Credit Solutions Says Debt Settlement is The Way

Credit Solutions has endorsed a white paper that says debt settlement is key to economic
recovery. A leading settlement industry association, the U.S. Organizations of
Bankruptcy Alternatives, published this new study, which is being made
available to the public and to policy makers.
Key findings include: the great advantage of debt settlement over the alternatives is
consumers can satisfy outstanding obligations while paying less than the
full amount of their unpaid balances; there are several downsides to using credit counseling agencies.
Most important, the total amount of consumers’ outstanding debt is not
reduced; credit counseling agencies receive payments from both consumer
and credit card companies. This additional payment, or “kick-back,” from
creditors is a percentage of the payments creditors receive from consumers; many credit card agencies have been hiking interest rates on
outstanding balances, causing debtors to find themselves running faster
and faster just to stay in place while the time frame for paying off
creditors is stretched out. Hence, some consumers will drop out of
credit counseling and simply declare bankruptcy; as with credit counseling, debt consolidation does not reduce the
total amount outstanding. A consolidation loan probably isn’t a viable
option for most households with high levels of difficult-to-service debt
obligations because these consumers lack a decent credit rating for home
equity loan access and debt settlement can be viewed as part of the healing process to
get distressed U.S. households back on a sound financial footing and
thereby improve the odds for a sustainable economic recovery in the
years ahead.

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U.S. Credit Card Issuers Facing a Perfect Storm

Aside from the “Credit Crunch” and the “Great Recession,” payment card issuers are facing a “Perfect Storm” of an accelerated implementation of the “CARD Act,” the creation of the “Consumer Financial Protection Agency” and swiftly moving legislation to attack overdraft fee policies. This week three major banks announced plans to adjust overdraft practices earlier next year, the chairman of the House Financial Services Committee proposed a less powerful version of the “CFPA” to get it passed and several legislators are now calling for all the new credit card rules be moved to December 1st of this year instead of February 2010. The American Bankers Association says credit card banks are working diligently to implement the new “CARD Act” provisions by next February, but it would be extremely difficult, if not impossible, for them to meet the new deadline. This week, U.S. Bank announced it will eliminate overdraft fees when a customer’s account is overdrawn by less than $10, regardless of the number of overdraft transactions that may have occurred; limit the number of overdraft fees to no more than three per day; and offer the “opt out” ability to any customer who would prefer that we decline or return any transaction on their account, whenever possible, when they are presented against insufficient funds. Wells Fargo and Chase also announced overdraft changes. Wells will eliminate overdraft fees for customers when they overdraw their accounts by $5 or less and will charge no more than four overdraft fees per day. In addition, Wells Fargo and Wachovia customers will be able to opt out of overdraft coverage. Chase announced it will eliminate overdrafts for debit cards unless the customer opts in to overdraft services; modifying the posting order to recognize debit-card transactions and ATM withdrawals as they occur; eliminating overdraft fees if a customer’s account is $5 or less overdrawn and reducing the maximum number of overdraft fees per day to three from six. (CF Library 9/23/09; 9/24/09)

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FedPrimeRate.com Explores LIBOR Card Rates

FedPrimeRate.com has added a new prepaid credit cards blog to its
finance-related weblogs addressing issues like London Interbank Offered
rate(LIBOR); U.S. Prime Rate; car insurance, 0% credit cards and the
credit card industry. LIBOR, assessed with every UK business day, is the
interest rate associated with large loans between banks in the London
wholesale money market. The rate acts as a critical index around the
world in the pricing of loans and other financial products, including
many adjustable-rate mortgages in the United States. This is an area
having drawn attention in recent years with the credit crisis having
peaked in the fall of 2008 and subsequently leading American banks to
hoard cash and cutback on lending.

