Circuit City threw in the towel today - announcing it was shutting down:

Circuit City would like to thank all of the customers who have shopped with us over the past 60 years. Unfortunately, we announced on January 16, 2009, that we are going out of business.

If you happen to hold a Circuit City gift card, you need to get moving and use it - or be prepared to lose its value:

Q. Will Circuit City stores continue to accept Circuit City gift cards?

A. Yes, customers holding Circuit City gift cards may redeem them at full value at our stores during the liquidation sales. Once the stores are closed and the company is out of business, the gift cards will have no value.

"Closing sales will run as long as it takes to sell existing inventory, but are expected to wrap up by the end of March. When the liquidation sales are completed, the stores will be closed."

In an 8-K filing with the SEC, Discover Financial Services reported that it has received preliminary approval from the U.S. Department of the Treasury to participate in the U.S. Treasury's Capital Purchase Program. "In connection with participating in the Program, the Company intends to become a bank holding company under the Bank Holding Company Act of 1956 and a financial holding company under the Gramm-Leach-Bliley Act. As previously announced, the Company's application to become a bank holding company was approved by the U.S. Federal Reserve on December 19, 2008."

Discover Financial Services has announced it is rolling out an enhancement to its Discover Information Security and Compliance (DISC) program that the company says "will streamline the validation and reporting process, making it easier for merchants that process transactions on the Discover Network to communicate their compliance with the PCI Data Security Standard (DSS)." READ MORE »

Three of the largest US credit card issuers have reported fourth quarter financial results yesterday and this morning: JP Morgan Chase, Bank of America, and Citigroup.

Included in their results are some startling declines in the purchase volume on their credit cards - declines of 7.6% at JP Morgan Chase, a 15% decline at Bank of America, and a 17.2% decline in US purchase volume at Citigroup.

As evidence that mobile payments adoption is really happening in India, Bharti Airtel has announced that more than one million users have registered for the mChek on Airtel service since its commercial launch in June 2008.

“Consumer adoption and repeat usage of the service has been extremely encouraging”, said Sanjay Swamy, CEO of mChek. “With the Reserve Bank of India’s mobile payments guidelines now in place, banks and merchants are fast adopting our open-platform to build a thriving eco-system, and a compelling suite of services for consumers.” READ MORE »

Citigroup Inc. today reported a net loss for the 2008 fourth quarter of $8.29 billion. Citi also announced it will realign itself into two businesses, Citicorp and Citi Holdings, "to optimize the company's global businesses for future profitable growth and opportunities. This structure will enable Citi to focus on driving the performance of its core businesses and, separately, on realizing value from non-core assets."

The strategic restructuring creates:

• Citicorp, which will focus on leveraging the competitive advantages of the company's global universal bank in more than 100 countries, and,
• Citi Holdings, which will be made up of brokerage and retail asset management, local consumer finance and a special asset pool – whose management will focus on tightly managing risks and losses, and maximizing the value of these assets.

Citi said revenues in its Global Cards business fell 27 percent. In its North American cards business, purchases on Citi-issued cards declined 15%. In EMEA, purchases declined 21%, in Latin America purchases declined 15% while in Asia purchases declined 7%.

More details are available in its 4Q2008 earnings presentation and financial supplement.

This morning Bank of America reported its financial results for the fourth quarter of 2008 - with a net loss of $1.79 billion in the quarter compared with net income of $268 million a year earlier. A copy of the bank's 4Q2008 earnings presentation is available online along with supplemental financial information.

In its Card Services business, the bank reported that purchase volume on bank-issued cards declined over 17 percent vs the fourth quarter in 2007.

