Based on BancNet research, experts are predicting the days of Friday,
December 21 and Friday, December 28 to reflect record ATM withdrawal
volumes. This research includes data that shows record ATM transactions on
December 22, 2006, December 29, 2006, August 31, 2007 and October 31,
2007, all of which were Fridays. In addition, the organization found that
on December 15 2006, there were 849,255 ATM transactions conducted by
Malaysian consumers. In response to these findings, bank experts are
recommending that consumers conduct purchases with their debit cards
rather than withdrawing funds for cash transactions. Heeding this advice,
consumers will put less strain on the ATM cash supply and face less risk
of losing money.

Consensus Builds for a Weak 2008 Economy

U.S. financial professionals believe the U.S. economy will weaken over the next 12 months but will not slip into recession in 2008. Meanwhile, The Conference Board reported that the U.S. leading index decreased 0.4% in November. The index has decreased sharply for the second consecutive month, and it has been down in four of the last six months. Most of the leading indicators contributed negatively to the index in November, led by large declines in stock prices, initial claims for unemployment insurance, the index of consumer expectations, and real money supply. According to results of a new survey conducted in early December by the Association for Financial Professionals more than a third of the survey respondents expect their organizations to expand their U.S. workforce in the coming year. Financial professionals expect gross domestic product to grow modestly in 2008, with the median prediction at 2.5%. Only 4% expect the economy to contract in 2008. Top concerns of financial professionals are the decline in the U.S. dollar, rising energy prices, and the housing market. Eighty-two percent of financial professionals are paying closer attention to the declining value of the U.S. dollar; 63% of respondents believe the U.S. dollar will continue to decline against the Euro, while 54% expect the dollar to decline against the yen.

Chinese Online Payment Firm Targets U.S.

China’s largest online payment service with 56 million users is being expanded to facilitate consumer purchases directly from U.S. retailers. Hangzhou-based Alipay, with a market share of over 54% among Mainland Chinese, is teaming with NY-based Philliou Selwanes Partners to promote its third-party online payment platform to North American merchants. Alipay is growing at a rate of more than 80,000 new registered users each day. The Company’s average daily transaction volume exceeds US$23 million handling an average of nearly 1.2 million each day. According to Research International the two kinds of U.S. products that attract the most purchase interest from the Chinese are cultural-related products and high-tech ones, that is, books/music/video and consumer electronics. Specifically, laptops, video/digital recording systems, VCD/DVDs and CDs have great market potential in China. Research International found that Beijing and Shanghai favor imported books/music/videos the most; Shanghai consumers have the greatest interest in consumer electronics and apparel/fashion accessories among 6 cities; and home appliances are more attractive in Guangzhou than in other cities.


For the provision of broadband communications, Mexico’s Grupo Elektra has
signed agreements for the deployment of the Gilat “SkyEdge” Satellite at
1,964 VSATs across Latin America. These communications will allow for the
processing of point-of-sale data management, credit card processing,
downloads, Internet access and communications. Grupo Elektra operates
nearly 1,900 retail outlets and financial services across Latin America
while “SkyEdge” satellite communications delivers data over a unified
system using flexible architecture and space segment utilization.

Money Centers Completes Triple DES Conversion

Money Centers of America has completed the conversion of its ATM terminal network to VISA’s Triple Data Encryption Standard. Compliance with Visa’s PIN Security Program minimizes the risk of PIN compromise and reflects Money Centers of America’s commitment to security, network integrity, and consumer protection. Money Centers of America, Inc. provides cash access, transaction management system, and financial networks to the gaming industry.

TJX Reaches More Settlements Over its Breach

Litigation between TJX and several banks and bankers associations has been settled over damages resulting from a TJX security breach disclosed earlier this year. The settlement involved the Massachusetts Bankers Association, Connecticut Bankers Association, and the Maine Association of Community Banks, together with Eagle Bank, Saugusbank, and Collinsville Savings Society. TJX has agreed to reimburse the settling plaintiffs for a negotiated portion of the costs and expenses that they incurred in the case. The bankers associations are also recommending that their member banks which are VISA issuers to accept the “VISA Alternative Recovery Offer.” Through that offer, TJX has agreed to fund up to $40.9 million in payments to VISA issuing banks which may have suffered damages as a result of the data breach. TJX created a $107 million reserve in the second quarter to cover settlements in the case.

Merchant Groups Jump on the EU/MC Decision

Following yesterday’s decision by the European Commission to restrict MasterCard Europe’s cross-border interchange fees, U.S. merchants are jumping on the news to bolster their efforts to lower U.S. interchange rates. The National Retail Federation says European authorities are telling MasterCard it is double dipping in Europe and driving up costs for consumers as well as retailers. The NRF suggests that authorities in the U.S. should take the European ruling as a signal that it’s time to bring the same relief to U.S. consumers. The Merchants Payments Coalition says that American consumers and merchants pay more than twice as much as Europeans, and that such fees in the U.S. are out of proportion to the amount that would be paid in a competitive market. MasterCard Europe said it is appealing yesterday’s EU decision based on its firm conviction that market forces, not regulation, should drive key decisions such as the setting of interchange fees and retailers’ choices over which forms of payment to accept. MasterCard cites the experience in Australia, the only other jurisdiction in the world to regulate interchange fees, where consumers have ended up paying more for credit cards and receiving fewer benefits and less choice. (CF Library 12/19/07)

Market Conditions Delays a Target Card Sale

Target says the initiative to unload all or part of its credit card portfolio is taking longer than expected. Blaming current market conditions, Target says it now plans to announce a decision in the first calendar quarter. Last month Target reported that its pre-tax credit card profits for the quarter ending November 3rd increased 17% over the year-ago quarter. Target reported that its total credit card receivables, which include its VISA and “Guest” cards (together known as “REDcards”), were $7.652 billion as of November 3rd, compared to $6.906 billion for 2Q/07 and $6.148 billion one-year ago. For complete details on Target’s latest performance, visit CardData (

Discover U.S. Card Profits Climb 43% Y/Y

Discover Financial Services reported this morning pre-tax U.S. credit card profits of $327.5 million for 4Q/07, a 43% increase over the year ago quarter, but down 4% sequentially. The Company also reported an overall loss of $84 million due to impairment charges related to its U.K. “Goldfish” business. U.S. managed loans rose 5% year-on-year to $48.2 billion. U.S. credit card sales volume rose 6% to $22.6 billion. The managed U.S. credit card net charge-off rate rose to 3.84%, 14 basis points higher than the third quarter. The managed U.S. credit card 30+ day delinquency rate was 3.59%, up 43 basis points from last quarter’s level. The firm also reported that transaction volume across the Discover and PULSE Networks rose 14% over last year. Discover says its U.S. card business was driven by growth in sales volume and receivables, strong credit results and improved revenues and operating efficiencies. In its “Third-Party Payments” segment, Discover’s network volume reached almost $25 billion in the quarter, an increase of 28%. For complete details on Discover’s fourth quarter performance, visit CardData ([][1]).


Transcard Names a New President

TN-based Transcard has appointed John Ainsworth, previously with Mastercard, as President of Stored-Value Processor. Prior to joining Transcard, he served as senior business leader with MasterCard Worldwide. His seasoned background includes over 15 years of executive sales and management experience with leading financial organizations such as SunTrust Bank, Visa International, and BlueTarp Financial. TN-based Transcard offers electronic funds transfer services including direct-to-card payroll technology, electronic fuel and transaction processing, asset management services, and research and development of technology services.