Unbanked and Underbanked Households Expand

Currently 25.6% of all U.S. households are unbanked or underbanked with disproportionately low-income. With nine million households unbanked-17 million adults-and 21 million households underbanked-43 million adults,- 21.7% of black households are unbanked; as are 19.3% of Hispanics and 15.6% of American Indian/Alaskans. Only 3.5% Asians and 3.3% of whites were unbanked. These findings, according to the FDIC “National Survey of Unbanked and Underbanked Households,” also show among the underbanked- those who rely on alternative financial services such as non-bank money orders and the like- 31.6% of black households partook, as did 28.9% American Indian/Alaskans, 24% of Hispanics 7.2% of Asian households and 14.9% of white households. Additional findings show households with income under $30,000 account for at least 71% of unbanked households; nearly 20% of lower-income U.S. households do not have a bank account; and 4.2% of households with annual income between $30,000 and $50,000 are unbanked.

HOUSEHOLDS & UNBANKED (%)
Black: 21.7
Hispanic: 19.3
Native American: 15.6
Asian: 3.5
White: 3.3
Source: FDIC

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U.S. Credit Card ROAA Rebounds for 3rd Month

The “Return on Average Assets” for the U.S. credit card industry rebounded again in October for the third month after a year of steady decline. The record low was reached in June at a negative ten basis points. For October, the figure returned to positive territory at a positive 42 basis points. According to CardData, the ROAA for Visa and MasterCard portfolios peaked in February 2007 at 263 basis points. ROAA is determined by dividing the after-tax return by the average managed card outstandings and then annualizing. According to R.K. Hammer Investment Bankers, pre-tax profit for the U.S. credit card industry declined 2.7% in 2008 to $39.6 billion driven by rising expense streams, especially charge-offs. For the latest portfolio metrics, visit CardData (www.carddata.com).

RETURN ON AVERAGE ASSETS
Oct 08: 1.04%
Nov 08: 0.95%
Dec 08: 0.88%
Jan 09: 0.79%
Feb 09: 0.68%
Mar 09: 0.61%
Apr 09: 0.31%
May 09: 0.27%
Jun 09: -0.10%
Jul 09: -0.02%
Aug 09: 0.06%
Sep 09: 0.31%
Oct 09: 0.42%
Source: CardData (www.carddata.com)

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Economy Impacts Financial Planning Big Time

With women accounting for the majority, 62% of Americans are planning to alter their financial plans due to economic uncertainty in the months ahead. Among these, 66% were women while 58% were men; 66% of those 18-54 are taking a closer look at their financial plans versus only 54% of those 55 and over; and 83% are planning to save more in the months and year ahead, with only 7% planning to do so using investment risks. This, according to the new Coinstar “Currency Poll” on economic trends, shows 87% of women vs 79% of men intend to save more rather than investing or spending and 93% of Americans ages 18-44 plan to save and invest more, compared to 87% of those over 45.

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pcKeyboard Offers a New POS Solution

AVE Investments has released “pcKeyboard”. By manufacturing together the mobile, low voltage
Intel® Atom™ processor and the top selling “Cherry SPOS Point of Sale”
keyboard, a new level of reduced size, low cost and enhanced mobility
is achieved for the POS system industry. By combining the POS system and the POS keyboard in one component,
the pcKeyboard joins AVE’s mobile POS products as new choice for
sidewalk sales or seasonal registers. AVE Investments
manufactures, installs, and services innovative and practical POS
platforms.

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JDS POS Solution Powers Shoe Palace

POS system provider JDS reports that CA-based Shoe Palace will open its
24th store
as it experiences growth during the difficult economic climate.
JDS Solutions develops retail software for mid-size retailers. JDS’
WinRetail Merchandising Software and Point of Sale (POS) System provide
greater visibility into the entire retail cycle with powerful reporting
features, merchandise planning and time saving wizards and alerts giving
retailers more control over their business. Founded in 1990, JDS serves
retailers in North America, Hawaii, Asia Pacific and the Caribbean.
Shoe Palace was established in 1993 by a husband and wife team along
with their children. The company has grown from a small brick and mortar
retailer to a major chain of retail stores in Northern and Southern
California.

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Electronic Arts Intros DebitSmart Visa

Interactive software designer Electronic Arts has launched the “EA SPORTS DebitSmart Visa Prepaid Card” to enable users to receive a percent back from every purchase. The Visa-branded EA SPORTS prepaid card is reloadable and funds can be allocated from a payroll direct deposit, checking account, another prepaid card or at thousands of GreenDot and Western Union retail locations nationwide including Wal-Mart, CVS/Pharmacy, Walgreens, Rite Aid, 7-Eleven, and Radio Shack. EA SPORTS prepaid cardholders can earn “EA SPORTS Reward Points” at over 26,000 community brick-and-mortar retailers including Macy’s, Barnes and Noble, Sunglass Hut, Office Max, Papa John’s and Coldstone, more than 700 online retailers including Wal-Mart, Target, Netflix, Apple iTunes, Gap, and Toys ‘R’ Us and at select grocery and convenience stores. Cardholders can then redeem their “Game Cash” at the EA SPORTS store by visiting www.EASPORTSrewards.com. The “EA SPORTS DebitSmart Visa Prepaid Card” was created in partnership with FL-based StorValue Card Solutions and is issued by MetaBank.

