Mobile Malware Growth at All-Time High

The number of pieces of new mobile malware in 2010 increased by 46%, compared with 2009 and 20 million new pieces of malware were discovered in 2010, equating to nearly 55,000 new malware threats every day. Of the almost 55 million total pieces, 36% were created in 2010, increasing as consumers coincidentally use their mobile devices for payments increasingly.

This is according to McAfee’s “McAfee Threats Report: Fourth Quarter 2010,” indicating a steady growth of threats to mobile platforms. Android/Geinimi, a Trojan inserted into legitimate mobile applications and games for the Android platform, was one of the most important threats of the quarter. McAfee Labs expects cybercriminals to more and more use botnet infections to target mobile devices.

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2009-10 Card ROA Lowest in Near 30 Years

Pre-tax net ROA for the credit card industry for 2009 and 2010 were at the lowest point since 1983, 2009 saw pre-tax ROA at 1.50% (down from a 4.25% average for the last decade), while last year’s 2010 net pre-tax ROA rose slightly to 2.10%.

This is the lowest since R.K. Hammer began tracking card profit metrics, which discloses given card companies only earned 2.1 cents pre-tax after expenses on every dollar of unsecured outstanding card loans on their books in 2010, and only 1.25 cents after-tax. Also, the average credit card account in the R.K. Hammer model earned only $45.46 pre-tax profit per year per consumer account for the bank card businesses issuing those cards; with the average “active” consumer account earning $83.33 per year pre-tax profit, both cut 40% for even smaller after-tax net results.

The onslaught of new rules will cost the card industry over $26 Billion per year, including “Goodwill Impairment,” primarily on intangible assets of subjective value which often have to be written down, to match a lowered balance sheet value with more accurate reduced current market value; loan losses on unsecured card debt still remain stubbornly and historically high; Net Charge Offs, which averaged around 5.00% for the last ten years, jumped to over 10% during the past two years; restructuring charges cost higher associated expenses and more red ink; and the proposed “Interchange Fee Limits.”

However, businesses will begin to hire again (when given incentives to do so), IT investment for the future will resume, financial institution capital will be replenished, shareholder dividends will be restored, banks will resume sensible lending to creditworthy consumers and businesses by providing the services and value they want (new account solicitations have doubled in the past year), loan losses will stabilize and normalize…and the business cycle will once again move ahead.

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MoneyGram Posts 4Q/10 Revenue Up 9% Y/Y

MoneyGram International global payment services posted its 4Q and full-year 2010. For the quarter, the money-transfer giant saw transaction volume grow 12% thanks in great part to an 18% growth in international remittance since the year ago period while money transfer fee and other revenue grew 7% during the same period. Meanwhile, total revenue for the landmark quarter was up 3% to $303.4 million from $295.6 million in 4Q/09, with total fee and other revenue up 3.1% to $298.3 million from $289.4 million last year. Additionally, total revenue for the Global Funds Transfer segment was up 5% to $276.7 million from $263.8 million in 4Q/09 thanks to an operating income of $44.2 million and an operating margin of 16.0% and money transfer transaction volume having increased 12% year-over-year. Throughout the year, global agent locations increased 19% over the prior year end to 227,000, full-year total revenue in 2010 was $1,166.7 million, up from $1,161.7 million in 2009. Moneygram’s accelerating performance was thanks to its focus on enhancing its product offerings and expanding its agent network in Mexico, Russia, Switzerland, Spain and Japan, among others.

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Discover & Banco Popular de Puerto Rico Forge Expansion

Discover Financial Services and Banco Popular de Puerto Rico (BPPR) signed an agreement to expand Discover card acceptance in Puerto Rico. This will give Banco Popular de Puerto Rico merchant customers access to the millions of cardmembers and billions in spending on the Discover and Diners Club International networks. International travelers to Puerto Rico can now expect Discover cards to be accepted at thousands more merchant location for use at merchants throughout the country. Banco Popular de Puerto Rico has $31 billion in assets.

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Americans Weighing Spending Habits This Valentine’s

Indicating a sign of the times, 73% of Americans now say it’s extremely (33 percent) or very important (40 percent) for them to personally save money and are making lifestyle changes to do more with less. But, they still plan to spend an average of $111 this Valentine’s Day, with men spending an average of $136 and women spending an average of $85. This, according to Citibank, also shows 52% are cooking their own food more often; 48% are staying home rather than going out more often; 41% are saving and using coupons more frequently; 35% are driving less, carpooling and combining trips to save gas more often; and 32% are bringing their lunch to work more frequently. Ultimately, 52% believe the way they spend and save is forever changed while only 25% feel their spending and saving will relapse to pre-recession habits. Additional findings show 49% say the economy impacted their social life; 55% of those without a spouse or significant other are paying more attention to a potential mate’s spending and savings habits ; 53% say its more acceptable to split the check; 35% say it is not more acceptable to split the check; 61% of women say it is more acceptable to split the check; and 44% of men believe splitting the check is more acceptable while 42% believe that it is not more acceptable.

