Thales Releases the payShield 9000 HSM

Thales information systems and communications security has launched its “payShield 9000” payment “Hardware Security Modules.” Providing cryptographic performance and resiliency options to support the growth in global transaction volumes, the “payShield 9000” high-performance tamper-resistant security platform was designed specifically to secure card payment systems. The first provider to offer dual power supplies in a payment HSM supporting the needs of high-capacity shared infrastructures in mission-critical security systems within modern data centers, Thales has designed the “payShield 9000” to satisfy demand for performance, processing up to 1,500 transactions per second (TPS). The new hardware platform is Advanced Encryption Standard (AES) and Elliptic Curve Cryptography (ECC) ready to support future payment system requirements and is designed to meet both FIPS 140-2 level 3 and the Payment Card Industry Hardware Security Module standard (PCI HSM).

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Credit Card Issuers Continue to Close Accounts

With consumer debt having plummeted more than $440 billion by 3.8%
since 3Q/08, in response to the ongoing recession, the consumer savings
rate of 3.71% was down from 4.74% in 2Q/08. This offers stark contrast
to the 3Q/08 savings rate of 1.30% and 0.20% in 1Q/08. This, according
to the latest Equifax “Credit Trends Report,” corresponds with issuers
continually closing accounts and reducing credit lines. Since September
2008, there are 88 million fewer accounts and credit lines have been
reduced by $751 billion while 4.36% of bankcard accounts are more than
60 days late, the worst seen in 5 years. New accounts opened were 54%
lower than July 2008. Cards issued to those with risk scores higher than
740 grew from 28% in July 2007 to more than 50% in July 2009 while those
with Equifax Risk Scores of 660 and below dropped from 42% to 22% in the
same period.

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GIVEX & VOLANTE

Givex gift card technology, a global provider of closed loop card
technologies for gift, loyalty and other stored value programs, has
integrated with Volante Systems hospitality technology provider at the
Art Gallery of Ontario. Volante Systems enterprise solution is designed
for the complex and varied businesses in the hospitality industry while,
in addition to gift cards, Givex also provides loyalty cards, e-gift
certificates, frequency cards, return cards, employee incentives,
expense accounts, promotional cards and coupons for all aspects of a
merchant’s business. Givex provides customer acquisition and retention
programs for clients in 35 countries while Volante provides open
standards, point of sale solutions to the hospitality industry.

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Consumers Open Up Wallets Slightly in September

According to the National Retail Federation, retail industry sales (which exclude automobiles, gas stations, and restaurants) increased 50 basis points from August, but fell 1.5% year-over-year.
September retail sales released by the U.S. Commerce Department show total retail sales (which include non-general merchandise categories such as autos, gasoline stations and restaurants) decreased 1.5% seasonally adjusted from the previous month and 5.4% unadjusted year-over-year. Labor Day sales and a final push for back-to-school shopping, clothing and clothing accessories stores sales increased 0.5% adjusted from August but decreased 0.4% unadjusted year-over-year. Electronics and appliance store sales were flat from the previous month and decreased 9.9% unadjusted over last year.

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New Survey Shows a Scaling Back for Thanksgiving

About 30% of U.S. consumers plan to adjust this year’s travel plans for Thanksgiving. Nineteen percent of the general population who traveled last year will be staying home in 2009. The findings come from the American Express “Spending & Saving Tracker” which indicates that consumers have not measurably changed their overall outlook on spending compared to last month but they are starting to open their wallets for the holiday season. Against the backdrop of high unemployment and a soft housing market, however, they expect to be more selective. As one might expect, consumers said they plan to spend significantly more over the next 30 days on travel, compared to last month (41% versus 33%). Nearly eight in ten of the affluent expect to spend more, or about the same, over the next 30 days on dining out (78%). Compared to last month, consumers expect to decrease spending in groceries (49% versus 40%), grooming (23% versus 16%) and tuition (19% versus 5%).

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Merchant Warehouse Connects to Aldelo

Merchant card processor Merchant Warehouse has partnered with
restaurant POS provider Aldelo. The partnership addresses this timely subject matter,
adding additional lines of security to the next generation of Aldelo’s
EDC POS system through the full integration with Merchant Warehouse’s
secure MerchantWARE “Payment Gateway”, which encrypts credit card data
at the point of swipe through the “MagTek MSR Card Reader”.
Merchant Warehouse’s “MerchantWARE” solution encrypts the data at the card
reader, completely eliminating this threat. “With MerchantWARE”, merchants
never actually store or transmit any unencrypted credit card
information.

