3Q/10 Online Retail Sales Projections Up 8% Y/Y

When it comes to back to school shopping, 17% plan to do their back-to-school shopping online this year, 5% more than the year ago period. These consumers are planning to spend an average of $271.77, an 8% increase over 2Q/10 and 20% increase over 3Q/09. This, according to the eBillme “Online Spending Index”, also shows shoppers plan to spend an overall average of $516.96 on back to school, both online and offline; 18 to 24 year olds plan to do the most back-to-school shopping, 13% above the overall average; and all consumers will spend an average of $144.41 on electronics and computers, $96.28 on clothing, $95.36 on books, $50.42 on back-to-school shoes, $41.66 on college dorm furniture, and $31.76 on school supplies. eBillme offers a secure way to pay online and the only online payment solution that extends the convenience of online banking to the merchant’s checkout process.

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AmEx Appoints New Board Member

Ted Leonsis has been elected to the American Express Board of Directors, Chairman of a new Innovation and Technology Committee. He has been, and will continue, advising American Express on digital and online payments strategy since the beginning of 2010 when the company acquired Revolution Money, for which he had been Chairman. Leonsis held a number of executive positions at AOL from 1994 until 2006, including Vice Chairman and President. Following his retirement from AOL, Leonsis founded and launched SnagFilms, a company that distributes documentaries to a global audience online. Ted is a graduate of Georgetown University and a member of its Board of Directors.

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Capital One Loses “Fixed” APR Argument

The United States Court of Appeals for the Ninth Circuit rejected the argument of Capital One Bank that the word “fixed” in front of the APR in its solicitations for credit cards is not misleading, although the Bank claims the right to change the APR at any time for any reason. In the Rubio v. Capital One Bank case, the decision was concluded “it is not ‘clear and conspicuous’ to describe an APR as ‘fixed’ when the creditor has reserved the right to change the APR for any reason,” as required by the Federal Truth in Lending Act. This is according to Kirtland & Packard, which has led consumer complaints in such cases as Morgan v. AT&T Wireless Services, in which the decision as to whether a corporation has deceived the public back in the hands of a jury, and Shroyer v. New Cingular Wireless Services, in which AT&T Wireless’ argument was rejected that the FCC has exclusive jurisdiction over claims by consumers that their wireless carrier breached their contract by failing to provide adequate service.

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ALI Solutions Expands Management Tool to China

China Merchants Bank has licensed ALI’s “OnQ” automated and centralized collections campaign and strategy management. OnQ is used by nine of the top ten US credit card issuers in the U.S. and processes over 500 million records per month. This is relevant with the rapidly growing Chinese credit card market, which has a 2010 potential market of more than 200 million consumers. Despite aggressive growth in the past few years, CMB’s credit card portfolio has one of the lowest charge-off and delinquency rates. These conditions create strong incentive for Chinese banks to manage risk and collections effectively at the individual level, tightening policies where appropriate but also loosening them where risk is low.

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62% Say American Economy Still on the Slide

The majority of Americans believe the economy has yet to hit bottom. In fact, 62% share this sentiment, a 3 point decline since March when only 59% felt this way. Conversely, only 33% believe the economy has already hit bottom, despite the fact the economy has seen growth since 3Q/09. This, according to a nationwide survey issued by Citi and conducted by Hart Research Associates, also shows 62% believing it will be at least two or three years before a recovery while 28% believe it will be at least four years before the economy stabilizes; 24% say the local economy where they live is good or excellent, up from 19% in March; 17% say their personal financial situation is better now than a year ago has improved slightly since the 15% in March; and 52% say their personal financial situations are about the same as they were a year ago. Additionally, 64% remain very or somewhat optimistic that their financial situation will improve in the next twelve months, compared to 32 percent who are somewhat or very pessimistic, and 85% reporting local employment opportunities are only fair (36%) or poor (49%).

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SICAP PAY4ME

The Orange Cameroon mobile collect call service, “Sicap Pay4Me,” was awarded at the Annual Growth Product Sharing Summit. Features such as the White List option, enabling the recipient of the call to be directly connected without having to always accept the collect call, are considered as assets for they make the service easier to use and more efficient. Our collaboration with Sicap has enabled us to introduce a service which is a first in Cameroon and to be recognized by the Orange Group as pioneers. This allows a prepaid user without credit to make calls that the recipient will be paying for.

