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July 19, 2008

Payments News - Weekly Wrap - Saturday, July 19, 2008

Here's a review of this week's top stories on Payments News. If you missed it, last week's Weekly Wrap is here. Back to the future!: for fun, click for this same week's activity a year ago here on Payments News!

Looking for more? Checkout our Other Payments and Banking Blogs page for more from the blogosphere about the worlds of payments and banking.

Quote of the week:: From Cardbeat, a syndicated market research report from Auriemma Consulting Group: "Consumers have indicated that contactless technology is not an easy sell. In light of the credit crunch, and increasing insecurity about the risk of identity theft, consumers need additional encouragement to acquire a new card – even if it features a compelling new technology."

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    You can find all of our Weekly Wrap summaries in the Payments News Weekly Wrap Archive. They're published every Saturday and look back at the highlights of the week's news. Please send us on how we can improve the Weekly Wrap!

  • July 18, 2008

    A Look at the FDIC

    In an article titled "A Run on Your Money?", Daniel Gross writes for Newsweek about the Federal Deposit Insurance Corporation (FDIC) and its current chairman, Sheila Bair. He reports that "ninety banks are on the FDIC's problem list."

    BusinessWeek Looks at College Affinity Credit Cards

    In an article titled "The College Credit-Card Hustle", Jessica Silver-Greenberg and Ben Elgin write for Business Week about how universities and alumni associations "are selling students' personal information to big credit-card companies eager for young customers."

    Diemo - Mobile Banking in Venezuela

    In an article titled "Start-up pushes for mobile banking among poor in Latin America", Matt Hamblen writes for Computerworld about Diemo, a start-up company that is launching mobile banking in August with GSM network provider Digitel in Venezuela.

    Obopay Increases Fees, Disables Instant Bank Transfer on Aug. 7

    Obopay has notified its users that, effective August 7, the transaction fee charged for sending money will change from $0.10 to $0.25. In addition, the instant bank transfer feature is being disabled. The changes are included in new terms and conditions that become effective August 7.

    [Update - July 23, 2008: In an earlier edition of this post, we had incorrectly stated that the instant bank transfer feature being disabled had been announced in March - that was incorrect. The features announced on March 18 remain part of Obopay's service.]

    Headline News - July 18, 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:

    • Jane Keller has been named Vice President - Strategy for the Electronic Payments Division at PurePay. Keller previously was with Electronic Clearing House, Inc. and the Executive Director of the National Check Network.

    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.

    July 17, 2008

    Glenbrook's Russ Jones at Direct Response Forum 2008 Conference

    Glenbrook's Russ Jones will be on hand at this year's Direct Response Forum (DRF) to lead a session on August 12th entitled "What We're Watching in Emerging Payments". Looking beyond the current generation of payment alternatives, Russ will be discussing TrialPay, eBillme, Secure Vault Payments, Amazon Payments, RevolutionCard, eLayaway, PaidByCash, and the Green Dot MoneyPak.

    Russ will also be participating in a round table discussion on best practices in recurring payments on August 13th. The DRF 2008 conference is being held in San Diego. The full agenda is available online. If you're going to be at the conference, - he'd love to meet you!

    NFC-based Proximity Mobile Payments Collaboration Model

    According to the Smart Card Alliance Contactless Payments Council, "eighty-six percent of industry stakeholders believe NFC-based proximity payments will be adopted, and it will happen with a “Collaboration Model,” bringing together banks, mobile operators, merchants, handset manufacturers and other service providers. The Council has published a new research report icon_PDF_small.gif detailing its findings including various stakeholders’ opinions on potential new sources of revenue from advertising, loyalty and rewards, co-branding arrangements, and customer fees for new services. READ MORE »

    Recent Developments in Consumer Credit and Payments

    On September 20-21, 2007, the Payment Cards Center and the Research Department of the Federal Reserve Bank of Philadelphia co-sponsored the fourth in a series of joint research conferences focusing on important issues in consumer credit and payments. The discussion brought together academic scholars and industry experts to present and discuss the latest research on these topics. The conference included both theoretical and empirical papers. The PCC has just published a conference summary icon_PDF_small.gif.

