as widely accepted by merchants.

That fact was hammered home recently, when Walgreens -- the nation's biggest drug store chain -- announced it wouldn't accept American Express cards anymore. AmEx hits retailers with higher average service fees than MasterCard and Visa, and Walgreens says it decided the premium wasn't worth it.

Bank of America has released the results of a new study of consumer thinking regarding online banking.

Overall, when consumers were asked, "What prompted you to start banking online?" 64% cited 24-hour access to their accounts, 54% noted convenience and 48% answered that online banking saved time.

Gambling Magazine reports on the use of RFID in casino chips.

iPayment has announced that it has acquired a merchant portfolio of approximately 25,000 small merchants from First Data Corp. The portfolio represents approximately $9 to $10 billion in annual charge volume and was acquired for $130 million in cash.   » Continue Reading

Aldo Svaldi reports in the Denver Post on the relationship between Visa International and First Data Corporation.

"On the one hand, they are our competitor, and on the other hand they are our customer. It is a unique dynamic," said Danielle Pereira, spokeswoman for Western Union, First Data's money-transfer subsidiary.

Jennifer Kingson reports in the New York Times on DataTreasury Corporation, a Melville, NY-based company that has sued others, including several banks and processors, for patent infringement.

DataTreasury, for its part, said in court filings that the two patents were the brainchild of its founder, an inventor named Claudio Ballard. The filings are silent on Mr. Ballard's professional credentials and background, but they do assert that he met at least once with people from J. P. Morgan Chase and that they appropriated his ideas.

Amazon.com has announced some early results from this holiday shopping season including setting a single-day record with more than 2.8 million units ordered, or 32 items per second, worldwide.

Bloomberg reports on new efforts by credit card issuers to press for changes in the US personal bankruptcy code.

Personal-bankruptcy filings have almost doubled in the last decade, reaching 1.58 million for the last 12 months, compared with about 800,000 in 1995, according to the Administrative Office of the U.S. Courts. The Bankruptcy Coalition, a lobbying group that includes JPMorgan Chase and HSBC, says those bankruptcies cost them $40 billion each year. The law the banks want would apply a means test to individuals seeking bankruptcy.

Bloomberg reports that US retailers' holiday gift card sales may have risen to more than $20 billion this holiday season.

Gift card sales may have accounted for 11 percent of holiday expenditures, said Michael Niemira, chief economist for the New York-based International Council of Shopping Centers, more than his earlier forecast of 8 to 10 percent. Wal-Mart Stores Inc., the world's largest retailer, on Dec. 18 said gift-card sales were ``significantly'' above last year's level.

Joel Millman, Robin Sidel, and Carlta Vitzthum report in the Wall St. Journal on Visa's focus on growing the use of card-based money transfers among Latin American migrant workers.

The moves by Visa and banks are challenging the role of Western Union, which has a 14% market share in the fragmented money-transfer business but a much larger share -- as much as 50%, according to some estimates -- of the remittance market to Latin America. Western Union says it can also profit from proliferation of debit cards, since migrants can still use Western Union to wire cash directly into their relatives' card accounts back home.

The Wall St. Journal reports that MasterCard saw an 8.1 percent increase in holiday spending this year.

The projection, compiled by SpendingPulse, a retail sales service from MasterCard Advisors, a consulting unit of MasterCard International, is rosier than holiday expectations inside the retail industry. The National Retail Federation is looking for a 4.5% gain for the season.

Bob Tedeschi reports in the New York Times on the good holiday season that online retailers just experienced.

Gift cards, in particular, helped generate a considerable amount of sales, and Apple, it turns out, may be responsible for a large part of that. Amazon said that $15 iTunes gift cards redeemable at Apple's online music store were the most popular item on its site last week.

Gail Liberman and Alan Lavine report in the Boston Herald on checking account issues.

Some 3.27 million ACH debits were expected to be returned as unauthorized in 2004, says NACHA-The Electronic Payments Association in Herndon, Va.

Kathy Kristof reports in the Los Angeles Times on gift card fees In an article titled 'Some Cards Are the Gifts That Keep on Taking".

Over the last several months, national banking regulators and the California attorney general's office have issued consumer alerts about the cards. Their main message: Gift cards aren't all alike, so be sure to read the fine print before you buy — or before you use them.

Jennifer Kingson reports in the New York Times on banks testing two-factor authentication techniques for online access.