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AmEx Survey Finds Businessowners Very Unsure

Among entrepreneurs, 55% are optimistic on near-term business prospects while 26% have disclosed expanding opportunities for their business, up from 45% in March 2009 and up from 15% a year ago, respectively. However, 63% do not think the worst of the economic downturn is over and 17% are at risk of going out of business in the next six months. These findings, according to 763 small business owners with fewer than 100 employees surveyed in accordance with the American Express “OPEN Small Business Monitor” survey, also show 13% disclosed the growth mindset can be attributed to the general ease to renegotiate equipment leases and supply contracts while 12% credit lower real estate costs and 32% are utilizing personal or private funds to address cash flow problems. The optimism is not, however, contributing to employment market with only 23% planning to hire this fall compared to the 26% level in the fall 2002 recession.

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AmEx and NBC Announce Shine A Light Winners

NBC Universal and American Express have announced NY-based Beacon Paint &
Hardware and HAPPYBABY and NM-based Sacred Wind
Communications as the three small business finalists
in the “Shine A Light” program. The three finalists each receive $10,000
and will now rally support to potentially win $100,000 in grant and
marketing support until October 16th, for which the public is invited to
vote online at www.nbc.com/shinealight. Chosen from more than 4,000
small businesses nominated from across the country for the program, the
3 finalists selected were chosen to showcase inspirational small
businesses and the role they play in driving the economy. The selections
were made with the help of show host Ellen DeGeneres, fashion designer
Diane von Furstenberg and MSNBC’s small business expert and host JJ
Ramberg.

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MoneyU Drops Fees for Educational Institutions

Online financial skills education tool MoneyU is now free to qualifying
educational institutions.
The course is designed for young adults age 17 to 24 and uses 120
lessons and tasks
covering eight topics to teach practical personal finance skills such as
comparing credit cards and auto loans, researching the starting salaries
in a chosen field, managing debt, saving for the future and completing a
1040 EZ income tax form. The offer is aimed at addressing the critical
need to provide young
adults the practical money skills and experience necessary to be
successful in the challenging environment they are about to enter. More
than 84% of college students have a credit card and half have
more than four credit cards; debt is the biggest reason for dropping out
of school; students leave college with an average loan debt of more than
$20,000, and student debt is rising faster than starting salaries for
new graduates. These same students say they don’t know enough about
personal finances and scores in this area show that student knowledge
about personal financial issues is worsening. Griffin Enterprises,
creator of MoneyU®,
must include a $4 fee for each learner to defray its costs to develop
and deliver the program and the offer.

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Borders Offers a Teachers Gift Card Promotion

Borders is set to launch its “Teacher Town Hall Meeting” at its
superstore locations on Sept. 29, offering teachers the opportunity to
win one of ten $400 Borders gift card for their schools as part of the
“Stock Your Library Challenge.” The “Stock Your Library Challenge”
sweepstakes invites teachers from the same school to gather at one
Borders store to enter the sweepstakes and enjoy the evening’s
festivities or to visit any Borders store in their area individually.
The schools with the largest number of teacher entries in the
sweepstakes will be entered into a drawing for the gift cards, which is
to take place Oct. 9. During the event and throughout the week educators
upon proof of educator status will enjoy 30% off the list price of
nearly everything in store including books, teaching resources and
materials, music, movies, educational toys and games, gifts and
stationery and cafe products.

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Wells Unveils C2C Mobile Payments Service

Wells Fargo & Company has rolled out its mobile customer-to-customer payment, enabling customers to transfer money to each other via the
Wells Fargo Mobile Banking service. Customers simply log-on to online banking, add the account number of the customer to whom they wish to transfer
money and make a first-time transfer. Subsequent transfers can be made
from customers’ mobile devices by logging onto WF.com and following the
prompts, or online from their computers. Mobile Web Site customers who browse the web on their mobile
phone can go to Wells Fargo’s mobile web site at WF.com and sign on to
their bank accounts to: review account balances, review account
activity, transfer funds, pay bills and find the nearest ATM.
Customers who send text messages on their phone can
send a text message to the short code “93557” (for “WELLS” on
traditional keypads) to automatically receive their balance within
moments – without having to log in. Customers just type “bal” to review
primary account balance, “bal all” to review all account balances, or
“act” to review recent account activity. BlackBerry® smartphone and iPhone™ and iPod touch users can download a
WF.com icon for “one-tap” access to Wells Fargo’s mobile web site.

