Heartland Payment Systems has announced that yesterday it successfully completed the first phase of its end-to-end encryption pilot project. According to the company, "this first step involved the transmission of live AES (Advanced Encryption Standard)-encrypted card transactions from a merchant to Heartland’s processing platform. AES is the highest level of encryption and is currently on track to replace DES (Data Encryption Standard) and Triple DES as the desired standard for sensitive data."

Earlier this month Heartland announced it was working with Voltage Security to develop its end-to-end encryption approach. READ MORE

Bank of America and First Data have announced "the formation of a new company that will deliver next-generation payments solutions to merchants ranging from small business to commercial and corporate clients worldwide."

According to the two companies, Banc of America Merchant Services, LLC will provide clients "with the most comprehensive suite of innovative payments solutions including credit, debit and prepaid cards to merchant loyalty, check and eCommerce payments." READ MORE

Heartland Payment Systems has selected Voltage Security as a partner to develop end-to-end encryption (E3) software specifically suited to payments processing.

“Heartland is developing a complete end-to-end encryption solution designed to protect cardholder data at all stages of a transaction – from card swipe through delivery to the card brands,” said Bob Carr, Heartland’s chairman and chief executive officer. “Together with Voltage, we are developing a comprehensive solution that currently does not exist.” READ MORE

Merchant e-Solutions has announced the addition of Visa and MasterCard automatic account updating services for e-commerce and card-not-present merchants that specialize in recurring billing. According to the company, "pproximately half of all card accounts change annually in an issuing bank's portfolio, which can lead to denial of transactions billed to outdated cards." READ MORE

Global Payments has announced that it has acquired the remaining 49% interest in its merchant services joint venture in the United Kingdom from HSBC Bank plc ("HSBC"). "In June 2008, Global Payments and HSBC formed a joint venture, HSBC Merchant Services, to provide payment processing services to merchants in the United Kingdom and Internet merchants globally. Under the terms of today's agreement, Global Payments will pay HSBC a total of USD$307.7 million in cash to acquire the remaining 49% ownership interest in this joint venture. In addition, HSBC will extend the current ten-year exclusive marketing alliance agreement whereby the bank provides merchant referrals and bank sponsorship to Global Payments to June 2019." READ MORE

Intuit has announced that Intuit GoPayment, a new way for business owners to process credit cards on their mobile phones, is the first small business application available for the new Palm Pre phone. According to the company, "GoPayment helps improve cash flow by giving small businesses an affordable and hassle-free way to process credit card payments outside the office as soon as the job is done." READ MORE

Elavon has announced enhancements to its international processing platform that expands multi-currency, cross-border and Dynamic Currency Conversion (DCC) capabilities for merchants. Elavon’s network now has the ability to authorize in 89 currencies, settle in 16, and convert up to 48 currencies for DCC. In addition, Elavon has launched DCC in Germany, where the processor can currently convert 27 currencies, giving its merchants the ability to generate a new revenue stream by sharing in the conversion fees. READ MORE

Earlier this year, Intuit "soft launched" its new GoPayment mobile card acceptance solution for merchants. Yesterday, Intuit officially announced the new service - "GoPayment helps small businesses improve sales and cash flow by using their mobile phones to accept credit card payments. GoPayment is affordable and hassle-free. All that’s needed is a mobile phone with access to the mobile Web, or the easy-to-download GoPayment application, and an Intuit GoPayment merchant account." READ MORE

In a story titled "Cash Vanishes from Merchants' Accounts", Amy Barrett and Jeremy Quittner write for BusinessWeek about how some merchant acquirers are imposing new reserve requirements on some of their card accepting small business merchants.

Most processing agreements give the transaction giants the right to accumulate those reserves simply by holding back money the merchant is supposed to be paid after a credit-card transaction has cleared, often with little or no warning.

Noting that US consumers spend $1 Trillion annually on recurring transactions and installment billing, Litle & Co. says it believes that in order to remain competitive, merchants -- particularly online, membership and subscription services businesses -- must embrace and support these transaction types as part of their overall offering. The company has developed a list of "Recurring Transactions Best Practices" to hel merchants take advantage of recurring transactions to convert traffic into long-term customer relationships and to maximize revenue opportunities. READ MORE

First Data has announced that it has entered into a relationship with Visa in Canada, becoming the first merchant acquirer in the country to directly participate in all three major schemes: Visa, MasterCard and Interac. READ MORE

CreditCards.com has announced the launch of its latest site, MerchantAccountGuide.com, saying it offers "a unique and vital service to the small business community in the United States. The website allows small business owners to compare merchant processing services, which facilitate the acceptance of credit cards for customer payments." READ MORE

Chase Paymentech and Revolution Money, operator of the RevolutionCard payment network, have announced that Chase Paymentech's processing platforms now enable the acceptance of RevolutionCard transactions for online and retail merchants. Revolution Money says it "currently operates the largest PIN-based acceptance network for credit card purchase transactions in the U.S." READ MORE

Fifth Third Bancorp and Advent International have announced entering into a definitive agreement whereby Advent International will acquire a 51% interest in Fifth Third's processing business through the establishment of a joint venture that values the new company at approximately $2.35 billion before valuation adjustments by either party. Fifth Third will retain the remaining 49 percent interest in the new company, Fifth Third Processing Solutions, LLC. READ MORE

In an article by Peter Lattman and Dan Fitzpatrick, the Wall St. Journal reports that "Fifth Third Bancorp is expected to announce Monday that it has agreed to sell a majority interest in its payment-processing unit to private-equity firm Advent International Corp." According to the article, Advent will pay Fifth Third $561 million in cash for 51% of the business. Apparently both Visa and MasterCard dropped out of the bidding for the Fifth Third unit.