The devices, which are handheld and small enough to attach to a keychain, are expected to cost customers roughly $10. They display a six-digit number that changes once a minute; people seeking access to their accounts would type in that number as well as a user name and password. The devices are freestanding; they do not plug into a computer.

Barbara Hagenbaugh reports in USA Today on merchant reactions to the fees merchants pay to accept American Express cards.   » Continue Reading

Isabel Berwick reports in the Financial Times on the upcoming liability shift about to take place in the UK that will shift the liability for fraudulent transactions to merchants from card issuers -- if the merchant has failed to deploy new chip card and PIN capable point of sale equipment.

About 85 per cent of retailers have installed chip and pin so far, with some shops still waiting for banks to deliver the machines. Others, mostly luxury retailers, have decided to take the risk, claiming that they know their customers and that the cost of running the machines is expensive.

Pete Barlas reports in Investors Business Daily on the growth in online ecommerce sales this holiday shopping season.

Christmas sales over the Internet are booming, far outpacing the growth of sales in physical stores, say reports. U.S. consumers using Visa debit and credit cards spent $16.8 billion online from Nov. 1 through Dec. 21, a 34% hike over the year-ago period, says Visa.

Cynthia Cho reports in the Wall St. Journal on RFID-based PowerPay and its deployments at several football stadiums this season.

China Daily reports on a new alliance between Chinese computer maker Lenovo Group and Visa International.

Lenovo will become the preferred information technology equipment vendor for Visa International worldwide.

Celent Communications has published a new report examining the state of the smart card payment industry that projects that "smart cards will have a significant presence by 2012 in the U.S. and Europe, despite the lack of initiatives in the U.S. over the past few years. The analysts say smart cards, also called chip cards, will overtake magnetic stripes and revolutionize the payment industry."   » Continue Reading

Christopher Conkey reports in today's Wall St. Journal on the range of payment options available to consumers this holiday season.

From cash and checks to credit cards and the increasingly popular debit cards, it's easy to get confused. Debit purchases, for example, are often made with "check cards," while recent banking regulations are spurring many check payments to be scanned at cash registers as if they were debit cards. It has created what leading expert Mark Budnitz, a professor at Georgia State University College of Law, calls "a complicated and bewildering exercise for consumers."

AP Business Writer Anne D'Innocenzio reports on how the surge in gift card sales is altering merchant financial results.

Gift card sales are not booked as revenues until the cards are redeemed. And, with more merchants eliminating fees that erode card values if cards are not used immediately, recipients have little incentive to spend right away. Greater use of the cards also is forcing retailers to consider stocking less merchandise earlier in the season and increasing the flow of goods in January, Slater said.

Global Payments is expanding its worldwide presence in the money transfer industry through the acquisition of Europhil.   » Continue Reading

The Hindu Business Line reports on the launch of card to card money transfer services in India by IDBI Bank and Visa International.

David Lazarus reports in the San Francisco Chronicle on WebLoyalty, a Connecticut-based direct marketing firm.

Webloyalty is able to obtain people's credit card numbers directly from many of its partners and will charge monthly fees for a service some people might not realize they've signed up for.

Exante Financial Services has announced a new Health Savings Account MasterCard debit card.

Cyota has announced that it has closed a new $7.25 million financing round led by Bessemer Venture Partners.   » Continue Reading

Susan Foulds of Watchfire GomezPro comments on recent launches of inter-institutional transfers by Citibank and Bank of America.

IITs are defined as fund transfers among accounts held by the same customer at two different institutions. That could mean a lot of things, but here we will focus on the recent trend at Citibank and Bank of America: IITs as ACH transfers among deposit and possibly investment accounts.

Susanna Schwartz writes in Billing World about Simpay, the European mobile commerce consortium.

The design of the payment platform is nearly complete, and expected to officially launch by Q2 2005. The vendors involved are Valista, Encorus, Privnet and Qpass, which are working with the founding operators to enhance specs.

The Simpay hub has recently been outsourced to Encorus, a mobile payments services company—majority owned by First Data Corp.—which will continue the development of Simpay's transaction processor. The acceptance testing will be conducted by Encorus in upcoming months. Simpay has built a test script and simulator hub, which transmits messages among members. It also has completed various business schemes, operating regulations and governing documentation.

The federal bank and thrift regulatory agencies have announced final rules to require financial institutions to adopt measures for properly disposing of consumer information derived from credit reports.

