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Barbara Whitaker writes for the New York Times about debit cards and how authorization holds can sometimes drive a series of overdraft fees and bank practices regarding charging extra fees for PIN-based transactions.
Bored with your current gig and looking to find your next gig? Our PaymentsJobs.com jobs listing board helps payments professionals find the best new opportunities. Here are some recent job listings:
A study forthcoming in the Federal Reserve Bank of New York’s Economic Policy Review, "The Role of Retail Banking in the U.S. Banking Industry: Risk, Return, and Industry Structure" (PDF), concludes that the industry’s recent emphasis on retail banking is driven almost entirely by the very largest U.S. banks and that it may be more persistent than in past cycles. » Continue Reading
First Data International has announced that it has reached an agreement to acquire POLCARD SA, Poland's leading independent merchant acquirer and card issuer processor, in an all-cash transaction for $325 million. » Continue Reading
BancorpSouth has announced that its banking customers who subscribe to the AT&T Mobility wireless service can now download the mobile banking application directly to their device, where they can access the application anywhere and at any time. » Continue Reading
Evan Schuman reports for eWeek's Channel Insider on more details about the recent TJX payment card data breach.
Visa USA has announced the national launch of its What's My Score program - including giving away 5,000 free FICO credit scores - to college students. The launch coincides with the release of a new survey of credit and debit cardholders that shows that only 17 percent of those surveyed knew their FICO credit score by the time they were 21 years old. » Continue Reading
BITS has released an ACH Check Conversion Risk Management Toolkit (PDF) to "educate financial institutions’ fraud department personnel and investigators about the benefits and risks associated with ACH check conversion." Interestingly, the report includes this comment: "The ACH network, which historically has had minimal fraud, has seen a large uptick in fraudulent transactions, similar to the various types of fraud experienced in the check environment environment." » Continue Reading
First Data International has announced findings from a study of banking fraud in Europe, Middle East and Africa in which fraud experts from 52 banks across the region called for greater co-operation in the fight against fraud while acknowledging the significant barriers that stand in the way of collaboration. » Continue Reading
Ben Charny reports for MarketWatch on the integration of PayPal send money functionality into the latest version of the Skype client software. More details at the Skype Beta blog.
Fiserv has announced it is now exchanging checks with Bank of America through Viewpointe, a provider of check image exchange and archive services in the United States. The agreement enables Bank of America to connect to thousands of endpoints on the Fiserv Clearing Network, while allowing other Fiserv customers to exchange images directly with Bank of America. » Continue Reading
Gemalto has announced a "new end-to-end solution to help Canadian debit and credit card issuers implement the international EMV standard. Its EMV Pilot Package includes microprocessor-based smart card technology to provide better security to cardholders, as well as personalization and consultation services." » Continue Reading
Jenn Abelson reports for the Boston Globe on the TJX data breach reported earlier - saying the breach involved "at least 45.7 million credit and debit card numbers" stolen over a period of several years. The data was provided by the company in a 10-K annual report filing with the SEC yesterday.
Firethorn Holdings has confirmed that "Verizon Wireless is working with Firethorn to introduce its mobile banking and payments solution. The announcement demonstrates growing support among the nation's leading wireless carriers for Firethorn's unique federation strategy for making the mobile banking and payments marketplace." » Continue Reading
The Network Branded Prepaid Card Association has announced results from a recent survey about paying for health care finding that consumers with prepaid health care cards, as part of their flexible spending account (FSA), were far more satisfied with being able to easily and efficiently pay for eligible health care expenses.* » Continue Reading
In his keynote address today to the CTIA Wireless conference, Visa USA President and CEO John Philip Coghlan said that mobile payment is "at a critical moment in its development, and realizing its full potential will require close collaboration between the wireless and payment card industries. Given the striking similarities in the paths our two industries have traveled, it is only natural we have arrived at a moment of convergence,” Coghlan said. “In fact, the convergence of payments and mobile communications is not just logical – it is inevitable.” » Continue Reading
First Data Corp. has amended its 10-K annual report filing with the SEC to include the financial statements of Chase Paymentech. Chase Payment is 51% owned by JP Morgan Chase and 49% owned by First Data Corp. First Data made the updated 10-K filing under an SEC rule requiring it as a result of FDC’s equity earnings in Chase Paymentech having exceeded 20% of FDC’s consolidated income from continuing operations before income taxes for the year ended December 31, 2006. The filing reports Chase Paymentech's 2006 revenues as $1.2 billion (up 49% from 2005) with net income of $476 million before some miscellaneous adjustments.
