The Chief Executive Board of the Star Alliance yesterday approved US Airways’ application to join the “Star Alliance” which includes United Airlines and 16 other air carriers. The addition of US Airways will increase the number of airports served by the Star Alliance network from 700 to 771, while the number of countries served will grow to 133 from 128. While no firm date has been set for US Airways’ official entry into Star Alliance, it is anticipated that the carrier will become part of the world’s leading airline alliance within the next nine to 12 months.
The U.S. Postal Service Governors yesterday approved the first “Negotiated Service Agreement” with Capital One. The first NSA features discounts for Capital One First-Class Mail volume above an annual threshold of 1.225 billion pieces and electronic return of undeliverable mail data by the Postal Service to Capital One. Prior to Monday’s Board decision, the “Capital One NSA” was examined during eight months of open litigation before the Postal Rate Commission. Under terms of the deal, Capital One will receive volume discounts between 3 cents and 6 cents per piece, depending on mail volume. The deal caps the discount at $40.6 million for the three year term. Capital One is the largest producer of First-Class mail and the USPS’ fourth-biggest customer. Capital One mails out more than 1.2 billion pieces of mail annually, and currently pays 29 cents for First-Class mail. (CF Library 5/21/03)
eBay’s stock rebounded late yesterday after a brief drop this week in the wake of jury verdict that found the company infringed on the patents of a Virginia man. The patents related to eBay’s “Buy it now” service which involves the use of fixed-price sales. Thomas Woolston and his company MercExchange LLC were awarded $35 million. However, it is most likely the case will eventually be settled out-of-court. The success of the lawsuit has raised concerns among other Internet players in light of the number of e-business process patents secured by private individuals and tiny firms. Woolston holds four e-commerce patents and has ten more pending. The patent involved in this week’s verdict was filed four months before eBay was launched in 1995.
Capital One has named Laura Olle, currently SVP of Corporate Control and Governance, as Chief Enterprise Risk Officer for Capital One. Olle’s new position will centralize on executive management oversight of the company’s enterprise risk management activities, and will be responsible for independently monitoring, analyzing and reporting on key corporate risk areas to include strategic, operations, legal and compliance and managing regulatory relationships.
Today, CardinalCommerce Corporation and Fifth Third Bank announced that they have signed an agreement to provide Fifth Third online merchants with CardinalCommerce’s payment authentication software, Cardinal Centinel.
CardinalCommerce will enable MasterCardÂ® SecureCode(TM) and Verified by VisaÂ® to authenticate cardholders during online transactions at participating merchants. The service requires cardholders to enter their private password in a pop-up window on their PC before their online transaction can be approved and completed. With these extra security measures, members can be confident that their account is protected, and Fifth Third Bank merchants gain greater assurance about the identity of the person completing the transaction.
CardinalCommerce is the leading provider of online merchant payment authentication for securing online transactions. Cardinal Centinel is designed for financial institutions, merchant service providers and their merchants. The software reduces the level of online fraudulent transactions and guarantees payment to online merchants who use it, while protecting the accounts of cardholders.
“Fifth Third Bank is one of the leading merchant acquiring banks in the United States,” stated James Butler, Executive Vice President for Cardinal Commerce. “Fifth Third’s selection of CardinalCommerce as their provider of payment authentication services is a great compliment. Their merchants will gain immediate benefits with our software by eliminating their fraud liability, gaining guaranteed payments for the first time, and increasing the security and confidence of online customers.”
Robert A. Sullivan, Fifth Third Bank Executive Vice President, offers, “Payment authentication is very important to our online merchants–they want an easy to use, reliable system and CardinalCommerce was able to provide that. Cardinal Centinel has the leading-edge technology Fifth Third customers have come to expect and we are thrilled to have the opportunity to partner with CardinalCommerce.”
