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« April 23, 2006 - April 29, 2006 | Main | May 7, 2006 - May 13, 2006 »

May 06, 2006

A New Generation of ATMs

Robin Sidel and Ian McDonald report for the Wall St. Journal about a new generation of ATM machines coming to market. Last year there were 10.5 billion ATM transactions ln the U.S. with about 80% involving cash withdrawals.

Payment Instrument Choice: The Case Of Prepaid Cards

Sujit Chakravorti and Victor Lubasi write for Economic Perspectives from the Federal Reserve Bank of Chicago about prepaid cards and how the costs and benefits to payment system participants can differ depending on which payment mechanism is used. The authors specifically explore the costs and benefits of prepaid card applications versus other payment instruments, such as cash, checks, and debit cards, for certain payment segments, including gift, payroll, and employer-initiated and government benefit programs.

Mobile Phones: A Key Player in Proximity Payment Systems

Michael L. Kasavana, NAMA endowed professor in hospitality management at Michigan State University, writes for AMonline about the evolution of vending machines to support contactless proximity payments.

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A Look At eBay's Health

Richard Waters writes for the Financial Times from San Francisco about eBay's current situation, asking whether eBay is about to become an ecommerce dinosaur or whether it is in the middle of an overhaul that will position it to "move into entirely new markets and continue to expand its 14 per cent share of global ecommerce?"

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May 05, 2006

Fed Reports Revolving Credit Flat In First Quarter

The Federal Reserve's report on consumer credit for the first quarter shows revolving credit flat with no growth during the quarter ending at $805.8 billion. Non-revolving credit grew at an annual rate of 2-3/4 percent during the quarter.

MasterCard IPO Could Be Year's Biggest

Calling it "one of the year's most eagerly anticipated offerings", Grace Wong reports for CNN Money that MasterCard's upcoming initial public offering could be the year's biggest -- as the company expects to raise up to $2.6 billion.

Last Call: Mobile Payments, Mobile Banking Survey

This weekend we'll be closing the Payments News readers survey on attitudes regarding mobile payments and mobile banking that we began a couple of weeks back. If you've not yet taken the opportunity to express your views, please do so now - it only takes 5-10 minutes to complete the survey and just taking the survey might bring you some new insights into how mobile may affect banking and financial services.

We'll be sharing some of the results from the survey here on Payments News beginning early next week. Stay tuned!

Going Online for Savings

Jennifer Kingson reports for the New York Times on high yield, online only savings accounts such as those offered by ING Direct, HSBC Direct, Emigrant Direct, Citibank Direct and others - and asks whether the banks offering those high rates can actually make a profit from doing so.

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Making Money From Mobile The Virgin Way

NetImperative takes a look at the UK's Virgin Mobile experience and predicts "an explosion is likely in the number of mobile virtual network operators (MVNOs) over the next ten years."

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Coinstar To Acquire Travelex Money Transfer

Coinstar has announced signing a definitive agreement to purchase Travelex Money Transfer Ltd. for approximately $27 million in cash. TMT is the third largest money transfer network in terms of agent locations and countries in which they do business. Currently TMT operates an agent network in over 17,000 locations in 138 countries.

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Consumers Say Mobile Phone As Payment Device "Unnecessary"

Enid Burns reports for ClickZ on a study by Market Platform Dynamics where more than half the young consumers who participated said they feel the ability to use their mobile phones as a payment device is unnecessary.

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May 04, 2006

eBay Holds Analyst Day Today - PayPal Update Included

eBay held its annual Analyst Day today covering eBay, PayPal, and Skype. The presentations from today's event (PDF - 17.4 MB in size) are available for downloading from the eBay Investor Relations site.

Some of the more interesting PayPal-related slides include a couple of slides in Scott Thompson's portion of the presentation -- including page 164 that shows the additional data available to PayPal in making its fraud risk decisions and page 166 that shows the very positive effects in terms of reduced transaction loss rate vs. growth in PayPal transaction volumes. Thompson is Senior Vice President and Chief Technology Officer at PayPal.

US merchant acquirers might want to take a look at page 198 showing how PayPal covers the traditional merchant value chain with a more integrated and, presumably, attractive solution.

Dana Stalder's presentation on "Beyond Internet Payments" discusses PayPal's efforts to both broaden and deepen its markets with both financial and mobile products. Not much actually new here - but a concise restatement of those efforts. Stalder's closing slide speaks to an expanded purpose for PayPal - aspiring to step beyond its traditional mantra of "creating the new global standard for online payments." Stalder is Senior Vice President of Marketing and Business Operations at PayPal.