A press release from National In-Store says that one in ten shoppers leaving a store without making a purchase cited the wait to check out as a factor in their decision not to buy and notes that customer satisfaction levels, when forced to wait in line in excess of 4 minutes, fall below 80%. [Editor's note: bank branch managers - a/k/a store managers - take note!] » Continue Reading
The Ask the Advisor blog posts a 24-point recovery checklist outlining actions recommended for identity theft victims - noting that "you can reduce your risks for identity theft, but you don't have control over government agencies, hospitals, or retail stores that manage to lose your personal information."
Netbanker's Jim Bruene is tracking the recent announcements of mobile banking services by US banks in a Mobile Banking Scorecard he's posted.
Kelli B. Grant writes for SmartMoney about the differences in consumer protections between credit cards and debit cards - including "zero liability" protections.
Obopay has announced the introduction of Obopay Checkout, calling it "an industry-first capability that enables mobile merchants to offer consumers effortless, instant payments that monetize digital and physical offerings." » Continue Reading
The BBC reports on a new £20 note featuring a portrait of Scottish economist Adam Smith that is being introduced by the Bank of England. The new note includes a number of security features - including the following comment: "some unpublicised "covert features" are designed to further deter counterfeiters."
United and Chase Card Services have announced a program offering United Mileage Plus Visa cardmembers double miles for every eligible dollar spent when they use their card to pay their personal (or quarterly estimated) federal income tax, or when they pay their state or property tax between March 1 and May 25, 2007. » Continue Reading
Jeremy Kirk reports for Network World that PayPal is working on persuading email providers to block email messages appearing to come from PayPal that don't contain digital signatures - in an effort to try to reduce phishing attacks.
Reuters is reporting that Travelex is acquiring business-to-business payments provider Reusch International for $440 million and merging it into Travelex's Commercial Foreign Exchange division.
Visa has released results from a new global survey finding about 25 percent of companies plan to increase their use of corporate payment cards and decrease their reliance on checks in the near future. According to Visa, these companies "believe that corporate payment cards will reduce costs and enable greater cash flow management as a result of more transparent financial data for payables and receivables." » Continue Reading
At the CTIA show this week, Kyocera Wireless says it will be demonstrating several solutions that "deliver on the promise of next-generation wireless technologies to enable a variety of mobile consumer applications. Kyocera Wireless and Visa International are demonstrating mobile payments utilizing NFC technology, essentially turning a mobile phone into a Visa payment solution using the Visa mobile platform." » Continue Reading
ViVOtech has partnered with Mobile Candy Dish to "provide consumers a complete end-to-end mobile commerce platform" by combining ViVOwallet OTA and NFC mobile payment software and the Mobile Candy Dish Blaze suite of mobile services. With the combined offering, the two companies say "consumers can use their mobile phone to get movie information and pay for tickets using any form of credit, debit or gift card, as well as to redeem theater tickets electronically without any delays at the venue by using the ViVOtech contactless readers." » Continue Reading
Obopay has announced the launch of an m-commerce payment solution for mobile merchants and application providers that are looking to engage consumers via their mobile phones. » Continue Reading
Cyveillance has announced availability of a report titled “Online Financial Fraud and Identity Theft” (PDF) that highlights the growth of Internet attacks and identifies the industries most at risk. » Continue Reading
AT&T and Firethorn have announced that Wachovia, Regions and SunTrust Banks have selected Firethorn's mobile banking and payments solution to provide their customers with anytime, anywhere access to their financial information and transactions capabilities. » Continue Reading
Metavante has announced the "signing of a memorandum of understanding to form a joint venture with Monitise, a European provider of secure mobile banking and payments capability, to operate a mobile payments system in the United States." » Continue Reading
CNET News.com writer Elinor Mills posts an interview with PayPal's CTO Scott Thompson about "new security measures in browsers and at Internet service providers' e-mail gateways that should help people differentiate legitimate PayPal e-mail from spam." Thompson says "we are a 7-year-old start-up with 6,000 people, and the best is yet to come from PayPal."