    Headline News - July 17, 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.

    July 16, 2008

    PayPal's Second Quarter 2008 Financial Results

    eBay reported second quarter 2008 financial results earlier today - saying that "PayPal had a strong quarter with $602 million in net revenue, an increase of 33% year-over-year. Net total payment volume (TPV) for the quarter was $14.93 billion, an increase of 35% year-over-year. Global active registered accounts increased to 62.6 million, representing 19% year-over-year growth."

    44% of PayPal's payments revenue was from international. PayPal's transaction revenue rate was 3.89% - essentially flat from last year - while its transaction loss rate declined from 31 basis points to 27 basis points. PayPal's transaction processing expense rate increased slightly to 1.23%.

    Credit Card Fair Fee Act Passes House Judiciary Committee

    The Merchants Payments Coalition (MPC) issued the following statement in response to the House Judiciary Committee passing the Credit Card Fair Fee Act, H.R. 5546, today. The Committee voted 19 to 16 in favor of the Act.

    “We applaud the House Judiciary Committee’s leadership with the passage of the Credit Card Fair Fee Act of 2008, H.R. 5546. Today’s victory is a landmark decision that reaches far across party lines in reining in Visa and MasterCard’s stranglehold over merchants and consumers alike. The Committee issued a loud, bipartisan wake-up call to credit card and financial services industry with the reporting of H.R. 5546, which they boasted would never see the light of day. The Committee not only reported the bill with 10 Democrats and 9 Republicans voting to report it, but defeated every poison pill amendment by similar bipartisan margins." READ MORE »

    Visa Europe Signs 5 Year Transaction Network Deal with BT

    Visa Europe has announced signing a five year managed services contract with BT to migrate its transaction network onto BT’s 21CN Global network. According to Visa Europe, "the agreement will move Visa Europe onto an efficient Internet Protocol (IP) based network, promising its 4,600 member banks in 36 countries a superior level of service through increased support, improved business continuity and enhanced network security." READ MORE »

    Contactless Credit Card Technology Not Understood By Consumers

    Cardbeat, a syndicated market research report from Auriemma Consulting Group, reports that "contactless credit cards that allow cardholders to wave-and-pay at checkout terminals fitted with contactless technology sensors is not yet the smash-hit that industry leaders had expected." According to the report, "consumers have indicated that contactless technology is not an easy sell. In light of the credit crunch, and increasing insecurity about the risk of identity theft, consumers need additional encouragement to acquire a new card – even if it features a compelling new technology." READ MORE »

    The Interchange Fee Debate on Capitol Hill

    In an article titled "On credit card fees, blame game begins", Chris Frates writes from Politico. com about the legislative battle underway on Capitol Hill over interchange fees and whether pending legislation to provide merchants a way to directly negotiate interchange fees should be passed. According to Frates, "the debate has sparked a huge lobbying campaign marked by Capitol Hill visits and briefings, coalitions and ad campaigns."

    Payments Professionals Management Changes

    We have received news of the following recent management changes:

    • Tom Wills has joined Javelin Strategy & Research to focus on strategic risk management, security, fraud, and compliance advisory services. Wills has served as a director, advisory board member, or strategic consultant for NTT Data Corporation, Wells Fargo Merchant Services, PayCycle.com, Hyundai and several startup ventures in the security arena.

    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.

