Motorola Gains Access to NFC Patents

Motorola has joined patent developer Via Licensing’s NFC joint
licensing program as a licensor. The joint licensing program for NFC is
designed to provide fair and convenient access to essential patents
through a single license
agreement. Among the applications covered by this program are
NFC–compliant mobile phones, consumer electronic devices, and commercial
systems such as payment processing terminals, transportation terminals,
and vending machines. A wide range of related technical specifications
published by ISO, ETSI,
and the NFC Forum are covered by the NFC patent pool agreement and are
available at www.vialicensing.com/patent/NFC_index.cfm.

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Kmart Smart Assist Savings Card Launched

Retailer Kmart is offering the “Kmart Smart Assist Savings Card”to
Michigan residents. Eligible cardholders will receive 20% off of their
grocery and drug staples. Verifiably unemployed Michigan residents who
register at www.kmart.com will receive a nontransferable Kmart Smart
Assist Savings Card valid for up to six months depending on the date of
issue. Registration is a private, online
process. Any Kmart customer who can present valid Michigan state-issued
identification and a state-issued unemployment benefits enrollment
confirmation is eligible
to enroll in the “Kmart Smart Assist Savings Card” program. Michigan
residents who
file for Michigan state unemployment benefits either before or after the
program
begins are eligible, provided they possess required documentation. If
customers gain employment before their Kmart Smart Assist Savings Card
expires, they
may still use the card up until its expiration.

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EZIPAY

Visa continues to rack up more partnerships to facilitate the expansion of global mobile payments with today’s announcement of a strategic alliance with Monitise. Under terms of the deal, Visa plans to make a minority equity investment in Monitise, a global mobile payments specialist. Monitise says it can optimize the user experience for Visa mobile payments and related services as its solution can detect phone make, model, screen size, browser type and multimedia capabilities. Visa says the partnership will produce mobile payments, mobile money transfer, mobile transaction alerts and mobile marketing offers. The two companies indicate they will focus on increasing the speed to market of unique payment and related services including mobile user enrollment services, application development and channel management. Last week, Visa announced two major m-payment partnerships. The NeuStar alliance will combine Visa’s global payment network with NeuStar’s carrier grade infrastructure. VisaNet Peru and Telefonica announced they will launch the “Pago Movil con Visa” service (Visa Mobile Pay) to enable cardholders in Peru to pay for products and services over a wireless network. In 2007 Monitise plc and Metavante partnered to create Monitise Americas. The mobile service is integrated with the NYCE Payments, which delivers the service to U.S. customers, and is available through mobile phone handsets over a secure network. (CF International Library 11/28/07; CF Library 6/23/09)

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ACCC & CABCHARGE

The Australian Competition and Consumer Commission (ACCC) has instituted
legal proceedings in the Federal Court, Melbourne against Cabcharge
Australia for alleged breaches of the Trade Practices Act 1974 in its
conduct. The ACCC is maintaining Cabcharge used its market power in the
provision of non-cash taxi fare payment processing services and taxi
specific payment products to refuse to enter into agreements with
competing suppliers of processing services as a means to process through
alternative EFTPOS terminals. Additional allegations declare Cabcharge
supplied taxi meters and fare schedule updates, either free of charge or
below cost, for anti-competitive purposes, going against Section 46 of
the Trade Act, and that Cabcharge entered into an arrangement with
Townsville Taxis to acquire their charge account business and replace
approximately 130 rival EFTPOS terminals with their own as a means to
diminish competition against Section 45 of the Act. In response, the
ACCC is seeking declarations that Cabcharge’s conduct contravened the
Act; pecuniary penalties; a compliance program; and proceeding
reimbursement. Cabcharge provides taxi industry solutions such as
payment products, processing services for non cash taxi fare payments,
taxi meters, dispatch and network services.

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UAL and Travel Agents Collide Over Card Fees

Travel agents are flying off the handle over a pilot program launched by United Airlines to require them to process their own credit card payments. United Airlines informed a limited number of travel agencies that, effective July 20th, they would “no longer have continued access to United’s credit card merchant agreements.” If the agent continues to use United’s merchant facilities then a $75 fee would be assessed for each transaction. ASTA listed off six reasons why the new policy is headed for a mid-air collision: 1. About two thirds of travel agents’ access to merchant services is limited to the “ARC TASF” program, which is designed to process service fees, not airline tickets; 2. United is requiring these agents to absorb United’s cost of doing business; 3. United will save no credit costs if the result of the policy is that consumers, or agents on behalf of consumers, book on credit cards at United.com; 4. travel agents have been given insufficient time to prepare their systems and procedures to accommodate a process change of this magnitude; 5. Travel agents’ cost of doing business will increase well beyond the agent absorbing the credit card merchant fees that United will avoid; 6. Consumers will be disadvantaged as costs shifted from United to travel agents will ultimately be borne by consumers in the form of higher service fees on top of the existing fare level.

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Cost Plus Settles Card Fraud Patent Lawsuit

Acacia Research Corporation has announced its Financial Systems
Innovation subsidiary has reached a settlement agreement to resolve
disputes regarding the Cost Plus patent for its credit card fraud
protection. The dispute, pending before the United States District Court
for the Northern District of Georgia, concerned Cost Plus’ expired
patent, asserting in this litigation its electronic card reader and
subsequent generation and use of a transaction number to specifically
identify each transaction processed within the system. This method is
designed to protect retailers and consumers engaged in credit card,
check card, and debit transactions. Acacia Research’s subsidiaries
control over 100 patent portfolios, covering technologies used in a wide
variety of industries.