CardinalCommerce Corporation is a leading provider of a technology-neutral authentication platform for securing electronic and wireless commerce, thus ensuring that individuals, businesses and government agencies can process electronic transactions and access confidential information safely, securely and privately. Cardinal’s proprietary technology provides consumers, merchants, credit/debit card issuers, and processors the ability to conduct fully authenticated Internet-based e-commerce, while protecting the transactions from fraud. Cardinal Centinel has been chosen as the solution for merchants by more acquirers, processors, gateways and merchants around the world then any other 3D Secure product. CardinalCommerce is based in Cleveland, Ohio, and has partners throughout the United States, Europe, Africa, the Middle East and India. For more information, visit [www.cardinalcommerce.com].
Fifth Third Bank processes 8.2 billion ATM and POS transactions per year for more than 185,000 retail locations and financial institutions worldwide, including The Kroger Co., Abercrombie & Fitch, Nordstrom, Inc. and The Finish Line. Fifth Third processes $83 billion in credit card sales annually. Fifth Third Bank is the fifth largest bank acquirer according to The Nilson Report (March, 2003).
Fifth Third Bancorp is a diversified financial services company headquartered in Cincinnati, Ohio. The Company has $84 billion in assets, operates 17 affiliates with 941 full-service Banking Centers, including 132 Bank MartÂ® locations open seven days a week inside select grocery stores and 1,880 JeanieÂ® ATMs in Ohio, Kentucky, Indiana, Michigan, Illinois, Florida, Tennessee and West Virginia. The financial strength of Fifth Third’s affiliate banks continues to be recognized by rating agencies with deposit ratings of AA- and Aa1 from Standard & Poor’s and Moody’s, respectively. Additionally, Fifth Third Bancorp continues to maintain the highest short-term ratings available at A-1+ and Prime-1, and was recently recognized by Moody’s with one of the highest senior debt ratings for any U.S. bank holding company of Aa2. Fifth Third operates four main businesses: Retail, Commercial, Investment Advisors and Fifth Third Processing Solutions. Investor information and press releases can be viewed at [www.53.com]. The company’s common stock is traded through the Nasdaq National Market System under the symbol “FITB.”
Andrews Federal Credit Union, which serves 99,000 members including personnel at Andrews Air Force Base, McGuire Air Force Base and U.S. servicepersons in central Germany, Belgium and The Netherlands, has chosen eFunds to provide ATM driving services and network access to their members in the USA and Europe. AFCU previously controlled the driving of their ATMs, but will now outsource that function to eFunds because it is one of the few vendors worldwide that has the currency conversion technology to support ATMs that dispense both U.S. dollars and international currencies from a single machine. AFCU was introduced to eFunds through an existing EFT services partnership with ENCORE Electronic Services Cooperative. ENCORE’s member base currently includes more than 110 credit unions of which more than 68 use eFunds EFT services.
The Independent Community Bankers of America has promoted Dewite North to CIO. North joined ICBA in 1999 to work on payment system issues. He has been accorded steadily increasing responsibilities including banker information technology outreach and coordination of the ICBA’s internal technological projects prior to his promotion. He was previously employed at First Virginia Bank, George Mason Bank and CardSystems. ICBA has nearly 5,000 members with 17,000 locations nationwide.
AL-based SouthTrust Bank has launched a “Rewards VISA for Business” credit card that offers redemption levels as low as 2,500 points for merchant and travel certificates. SouthTrust Rewards VISA for Business cardholders will earn points redeemable for air travel, hotel and car rental certificates, and merchant certificates with every purchase they make.
The FTC has sued three NJ-based corporate defendants and their principals to halt an alleged nationwide scheme to extract millions of dollars from consumers by falsely threatening them with arrest and prosecution unless consumers immediately pay them amounts that the consumers do not owe. The complaint also charges the defendants with misrepresenting the amount of the debt when they added extra charges without telling consumers. In addition, the defendants allegedly failed to inform consumers of their right to receive more information about the debt or to dispute the defendants’ claims prior to payment. The three corporate defendants include National Check Control, Check Enforcement, and Goldman & Co.