• Visa payment card security training schedule for 2009
• Forbes.com: Bracing For New Mobile Security Challenges
• Dow Jones: Decline In Credit Card Spending Weighs On Visa, MasterCard
• The Electronic Funds Transfer Association and NACHA-The Electronic Payments Association Join Forces to Create New Electronic Benefits Transfer Council - MarketWatch
• Initial Bay Area Security Professionals / PCIUG Meetup
• InformationWeek: Discover Card Offers Mobile Management Service
• NetSpend(R) and Liberty Tax Service Announce Customer Option of Prepaid Debit Cards Through New Partnership
• E-Commerce Payment Processing Beyond PayPal

Late today, the financial agencies of the U.S. government announced they had entered into an agreement with Bank of America to provide a package of guarantees, liquidity access, and capital as part of their commitment to support financial market stability. READ MORE »

Almost 300 folks are now following Payments News on Twitter since we began posting in real-time to Twitter last May. If you're active on Twitter and would like notification in your Twitter feed when we post a new item to Payments News, it's easy to subscribe to the Payments News Twitter feed!

Since we started on Twitter, about 1,500 "tweets" have gone out in real-time as we've posted new stories here on Payments News. Read on if you'd like to learn more - on the other hand, if you prefer receiving only a daily email update from Payments News, Twitter's not for you! READ MORE »

Rep. Carolyn B. Maloney (D-NY) has posted a press release on her re-introduction of the Credit Cardholders Bill of Rights today along with Senators Charles Schumer and Mark Udall.

“A credit card agreement is supposed to be a contract, but in recent years cardholders have lost the ability to say no to unfair interest rate hikes and fees. This bill levels the playing field between card companies and cardholders while fostering fair competition and free market values. It sets no rate caps, fees, or price controls, nor does it dictate any business models to card companies. There is no doubt that credit card companies provide a valuable service and deserve to earn a fair profit, but consumers deserve the right to be able to understand their accounts and be empowered to control them. This bill would give cardholders the information and rights they deserve to make decisions about their own credit,” said Rep. Maloney.

Connie Prater at CreditCards.com takes a deeper look.

The Federal Reserve Bank of Chicago has announced its 9th annual Payments Conference on the topic of “Payments Pricing: Who Bears the Cost?” to be held at the Chicago Fed on May 14-15, 2009. The conference will focus on:

• Evaluating the role of public intervention
• Comparing perspectives on market-based solutions
• Offering incentives to affect payments behavior
• Leveraging technology to increase competition
• Developing future payment pricing strategies

Who should attend? Decision-makers from financial institutions, payment networks, regulatory bodies, central banks, merchants and payment innovators as well as academics.

For more information, please visit http://www.chicagofed.org/paymentsystems.

Reuters reports that Senator Charles Schumer of New York and Senator Mark Udall of Colorado have re-introduced the credit card reform legislation (called the "Credit Cardholders Bill of Rights") originally authored last year by U.S. Rep. Carolyn Maloney of New York and that Rep Maloney will be doing the same in the House.

In an article titled Citi, BofA Problems Seen Spreading to Other Banks, Jeff Cox reports for CNBC that financial analysts are predicting a spread of the problems currently affecting Citi and Bank of America to other US banks.

Prem Ramaswami, Product Manager, Google Checkout writes on the Checkout blog that Google will begin charging processing fees to non-profits using Google Checkout who are no members of Google's Grants program.

The SVPCO Image Payments Network has announced it exchanged a record 5.6 billion check images in 2008, up 97% from 2.8 billion images in 2007. For all of 2008, dollar volume also hit an all-time high of $8.5 trillion, up 71% from $5 trillion in 2007. The number of institutions exchanging images also rose to an all-time high of 44 in 2008, up from 24 in 2007. The SVPCO Image Payments Network began operations in January 2005. READ MORE »

This morning, the top 5 free finance applications for the Apple iPhone as listed in the iTunes Music store are: Mint.com, Bank of America - Mobile Banking, Bloomberg, Chase Mobile, and PayPal.

Discover Card has announced the launch of a mobile solution for its cardmembers at Discover.com Mobile. This mobile version of the Discover Card Web site will allow cardmembers to manage their credit card account directly from their mobile phone’s browser. READ MORE »

Austin Ventures has announced the acquisition of three companies and the subsequent formation of Century Payments Inc. (“CPI”) in partnership with CEO-in-Residence Robert Wechsler.