Current law requires financial institutions to protect customer information by implementing information security programs. The final rules require institutions to make modest adjustments to their information security programs to include measures for the proper disposal of consumer information. They also add a new definition of "consumer information."

The final rules take effect on July 1, 2005. The full text is available online for downloading (PDF).

Computer Sciences Corp. (CSC) has announced the results of a performance and scalability benchmark test of is CAMS II card and merchant system. CSC's five-month testing project demonstrated that the strategic in-house card management platform can process a simulated workload of 100 million active cardholder accounts.

"Most U.S. credit card processing is outsourced to third parties who achieve scale economies through product standardization," said Theodore Iacobuzio, vice president of research at TowerGroup, a leading financial services research and advisory firm. "An in-house alternative would contribute to a sea change by enabling more flexible credit-card processing at scale, under the issuers' direct control."

AMR Research has published an alert on contactless payments.

Conclusion: Despite the promise, no new payment system gains hold rapidly.  There’s too much inertia in the system from consumer education, to POS infrastructure, to payment devices in consumers’ hands.  Retailers should carefully watch the success of CVS and merchants accepting MasterCard’s PayPass.  Retailers should resist jumping in until they feel there are a reasonable number of RF-enabled cards or keyfobs in circulation in their geography. 

JCB has announced it has acquired a one-third ownership in EMVCo, LLC, joining MasterCard International and Visa International with each having equal interests in the organization.   » Continue Reading

Bank of America has announced that its customers spent a record $100 billion on their debit cards for goods and services during 2004. Bank of America, the largest debit card issuer in the country with over 22 million cards issued, is the first financial institution to pass that milestone within any year.   » Continue Reading

MSN Money's Terry Savage has advice for consumers who are struggling with high levels of revolving credit card debt.   » Continue Reading

MasterCard reports that it saw an increase of 9.2 percent in transaction volume for the fourth holiday shopping weekend as measured through Saturday evening.

Bankrate.com has released the results of a study of gift cards available from the 20 largest US retailers as well as gift cards offered by Visa, MasterCard, American Express and Discover.

Americans have embraced gift cards with a big materialistic hug. The National Retail Federation reports that three-fourths of us will buy at least one gift card this holiday season, spending a total of $17.34 billion, up $100 million from last year. The average person will buy three cards, most often for relatives outside their immediate family, spending a total of just over $100.

Equifax and Fair Isaac have announced Score Watch, a consumer FICO credit score monitoring service.

Score Watch continuously monitors subscribers' Equifax credit file for changes that can affect their FICO scores. Once a change is detected, Score Watch alerts subscribers via email or wireless text message, advising them to visit a secured web site for a detailed explanation of the change in credit status. If the subscriber's credit score changes by a significant amount due to changes in their credit file, the Score Watch alert will also include their up-to-date score.

Consumers will have to pay $7.95 per month to monitor their FICO scores using Score Watch. Providian recently started making consumer FICO scores available online to its cardholders for free.   » Continue Reading

Taco Bell has announced that it will accept credit and debit cards at all of its company-owned restaurants and many of its franchise locations.   » Continue Reading

Global Payments has announced @dvantage, an Internet connectivity product suite for merchants.

Chairman, President and CEO of Global Payments, Paul R. Garcia, said, "Global Payments is committed to the expansion of connectivity options that make it fast, secure and convenient for merchants of all sizes and types to process Internet transactions. Whether the focus is on security or transaction speed, Global Payments has a solution set that meets both simple and complex requirements."

The Scotsman reports on anti-skimming devices being deployed by Barclays Bank to protect its ATMs.

Viewpointe has announced that First Horizon and SunTrust have begun electronic check clearing through ViewPointe's ImageShare image exchange capability.   » Continue Reading

The Washington Post reports on the status of online risks -- saying they're likely to continue to grow in 2005.

"I liken the problem of online crime to the '20s and '30s, when law enforcement was still trying to figure out who all the gangsters were," said Marcus Sachs, a former White House cyber-security adviser who now directs the SANS Internet Storm Center, which monitors hacker trends.

Shannon Henry reports in the Washington Post on a recent roundtable discussion titled "What's Next in Wireless?"

The panelists agreed that one of the most interesting and potentially lucrative wireless niches will be "micropayments," finding ways to use a cell phone to pay small amounts, such as $1 or $2, for a new ring tone or a game. "That's a gigantic opportunity," said Mark Ein, founder of District-based venture capital firm Venturehouse Group.