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Merchant Data and ControlScan Team

Payment processor Merchant Data Systems has partnered with GA-based PCI
compliance provider ControlScan to offer PCI DSS validation to
merchants. Merchant Data Systems merchants will now have access to
ControlScan’s “PCI 1-2-3” compliance solution, available online via a
Web-based merchant
portal called “myControlScan.com”, which provides merchants with the
leading tools and support necessary to analyze, remediate and validate
PCI compliance, including the PCI 1-2-3 Self Assessment Questionnaire;
PCI 1-2-3 Vulnerability Scanning; PCI 1-2-3 Security Policy Builder;
PCI 1-2-3 Security Awareness Training and Personal Touch Support.
ControlScan is a provider
of Payment Card Industry (PCI) compliance and security solutions
designed exclusively for small- to medium-sized e-commerce and retail
merchants. ControlScan provides
easy-to-use Web-based security solutions and a personal level of service
that make it easy and cost-effective for these businesses to analyze,
remediate and validate compliance.

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CARREFOUR AXESS

MasterCard Europe has partnered with Carrefour retailers and Axess Bank
to introduce “Carrefour Axess” ‘Tap&Go’ contactless payment solution.
Available in over 170 Carrefour hypermarkets and supermarkets throughout
Turkey, the new card program merges the Axess multi-merchant scheme with
Carrefour’s “Carrefour Plus” loyalty scheme to bring banking services
directly into the supermarket environment. Cardholders are instantly
issued the payment device instore for enhanced loyalty and installment
programs with no need for signature on purchases of 16 euros or less.
Axess full service credit card program serves over 4.5 million
cardholders, offering its ‘cash points’ reward scheme through purchases
at over 160,000 merchant partners outlets while MasterCard Worldwide
serves consumers and businesses in more than 210 countries.

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Top Issuer Q2 30+ Delinquency Slows to 5.77%

After four consecutive quarters of rising credit card delinquency it appears that the second quarter figure will post about 15 basis points lower than the prior quarter. The sequential increase in quarterly delinquency (30+ day) among the nation’s top issuers was 15% in the first quarter, compared to an 18% surge in the fourth quarter.
However, the second quarter is expected to be about 2.5% lower than the prior quarter. Among the nation’s top issuers with at least $50 billion in outstandings, the projected delinquency rate for the second quarter is 5.77%. The average delinquency ratio for 1Q/09 was 5.92%, compared to 5.16% in the fourth quarter and 4.00% for 2Q/08, according to CardData (www.carddata.com). Discover recently reported that its over 30 day delinquency rate on managed loans was 5.08%, down 17 basis points from the first quarter, but up 127 basis points from the prior year. American Express reported that 30+ day managed U.S. delinquency edged down to 4.7% in May from 4.9% in April and 5.1% in March. Capital One reported that 30+ day managed U.S. delinquency declined to 4.90% in May from 5.04% in April and 5.08% in March. According to Moody’s “Credit Card Index” the delinquency rate for all credit card ABS was 5.97% for May compared to 6.34% for April. (CF Library 6/15/09; 6/17/09; 6/18/09; 6/24/09;)

Top U.S. Issuers
30+ DAY DELINQUENCY
(minimum $50 billion in outstandings)
2Q/08: 4.00%
3Q/08: 4.36%
4Q/08: 5.16%
1Q/09: 5.92%
2Q/09: 5.77%
Source: CardData (www.carddata.com)

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CashStar Powers the New CVS Virtual Card

RI-based drug retailer CVS is now offering the “CashStar” interactive gift card. CVS/pharmacy
customers can now purchase virtual gift cards on the company’s website,
www.cvs.com. Senders can personalize the look and feel of the virtual
gift card, select the dollar amount, and set the day and time that the
card should be delivered via email. CashStar gives
CVS/pharmacy access to an extensive online network that will expose
their interactive gift card to millions of potential customers on the
coupons.com website. This gives CashStar significant competitive
advantages in promoting and driving sales for its retail partners.

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Security Remains Chief Concern for E-Shopping

A recent survey found that 43.5% of respondents who had never purchased on the Internet, gave security concerns as the reason. Among those who rarely shopped online, 26.4% cited security as the reason they did not do so more often. The survey by Analytica for NYCE also found that nearly half of the frequent Internet purchasers who were reached for the survey online indicated they would consider replacing their current method with one offered by their bank or credit union, as long as they felt it was safe and secure. Additionally, 18% of those who had never purchased anything online indicated they would likely try online shopping using a secure payment method offered by their financial institution. Among those who rarely shopped online, 27.6% indicated they would likely make more purchases using such a method.

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VISA VALE

Visa and Credibanco have launched the “Visa Vale” card with its
electronic purchase voucher solution. Implemented in collaboration with
Citibank and Davivienda, “Visa Vale” offers increased control, security,
access and convenience through electronic payments, benefiting
companies, merchants, and Colombian workers. Accepted wherever Visa is,
the PIN card works electronically at POS merchant terminals exclusively
for purchases, not providing access to cash at ATMs. The card was
designed by and meant for the Latin American market to simplify payment
processes, reduce handling time, operating costs and to extends the
shelf life of employee fringe and tax benefits. Visa has presence in
more than 170 countries while Credibanco is a Principal Group Member of
the Payment Card Association.

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