Diebold to Offer Better ATM Gift Cards

Diebold has become the first ATM manufacturer certified to offer AZ-based Better ATM prepaid gift cards. This means that the new technology enables existing ATM machines to dispense prepaid cards to their customers through offered cash trays. Better ATM Services’ cards are contained as a single panel of three panels on a “card sheet.” The card sheet has approximately the same dimensions of larger foreign currencies like the Danish Kroner. ATM cassettes accommodate currency of various sizes that can accommodate Better ATM Services’ card sheet dimensions. Early testing with two ATM manufacturers’ equipment has proven that the card sheets can be easily retrieved and dispensed. Better ATM Services’ technology runs on all of Diebold’s “ix,” “iSeries,” and “Opteva” ATMs.

DIGIPASS & APACS

VASCO Data Securities has announced that it will be unveiling its APACS-
compliant Digipass smart card reader family at the October-18th London
Banking Summit. The smartcard reader line consists of the “Digipass 830” and
the “Digipass 840”. Both devices provide smart card reader functionality,
meet
EMV-CAP compliance, offer 3D Secure Internet Payment Authentication and
meet APACS user interface requirements. The “Digipass 840”, however, has an
embedded speech module to provide service to the blind and visually
impaired.
Over 5,300 companies in more than 100 countries utilize VASCO’s financial
products and services.

Card Mail Slows; Response Rates to Top 0.6%

A new report projects that U.S. households will receive about 5.3 billion credit card solicitations during 2007. The full year projection shows a slight decrease from the 5.76 billion offers received last year, which was also down from the all time high of 6.05 billion card offers received in 2005. According to Synovate’s “Mail Monitor,” response rates will edge up slightly to 0.6% from 0.5%, representing some 32 million applications for new credit cards. The 2007 dip is a continuation from 2006, and mainly due to the Bank of America/MBNA merger and a decrease in direct mail by Chase and Capital One. Synovate says that despite the decrease, 2007 will likely be the third heaviest year on record for credit card direct mail since Synovate first began tracking solicitations in 1988. Synovate says other acquisition channels, particularly the Internet, will play an increasingly important role but direct mail, with more than 50% of card applications, will likely remain dominant for the foreseeable future.

CARD MAIL HISTORICAL
YEAR OFFERS RESPONSE
1998: 3.44b 1.2%
1999: 2.54b 1.0%
2000: 3.54b 0.6%
2001: 5.01b 0.6%
2002: 4.89b 0.5%
2003: 4.29b 0.6%
2004: 5.23b 0.4%
2005: 6.05b 0.3%
2006: 5.76b 0.5%
2007: 5.30b 0.6%
Source: Synovate’s Mail Monitor

MasterCard Unveils a New PCI DSS Program

MasterCard has released a new a new program offering practical assistance in educating merchants and encouraging broader adoption of the “Payment Card Industry Data Security Standard.” The new “PCI Merchant Education Program” provides requirements for enhancing payment account data security. There is a series of customizable, interactive modules for financial institutions to develop training sessions and materials tailored to their merchants. The education program offers several training options including: in-person training for acquiring bank members at designated locations; a live Web meeting; and an on-demand Webinar series. MasterCard offers a safe harbor for merchants and service providers who are compliant with the “PCI DSS,” exempting them from fines and other costs if cardholder data is compromised as a result of a breach of their systems.

CONSUMERS & SAVINGS

In conjunction with the introduction of a new interest rate on balances
in its
“Direct Savings Account” of 4.25%, an HSBC Canadian survey was recently
conducted to examine the spending and savings habits of consumers. The
survey
showed that across all regional and age demographics, Canadians tended
to be
money savers. Moreover, the research showed that 70% of Canadians have
either
investments or savings, 33.3% are saving on a schedule of pre-authorized
deductions, 55% save up rather than using credit and 12% will pay their
credit cards
off tomorrow. The survey also showed that 91% feel a high savings rate
is important,
less than 50% know what their savings account return rate is, and 48%
check their
rates of return each month. Comparing different Canadian regions, 88% of
Albertans
are confident in managing their money and 32% twice as likely as others
to put away
a set amount of money on a monthly basis, 29% of those in the Prairies
are more
likely to be at their credit maximum and 78% British Columbians say they
are no
where near their credit card maximum. HSBC Bank Canada has more than 170
offices while HSBC has nearly 10,000 offices in 83 countries and
territories with
assets of US$2,150 billion.

Kohl’s Dept Stores to Implement VantageScore

WI-based retailer Kohl’s will implement Experian’s “VantageScore” to score its credit card approval processes. VantageScore, a credit score jointly developed by Experian, Equifax and TransUnion, simplifies the credit granting process for businesses by providing a service that applies one, consistent formula to data from all three of the credit bureaus. Kohl’s operates 914 stores in 47 states.

