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« March 2, 2008 - March 8, 2008 | Main | March 16, 2008 - March 22, 2008 »

March 15, 2008

Red Ink Rising

In his New York Times article today, Joe Nocera quotes from an article titled "Red Ink Rising" by Dean Starkman published in this month's Columbia Journalism Review. Starkman's primary point is how the business and financial press focused only on "traditional earnings and marketing stories" while what he calls a "radical shift" was underway as the credit card industry "shifted from a lending and underwriting paradigm to a sales paradigm; penalties, fees, and default interest at rates that were illegal a generation ago are no longer regrettable outcomes to be avoided but central to the business model."

"Heads You Lose, Tails They Win"

In an article titled 'Credit Cards Are Frothy, Not Bubbly', Joe Nocera writes for the New York Times about the current state of the credit card industry and why it's likely that the 'credit card companies will actually do O.K. while the rest of us suffer.'

[Editor's note: Nocera is the author of 'A Piece of the Action: How the Middle Class Joined the Money Class' published in 1995 that tells, among other things, the early history of the credit card industry. It's one of our recommended books for payments professionals.]

March 14, 2008

First Data Reports Earnings, Files 10-K

First Data Corp. yesterday reported its financial results for the fourth quarter of 2007. This morning, the company held a conference call to discuss the results (presentation available). Also today, FDC filed its Form 10-K Annual Report with the SEC. FDC's 10-K also includes the financial results of Chase Paymentech due to the size of Chase Paymentech's contribution to FDC's financial results.

US Credit Card Interest Rates Fall to 2 Year Low

Andrea Coombes writes for MarketWatch.com that, according to a survey by IndexCreditCards.com, the average credit card interest rate is at a two year low of 13.29% on cards without rewards features. For cards with rewards programs, the average interest rate has dropped to 15.15%.

Shipley Energy to Offer Co-branded RevolutionCard

Revolution Money and Shipley Energy have announced that Shipley has become the first energy company to offer a co-branded RevolutionCard. Shipley plans to "periodically boast valuable incentives for consumers when they use their RevolutionCard for qualifying Shipley Energy purchases."

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Donations of £1 Billion on Cards in 2007 Across UK

APACS, the UK payments association, has announced that "donations to charitable organisations on plastic cards reached £1.013 billion in 2007- up from £842 million in 2006. This is the first time donations on plastic have gone through the £1 billion barrier."

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Consumers Don't Testify at Yesterday's Credit Card Hearing

In an article titled ''Muscle' Silences Credit Card Adversaries', Vija Udenans writes for ABC News about yesterday's US House subcommittee hearing on credit card issuer practices and why five consumers who were originally scheduled to testify didn't. A webcast archive of the hearing is available. Elizabeth Warren (one of yesterday's witnesses) writes about the issue on the Credit Slips blog.

Debit Card Fraud in Canada and the Migration to Chip Cards

In an article titled 'Soaring rates of debit fraud prompt switch to smart cards' in today's Globe and Mail, Timothy Appleby writes about fraud on Interac debit cards and the planned migration to chip cards in Canada.

Headline News - March 14, 2008

Note: Throughout the day, as Payments News happens, this post is updated. For job opportunities available for payments professionals, visit PaymentsJobs.com. Employers looking to hire payments professionals can post their job openings there as well.

Payments Professionals Management Changes

We have received news of the following recent management changes:

  • O.B. Rawls has been named senior vice president of sales at TASQ Technology. Rawls previously was senior vice president of international sales for Hypercom.
Announce yourself! Have you recently taken on a new position in the payments industry? If you'd like to share the news with your colleagues, be sure to tell us about it. Are you looking for a new payments-related job? Or are you needing to find someone great? Checkout the Payments Jobs job board.

March 13, 2008

User-Centered Design at Wells Fargo

Adaptive Path's Jesse James Garrett interviews Wells Fargo's Secil Tabli Watson, senior vice president of Internet channel strategy at Wells Fargo Bank, about user-centered design and experience at Wells Fargo. Watson will be speaking at Adaptive Path's upcoming MX San Francisco conference being held April 21-22.

Debit Cards and Hotel Holds

Kitty Bean Yancey writes for USA Today about how authorization holds can impact cardholders when they use their debit card for paying for hotels. Yancey writes that "most people aren't totally maxed out on their credit cards, so they don't notice a hold. But people are closer to zero in their banking account and don't realize they can lose access to money they haven't actually spent."

MasterCard Comments on Credit Cardholders' Bill of Rights Act

MasterCard Worldwide issued a statement today regarding the Credit Cardholders’ Bill of Rights Act of 2008 (H.R. 5244). "Americans benefit significantly from a highly competitive payment system that offers incredible choice and financial opportunity for consumers. However, the wide array of payment options American consumers currently enjoy would be undermined by H.R. 5244, which would reduce choice, decrease the availability of credit, and raise interest rates and fees to many consumers."

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JPMorgan, Kelly Services Win Best Payroll Card Program Award

JPMorgan and its customer Kelly Services received the Best Payroll Card Program Award last week at the second annual Prepaid Card Expo in Las Vegas. Kelly Services has been offering the Chase Payroll Card program to its temporary employees since 2004. Kelly deployed the payroll card as a means to provide its temporary employees with a safe, convenient, and dependable alternative to payroll checks, as well as reduce the costs and time associated with issuing paper payroll checks.

