San Francisco’s smart card regional fare payment system expanded this week to include the entire Muni Metro system. The four-month-old TransLink pilot program has distributed smart transit cards to some 5,000 pilot program participants so far. Participants can load value onto their cards at self-serve Add Value Machines in transit stations and some 40 retail locations throughout the Bay Area, or by calling the TransLink Customer Service Center. Add Value Machines accept cash, debit cards, and VISA, MasterCard and Discover credit cards. TransLink users can also reload value automatically by subscribing to the TransLink Autoload Program. Each TransLink smart card distributed to pilot program volunteers is pre-loaded with $3 in TransLink e-cash. The TransLink program involves AC Transit, BART, Caltrain, Golden Gate Transit, Santa Clara Valley Transportation Authority and San Francisco Muni. MTC has contracted with Motorola and ERG Limited to implement and operate the TransLink fare-collection system. MTC expects to install TransLink equipment on all 21 Bay Area transit systems by mid-to-late-2003 , which together carry in excess of 1.6 million riders a day. (CF Library 1/31/02; 3/21/02)
JCB Co. is launching a smart loyalty card in conjunction with the City of Osaka, Japan’s third-largest city. The credit card giant says it plans to aggressively market the new service to other cities and towns throughout Japan, and has set a target of 10 contracts and one million cards in the first year. The Osaka City Card is a smart card with contactless chip that will keep track of points awarded for purchases at participating city shops, amusement facilities, and businesses, which customers can then exchange for rewards. JCB will issue the cards and provide POS terminals at merchant locations, building on the network of JCB credit card-enabled terminals already deployed. Point program operations will be subcontracted to the Japan Point Anex, a joint venture established in 2001 by JCB with a number of other credit
card companies and major retailers. JCB also offers service customers the option of cards with an advanced dual-interface IC chip, allowing both contact and contactless access to a single chip that means the card can be used in a wide variety of applications. For example, in the future, the Osaka City Card loyalty program could be combined with the KANSAI THRU PASS prepaid transport card, also contracted to JCB by the Osaka Municipal Transportation Bureau, as well as incorporating credit card payment functionality.
U.S. Bank Voyager Fleet Systems and FuelQuest have sealed a deal to combine the functionality of the FuelQuest Fuel Management Online solution, with the Voyager fleet card. The partnership will enable companies to improve operational efficiencies as customers will no longer have to manage and manually manipulate two different data sources for each of their rolling assets and locations. By combining the functionality of the FuelQuest Fuel Management Online solution, with the Voyager fleet card and its transaction reporting capabilities, managers now have web access to consolidated data from which to analyze and monitor their complete organizational fuel spend.
A debit smart card for purchasing drinking water has been introduced in Ronda, in central Cebu. New Jersey-based WorldWater Corporation launched its AquaCard this week. The new debit card system from enables users to purchase clean drinking water by the liter. Cebu residents insert the cards into AquaMeters which then deliver the requested number of liters of clean drinking water from the solar pump nearby. The smart cards are recharged by the customer at a community bank. The user can purchase up to 1000 liters per charge. WorldWater maintains a 10% carrying charge net of the card gross for service charges during a 10-year contract.
The University of Mississippi, Oxford, and William Paterson University have inked contracts with Student Advantage to launch an off-campus stored-value payment card program. Adding the SA Cash function to the school’s IDs will enable students, faculty, and staff to buy food, necessities, and entertainment at off-campus businesses. These two universities are the latest in a growing number of campuses that have adopted the SA Cash Program. Other schools that have added Student Advantage’s SA Cash function to their IDs include Dartmouth, Princeton, Johns Hopkins, Carnegie Mellon, and American University.
Citadel Commerce Corp and SyTec, Inc have agreed to enhance their POS check verification and electronic check conversion services with SafeCHECK in early July. Both companies will be able to provide merchants with an instant verification that the customer’s account is open and there are sufficient funds to cover the check. SafeCHECK also enables processors to immediately debit those funds through existing ATM networks. Merchants utilizing this capability can return a cancelled check to the customer at the time of the transaction.
Standard Insurance Company launched its Standard SecureCard today in conjunction with individual disability insurance policies. Benefit payments are automatically credited to the stored value card, which can be used at ATMs nationwide or as a debit card for VISA POS purchases. The Standard SecureCard was first introduced in January 2001 for group disability policyholders. The card also may be used to transfer funds as needed to checking and savings accounts with a phone call. Balances and transactions are monitored through a personal Web site account.
David Grano, former president and CEO of Card Capture Services and Rick Holt, former VP of sales at E*TRADE Access, have teamed to form Portland, OR-based APTUS Financial which offers a payment platform that allows wireless carriers and online service providers to expand into the prepaid service market. APTUS is developing additional proprietary solutions to allow for alternative delivery by financial institutions and transaction processors via ATMs and point-of-sale terminals. Additional applications include in-branch check cashing terminals and traditional ATM programs in the United States and Canada.
San Francisco-based Financial DNA has released a research report that says First Data’s international money transfer operations will face significant competition from groups such as the Inter-American Development Bank which is building a network comprised of Latin American banks. Moreover, the growth of Person-Person fund transfers using international banking affiliations and the enabling platforms of new technology vendors pose a serious, long-term threat to Western Union’s pricing regime.
GTS PrePaid phone cards have joined the DuoCash network to expand functionality by enabling cardholders to do online transactions at select e-merchants. GTS Prepaid is a provider of prepaid products and services primarily targeted to the supermarket and convenience store industries, including such large chains as Sunoco, Circle K and A&P. Additionally, GTS recently announced a distribution agreement with Fleming, a major distributor in the food, drug and specialty store industryâservicing over 3,000 grocery stores and more than 5,000 convenience stores.
Atlanta-based InfiCorp Holdings has purchased the credit card loan portfolios from Midwest United Credit Union in Blue Springs, Missouri and Medical Community Credit Union In Odessa, Texas. Midwest’s portfolio has $6.6 million in outstandings while Medical’s portfolio has $3.6 million. Both credit unions also established a long-term credit card agent relationship with InfiCorp. Both credit unions sold their portfolios through AssetExchange, which managed the marketing, bidding and transaction process for the sale. InfiCorp Holdings is a wholly owned subsidiary of First National of Nebraska.
The merchants’ counsel said Monday it is ready to give notice to the class members and proceed to trial in its debit card lawsuit. Constantine & Partners also said most of the key legal issues have already been decided against VISA and MasterCard in the U.S. Goverment’s antitrust case, which was won by the Government last year. Constantine & Partners says under the legal principle of collateral estoppel, the decisions in the already-decided U.S. case will likely be applied in the merchants’ case. The class-action lawsuit, filed by Wal-Mart, The Limited, Sears Roebuck, Safeway, Circuit City, three trade associations — the National Retail Federation, the International Mass Retail Association and the Food Marketing Institute — and 13 other large and small retailers, charges VISA and MasterCard with violating U.S. antitrust law by attempting to monopolize the debit card market and forcing merchants to accept off line debit cards, which carry a much higher transaction fee than online PIN debit transactions. The class action is expected to cover upwards of four million merchants. Constantine & Partners expects the trial to begin early next year.
DEBIT CARD HISTORICAL
(off-line or signature-based debit cards)
Dollar Volume 2001 2000 1999 1998 1997
VISA $324.0b $239.3b $183.8b $134.7b $ 93.7b
MasterCard $ 96.7b $ 62.6b $ 48.2b $ 35.1b $ 16.8b
TOTAL $420.7b $301.8b $232.0b $169.8b $ 110.5b
Source: CardData (www.carddata.com)