The new company, headquartered in Dallas, Texas, will focus on providing growth capital strategic assistance to merchant service providers (“MSPs”) and on building best-in-class sales forces to support our network of distribution partners. AV has committed up to $50MM of equity capital to support management’s strategy of additional acquisitions and organic growth. Mr. Wechsler will lead the new organization as its President and Chief Executive Officer.

Moneybookers has made a newly-developed payment process immediately available as a free plug-in to Magento, anl Open Source shop software provider. "By using the Moneybookers interface, implemented as a whitelabel product, the Magento shop operator will benefit from Moneybookers' global ePayment network. Customers can pay quickly and easily directly via the web store - by credit card or one of the 60 other local payment options offered by Moneybookers." READ MORE »

The Federal Financial Institutions Examination Council has issued guidance titled "Risk Management of Remote Deposit Capture" .

This guidance addresses the necessary elements of an RDC risk management process in an electronic environment, focusing on RDC deployed at a customer location. The general principles of RDC risk management discussed here are also applicable to financial institutions’ internal deployment and other forms of electronic deposit delivery systems (e.g., mobile banking and automated clearing house [ACH] check conversions).

Today marks the start of financial insitutions reporting their earnings for the fourth quarter - a quarter that pundits say may be the first is almost twenty years when the industry in aggregate didn't make any profits.

First up is JP Morgan Chase who reported fourth-quarter 2008 net income of $702 million, compared with net income of $3.0 billion in the fourth quarter of 2007. In its cards business (which now includes Washington Mutual's card business as well), the net loss was $371 million, a decline of $980 million from the prior year due primarily to increased provision for credit losses. Charge volume was up only 1% year over year. The net charge-off rate grew to 5.29%, up from 3.89% last year. More details are included in this presentation on the Chase website.

• Amazon Payments Blog: You spoke, we listened – Callback API is now live with Checkout by Amazon!
• Christopher Brauchli: Citigroup And The Credit Card
• Inside Facebook: How Major Retailers Can Improve the Effectiveness of Their Facebook Pages
• Future Banking Blog: Twitter and the Customer Experience at Bank of America
• CHARGE Anywhere and Tripoint Communications Deploy Wireless Point of Sale Solutions in the Bahamas and the Turks & Caicos Islands
• San Francisco Issues Municipal ID Cards With Capture Technologies’ Solution
• a thousand cuts :: adam cohen's blog: Do Alternate Payment Methods Help Retailers?
• Wall St. Journal: More Pain Ahead for Card Issuers
• PaySimple Blog: Recurring Billing with Credit Cards and eChecks? No Sweat!
• Amazon Payments Blog: Don’t IOU? – Just Amazon TextPayMe™
• Fair Isaac Expands Program for Lenders to Deliver Free FICO Scores to More Consumers
• The PayPal Blog: Is Free Shipping Right for You?
• DMNews: Study: Google Checkout use slowing
• Digital Money Forum Podcast: Murdo Munro, Paytekh
• Examine the Private-Label Credit Cards in The U.S., 6th Edition
• StorefrontBacktalk: Macy's Own Software Caused Its Holiday Debit Card Glitch
• The Conference Board(R) Spain Business Cycle Indicators(SM)
• The Financial Services Club's Blog: Mobile payment provider 'infuriates' banks - commentary about M-Pesa
• U.S. Consumer Confidence Sinks Lower as Americans Appear to Be Waiting for the Obama Administration to Throw It a Lifeline
• Alliance Data Signs Multi-Year Agreement with HSN, a Leading Multi-Channel Lifestyle Retailer
• Reuters: Capital One card delinquencies rise in December

We're looking for the best sources to answer the following questions re: contactless payments in the US market - your suggestions are welcome!

• Acceptance - How many POS acceptance locations in the US have been upgraded to support contactless? What has been the ramp to get to today? What is the forecast for the next 3 years?
• Transactions - What has been the transaction growth of contactless payments over the last 3 years? What is the forecast for the next 3 years? Is there evidence that contactless cards migrate to being preferred as the "top of wallet" payment card?
• Issuance - How many contactless payment (credit and debit) cards have been issued in the US? What is the forecasted number of contactless payment cards in the market by 2012?