American Express and CVS have announced that CVS is the first national merchant partner to accept ExpressPay from American Express.   » Continue Reading

Walgreens, the country's largest drug store chain, has announced it will stop accepting American Express cards because Amex's service fees are higher than other cards.

Although American Express hasn't raised its rates since Walgreens began accepting the card chainwide in 1996, Walgreens is not seeing significantly larger purchases from American Express cardholders that might offset the high fees.

The Federal Deposit Insurance Corporation (FDIC) today released the results of a study titled Putting an End to Account-Hijacking Identity Theft (PDF). Among the study's recommendations, the first was that financial institutions should upgrade existing password-based single-factor customer authentication systems to two-factor authentication.

Alenka Grealish of Celent Communicatins writes in Bank Systems & Technology on banking trends for 2005.

[Note: This offer has expired. This post is here as an historical archive.]

Citibank has begun offering free Apple iPod Mini's to new EZ Checking account customers.

Consumers must open the account online, fund it with $2,500 and pay 2 bills online each month for 12 consecutive calendar months -- a few of the key terms among the offer's fine print.

With American Express announcing its second US bank partner deal with Citibank yesterday, the implications for card-accepting merchants of any shift in spending away from Visa and MasterCard branded cards to Amex cards are coming into focus.

One industry analyst estimates that for every $100 in cardholder purchase activity that moves to Amex-branded cards, merchants will pay $0.50 in higher card acceptance fees due to the higher interchange/merchant discount fees that American Express charges.

Of course, it's the financial participation in that higher interchange fee income that's the primary (only?) motivator for MBNA and Citi to do these alliance deals with Amex. In combination, Citi and MBNA issue cards responsible for about 25 percent of credit card spending in the US.

2005 could also shape up to be a tough year for MasterCard in terms of potential impact to its US payment volume. Two of its largest issuers have announced Amex alliances. One (MBNA) is in the midst of an aggressive roll-out of Amex-branded cards. Another top issuer, JP Morgan Chase, is reportedly still considering its brand decision -- between Visa and MasterCard (or, perhaps, also Amex?).

Robin Sidel reports in the Wall St. Journal on MBNA's launch of marketing of Visa Signature cards. For more information, see MBNA's Visa Signature home page.

RSA Security has announced that Commerce Bank will be using RSA's SecurID token for two-factor authentication of more than 4,000 employees and corporate banking customers.   » Continue Reading

Business Week looks at the Citibank / American Express deal.

Now that two of the biggest card-issuers are on board with American Express, it puts competitive pressure on other banks to sign on.

Next convert? Observers are putting their money on J.P. Morgan Chase, which has 92 million U.S. cardholders that American Express would like the opportunity to court.

Update: Jennifer Kingson reports on the Amex/Citi card issuing alliance in Tuesday's New York Times.

American Express this afternoon announced its second major US bank card issuing alliance with Citibank.   » Continue Reading

Last week the Office of the Comptroller of the Currency published a list of consumer tips regarding gift cards (PDF).

Remember that a gift card is like a loan: you are giving money to the company that holds the value of the card until you use it, and they are promising to give that money back when you ask for it. Make sure you know who is standing behind that promise, and remember that you are putting your trust in that company (and its financial stability).

JP Morgan Treasury Services has announced it has been selected by MetLife to provide its Order-to-Pay Service to streamline its procure-to-pay cycle.   » Continue Reading

Wachovia has announced the introduction of a new receivables service, Remote Desktop Capture, that enables the remote capture and transmission of paper checks for deposit.   » Continue Reading

AuctionBytes.com's Ina Steiner reports on the expansion of PayPal acceptance beyond eBay.

Steve Chawkins reports in the Los Angeles Times on Walter Cavanagh, the king of credit cards with 1,496 active cards.

At heart, the 61-year-old retired financial planner is a one-card guy. And, unlike the average American household, which carries more than $9,000 in credit card debt at any time, Cavanagh pays off his card (whose lender he would not disclose) in full each and every month.

Bob Tedeschi reports in the New York Times on some difficulties that online ecommerce sites have experienced this holiday shopping season.

MasterCard reported this morning that transactions processed over its Banknet global telecommunications network increased 7.8 percent year over year for the third weekend of the holiday shopping season as measured through Saturday evening.

MasterCard processed 67.7 million authorizations over its network this year in the third holiday shopping weekend, as compared to 62.8 million for the same period in 2003. MasterCard has processed 483.1 million transactions through December 11 this year, as compared to 439.9 million at this same time in 2003, a 9.8% cumulative growth in transactions for the season overall. 2004 has two more shopping days in the holiday season than in 2003.