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M-Financial Service Adoption Rate to Explode

Banks offering mobile financial services can increase new customer acquisition by as much as 60%, with nearly one-third of consumers using or considering using mobile financial services in the next year and consumer mobile financial service adoption exceeding the use of online banking by 2015. This, according to a recent survey by Mercatus financial services strategy consulting and investment firm, also shows customer acquisition promotional offers including mobile financial services out-performed those that did not include mobile financial services by nearly 30%; a decrease in cost of acquiring a new customer by as much as 20% based on the increased effectiveness of mobile-related; and, most importantly, customer acquisition marketing mobile financial service capabilities were more impactful in a consumer’s decision to select a bank than availability of online banking, access to ATMs, or nearby branches. Additional findings show mobile financial service users are mostly between 18 and 39; have higher incomes; can be serviced at a 20% lower cost than traditional bank customers; and display lower rates of attrition as compared to traditional customers.

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NEOVIA NET+

NEOVIA Financial global online payments business has announced the first
anniversary of its “Net+” Prepaid MasterCard, the first prepaid
MasterCard made available to NETELLER’s e-wallet customers as a physical
and virtual, online-only, prepaid card. The “Net+” card synchronises
automatically in real time with the funds in the NETELLER customer’s
e-wallet, avoiding the need for a separate pre-load transaction of the
prepaid card. Issued by Conister Bank Limited, its incorporates chip and
PIN technology and allows cardholders access to their e-wallet account
at over 29 million retail POS locations and more than 1 million ATMs
worldwide.

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First Data and Sovereign Bank Renew

First Data Corporation has extended its merchant services agreement with Sovereign Bank.
First Data will continue to provide merchant processing services to
Sovereign’s business and commercial customers throughout the
northeastern United States, allowing Sovereign to offer a full suite of
electronic payment products and services including credit, debit, check
and gift card programs. Sovereign Bank, a subsidiary of Banco Santander, S.A., is a financial
institution with principal markets in the northeastern United States.
Sovereign has more than 750 branches, over 2,300 ATMs and approximately
9,700 team members and is one of the top 20 merchant
acquirers in the United States with more than 60,000 merchants.

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PREPAID CONSUMERS

Despite efforts to promote them as a solution to payment card fraud,
only 33% of UK consumers don’t know what a pre-paid card is while 23%
know what they are but don’t understand how they work. With over 25
types of pre-paid cards on the market in Britain, only 12% of people
have actually purchased one, half of which purchased it more than six
months ago and 45% acquired the card to make online purchases. This,
according to research released by TNS and VRL, also shows the cards are
being used by 24% to budget more easily; 20% are using them to spend
money abroad; and 8% are using them to manage money they give to their
children. Meanwhile, among those who hadn’t purchased a pre-paid card,
46% did not know about initial or monthly fees; 26% assumed there were
no monthly fees; and 40% weren’t aware of paying any monthly fees.

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AmEx Leads Dunkin Donuts’ Auto-Recharge

American Express is ‘charged up’ to be the ‘Official Card Partner of
Auto-Recharge’ from Dunkin’ Donuts. By using the American Express Card to sign up for “Auto-Recharge”, the
automatic reloading feature on the Dunkin’ Donuts Card, American
Express Cardmembers will receive a 20% bonus on each
Auto-Recharge transaction of $25 or more. For every $25 Auto-Recharge,
American Express will automatically load an extra $5 onto the Dunkin’
Donuts Card. This promotion for American Express Cardmembers is
available now through March 31, 2010. In 2008, Dunkin’ Donuts’ global system-wide sales were $5.5 billion.

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AMEX & WMF

World Monuments Fund (WMF) and American Express have teamed up with the
National Forestry Corporation of Chile (CONAF) to develop a sustainable
visitor reception center on Easter Island in Chile as part of the
Sustainable Tourism Initiative. With construction scheduled to begin
early in 2010, the Centro de Recepción de Visitantes de la Aldea
Ceremonial de Orongo will be funded with the US$200,000 grant from AmEx
& WMF. Severely impacted by increasing numbers of tourists each year,
Orongo has been the focus of an intensive conservation and interpretive
program supported by WMF and American Express since 2001. The visitor
reception center at Orongo integrates the existing facilities: the core
of the new building is the old warden station, and much of the original
structure will be retained, with construction materials to be recycled
and incorporated into the new building, which will be powered by solar
and wind energy.

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