The Nilson Report - Issue 855

The latest Nilson Report has arrived featuring an in-depth look at the general purpose cards in Canada (subscription only). Among other feature articles, this issue also has an interesting article showing the 2005 corporate revenues of the top card corporations along with some details on the new UBS card program (issued in partnership with Barclaycard US on both Visa and American Express-branded cards).

A Look At The New Bankruptcy Law

Helen Mirza of the Chicago Federal Reserve Bank has written an overview article about the new bankruptcy law (PDF) that took effect last fall.

Study Predicts Doubling in Electronic Payment Volumes by 2010

ACI Worldwide has announced the results of a Global Electronic Payments Market Study (PDF) conducted with Global Insight, Inc. finding that the annual number of electronic payment transactions, currently at approximately 210 billion worldwide, will double by the end of the decade and is growing at a compounded annual rate equal to four times the expected growth in real gross domestic product (GDP).

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2006 Annual Bank Card Profitability Study

Cards&Payments has announced the results of its 2006 Annual Bank Card Profitability Study reporting that "U.S. issuers of Visa and MasterCard credit cards in 2005 posted a collective after-tax return on assets of 1.99%, up from 1.59% in 2004. Total revenue among issuers of Visa and MasterCard consumer and commercial credit cards last year reached $109 billion, up 5% from $103.4 billion in 2004."

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From Wireless Ventures: A Look At Text Pay Me

The Seattle Post-Intelligencer's John Cook reports from the Wireless Ventures conference in San Jose on a presentation by Text Pay Me's founder and CEO Philip Yuen in which he described his company's differentiation from PayPal Mobile.

May 03, 2006

Allen Weinberg's Musings from CardTech/SecureTech

Glenbrook's Allen Weinberg reports from this week's CardTech/SecureTech Conference in San Francisco: "Even with all the press contactless payments has been getting, I was still shocked by the sheer dominance contactless payment solutions had at CardTech/SecureTech. Vendors from all over the world promoting their readers, reader components, cards, inlays, RFID stickers, etc. etc. etc. Standing by just about any booth, it didn't take long to hear someone ask the vendors "but what about contactless?"

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MasterCard Says PayPass Is Moving Cards To Top Of Wallet

Card Technology reports on a talk by Cathleen Conforti, a senior vice president at MasterCard and PayPass global product manager, at this week's CardTech/SecureTech conference in San Francisco where she said that consumers using their PayPass cards are paying with them 85% to 95% more often than they previously used their cards. “It’s definitely their top of wallet card,” she said.

American Airlines, American Express Expand Payment Options in the Sky

American Airlines has announced it has introduced a new service to accept credit and charge cards for onboard purchases, in addition to cash, using wireless handheld devices. American will be the first U.S. airline with a global network to offer this option onboard all aircraft. The new payment acceptance capability is being supported through an expanded relationship with American Express.

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Visa USA Tightens Debit Card Fraud Controls

Digital Transactions reports on steps being taken by Visa USA to have its debit card issuing members begin reporting PIN-based debit card fraud to Visa in June.

MasterCard Updates S-1 Registration Statement With SEC

Following yesterday's release of its first quarter earnings, MasterCard has filed with the SEC Amendment No. 5 to its S-1 Registration Statement that includes for the first time a proposed maximum offering price per share of $43.

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So You Want To Be A Mobile Operator?

DiamondCluster has published a white paper by Hamilton Sekino, Amaresh Tripathy, and David Gates titled "MVNO 3.0: How a new breed of wireless providers will bring strong brands into the MVNO space" (PDF) that discusses the rise of Mobile Virtual Network Operators (MVNOs) such as Virgin Mobile and Mobile ESPN and looks at how the MVNO ecosystem could evolve to support other brands - such as financial services brands - launching their own private label mobile services. Imagine getting your next specially equipped mobile banking and payments-powered Treo from your credit card issuer or your retail bank!

Mobile Payments: Call For Papers

The Electronic Commerce Research and Applications (ECRA) Journal published by Elsevier has issued a call for papers for a special issue to be published next year on the subject of mobile payments.

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UK: Scramble Starts For Pay-By-Mobile Business

Richard Wray reports for the Guardian about the launch of LUUP, a new mobile payments company, in the UK and plans by the five mobile operators in the UK to launch their own service later this summer called Pay4It. See also LUUP's press release on its service launch in the UK and Germany.

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Identity-Safety Excellence Among Credit Card Issuers

Javelin Strategy & Research has announced its 2006 Card Issuers' Identity Safety Scorecard saying it reveals a significant difference when comparing the performance of the top-rated and the bottom-rated credit card issuers in partnering with customers to protect against identity fraud.

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