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USA Technologies Hits a New Milestone

Cashless transaction provider USA Technologies has processed $5 million
in cashless micro-transactions processed through its network in September.
The Company today has 57,000 devices connected to its network located
nationwide and in Canada, representing over 600 customers, including
many of the biggest national and global credit card companies, vending
machine operators, soft drink bottlers and other unattended,
self-service retail kiosks. USA Technologies also reported that a survey
of the 10,000 top
performing ePort® cashless vending machines had
shown an average 54% increase in cashless sales over the past 12
months as compared to the prior 12 month period. The annual cashless
sales of these ePort equipped
vending machines had grown from $1,992 to $3,071. The knowledge base
data is the result of tracking the performance of 38
channels and sub-channels and the cashless performance metrics from 600
customers, representing 6,000 cashless vending deployments, together
averaging 27% card usage, and annual cashless sales of over
$2,500 per machine.

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TSYS Program Solutions is Launched

TSYS has formed TSYS Program Solutions to provide turnkey credit card
programs for regional and community financial institutions.
TSYS will provide the program development, implementation and ongoing
delivery to make it easy for smaller banks to enter or re-enter the
credit card market. The new division will be led by:
Wayne Johnson,, previously with First Data, Andrew Mathieson ,
previously CEO and founder of Fintura Corporation, Patrick Fox ,
previously EVP of business development for Metris Companies,
Fred J. Grigsby III previously chief marketing officer at Fintura
Corporation and George Whitley, previously EVP, Fintura’s Business
Performance and Analysis functions.
TSYS’ solution includes profitability analysis, portfolio management and
campaign and marketing support combined with TSYS’ core capabilities in
data processing, card and statement production, customer care, analytics
and loyalty.

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SCA and M-Payments Council Outline Priorities

The Smart Card Alliance Contactless and Mobile Payments Council will
continue educating on chip card technology security benefits in the
hopes of reducing fraud in the U.S. payments industry. Resources on this
continued education include a position paper, End-to-End Encryption and
Chip Cards in the U.S. Payments Industry. With contactless cards and
acceptance terminals already widely deployed in the United States, the
paper discusses the fraud-reducing benefits of contactless chip cards.
The embedded dynamic cryptogram with each transaction stops card
counterfeiting, a major source of fraud, the increasing adoption of
which builds on infrastructure already in place to meet interoperable
EMV standards. The Contactless and Mobile Payments Council is made up of
over 120 individuals from 45 organizations, who welcome its new Chair,
Charles Walton of INSIDE Contactless, new Vice Chair, Ron Pinkus of
Giesecke & Devrient and new Secretary, James F. Lock III of JPMorgan Chase.

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Chase Cards Lose $700 MM in the Third Quarter

Chase posted a net loss of $700 million for its Card Services division for the third quarter. EOP managed loans were $165.2 billion down 11% from the prior year and down 4% from the prior quarter. The decrease from the prior year was due to lower charge volume and a higher level of charge-offs. Charge volume was $82.6 billion, a decrease of 12% from the prior year. Return on equity was negative 19%, down from positive 8% in the prior year. Pretax income to average managed loans (ROO) was negative 2.61%, compared with positive 1.17% in the prior year and negative 2.46% in the prior quarter. Net interest income as a percentage of average managed loans was 10.15%, up from 8.18% in the prior year and 9.93% in the prior quarter. Merchant processing volume was $103.5 billion, on 4.5 billion total transactions processed.

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LATERAL LIVING

With more people exploring alternative avenues towards personal
fulfillment and success, 28% can be described as “The New Potentialists”
with an inclination for “Lateral Living”. Among “The New Potentialists”,
49% seek to travel the world, meet new people and experiencing new
cultures, 36% wish to spend more time enjoying a hobby and 28% would
like to spend more time with their family. Identified in a study
commissioned by American Express, the research also shows 37% have
re-evaluated what is important in their lives thanks to the recession
while less than 10% are concerned with making more money. Additionally,
80% of women believe they will reach their full potential compared to
74% of men; 89% of women are optimistic about the future compared to 84%
of men; and 40% of women have re-evaluated what’s important in their
lives over the past year, compared to 34% of men.

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MOBILE EXCELLENCE

Because of its unique solution, Monitise Americas mobile banking and
payments provider has been chosen as a finalist for the “Mobile
Excellence Award for Best Mobile Innovator”, to take place December 7th.
Produced by Little Monster Media, the Mobile Excellence Awards (MEAs)
goes to the company proven most progressive or has launched the most
groundbreaking product/service/model. Monitise Americas mobile banking
services with its “Mobile Money” offering is the world’s first mobile
banking ecosystem. Made available by banks, credit unions and prepaid
issuers around the country, “Mobile Money” allows consumers to perform
banking and payment transactions using a single consistent interface.
Judged by professionals in the industry, the MEA criteria are based on
several achievements including Strategic Initiative, Impact of
Technology used in the Industry, Creativity, Ease of Use and Reach, and
Execution & Proven Success in the Market.

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