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SenSource Offers a Wi-Fi POS Data Analyzer

OH-based traffic monitoring provider SenSource has released its “Wi-Fi
Photoelectric People Counter” to combine POS data with customer traffic data to
analyze traffic and sales conversion ratio.
The Wi-Fi Wireless People Counter installs in minutes and accommodates a
variety of entry styles by offering both front and side-firing options.
Its new sleek design is available in a black or a light gray enclosure
to blend aesthetically at the entrance. This innovative product is
comprised of a two-part break-beam system that covers openings up to 40
feet wide. The selectable group counting feature can be used to count a
group as one unit, rather than counting each individual.
The people counter is also available for use as a stand-alone system
without the Wi-Fi integrated transmitter.

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nuBridge Says Tokenization is The Way

GA-based data protection provider nuBridge is looking to data security model—tokenization to reduce the
expense of complying with PCI-DSS. Unlike traditional encryption methods where the encrypted data or
“cipher text” is stored in databases and applications throughout the
enterprise, tokenization substitutes a token—or surrogate value—in place
of the original data. Under the PCI DSS, encrypted payment card data is
considered to be “in scope” for audit purposes. By limiting occurrences
of encrypted data to a central vault, organizations can reduce the
number of systems, applications and processes that must be audited for
compliance with PCI DSS. With “Format Preserving Tokenization”,
a token uses the same amount of storage as the original clear text data
instead of the larger amount of storage required by encrypted data.
Because a token is not mathematically derived from the original data, it
is arguably even safer than cipher text. Authorized applications that
need access to encrypted data can only retrieve the data using a token
issued from a token server, which provides an extra layer of protection
for sensitive information. Compared to traditional encryption, a
tokenization architecture can also reduce data storage requirements and
preserve storage space on data collection computers.

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InformationWeek Cites Heartland Payment Systems

Heartland Payment Systems payments processors has been named a leader
among the nation’s most innovative companies for the third year in a row
through InformationWeek 500, which identifies and honors creative users
of information technology. The recognition is thanks to the company’s
its plans to implement end-to-end encryption (E3TM) technology for
payments processing, which is being designed to safeguard cardholder
data at rest and in motion throughout the lifecycle of payments
transactions. The solution is being designed to protect data from card
swipe, through the payment processor’s network and to the card brands.
InformationWeek identifies and honors the nation’s most innovative users
of information technology with its annual 500 listing, now in its 21st
year, while Heartland Payment Systems is the 5th largest payments
processor in the United States providing card processing, payroll, check
management and payments solutions to more than 250,000 business
locations nationwide.

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DIRECTV Customers Take-On Auto Card Payments

Customers of DIRECTV have gone to court to block the company from automatically
removing the fees from customers’ bank accounts or charging their credit
card accounts without consent. In a complaint filed last September in Los Angeles Superior Court by Kathy Greiner, a six-year
customer of the company, cancelled her service and returned the
equipment. DIRECTV subsequently levied a $240 “early cancellation” penalty on Greiner,
which the company took directly from her bank account (after deducting some
amounts she had previously paid) without her knowledge or permission.
Greiner’s complaint was later consolidated with another lawsuit The joint
lawsuit alleges that DIRECTV failed to disclose to
customers that it imposed an 18 or 24 month term of service and that cancellation
before the end of the term would result in enormous penalty fees. The company would also
automatically extend the “contractual obligation” by another 18 to 24
months if malfunctioning equipment needed to be replaced or the customer decided
to make a change to programming or other services. These policies were not
properly disclosed to purchasers beforehand, and consumers did not agree to them, the suit
states.

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