MasterCard Worldwide has announced that it has signed a development agreement with ASK to create paper-based contactless payment solutions for use in transit and other payment environments. » Continue Reading
MasterCard Worldwide has announced it has assigned the PayPass ISO/IEC 14443 Implementation Specification v1.1 to EMVCo, the EMV standards body jointly owned by JCB, MasterCard Worldwide and Visa International - saying the move "signals significant progress towards a common platform for contactless EMV payment transactions." » Continue Reading
MobileLime has announced it is merging with Cuesol, a provider of interactive shopping, marketing and self-service solutions for grocers. The companies say "the merger will allow the companies to combine MobileLime’s mobile rewards and payment platform with Cuesol’s range of Web, kiosk and shopping cart solutions." » Continue Reading
Payoneer has announced that it has secured $4 million in a Series A venture funding led by Greylock Partners. Payoneer says it "will use the additional funds to expand its services for Web 2.0 companies and other businesses that need faster, easier and more cost-effective ways of paying people around the world." » Continue Reading
Greg Farrell writes for USA TODAY about Wells Fargo CEO Dick Kovacevich - saying he "may well be the best banker you've never heard of." The focus on cross-sell at Wells Fargo has been relentless - Kovacevich says "the cost to us of selling a product to an existing customer is only about 10% of selling the same product to a new customer."
Zhang Fengming reports for the Shanghai Daily on plans by China UnionPay to expand into eight more overseas markets this year - including Denmark, Sweden, Norway, Iceland, Egypt, South Africa, England and Canada. "We plan to build up UnionPay as the second passport of Chinese in the overseas market in our five-year plan," said Yan Qiang, assistant president of UnionPay. "UnionPay aims to cover 99 percent of overseas countries and regions where Chinese travel."
Michele Singletary writes about the recent FTC action taken against Kmart regarding some of its practices regarding fees on Kmart gift cards (reported earlier here). "The FTC alleged that Kmart, a subsidiary of Sears Holding, told consumers that its gift cards never expired. However, the agency claims the retailer didn't clearly inform customers that a $2.10 monthly fee kicked in retroactively if a gift card went unused for two years."
Glenbrook's Carol Coye Benson provides this update on two recent Glenbrook Payments Boot Camps.
Glenbrook just wrapped up two challenging and lively Payments Boot Camps. Last week we held our core session in Atlanta for the first time, and this week we had the first of our new Merchant Payments Boot Camps. Both events were sold out and had great and diverse groups attending. » Continue Reading
Forrester's Khalid Kark and Chris McClean have published a new report titled "The Top 10 Things You Should Know About PCI Compliance" saying that "compliance levels remain low because the consequences for noncompliance weren't clear. Lately, however, the credit card companies have been threatening their clients with severe punitive consequences for noncompliance, including fines or loss of privileges to use their brands. As many companies scramble to get compliant after an initial period of inattentiveness, here are the top 10 things they need to know."
A friend of Payments News sends a pointer to a story about Google Payment Limited now being listed as an eMoney licensee by the UK's FSA. If you do a search for Google on the FSA site - it shows an eMoney license was issued to Google Payment Limited on March 19, 2007. PayPal has a similar license - issued February 13, 2004.
Robin Sidel reports for the Wall St. Journal on steps being taken by Visa USA, MasterCard, and merchant processors to crack down on restaurants "for not adequately protecting diners' credit-card data from thieves." SIdel reports that "since January 2005, restaurants represented about 40% of incidents in which intruders gained unauthorized access to credit-card information, according to data tracked by Visa. That is the largest percentage of incidents among merchant groups."
Today's Guardian from London has a first person article on credit card fraud by Neil Forsyth and Elliot Castro titled "Money for Nothing - Confessions of a teenage credit card fraudster."
Earlier today, Morgan Stanley filed with the SEC a preliminary information statement describing its plan to spin-out its Discover Financial Services business unit later this year.
Glenbrook's Bryan Derman files the following report he prepared following his participation last week on a panel titled "Hype or Reality – Anti-Money Laundering Risks from Prepaid Payment Products and What Can Be Done About Them" at the Spring Meeting of the American Bar Association’s Business Law Section in Washington, DC. » Continue Reading
Aner Ravon blogs about a new PayPal mobile payment service he calls PayPal Mobile Checkout. Vauhini Vara writes for the Wall St. Journal about the service - quoting PayPal spokeswoman Amanda Pires as saying it is expected to launch within the year.
The Mint blog has an in-depth look into credit scores, why they're important, how they're calculated, how to improve your credit score, etc. Mint is a "venture-funded startup that is working nights and weekends to build a free, effortless, and secure anytime-anywhere personal finance tool for individuals who want control of their current and financial future." You can sign up to be notified when they launch.
Netbanker's Jim Bruene blogs about a new cell phone protection plan introduced by Wells Fargo - pay your cell phone bill automatically using a Wells Fargo credit card and receive insurance in the event the phone is damaged, lost or stolen (subject to several limitations of coverage). Details here on the Wells Fargo Bank website.
