U.S. Consumers Digging Their Own Way Out of Debt

Recent figures show 47% of consumers are handling their debt problems
themselves. Additional studies show 11% are getting help from
family/friends; 4% are going to a non-profit credit counselor; 3% are
seeking help of a bankruptcy attorney; and 2% are working with a debt
settlement company. The findings were concluded through a national
telephone poll of 500 female adult and 500 male adult interviews
conducted for Credit.com by GfK Custom Research North America in June of
2009.

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CFIB

In the battle against credit card practices adversely impacting smaller
merchants, the Canadian Federation of Independent Business (CFIB) is
challenging Visa, Mastercard, chartered banks and card processing
companies to adopt a Code of Conduct on behalf of the small business
sector. Pleased governments are paying close attention to this issue,
CFIB is calling on credit card companies and the banks to adopt a Code
of Conduct for small businesses with a focus on 10 principles. As an
alternative to strict regulation of the industry, these principles
include the assertion premium cards should never be distributed without
cardholder request; merchants should know the total fee associated with
a card prior to acceptance; merchants should be able to refuse any card
or assess a fee for acceptance; merchants should be able to exit a
contract without penalty under changed terms; and credit card companies
should never introduce a “percentage of sale” fee in the debit card
marketplace.

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MAY ABS

Delinquency and charge-offs amongst credit card-backed securities hit record highs again in May. Charge-offs leapt 50 basis points while 60-to-180 day delinquency nudged up by 20 basis points. The Fitch “Charge-off Index” increased for the fourth straight month in May to 9.1%, compared to 8.6% in the prior month and 6.4% one-year ago.
Fitch says it is particularly concerned that the increase in charge-offs is a result of the increased roll-through of delinquencies, with the stress on consumer payments brought about by the deterioration in the UK economy expected to continue throughout 2009. In May, the Fitch “Delinquency Index” increased for the ninth month in a row, moving to 5.5% from 5.3% in April and 3.7% in May 2008. On an individual trust basis, six of the eight trusts included in the “Index” reported new historical high delinquency levels in May. Fitch also reports that its “Monthly Payment Rate Index” fell 10 basis points in May to 15.4%. However, the Fitch “Yield Index” increased to 20.0% in May, compared to 19.4% in April.

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GuestMetrics and Vigilix Team for PCI

Hospitality POS provider GuestMetrics has partnered with Vigilix to offer a PCI compliant technology platform.
The partnership will allow the Vigilix technology platform to be utilized to deploy and
configure GuestMetrics’ “GuestSnapshot” client software.
The Vigilix technology platform will enable POS dealers to deploy and
configure “GuestSnapshot” by checking the appropriate
box on the Vigilix portal at the client location. This provides POS
dealers an additional value-added service they can offer to their
customers and a subscription based revenue generating opportunity that
can easily be deployed and maintained. In addition,
Vigilix will also distribute the “GuestSnapshot” enterprise
reporting tool to the hospitality POS dealer and systems integration
channel. Vigilix integrates with many leading POS applications and is
used by help desks to monitor over 7,000 point-of-sale systems. Vigilix provides monitoring and
alerting software and remote support tools dedicated to the
point-of-sale industry.

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Optimized Payments Targets Merchant Fees

GA-based Optimized Payments Consulting has launched a free online
calculator and webinars to help businesses understand and lower their
cost of electronic transactions. The tool will clear up misconceptions about processing
costs and show businesses their true effective cost of processing credit
and debit cards. This realization will cause merchants to take action
and in the process add significant savings to their bottom line
Optimized Payments Consulting has also launched a series of free monthly
webinars that discuss strategies merchants can employ to not only lower
their payment costs, but also to increase sales. The firms’ analysts
will discuss industry best practices and allow attendees to get answers
to their specific payments questions.

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HYPERCOM EXEC

Peter Vesco has been appointed Managing Director, Northern Europe, for
Hypercom Corporation to oversee the directing and driving Hypercom’s
business activities throughout the region, effective October 1, 2009.
Peter joins Hypercom from First Data International, where he served for
two years as Regional President, Germany, Italy, Austria and
Switzerland, out of Bad Vilbel, Germany, after having served as COO with
Vesco and Deputy CEO with ATOS Worldline out of Frankfurt. Vesco holds a
Degree from Johann Wolfgang von Goethe University in Frankfurt and a
Postgraduate Diploma in Management from University of Huddersfield in
the UK. Hypercom Corporation offers secure, end-to-end electronic
payment products and services in more than 100 countries around the world.