    July 15, 2008

    A Look at Consumer Protections for Gift Card Users

    In a new paper titled "The Laws, Regulations, Guidelines, and Industry Practices That Protect Consumers Who Use Gift Cards" icon_PDF_small.gif, Industry Specialist Philip Keitel of the Payments Cards Center at the Federal Reserve Bank of Philadelphia discusses the consumer protections available to gift card users. READ MORE »

    MasterCard Urges House Committee to Stop Price Control Legislation

    In a press release this afternoon anticipating tomorrow's House Judiciary Committee meeting to mark up H.R. 5546, the "Credit Card Fair Fee Act of 2008," MasterCard urged members of the Committee "to consider the many credible organizations and regulatory bodies that have voiced significant concerns about this legislation." READ MORE »

    American Express, InterContinental Hotels Partner on Folio Data

    American Express has announced it has signed a hotel folio agreement with IHG (InterContinental Hotels Group) that enables American Express to provide its corporate card customers with reports that break down their lodging expenditures at nearly 2,800 IHG properties in the U.S. READ MORE »

    Bernanke Comments on Unfair Credit Card, Overdraft Practices

    In his Semiannual Monetary Policy Report to the Congress today, Federal Reserve Chairman Ben S. Bernanke concluded his remarks by discussing the rules that the Federal Reserve working jointly with the Office of Thrift Supervision and the National Credit Union Administration have proposed regarding unfair or deceptive practices for credit card accounts and overdraft protection plans. READ MORE »

    Bill Me Later Rewards Shoppers With $10 Off Amazon Purchases

    Bill Me Later has announced "that to celebrate its launch on Amazon.com, customers that pay with Bill Me Later will receive $10 off qualifying Amazon.com purchases of $50 or more. The offer is available through July 21, 2008." READ MORE »

    Groups Send Message to Lawmakers About Credit Card Practices

    In what's called "a groundbreaking joint effort by the nation's fastest growing union and trade associations representing merchants, the Service Employees International Union (SEIU), Food Marketing Institute (FMI), National Association of Convenience Stores (NACS), and the National Grocers Association (N.G.A.) sent a letter to every Member of the House of Representatives today calling on Congress to stop the nation's biggest banks and credit card companies from continuing abusive practices which harm American consumers and businesses. The groups jointly urged Congressional action to pass the Credit Cardholders' Bill of Rights Act of 2008 (H.R. 5244), the Credit Card Fair Fee Act (H.R. 5546 and S. 3086), and the Credit Card Interchange Fees Act of 2008 (H.R. 6248)." READ MORE »

    Aladdin, IdenTrust Partner for Online Banking Security

    Aladdin Knowledge Systems has announced a partnership with IdenTrust to provide identity authentication solutions for secure online banking and financial transactions. READ MORE »

    NFC Mobile Payments to Reach US$75 Billion by 2013

    Juniper Research has released a new analysis of the NFC mobile payments opportunity forecasting that "the gross transaction value of payments made via NFC contactless technology, for relatively low value purchases (such as refreshments, tickets and food), will exceed $75bn globally by 2013."

    But, in a cautionary note about the rosy forecast, the report notes that "the industry as a whole will need to convince both consumers and merchants of the merits of yet another payment mechanism on top of cash, cheques, credit and debit cards, and to allay understandable (even if unfounded) fears and scepticism about the security of The Mobile Wallet." READ MORE »

    41st Parameter Provides Anti-Fraud Solution to Continental Airlines

    41st Parameter has announced that it has been selected by Continental Airlines "to help detect and prevent Card-Not-Present (CNP) fraud in its online sales channels. The airline will employ 41st Parameter’s FraudNet to help it identify legitimate versus suspect website transactions on a global basis, as well as to prevent fraudulent account access, enabling the airline to protect sensitive customer data." READ MORE »

    Barclaycard US Appoints Phillip W. Steitz as CIO

    Phillip W. Steitz has been appointed to the position of Chief Information Officer (CIO) for Barclaycard US, the credit card business of Barclays PLC in the United States. Mr. Steitz most recently served as Senior Vice President and Chief Technology Officer for American Express, where he oversaw global technology standards and strategy. READ MORE »

    Headline News - July 15, 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.

    July 14, 2008

    BB&T Introduces New Vault360 Commercial Deposit Service

    BB&T has announced Vault360, a new service that will allow the bank to accept and process large cash or check deposits from commercial clients operating anywhere in the continental United States. READ MORE »

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