We're aware of the excellent contactless resources already available in the Smart Card Alliance's Contactless and Mobile Payments Council website - are there others? Let us know and we'll share a summary here.

In a press release titled "ClairMail Powers Mobile Banking for State Bank & Trust", ClairMail provided some insight into consumer use of mobile banking:

The ClairMail System is seeing tremendous adoption and continued growth, with over 12 mobile banking transactions conducted every month per consumer. This is more than three times greater than the monthly transactions per consumer found in published reports from other mobile banking solutions. Moreover, ClairMail customers have seen upwards of 25 percent adoption by online banking consumers, shattering industry averages which are less than 3 percent.

The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for December, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $343.2 billion, a decrease of 2.7 percent (±0.5%) from the previous month and 9.8 percent (±0.7%) below December 2007. Total sales for the 12 months of 2008 were down 0.1 percent (±0.4%)* from 2007. Total sales for the October through December 2008 period were down 7.7 percent (±0.5%) from the same period a year ago. The October to November 2008 percent change was revised from -1.8 percent (±0.5%) to -2.1 percent (±0.3%).

• Wall St. Journal: Bank of America to Get Billions in U.S. Aid
• NetBanker: SmartyPig Releases Social Savings Metrics; Launches in Australia with ANZ Bank
• Fortune: Say goodbye to the big Citi
• Mobile Payment: Potential and reality for Nigeria
• TD Retail Card Services Acquires Private Label Credit Card Program of Canadian Luxury Jeweler Birks
• Bank Systems & Technology: Banks’ Intellectual Property at Great Risk Amid Layoffs
• Capital One: MoneyWi$e Financial Education eLearning Resource Launches in Spanish
• CreditCards.com: How a credit card is processed (provides a Flash animation of the flows!)
• eMarketer: How Do Online Buyers Pay?
• Payments Industry Regulatory Compliance Blog: Prospects for Payments Regulation Reform
• Mobile banking users to exceed 150m globally by 2011 according to Juniper Research
• ClairMail Powers Mobile Banking for State Bank & Trust
• MyECheck Grows Revenue by 1,096% in 2008 Unaudited Financial Results
• Trustwave Establishes New Latin American Headquarters in Brazil
• IBM Shatters U.S. Patent Record; Will Openly Publish Many More Future Inventions; IBM Research to Work on Patent Quality Index
• SafeNet Protects B&H Photo Online Shoppers' Data
• KeyPoint Credit Union Selects The Bank of New York Mellon to Provide Remittance Services to Silicon Valley Members
• The Financial Services Club's Blog: PayPal's tenth birthday party
• New AIte Group Report: U.S. Credit Unions: Seize the Opportunity

In an article titled "Citigroup Ready to Shrink Itself by a Third", David Enrich reports for the Wall St. Journal on plans expected to be announced soon by Citigroup to shed several business units.

Earlier today, Citi announced it had entered into a "definitive agreement to combine Morgan Stanley's Global Wealth Management Group and Citi's Smith Barney, Quilter in the UK, and Smith Barney Australia into a new joint venture to be called Morgan Stanley Smith Barney."

According to Enrich's reporting, Citigroup "executives hope to dump or shrink businesses that cater to less-affluent customers."

First Data has announced signing a partnership agreement with WestLB to launch a new business, First Merchant Solutions, to provide card acceptance services for retailers in Germany and across Europe. "As part of this new venture, WestLB, a German regional state bank with a strong European presence, will provide the licenses and payment services infrastructure while First Data will provide a comprehensive range of merchant acquiring services." READ MORE »

EFT Network has announced the FAXTellerPLUS remote deposit capture solution - calling it "a brand new way for businesses, financial institutions even consumers to participate in remote deposit capture by using a standard fax machine with absolutely no hardware equipment or software to purchase or download." READ MORE »