Bankrate.com's Holden Lewis blogs about a recent change Bank of America made to its credit cards fees - imposing a $1.50 per month minimum finance charge. He explains that while the initial notice he received was confusing, the bank clarified that the fee does not apply to transactors - those who pay off the balance in full each month - but to revolvers and sets a minimum finance charge amount for them.
Cellular South and Kyocera Wireless Corp. (KWC) have announced a multi-city consumer trial of Wireless Wallet technology beginning in May in Memphis, Tenn., and Jackson, Miss. » Continue Reading
Ina Steiner writes on her AuctionBytes.com blog about a PayPal survey she received from a reader asking about several potential new features that PayPal might offer to merchants.
Reuters reports that "web telephone calling service Skype will shortly begin allowing users to send money to other Skype users via the PayPal online payments system, Skype co-founder Niklas Zennstrom said on Tuesday."
Joel Garreau writes for the Washington Post about the US Mint's new presidential dollar coins - as mandated by the Presidential Dollar Coin Act of 2005 - being issued in the face of the migration to electronic payments and away from cash. He cites Visa's Tim Attinger: ""I dream of a day when kids on the corner selling lemonade will take Visa payments," he says. "Not next year, but it can happen."
We launched our new PaymentsJobs.com jobs listing board for payments professionals last month. Here are some of the current listings:
Jaikumar Vijayan writes for ComputerWorld about GratisCard - saying that "when the company launches on April 1, it plans to introduce the nation's first completely anonymous credit card with no name or number and no physical data stored on the card itself."
Information Week's Eric Zeman blogs about a new SMS-based mobile payment system in Belgium. Zeman reports that "unlike near-field communication (NFC), which requires a handset equipped with an NFC short-range radio, this program will let every cell phone user complete retail transactions from their phones."
Eight federal regulators have released a notice of proposed rulemaking (NPR) requesting comment on a model privacy form that financial institutions can use for their privacy notices to consumers required by the Gramm-Leach-Bliley Act (GLB Act). » Continue Reading
This morning's NPR Morning Edition radio show included a segment titled "Cell Phone Loans Might Be Too Easy" - describing the market in Finland for taking out consumer loans via SMS messages from your mobile phone. "Nearly 20 companies have begun offering these loans since the business started in Finland two years ago."
First Data Corp and PrivaSys have announced a "long-term licensing agreement that sets the stage for First Data to become a clear leader in the processing of contactless and other emerging payments for its clients - both financial institutions and merchants - around the world." » Continue Reading
In a press release this morning, PayPal announced that it has nearly 35 million accounts in Europe, a milestone that PayPal says "demonstrates the growing popularity of PayPal among internet consumers and merchants across Europe." Note that the number announced appears to be total, not active, PayPal accounts. In January, PayPal reported over 133 million total accounts of which 37.6 million were active in the quarter ending December 31, 2006. » Continue Reading
Javelin Strategy and Research has released a new report titled "Telephone Banking Authentication: Securing a Popular yet Vulnerable Channel" that concludes that "weak authentication measures continue to be utilized for phone banking." According to the report "a majority of top 23 US financial institutions need to strengthen authentication methods for the phone, with over 1 in 4 still asking for a full Social Security number, and only 8% requiring a password or answer to challenge questions." » Continue Reading
PAYjr has announced a strategic marketing partnership with the Credit Union Association of New Mexico (CUANM) that enables CUANM to offer a co-branded version of the PAYjr Programs to their existing customer base of more than 500 credit unions as well as future clients of the association's CU Succeed youth financial education program. » Continue Reading
Visa has released its global Commercial Consumption Expenditure (CCE) measurement for 2006. "Using the CCE index, a standardized metric to track business and government spending globally, Visa Commercial calculates global CCE in 2006 to be US$66.7 trillion, which represents an increase of 8.0 percent over 2005 expenditures of US $61.8 trillion." » Continue Reading
Dave Birch has posted the final agenda for the Tenth Annual Digital Money Forum being held next week in London. He's put together a great list of speakers for this year's event.