Simon Lelieveldt blogs from a conference in Amsterdam on mobile payments.

Simpay will go live in second quarter of 2005; merchants accepting simpay will be faced with 30% fee to be paid as a merchant service charge.

Patrick McGeehan reports in the New York Times that MBNA has decided it should ask for permission before switching its customers' credit cards to American Express cards. The company's decision follows publicized reports of some customers being upset at having their Visa or MasterCard-branded MBNA card replaced with an American Express card.

Terri Bradford of the Federal Reserve Bank of Kansas City has published a brief paper on Payments Types at the Point of Sale: Merchant Considerations (PDF).

Apple and PayPal announced today that Apple's iTunes Music Store will now accept PayPal for purchases. The first 500,000 customers to open a new iTunes account in the US using PayPal as their form of payment before March 31, 2005, will receive five free songs.

"We are thrilled that PayPal users can now buy their music on the world's number one online music store," said Todd Pearson, general manager of PayPal's Merchant Services. "PayPal's virtual wallet offers iTunes customers the convenience of paying in the way they prefer."

Business Week reports on the 10th anniversary of ecommerce.

Analysts at Forrester Research Inc. say U.S. online sales will reach $145 billion this year -- or 7% of U.S. retail sales. While growth has slowed from last year's hefty 38% gain, that's still a 26% leap from the $114 billion racked up in 2003.

Jennifer LeClaire reports in Ecommerce Times on the potential for microcommerce.

Much attention has been focused on the promise of enabling large business-to-business transaction over the Internet -- and many corporations can testify to the Web's transforming power to streamlin inventory management. However, there's a new revolution coming online, and it's called microcommerce.

CyberSource predicts that online shopping volumes will peak this holiday season next Tuesday, December 14th.   » Continue Reading

Myvesta has announced the results of an annual credit card survey that indicates the average amount of credit card debt carried by individuals in the US has risen 14.5 percent.

The average American is now carrying $2,627 in credit card debt, up from $2,294 in 2003. Individuals are also carrying more credit cards in their wallets. Americans are now carrying an average of 2.9 credit cards, up from 2.3 in 2003.

The American Bankers Association has issued a warning to consumers to be on the lookout for phishing emails.

Robert Lemos reports for CNET News.com on companies moving away from relying only on passwords for user authentication.

Raymond Keating writes a commentary in the Washington Times about the recent US Department of Justice anti-trust lawsuit against Visa and MasterCard.

As so often is the case with antitrust, this wasn't about consumers, but about competitors using the government to gain ground in the marketplace. Meanwhile, the court mandate for Visa and MasterCard to allow banks to offer other cards easily could translate into higher fees for merchants.

After all, if Card Issuer A cuts a more lucrative deal with a bank at higher fees, then wouldn't that bank have an incentive to push more customers to Card Issuer A and away from the lower priced transactions charged by Card Issuer B? Wouldn't Card Issuer B be compelled to raise its fees and provide a bigger chunk to the bank? Meanwhile, the merchants, including countless small businesses, would face higher costs.

Patrick McGeehan writes in the New York Times about the negative reactions some MBNA cardholders have been having to having their cards switched from Visa or MasterCard to American Express branding.

Linda Sherry, editorial director of Consumer Action, an advocacy group, said she saw the deal between MBNA and American Express as "a positive thing" for consumers, but she questioned the "heavy-handed" marketing approach. "This is a dumb way to do this," Ms. Sherry said. "You don't go to your existing customer base and force-feed them something like this."

Ace Cash Express has published a report on the current state of the retail financial service needs of consumers in the United States. The report is available for downloading (PDF).

The report provides an overview of the evolving nature of how Americans access and utilize financial services at the retail level and the increasing number of consumers who periodically or rarely utilize the traditional retail banking system.

Cash Technologies' subsidiary Heuristic Technologies has announced the launch of a new debit card product called the CashTech.Card.

Heuristic plans an immediate distribution of CashTech.Cards for expense reimbursements, Health Reimbursement Accounts (HRA's) and Health Savings Accounts (HSA's). Other anticipated uses include payroll, check cashing, loyalty programs and personal uses.

Rich Smith reports from Motley Fool on phishing attacks that exploit weaknesses in online banking web sites.

MasterCard has announced that it is offering its instructional symbol for contactless payments to the payments industry as an open universal identifier.