JET AIRWAYS & CYBERSOURCE

Jet Airways has implemented CyberSources’ automated fraud assessment
solution, “Decision Manager,” to reduce the risk of fraud. Jet Airways
selected
the fraud management solution because of its reliability, scalability,
and flexibility
to the Indian market. “Decision Manager” evaluates transactions in
real-time
based on specifications determined by Jet Airways to determine whether the
online ticket purchase should be accepted, rejected or reviewed. This
evaluation,
or “decision”, is made automatically within the matter of a few seconds.
Demonstrating the flexibilty of the solution, the client, in this case
being Jet
Airways, can update specifications and terms for the determination of
fraud at
anytime. Jet Airways operates a fleet of 66 aircraft and operates over
340 daily
flights to 53 destinations around the world having flown over 75 million
passengers
since it first began operating in 1993.

Citi Credit Card Profits Dive 21% in 3Q/07

Citigroup reported that 3Q/07 profits for its U.S. Cards unit declined 21% year-on-year to $852 million due to increased credit costs and expenses. U.S. card revenues decreased 2% to $3.39 billion. Bank credit card outstandings for the U.S. were flat at $110.1 billion compared to one-year ago. However, private label card outstandings increased 4% to $31.8 billion. Purchase volume for the third quarter rose 6% to $81.6 billion. Citi’s account base at the end of the third quarter dipped 3% year-on-year to 146.4 million accounts, down 1.1 million accounts from 2Q/07. Citi’s charge-offs for bankcard and private label cards declined to 4.41% compared to 4.55% in the prior quarter and 4.26% one-year ago. Overall delinquency (90+ days) rose slightly from 1.47% for 2Q/07 to 1.60% for the third quarter 2007. Citi noted that the managed net interest margin improved 27 basis points to 10.55% primarily due to growth in non-promotional balances. For complete details on Citigroup’s 3Q/07 performance, visit CardData ([www.carddata.com][1]).

CITIGROUP
U.S. Credit Card Net Income
3Q/06: $1085 million
4Q/06: $1001 million
1Q/07: $ 897 million
2Q/07: $ 726 million
3Q/07: $ 852 million
Source: CardData (www.carddata.com)

[1]: http://www.carddata.com

DEALOGIC EXPANSION

In response to Dealogic’s recent growth and subsequent increase in
customers service demand, the transaction management company will
be expanding its presence around the world. The technology firm is
expanding its offices in New York, Hong Kong, Tokyo and Sydney
that will provide the additional, needed client support and software to
its clients. New York offices are scheduled to opened in 2008, Hong
Kong offices are slated to be open in November of 2007 and the lease
for the expanded Tokyo offices are to commence on Jan 15, 2008.

RESOLUTION FOUNDATION

In response to a poll commissioned from Yougov, The Resolution Foundation
is intent on improving standards and provide reassurance for consumers
about
the transparency of comparison sites. The Yougov poll of 2,010 adults
showed that 45% have used sites such as these to make financial decisions
since July of 2006. Although many of these sites were found to be user
friendly
by Opinion Leader, many were also found to be misrepresenting promotional
features as best value products to consumers. These sites also failed to
explain
technical terms and jargon, often requested excessive personal
information of
the consumer and, on occasion, provided irrelevant information. The
Resolution Foundation is moving that these sites provide transparency in
helping consumers make informed financial decisions, promote a healthy
comparison site market without the need for new regulation and support
Government policies to improve â˜financial capability’.

Merchants Want a Choice in Storing Card Data

The “Real Security Summit,” sponsored by Shift4 Corporation, has revealed a consensus that the future of credit card payments depends on systems that remove usable card data stored anywhere at the merchant level. Citing concern over data breaches, the National Retail Federation has sent a letter to Payment Card Industry Security Standards Council, requesting changes in how the credit card industry requires merchants to store credit card data. Credit card companies typically require retailers to store credit card numbers anywhere from one year to 18 months in order to satisfy card company retrieval requests. According to NRF, retailers should have a choice as to whether or not they want to store credit card numbers at all. The NRF says the bottom line is that it makes more sense for credit card companies to protect their data from thieves by keeping it in a relatively few secure locations than to expect millions of merchants scattered across the nation to lock up their data for them.

WESTERN UNION & HERSING

Western Union (WU) will be acquiring 49% of the Western Union Global
Network, its Singapore agent and Hersing Corporation subsidiary.
This development is part of the WU strategy to strengthen its global agent
network and increase its equity stakes. With this, the company’s current
investment will be upgraded to ordinary shares, will now earn a pro rate
share
of profits from WUGN, will be given voting rights and is allowed to explore
additional agent relationships throughout the country. Western Union and
Hersing partnered in 2001 to provide WUGN with over 60 locations
throughout Singapore. Globally, Western Union network consists of over
312,000 Agent locations in over 200 countries.