In its 2008 earnings release this morning, First Data Corp. announced that on Dec. 31, 2008 First Data and Wells Fargo extended their merchant alliance joint venture, Wells Fargo Merchant Services, for five years. In connection with the transaction Wells Fargo increased its ownership in WFMS by paying First Data a cash consideration resulting in First Data and Wells Fargo owning 40% and 60% of WFMS, respectively, as of Dec. 31, 2008.

First Data held a webcast this morning - an accompanying presentation is available online.

Diners Club International, a business unit of Discover Financial Services, in conjunction with Discover, and SIX Multipay, a leading Swiss-based payment services provider, have announced that they have signed a long-term merchant acquiring agreement. This is the first multi-country, acquirer agreement to further European acceptance of Diners Club and Discover Network cards. READ MORE

TSYS Acquiring Solutions has announced the availability of two new all-in-one point-of-sale (POS) solutions to help small- and mid-sized retailers integrate store operations with the point of purchase. Offered as a complete business-in-a-box, each solution includes hardware components and Microsoft software to help retailers manage every aspect of their business. READ MORE

Intuit has introduced Intuit GoPayment - saying it "enables business owners to accept credit and signature debit card payments using their mobile phone and a QuickBooks Merchant Services Account." The new service supports an optional Bluetooth mag stripe reader or reader/receipt printer along with Quickbooks integration of the payments processed.

Web.com has announced an agreement with Chase Paymentech to offer merchant payment processing solutions to small and medium-sized businesses Web.com customers will have access to multiple secure payment processing services including all major credit, debit and customizable gift cards. READ MORE

Are you a member of our LinkedIn Merchant Acquirers group? If you're a payments professional in the merchant acquiring side of the payments business, please consider joining.

Last week, we asked the following question of the Merchant Acquirers group:

Which Merchant Bankcard Acquirer is the World's Largest (by revenue)? In other words, which bankcard acquirer in the world is the world's largest as measured by annual revenue?

Who do you think? Join the Merchant Acquirers group and share your thoughts!

First Data and American Express have announced a new merchant services agreement in Poland where First Data will become the exclusive merchant acquirer and merchant processor for American Express Card transactions in Poland. READ MORE

Elavon, the merchant acquiring subsidiary of U.S. Bancorp, has announced that it is the "first acquirer to commercially market the American Express OnePoint program to its third party sales channels, including Merchant Service Providers (MSP's) and Agent Banks." Under this program, Elavon says it performs all set up, processing, settlement, funding, customer support and reporting for eligible American Express acceptance, thereby providing merchants with one processing relationship for all major card brands. Elavon also offers OnePoint to merchants in its direct sales and alliance bank referral channels. READ MORE

Are you involved in the merchant acquiring side of the payment card business? If so, you'll want to join the Merchant Acquirers group on LinkedIn and join over 400 of your merchant acquiring colleagues as we discuss industry topics. Check it out!

According to Litle & Co., a provider of payment processing solutions for card-not-present merchants, "payment processing is an often overlooked source of revenue creation and marketing intelligence, two of the most important concerns for merchants facing the current economic conditions. By looking at payments and processing as an opportunity to improve operations, merchants can increase their revenue by reducing declined authorizations, offering the right mix of payment options and focusing attention on their most profitable customers." READ MORE

Heartland Payment Systems has announced that "it has formed an internal department dedicated exclusively to the development of end-to-end encryption to protect merchant and consumer data used in financial transactions. For the past year, Robert O. Carr, Heartland's chairman and chief executive officer, has been advocating for payments industry adoption of this technology - which will protect data at rest as well as data in motion - as an improvement for payment transaction security." READ MORE

US Bank has reported financial results for the fourth quarter of 2008. Among the details, US Bank reported that debit card transaction dollar volume was essentially unchanged in the fourth quarter as compared to the same quarter in 2007 and was actually down sequentially from the second and third quarter of 2008.

For credit cards, the bank reported a decline in credit card purchase volume in the fourth quarter of about 3.5% from both the prior year. Fourth quarter credit card purchase volume was also lower that in both the second and third quarter of 2008. In the bank's merchant acquiring business (Elavon), the number of transactions processed increased about 3.5% over the prior year while the purchase volume declined about 6%.

Eric Dash and Brad Stone report for the New York Times on the payment card data breach announced yesterday by Heartland Payment Systems. The compromise may have occurred as early as last May but wasn't detected until late last fall.

The Heartland breach also showed that in spite of the adoption of more stringent standards and tougher oversight by banks and credit card companies, consumers are still vulnerable."

Heartland Payment Systems has announced it has learned it was the victim of a security breach within its processing system in 2008. Heartland says it "believes the intrusion is contained." The company has created a website for "to provide information about this incident and advises cardholders to examine their monthly statements closely and report any suspicious activity to their card issuers."

Brian Krebs reports for the Washington Post that the breach "may have led to the compromise of more than 100 million credit and debit card transactions."

The data stolen includes the digital information encoded onto the magnetic stripe built into the backs of credit and debit cards. Armed with this data, thieves can fashion counterfeit credit cards by imprinting the same stolen information onto fabricated cards.

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