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M&M PAYWAVE

The 470 M&M Meat Shops have joined the network of Visa ‘payWave’
contactless payment merchants, allowing its customers to “wave and go”
when conducting transactions. Thanks to its contactless terminal, Visa
‘payWave’ delivers speed and convenience to participating merchants and
Visa cardholders through the security of chip technology, closely
aligned with Visa’s migration to chip card technology in Canada. Visa’s
layered approach to fraud prevention employs card technology paired with
the company’s processing network. Visa retail electronic payments
network provides processing services and payment product platforms for
local currency in more than 170 countries while M&M Meat Shops was
established in 1980 to provide consumers specialty frozen food.

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Economic Recovery Hope Fades Among Consumers

The glimmers of hope found in the spring surveys is quickly fading as another monthly monitor finds that consumer attitudes toward the economy reversed course from the previous three months. Over half, 51%, plan to spend less in the month ahead on discretionary purchases, a two point increase from May. The latest “Discover U.S. Spending Monitor” fell in June for the first time in four months from 86.2 to 85.6. For the third straight month, less than half of consumers have money left over after paying the monthly bills, one point lower than the previous month. Of those who do have money left over, 79% plan on having the same or more money left over than the previous month, a one point increase from the previous month. Fifty-nine percent currently rate the economy as poor and only 8% of consumers feel economic conditions are good or excellent. Compared to a year ago when gas prices were touching $4 per gallon, 15% of consumers still felt the economy was good or excellent while 54% felt it was poor.

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Discover’s Public Offering to Net About $480MM

Discover Financial Services priced its public offering of 54.1 million shares at $9.25 per share. The price represents a 12% discount from Monday’s close of $10.50. Discover will receive estimated net proceeds from the offering of approximately $480.3 million. The net proceeds from the offering will be used for general corporate purposes, which may include capital contributions to the company’s subsidiary, Discover Bank, possible investments in the company’s businesses, or possible repurchase of fixed rate cumulative perpetual preferred stock issued by Discover to the U.S. Treasury under its “Capital Purchase Program.” J.P. Morgan Securities Inc. is acting as the sole book-running manager for the common stock offering.

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ICMA Schedules MEA Workshops for the Fall

NJ-based International Card Manufacturers Association is set to hold its “Academy Workshop Series”
in the U.S. and Europe this fall. The Workshops will discuss the latest issues affecting professionals
throughout the card manufacturing industry, as well as offer topics that reflect
industry trends in each market. Topics will cover a variety of areas pertinent to each
region including innovations in security, material alternatives, card testing
options, NFC, personalization and print technology. The Workshops are suitable for card manufacturing professionals from
around the world including personalizers, issuers, card manufacturers and other
industry stakeholders. A variety of speakers from JDSU, Oberthur, DataCard, SMARTRAC,
Waytek, Mirel, HID Global, CFC International and Bayer MaterialScience
will also be featured at the Workshops who will share their insight on new industry
processes and applications and offer their perspectives on the future of the
industry. The Workshops are only open to members of the association.

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PAY.ON & QUOVA

PAY.ON AG payment and risk management technologies and
online transaction processor has implemented Quova’s IP geolocation data
to assist, detect and prevent fraudulent online payment transactions.
The Quova’s IP geolocation data will allow PAY.ON to establish the real
world location of a Web visitor and break down cardholder details to
country, state or even city level to compare with their registered card
details during the order process, scanning for mismatches. PAY.ON’s
fully PCI-certified online payment platform was founded in 2004 and
enables online payments to occur across numerous sectors for payment
service providers, payment scheme suppliers, acquirers, clearing houses
and risk management providers. UK-based Quova allows online businesses
to instantly identify where a visitor to their web site is
geographically located, with a 99.9% country accuracy rating.

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MegaPath Webinar to Offer PCI Advice

IP provider MegaPath is a participant in RIS’ “Future Proof Your
Network with MPLS and PCI Compliance” webinar.The July 14th webinar will
cover optimizing retail applications and future-proofing networks to be
both efficient and flexible; reducing costs by connecting all store
applications over a single
high-speed, PCI compliant network;removing WAN PCI compliance hurdles
through use of MegaPath MPLS VPN; utilizing Managed Security Services to
promote PCI compliance;building scalability and flexibility into a
network to accommodate changing bandwidth and connectivity and enhancing
operational efficiency through prioritization to ensure bandwidth is
available as needed for mission critical applications via use of MPLS to
achieve Quality of Service (QoS). MegaPath is a provider of managed IP
communications services in North America.

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