Evolution Benefits has announced that is has been granted a patent for its technology used in the substantiation of health benefits debit card transactions. The company’s patent, U.S. Patent 7,174,302 titled “System and Method for Processing Flexible Spending Account Transactions,” refers to the system and method EB developed for real time substantiation of card transactions prior to authorizing payment. » Continue Reading
Burton Group has announced a new research report with "a list of recommendations to help merchants and payment service providers get the most out of the payment card industry (PCI) data security standard (DSS) compliance work." » Continue Reading
Gerri Willis writes for CNN Money about techniques consumers can use to increase their credit scores - "the best way to improve your credit score in the short term is to pay off the high balances on your credit card - that can raise your FICO score 60 to 70 points overnight."
Opportunities still exist for small businesses to grow, despite an overall slowdown in the economy, according to Wayne Best, senior vice president of Business and Economic Analysis for Visa USA. According to Visa, "Best struck a note of cautious optimism in his keynote presentation at the Microsoft Small Business Summit, based on his analysis of macroeconomic trends, Visa spending data and small business studies." » Continue Reading
The Get Rich Slowly blog has an interesting post titled "What’s It Like to BORROW Money with Prosper?" written by Tricia (who also writes her own blog titled Blogging Away Debt) describing her experiences as a borrower using Prosper.com to find other folks willing to lend her money. She describes her experience seeking to borrow $3,500. She posted a starting interest rate she was willing to pay of 12%. As it turns out, lenders competed for her business and she ended up getting an interest rate of 9.9% from a group of 13 Prosper lenders.
Ellen Roseman reports for the Toronto Star about changes that Canadian credit card issuers have been adopting that increase the fees and interest charged on credit cards in Canada.
Zopa has announced that Douglas H. Dolton, formerly CEO of Chela Education Financing, has joined the company as Global CEO. In addition, Zopa has secured additional investment of $12.9 million from its venture backers, in a Series C round led by Bessemer Venture Partners. » Continue Reading
Simone Baribeau writes for the Christian Science Monitor about rewards credit cards - noting that "some 85 percent of US households count at least one rewards card among the seven (on average) credit cards they own. In 2006, financial institutions spent $10.3 billion on rewards, a figure that is expected to grow to $18.4 billion by 2010, according to Aite Group, a Boston-based research firm."
Diana Ransom writes for the Wall St. Journal about the techniques one should follow to minimize the chances of identity theft by electronic means - especially if you're using a wireless router in your home or business.
Bank of America has announced that its suite of check transformation tools will allow retailers and other business clients to take full advantage of the new Back Office Conversion rule that took effect on March 16, 2007. The Back Office Conversion (BOC) rule was issued by NACHA to allow businesses to collect a check written at the checkout counter and convert it in the back office into an electronic form. » Continue Reading
FDIC Chairman Sheila C. Bair issued a statement earlier today following Wal-Mart's decision to withdraw its bank application. According to Bair, "Wal-Mart made a wise choice. This decision will remove the controversy surrounding their intentions. They don't need an ILC to play an important role in expanding access to financial services, they can do so by partnering with banks and others. We look forward to working with Wal-Mart in meeting the need for low-cost financial services across all populations."
Adam Levitin has written a second paper examining rewards cards titled "Priceless? the Competitive Costs of Credit Card Merchant Restraints".
From the abstract: "Credit card transactions cost American merchants six times as much as cash transactions. Why, then, do consumers pay the same price for purchases, regardless of the means of payment? The answer lies in a set of credit card network rules known as merchant restraints. Merchant restraints forbid merchants from surcharging for credit and discounting for non-cash payments, while the framing effect, a well-documented cognitive bias, makes discounting for cash ineffective. Merchant restraints thus prevent merchants from pricing according to consumers' payment method and from signaling to consumers the costs of different payment methods. Accordingly, consumers never internalize the costs of their choice of payment system."
Aneace Haddad blogs about Adam Levitin's new paper titled "Priceless? The Social Costs of Credit Card Merchant Restraints".
From the abstract: "Who pays for credit card rewards? This article demonstrates that credit card rewards programs are funded in part by a highly regressive, sub rosa subsidization of affluent credit consumers by poor cash consumers. In its worst form, food stamp recipients are subsidizing frequent flier miles. The subsidization is created by a set of credit card network rules called “merchant restraints” that combines with a cognitive bias known as the framing effect to limit merchants' ability to price payments systems according to cost."
Wal-Mart Financial Services President Jane Thompson released the following statement today: “We notified the FDIC today that Wal-Mart has withdrawn the application we made in July 2005 for an Industrial Loan Company (ILC) charter. This action follows January’s FDIC decision to extend the moratorium on a number of pending ILC applications. Unlike dozens of prior ILC applications, Wal-Mart’s has been surrounded by manufactured controversy since it was submitted nearly two year