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« August 2, 2009 - August 8, 2009 | Main | August 16, 2009 - August 22, 2009 »

August 15, 2009

Credit Card Reward Programs Are Suddenly Less Rewarding

In an article titled "There Goes The Prize", Nancy Trejos writes for the Washington Post's Sunday edition about how credit card issuers are adjusting their reward programs to be "suddenly less rewarding."

August 14, 2009

Payments Pricing: Who Bears the Cost?

cflseptember2009_266a-140px.jpgThe Federal Reserve Bank of Chicago has published "Payments Pricing: Who Bears the Cost?—A conference summary" by Katy Jacob, policy research specialist, Financial Markets Group, Carrie Jankowski, business economist, Financial Markets Group, and Anna Lunn, associate economist, Financial Markets Group.

"As consumers and merchants increasingly adopt electronic payments, the pricing of these services has generated substantial scrutiny by public authorities around the world. To discuss these developments and related issues, the Federal Reserve Bank of Chicago hosted its ninth annual Payments Conference on May 14–15, 2009."

First Data Reports 2Q2009 Financial Results

FirstDataCorp_logo.jpgFirst Data has reported its financial results for the second quarter ending June 30, 2009. "Consolidated revenues were $2.2 billion, or flat, and up 4% on a constant currency basis. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) were $607 million, down 5%, or down 1% on a constant currency basis. In addition to the adverse impact of the strong U.S. dollar, adjusted EBITDA comparisons were unfavorably affected by lower royalty revenue. Excluding currency effects and the change in royalty revenue, adjusted EBITDA was up 1%. The net loss attributable to First Data was $196 million, which includes after-tax interest expenses of $284 million."

"We continue to execute well on all fronts," said Michael Capellas, chairman and CEO of First Data. "In particular, our unique strategic alliances continue to enhance our leadership position in delivering innovative payment services to merchants." READ MORE »

A Look at PayPal's New Student Account

Mary Pilon reports for the Wall St. Journal on PayPal's new Student Account program - saying it is "stepping further into the world of mainstream banking." Included is a link to an interview by MarketWatch’s Jonathan Burton with PayPal vice president Don Fotsch who helped lead development of the new program.

China Slows Credit Card Growth

In an article titled "China Cracking Down on Credit Card Issuers", Michael Wei and Kirby Chien write for Reuters from Beijing about China's slowing down expansion of credit cards - noting that concerns about expanding too quickly have led "Beijing government and banks to scale back a credit card policy that expanded too far, too fast in a country with little history of or experience with personal debt."

Headline News - August 14, 2009

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.

August 13, 2009

More on Chip and PIN Challenges for US Travelers

PaymentsViews_logo-140px.jpgIn a new PaymentsViews.com post, Glenbrook's Jacqueline Chilton updates her earlier post that described her personal experience trying to use her US-issued mag stripe (non-chip) credit card during a recent visit to the UK.

Citi Adding Annual Fees to Certain Credit Card Accounts

Citi_logo-140px.jpgIn an article titled "Annual Fees: Citi Takes Leap" in tomorrow's American Banker, Maria Aspan reports that Citi "has started adding annual fees to some of its existing credit card accounts in one of the first such attempts by a major issuer to offset the effects of the government's crackdown." Many have expected to see a return to annual fees for more accounts as a result of Credit Card Accountability, Responsibility and Disclosure Act signed into last May.

Consumers Union Reports on Prepaid Card Fees, Weak Protections

A new Consumers Union report finds that "prepaid cards come with high fees and don't offer consumers the same kinds of protections as other forms of plastic payment. Prepaid cards are reloadable cards that can be used to make payments similar to debit cards and are becoming the foundation of a second tier banking system used by a growing number of low income consumers." A copy of the report can be found at: http://www.defendyourdollars.org/Prepaid%20WP.pdf. READ MORE »

Chase Incents Checking Customers to Use Chase Freedom Credit Card

Chase_logo-140px.jpgChase has announced a new program that gives its checking account customers "more rewards on every purchase when they use their Chase Freedom credit card."

“This is one more way to thank customers for doing more business with Chase,” said Scott Powell, head, Consumer Banking. “That’s especially important as consumers watch every dollar they earn and spend.”

According to Chase, its "Chase Exclusives program rewards Chase checking account customers with better rates, more rewards and bigger discounts on nearly all the financial products offered through Chase’s bank branches." READ MORE »

Consumers Want Person-to-Person Payments Services From Banks

CashEdge_logo-140px.jpgCashEdge has announced results from its fourth annual Consumer Online Banking Survey saying it "demonstrated an increasing demand for simple, secure person-to-person (P2P) payment services and the preference by consumers to get these services from their financial institution, rather than an independent service such as PayPal. Conducted annually by CashEdge, the study examines the behavior and preferences of more than 850 consumers nationwide aged 18 years and older who use online banking capabilities." READ MORE »

Effectively Serving the Underserved

Zoot_logo-140px.jpgZoot, a provider of instant credit decisioning and loan origination solutions, has announced the release of a new white paper, “Giving Credit Where Credit is Due: Serving the Underserved in the United States through Insight into the European Credit Culture.” The paper discusses technology and business strategies credit risk managers and community reinvestment officers should consider when they attempt to reach this overlooked market. READ MORE »

INSIDE Contactless, Cryptography Research Sign Patent Agreement

INSIDE Contactless and Cryptography Research have announced an agreement regarding the use of CRI’s patents covering countermeasures to Differential Power Analysis (DPA) and related attacks for INSIDE’s MicroPass and other secure semiconductor products. Under the agreement, INSIDE may use CRI's patents as part of the security strategy for its contactless semiconductor products which are used around the world in a variety of form factors – including contactless cards, key fobs, mobile payment bridge products, and NFC secure elements for mobile phones – for use in applications such as contactless payment, loyalty, identification, transit and access control. READ MORE »