"As interest in contactless payments continues to grow, it is very important for the payments industry and merchant community to clearly educate consumers on how to use these new cards and devices," said Art Kranzley, executive vice president and Chief e-Business Officer, MasterCard International.

"Now that a universal symbol exists for the industry, we expect this education process to move quickly, allowing consumers to enjoy the simplicity and convenience of contactless payments."

Visa International's Sue Gordon-Lathrop writes in ContactlessNews about Visa's perspective on contactless payments.

2005 will be a year where contactless payments gain more significant traction as infrastructure continues to deploy. It will also be a year where the messaging for contactless payment will need to be further refined. The technology works, it’s been proven to be acceptable to all, but in order to mass market the potential it will be important to focus on some key areas of education.

American Express has announced the launch of its first cards in China, issued in partnership with the Industrial and Commercial Bank of China (ICBC).   » Continue Reading

Theresa Carey reports in eWeek on MasterCard's e-P3.

MasterCard e-P3 automates the financial and information value chain for corporations and public sector organizations by integrating MasterCard settlement options into electronic invoice payment and presentment (EIPP) platforms.

Citigroup is holding an Analyst/Investor Day briefing tomorrow for its Global Consumer business.

Ray Martin of CBS Marketwatch.com has some advice for credit cardholders who find themselves on the receiving end of a significant jump in the interest rate on their outstanding balances.

Most consumers agree that hiking interest rates like this seems unfair, but the credit-card companies say they are being prudent to raise interest rates for customers when they think the risk of being repaid had increased. The card issuer's position is that if a customer appears to be a higher risk category -- i.e. they may not pay their bills on other accounts on time -- then the card company needs to protect itself by charging higher rates.

Business Week reports on the increasing tendency of consumers to tap home equity loans or lines of credit to pay off their credit card outstandings.

Growth in credit-card receivables -- what card holders owe -- has slipped to low single digits for issuers in the last couple of years, and some industry watchers think the trend is here to stay.

"The logic of borrowing at 3% to 7% on a home-equity loan compared to 13% on a credit card is too powerful to ignore," says Morgan Stanley analyst Kenneth A. Posner.

Note: Tom Brown of Bankstocks.com includes a link to Posner's report on home equity lending (done in conjunction with Betsy Graseck) in this weblog posting

Commerce Bank has announced a new Visa Gift Card now available for purchase at its branches with no additional fee.

"The new Commerce Visa Gift Card enables our customers to have choice and convenience, and naturally, we offer it for free and in a unique and memorable way - all the things Commerce is known for," said Dennis DiFlorio, President of Retail Banking and Operations, Commerce Bank.

Theresa Carey reports in eWeek on a panel at Oracle's OpenWorld session that concluded that banks must move beyond just moving money and consider managing the information embedded in payments.

American Express Incentive Services has announced the Housewarming Gift Card, a gift card designed for the real estate industry.

"The Housewarming Gift Card was designed to let consumers choose something nice for their new homes, while taking the guess work out of the gift giving process for the real estate industry," says American Express Project Manager Phil Gorman.

According to a Realtor Magazine poll, 77% of all Realtors gave their clients a housewarming gift last year. Of those 77%, 44% gave gift cards. Those numbers should increase this year with the increasing popularity of gift cards.

Griff Witte reports in the Washington Post on the Fed's recent report that in 2003 the number of electronic payments exceeded the number of paper check payments.

The increased popularity of electronic payment, however, has spawned questions about whether the systems for processing transactions adequately protect consumers and whether they're fair to retailers.

Paul Roberts of IDG reports on results of a recent Gartner survey that shows online consumers are growing frustrated with the lack of security provided by banks and online retailers including feeling that passwords are no longer sufficient to secure their online transactions.

According to the data, almost 60 percent of those surveyed by Gartner said they are concerned or very concerned about online security.

Even more important for online retailers: Over 80 percent of those surveyed said they would buy more from an online vendor who offered them more than just a user name and password to protect their accounts.

ABC News interviews Wayne Best, Visa USA's senior vice president of strategic and economic analysis.

However, the most significant trend that we've seen in this industry over the past 10 years has been the mainstreaming of the debit card and a clear consumer movement toward using a mix of payment options, depending on the type of purchases that they want to make.

Gone are the days that electronic payments are the exclusive domain of credit. Instead we're now seeing consumers who have grown to expect — if not demand — the convenience, utility and security of electronic payments, whethe