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Fiserv Online Leadership Community Membership Hits 6,000

Fiserv financial services technology has launched its “Boardroom Series” online thought leadership community has enrolled 6,000 members in less than one year. Having launched on July 30, the “Boardroom Series” provides Fiserv clients trends, analysis, insight and research to help them improve their overall business performance. Membership is currently comprised of 46 percent banks, 41 percent credit unions, and 13 percent other financial institutions. Features provided on the Boardroom Series by Fiserv subject matter experts include executive briefings, videos, webinars, polls, client case studies, virtual events and weekly updates.

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TRANSFER2HOME

Standard Chartered Bank has made available its “Transfer2Home” online remittance service, allowing users to transfer money to India from USA, UK, UAE, Singapore, Hong Kong and Bahrain. In partnership with TimesofMoney payments service provider, Standard Chartered can now provide standard platform transaction processing which is fully compliant with payment norms suiting regulatory framework in several countries worldwide.

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Cardtronics to Redeem Subordinated Notes

Cardtronics non-bank owner of ATMs has initiated a full redemption of its $100.0 million 9.25% Senior Subordinated Notes – Series B due in 2013. The Series B Notes will be redeemed on August 20, 2010, at a redemption price of 102.313% of the principal amount thereof, plus accrued and unpaid interest through August 20, 2010. The Notice of Redemption for the Series B Notes was sent to all registered holders on July 21, 2010. The redemption of the notes will be funded with approximately $30 million of available cash on hand plus approximately $70 million of borrowings under the Company’s recently-executed, $175.0 million revolving credit facility.

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MYBARCLAYCARD

The “mybarclaycard” next-generation online account servicing system offered to Barclaycard customers, will now provide SMS and email alerts to enable customers to keep on top of their spending when out and about. The new service offers Barclaycard customers the choice of up to six alerts, including account balance, notification of statements posted online, payments due, payments received, spending limit reached, and balance limit. One set of alerts is available for every credit card account, allowing customers complete control and flexibility over how they manage their finances. Customers opt in for these free alerts if they wish to receive them, and can select the ones they feel are most relevant to them.

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U.S. Bank Posts 2Q/10 Net Revenue Up $4.5B

U.S. Bancorp reported net income of $766 million for the second quarter of 2010, driven by record total net revenue of $4.5 billion for 8.7% growth over the year ago period. The quarter was highlighted with $1.7 billion of lines related to new credit card accounts; year-over-year growth in payments-related fee income thanks to merchant processing services revenue up 15.1%; and a third consecutive quarterly decrease in the provision for credit losses with net charge-offs having decreased 1.9% since last quarter. Additionally, US Bank saw provision for credit losses in excess of net-charge-offs of $25 million and a $28 million gain related thanks to its investment in Visa. The Bank’s Payment Services consumer and business credit cards, stored-value cards, debit cards, corporate and purchasing card services, consumer lines of credit and merchant processing contributed $180 million of the Company’s net income. This contribution is an increase of $126 million over the year ago period and a $61 million increase over the prior quarter and is thanks to a combination of higher total net revenue, up $121 million (12.1% Y/Y) and a lower provision for credit losses. The provision for credit losses decreased $150 million (29.5%) due to a favorable change in the reserve allocation due to improved loss rates, partially offset by reserve build related to credit card portfolio purchases.

MERCHANT ACQUIRING VOLUME HISTORICAL
1Q/08: $64,853,000,000
2Q/08: $66,940,000,000
3Q/08: $66,941,000,000
4Q/08: $58,630,000,000
1Q/09: $57,877,000,000
2Q/09: $59,725,000,000
3Q/09: $62,011,000,000
4Q/09: $60,729,000,000
1Q/10: $63,437,000,000
2Q/10: $72,952,000,000
Source: CardData (www.carddata.com)

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CyberSource Stockholders Approve Visa Acquisition

CyberSource stockholders approved its acquisition by Visa. Approximately 71.76% percent of the outstanding shares were voted, of which approximately 99.77% were voted in favor of the acquisition. The acquisition is expected to close July 21, 2010. CyberSource solutions enable electronic payment processing for Web, call center, and POS environments. CyberSource also offers industry-leading risk management and payment security solutions for merchants accepting card-not-present transactions.

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