FleetCor Acquires UK, Ireland Fuel Card Businesses from Retail Decisions

Fleetcor_logo-140px.jpgFleetCor has announced that it has acquired the UK and Ireland fuel card businesses of Retail Decisions (ReD). The acquisition includes all of ReD’s fuel card operations in the UK and Ireland, including ReD’s network of UK fuel bunkering outlets. READ MORE »

Lender Angst and Consumer Frugality Drive Debit Card Usage

TowerGroup_logo-140px.jpgNew research from TowerGroup titled "Shuffling the Cards: The Migration of Frugal Consumers and Cautious Lenders to a Debit Card World" finds that "debit cards are far more resilient in the current recessionary economy than credit cards. In less than 15 years, debit card transactions in the United States grew from 1 percent of noncash transactions to more than 50 percent. TowerGroup predicts that debit card transaction volume and card spend will grow through 2015, through the current recession and ensuing economic recovery." READ MORE »

Elavon Signs Alliance Agreement with FNC

Elavon_logo-140px.jpgElavon, a wholly owned subsidiary of US Bancorp, has signed a three-year agreement with FNC Inc., a technology company offering tailored solutions for the real-estate and mortgage industry to streamline industry processes, regulations and compliance. According to Elevavon, "the agreement provides credit and debit processing services via a new dashboard functionality offered by FNC in support of the Home Valuation Code of Conduct (HVCC) – a regulatory requirement impacting the mortgage industry’s appraiser selection process." READ MORE »

August 12, 2009

Mint.com Raises $14 Million in Series C Funding

Mint.com_logo-140px.jpgMint.com has announced raising $14 million in a Series C financing round led by DAG Ventures. The company described the financing as "a preemptive round, with new participation from The Founder's Fund, and investment from existing investors Benchmark Capital, Shasta Ventures, First Round Capital, and Sherpalo. Valuation is not being disclosed, but it represents a significant up round." READ MORE »

New Zealand Commerce Commission, Visa Reach Settlement

NewZealandFlag_logo-140px.jpgThe New Zealand Commerce Commission has announced it has "signed an agreement with the Visa International Service Association and Visa Worldwide Pte Limited (Visa) settling the Commission’s claims against Visa in relation to credit card interchange fees. The Commission’s proceedings allege that the rules of the Visa scheme providing for the payment of multilateral interchange fees, together with related rules, breached the restrictive trade practices provisions of the Commerce Act." READ MORE »

Card Issuers Cancel Cards Leaving Cardholders Stranded at POS

bank-generic_logo-140px.jpgIn an article titled "Cardholders Get Rude Surprise at the Register," Mary Pilon writes for the Wall St. Journal about credit card issuers quietly cancelling accounts before cardholders have received notification about their accounts being cancelled. Instead, cardholders are having their purchases declined at checkout and, when they call their card issuer, being told that their account had been cancelled and a letter was on its way. Issuers claim that under current law they can cancel the account and only have to notify the cardholder within 30 days following cancellation.

RBS WorldPay, VeriFone Market End-to-End Card Encryption Solution

RBSWorldPay_logo-140px.jpgVeriFone Holdings has announced that RBS WorldPay has agreed to work jointly towards marketing VeriFone's VeriShield Protect end-to-end solution for encrypting payment card data. According to VeriFone, "RBS WorldPay is the first merchant acquirer to endorse a commercial end-to-end encryption solution. By encrypting the card number on swipe, right at the point of sale, RBS WorldPay merchants who choose the VeriShield Protect solution will be able to dramatically reduce both their own risk and that of their customers as well." READ MORE »

Headline News - August 12, 2009

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.

August 11, 2009

Mobile Banking Vendor Survey Finds Continuing, If Slowed, Interest

mobilepayments-140px.jpgA new study from IDC Financial Insights - "Market Analysis: Retail Mobile Banking Vendor Survey Results – Mobile Banking Will Have Its Day, Just Not Today" - finds that "while current economic conditions may have curtailed both consumers' demand for mobile banking and banks' willingness to invest in it in the short term, things are still moving forward."

The study presents the results of a survey of 14 U.S. mobile banking solution providers with the objective to get a better understanding of who the key players are in mobile banking, what products and features they offer, and an overall look at industry trends. READ MORE »

PayPal Introduces Student Accounts for Teens

PayPal_logo-140px.jpgPayPal has announced the launch of the Student Account - calling it "a fast and secure way for U.S. teens to shop online using PayPal and in stores with the Student Card, while providing parents with a variety of monitoring capabilities."

According to PayPal, "the Student Account eliminates the hassle of everyday money exchange between parents and teens, while giving teens the chance to learn good spending habits through the experience of being responsible for their own money. Parents can establish up to four PayPal sub-accounts for their teens, transferring funds into those accounts when needed, on a one-time or recurring basis." READ MORE »

A Look at Meta Payment Systems

Meta Financial Group has reported its financial results for its third fiscal quarter of 2009. Included are the results of its Meta Payment Systems business unit, one of largest prepaid card issuers in the US. MPS quarterly revenue grew by 68%, up from $10.3 million in fiscal 2008 to $17.4 million in 2009. Non-interest income for the quarter more than doubled from $7.6 million in fiscal 2008 to $15.7 million, or 107%, in 2009. MPS said the growth in non-interest income was spread among its prepaid and credit programs.

August 10, 2009

USAA To Support Remote Deposit Capture from iPhones

In an article titled "Bank Will Allow Customers to Deposit Checks by iPhone", Susan Stellin writes for the New York Times about USAA's plans this week to add an iPhone application that will support remote deposit of checks using the camera built into the iPhone. USAA said it plans to offer the service on other phones later this year.

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