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US House Holding Hearing on Credit Cardholders' Bill of RIghts

Today the Subcommittee on Financial Institutions and Consumer Credit of the US House of Representations is holding a hearing on legislation recently introduced by Rep. Carolyn B. Maloney called the Credit Cardholders' Bill of Rights Act of 2008. The subcommittee is hearing testimony from eight witnesses including representatives from several major credit card issuers including Bank of America, Capital One, and Chase Card Services. The prepared testimony of the witnesses is available for download. Tim Westrich of the Center for American Progress comments on the hearing and the legislation.

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Fiserv's Integrated Mobile Banking for Handheld Devices

Information Technology, Inc. (ITI), a business unit of Fiserv, has announced the launch of Premier Mobile Banking, an integrated mobile banking solution that gives customers the convenience of managing their accounts anytime and anywhere. Operating on a browser embedded in handheld devices, the product is both carrier-independent and compatible with any web-enabled device. Banking customers are able to check account balances, view recent transactions, receive alerts and transfer funds between accounts in real time with their cell phone or PDA.

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Using Commercial Cards to Save Costs

A new survey by CFO Research Services prepared in collaboration with American Express reveals that mid-size companies have a plan to weather uncertain economic times by adopting savvier ways of managing costs, controlling some areas of spending, and investing more in employee productivity tools. But the survey also shows that growing firms face a considerable challenge in taming their costs, since many forego the benefits of negotiated discounts by permitting employees to spend with vendors who are not preferred suppliers.

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March 12, 2008

ACI Worldwide Investor Day Presentation

ACI Worldwide held an investor day in New York City earlier this week. The presentation slides icon_PDF_small.gif are available online (note that it's an 18+ MB file and may take a bit of time for you to download!)

Contactless Payments Security

The Smart Card Alliance has published an FAQ on contactless payment security that applies "only to contactless payment using contactless smart card technology, as implemented by American Express, MasterCard and Visa." A PDF version is also available.

A Look at Person-to-Person Lending

In an article titled 'Where Either a Borrower or a Lender Can Be', Jane J. Kim writes for the Wall St. Journal about person-to-person lending networks (like Prosper.com, Lending Club.com and Zopa.com) and how small business owners are increasingly turning to those networks as access to bank credit has become more difficult.

Update: Jim Bruene gets this one right over on his NetBanker blog - it's actually about person-to-business lending!

Mobile Banking: This Time for Real?

The new issue of BAI's Banking Strategies includes an article by Kenneth Cline titled "Mobile Banking: This Time for Real?" based on a roundtable of experts from banks, wireless carriers, and solutions providers.

Consumers Increasingly Embrace Mobile Phone Commerce

A new Harris Interactive study finds that "mobile phone users are increasingly comfortable making banking and purchase transactions while on-the-go – a virtual taboo until now. The survey finds 16 percent of mobile phone subscribers already use mobile banking services, with 60 percent of these people using the services at least once a week. Many others presently not banking and buying on-the-go expressed interest in mobile banking, with 35 percent open to checking bank account balances and transferring funds via their mobile devices. A third of those surveyed (33 percent) also said they would like to receive text message alerts from their financial institutions." The survey also found that the biggest barrier affecting consumer acceptance of mobile banking and commerce is security concerns over personal data.

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Jack Henry Announces 54th Mobile Banking Customer

Jack Henry & Associates has announced that goDough, its mobile banking solution, has been adopted by 54 of its core banking clients. goDough is a browser-based solution developed internally by Jack Henry & Associates and introduced in November 2007. [Editor's Note: Last September, Glenbrook's Russ Jones posted a 10-Step Cookbook for Glenbrook's Mobile Banking Strategy recommending that bankers get to work enabling a browser-based mobile banking solution.]

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Union Bank Chooses MasterCard PayPass for Debit Cards

Union Bank of California has announced it will be providing its banking customers with MasterCard PayPass contactless payment technology on their debit cards. To be issued over the next several months, nearly one million Union Bank debit cardholders eventually receive new contactless debit cards.

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APACS Reports Card Fraud Statistics for 2007

In the UK, APACS has reported 2007 statistics for both card fraud losses and online banking fraud losses. Card fraud losses were up by 25% with the increase being driven by a £90.5 million increased in fraud abroad as more UK card details were stolen for use in countries yet to upgrade to chip and PIN. Online banking fraud losses went down 33% to £22.6 million.

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March 11, 2008

Glenbrook Payments Boot Camp Update - Atlanta, Georgia

The time has come for a last call for registrations for Glenbrook's Payments Boot Camp next week (Tuesday-Wednesday, March 18-19) in Atlanta, Georgia. If you're interested in attending, please register right away!

Glenbrook's Payments Boot Camps provide a "deep dive" on U.S. payments systems - covering soup-to-nuts, basics through emerging payments. After the Atlanta Payments Boot Camp next week, our next Payments Book Camp will be held in New York City on April 16-17.

More Debit Card Use at POS, Declining Usage at ATMs

At its 7th Annual Debit Conference, MasterCard Europe has announced what it calls "the emergence of a series of significant cross-border purchasing trends in Europe coinciding with the official launch of the Single Euro(pean) Payments Area (SEPA)."

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Concerns about Payments Fraud

The Association for Financial Professionals reports results from its 2008 AFP Payments Fraud and Control Survey concluding that" "payments fraud continues to challenge treasury and finance professionals, with almost one third of respondents to a new AFP survey reporting that incidents of fraud increased in 2007 compared to 2006."

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