SVPCo announced that M&T Bank has taken an ownership stake in SVPCo, the private-sector payments company providing ACH services through its ACH Operator, the Electronic Payments Network (EPN), and check “electronification” services through the Electronic Clearing Service (ECS) to more than 1,000 financial institutions nationwide.
With the addition of M&T, SVPCo participating banks represent more than 59% of the volume of checks cleared in the U.S and 34% of the ACH origination volume. This provides SVPCo with the critical mass essential to continue its enhancement of the ACH process and aggressively advance electronic payments, including images as a replacement for paper in the check clearing process.
“This very well-respected regional bank has joined the other 20 SVPCo owner banks in our mission to convert checks to electronic payments as early in the clearing process as possible,” said Hank Farrar, President of SVPCo. “We look forward to adding M&T to our expanding network, and their intellectual capital to our endeavors to create robust private sector payment systems.”
SVPCo offers a variety of products and services including Electronic Clearing Services (ECS), which is the nation’s largest provider of Electronic Check Presentment services, operating 368 exchanges per day, representing $3.4 billion and 4.4 million transactions per day. ECS is rapidly developing an image exchange network to add value to its ECP services. It also includes the Electronic Payments Network (EPN) for ACH, and SafeCHECK for check conversion.
Today, U.S. payments are shifting from paper to electronic, but checks will still be written for the foreseeable future. “As long as customers choose to write checks, we will work as an industry utility to reduce costs and improve the efficiency of the clearing process,” said Mr. Farrar.
“We already use the Electronic Payments Network for ACH services,” said Lin Szenina, Senior Vice President of M&T Bank, “and we’re enthusiastic about electronic check exchange, which serves as a foundation for check truncation by exchanging check images with other banks in the marketplace.”
The Image Exchange utility is an open system where all banks, all sizes, in all locations, can exchange images directly or through others. It will be operational for image forward presentment and electronic returns in first quarter 2004.
SVPCo is owned by 21 of the largest banks in the United Sates, representing over 59% of U.S. commercial bank deposits. SVPCo owner banks are: [ABN AMRO], [Bank of America], [The Bank of New York], [Bank One], [BB&T], [Citibank], [Comerica, Deutsche Bank Trust Company Americas], [Fleet National Bank], [HSBC Bank USA], [JPMorgan Chase Bank], [KeyBank], [Mellon Bank Corporation], [M&T Bank], [National City Bank], [PNC Bank], [SunTrust], [U.S. Bancorp], [Union Bank of California], [Wachovia Bank], and [Wells Fargo Bank]
M&T Bank is considered one of the country’s strongest and most highly regarded regional banks. It was founded over 140 years ago in Western New York, where it is still headquartered. M&T Bank Corporation is the nation’s 25th largest bank holding company, with assets of over $33 billion as of December 31, 2002. It has over 470 branches throughout New York, Pennsylvania, Maryland and West Virginia and a sizable ATM network of more than 1,000 locations as well as state-of-the-art telephone and Web Banking. M&T Bank is recognized for its financial strength and sound management.
Drexler Technology Corporation has received a $1.8 million order for LaserCard optical memory cards to be used as Canadian government Permanent Resident Cards. The order calls for continuing monthly deliveries of optical memory cards in quantities to stay ahead of card personalization requirements.
Fifth Third Bank has expanded its rewards program to business cards. The new “Business Travel Rewards MasterCard” enables the primary cardholder to earn up to 100,000 points annually. Business cardholders earn one point for each $1 in net purchases. Points can be redeemed for free airline tickets, discounted hotel rooms, or cash-back. Redemption opportunities starting at 10,000 points. The cash-back feature offers a $100.00 check for 10,000 points. The introductory interest rate for purchases on the new MasterCard is fixed at zero percent for the first four billing cycles, then goes to Prime + 7.99%. The card also carries a $50 annual fee. Fifth Third launched reward programs for its credit card and debit cards in 2002. Under the debit card rewards program, cardholders earn one point for every $2 in purchases. (CF Library 3/18/03)