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Top Image Systems Appoints Senior VP

Clive Williams has been appointed Senior VP to lead Top Image Systems (TIS) Enterprise Content Management solutions’ Banking Business Unit. Bringing with him over 20 years’ executive management experience in the banking and financial services market to the role, Williams was most recently a Senior Solutions Director for Enterprise Retail Banking, Wealth Management and Compliance and Risk with Misys International Banking Systems, where he also served as member of Misys’ Banking Solutions Operating Board and Strategy Council. During his tenure at Misys, Clive oversaw Strategy, Development and Delivery of Misys’ solutions and related business activities.

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Most Retail Spending Sectors Up in January

MasterCard Advisors “SpendingPulse,” tracking national retail and services sales, in January recorded strong growth. Specifically, Total Apparel sales continued to do well with all sub-sectors posting solid year-over-year increases, mostly in the Teen and Men’s sub-sectors, up 12.8% and 8.1% year-over-year, respectively. The Electronics and Appliances sector posted a year-over-year decline of 3.8% in January following a year-over-year increase recorded in December while the Consumer Electronics sub-category declined by 3.3% and the Appliance sub-category fell sharply by 6.4%. But e-Commerce posted double digit year-over-year increases for the third consecutive month, growing 12%.

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Maas Global Supports PRIDE Virtual POS Solution

Maas Global Solutions Corporation (MGS) has partnered and is investing in the PRIDE Payments Network and will now provide its processing for the PRIDE Virtual POS Terminal. Namely, MGS will provide PRIDE technological and intellectual capital to expand into the global marketplace and offer its merchant clients PCI/HIPAA-compliant integrated gateway connection via a virtual terminal; acceptance of all major debit/credit cards, eCheck/ACH and electronic processing of paper checks; a processing engine for any type of alternative payment transaction; real-time transaction reporting analytics to drive a merchant’s future sales; and smaller merchants an integrated, inexpensive and secure processing platform to stay competitive. PRIDE is built on expertise gained through First Data personnel.

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Expert Group Installs ATMs with New York Bagel

Expert Group has installed its ATMs at New York Bagel Deli (NYBD), which is expanding its operations rapidly with multiple locations. Going on selling their 15 millionth bagel in South Florida, is looking to the Expert Group to further expand by implementing the 24 hour ATM network. Deploying this network allows ATM digital screen advertising to target specific consumers. This allows broadcasting content on the ATM digital screen through scrolling text, movie clips and commercials. Moreover, the ads can be created, scheduled, distributed, displayed and managed with reports generated from EXPERT ATM transcripts and can be inserted into the ATM digital screen program.

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Twitpay Social Payments Nails Down Growth Funding

Twitpay social media payment technology now has money to grow thanks to TomorrowVentures and CompuCredit Holdings. Having secured its undisclosed growth funding, Twitpay can expand its existing service offerings and continue its focus on serving nonprofit organizations looking to raise funds directly over Twitter, social gaming developers offering virtual currency and retailers facilitating social commerce. This is in conjunction with its recently announced a partnership with Incomm to offer social gaming publishers access to a customized promotion and lead generation platform designed specifically around the social gaming model. The first social gaming campaign is due out in early 2011. Twitpay ultimately touts itself as a provider of payment systems solutions for social media networks.

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O2 Seeks m-Money Play License

O2 is applying to the UK’s FSA for an e-money license later this year. This will let it offer financial services and facilitate payments without a banking partner and is in conjunction with having set up a personal finance unit last year. It also coincides with Everything Everywhere announcements to team with BarclayCard to launch the UK’s first commercial contactless mobile phone payments system. O2 has also participated in contactless mobile payments trials for London’s Oyster card and partnering with high street bank NatWest to launch Visa pre-paid cards.

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ShopSavvy Names PayPal Expert its VP, Product

The personal smartphone shopping companion ShopSavvy has appointed Matthew Weathers VP, product. Former product lead for PayPal Mobile, Weathers will lead the development of ShopSavvy’s mobile commerce strategy with QuickPay, which enables ShopSavvy users to purchase the products they scan without ever leaving the application. Weathers was part of the actual founding team for PayPal Mobile and led the mobile product team for four years. He oversaw installation and establishment of P2P payments, eBay mobile checkout, and mobile merchant services after having led PayPal’s merchant business on ecommerce checkout flows. Matthew holds an MBA from the University of California, Berkeley and a Ba from UCLA.

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