Cardholders Still Hammered by T&C Changes

A new survey has found that a third of consumers say their card company has made one or some combination of changes recently. The June poll by GfK found that 19% reported an increase in their interest rate 19%, up from 15% in the February survey. About 18% report their credit limit was lowered, up from 8% in February survey. Other findings: 14% report an increased in fees; 12% report an increased in their minimum payment due and 9% says their rewards program was reduced. The national telephone poll was conducted on behalf of Credit.com.

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Online Shopping Carts Left Stranded at Checkout

Recent research reveals that 45% of online shoppers have abandoned their interactive ‘carts’, which averaged a total of $109, more than once over the course of the previous 3 weeks. The PayPal survey found that 40% of the 46% who decided not to purchase items because of high shipping charges shared that they may have executed the purchase if shipping fees were disclosed upfront, the demographic PayPal is targeting with its “Express Checkout” Instant Update API. “Express Checkout” allows merchants to show order details, such as shipping options, insurance choices and tax totals, earlier in the process. Among the 553 U.S. participants whom disclosed they have recently abandoned their ‘cart,’ additional findings show 37% did so to compare other website prices while 36% simply did not have the money. Less popular reasons for abandonment show 27% wanted to look for a coupon; 26% decided to shop offline; 24% couldn’t find their preferred pay option; 23% disclosed the chosen item was unavailable at checkout; 22% couldn’t find customer support; and 21% were concerned about security of credit card data.

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EZIO OPTICAL TAN

Among the most secure online banking schemes is the optical authentication system used in Germany. Gemalto has unveiled “Ezio Optical TAN,” whereby users simply present the device in front of their computer screen and optical sensors capture the data they would normally enter from the reader keypad to carry out and sign online transactions. No software needs to be installed to use the device. The size of a credit card, the new Gemalto reader is compliant with the latest German “HHD” standard and leverages the security of “SECCOS” banking cards. Gemalto has already delivered “Ezio” authentication solutions to leading banks in Asia, Europe and the Americas. Germany has the largest number of online banking customers in Europe, about 30 million.

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Credit Card ABS Charge-Offs Top 10% in May

Charge-offs among credit card-backed securities logged another record in May topping the 10% milestone. However, the delinquency ratio declined for the second consecutive month. The latest “Moody’s Credit Card Index” shows 30+ day delinquency dropped to 5.97% from 6.34% in April. However, Moody’s says the improvement is an expected seasonal phenomenon arising from the tax refund season and fully expects delinquencies to resume their upward trend. Charge-offs rose to 10.62% in May from 9.97% in April and 6.41% a year earlier. The May “Index” also shows payment rates slipping for the second consecutive month, to 16.01% from 16.20% in the prior month. The yield index rebounded from last month’s sharp decline, returning above the 18% level and reflecting discounting initiatives by Citibank and Bank of America. However the increase was not enough to keep excess spread levels from falling below the 5% level for the first time since 1998.

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One World Visa & MasterCard is Launched

Prepaid card provider One World Ventures is now marketing the
“One World Card” for migrant workers. The One World Card is a VISA/MasterCard remittance solution “Money Transfer Card” and the
world’s first combination “Pay-Remit Card.” These two new products
combined in to one card have been designed for American-based migrant
workers, the underserved and their families back home in Indonesia,
Vietnam and the Philippines. One World Ventures is a holding company that invests in
technologies, communities and systems that facilitate trade, finance,
communication and travel across international boundaries, cultures and
languages.

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Off-Premise ATMs Ideally Suited for Wi-Fi Access

While the U.K. historically is a “follower” rather than an “innovator” in the financial services industry, it has pioneered ATM optical recognition technology and is now leading the way by turning ATMs in Wi-Fi hotspots. This week, Cashbox and British Telecommunications inked a five-year deal to add wireless Internet services to more than 2,500 off-premise ATM locations across the U.K. Customers from iPass, Boingo and other BT “Openzone” roaming partners will also be able to use the service. The new “Openzone” hotspots will expand the BT network in the U.K. for BT’s 4.8 million broadband customers. BT customers can also connect at over 190,000 residential and commercial hotspots in the U.K. and Ireland including BAA airports, BA lounges, Caffe Nero, Hilton, Thistle and Ramada Jarvis hotels and, shortly from Starbucks coffee stores. According to CardFlash International, Cashbox deploys Tidel ATMs and had 2,838 installed machines at the end of 2008.

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Alternative Online Consumer Payments Take-Off

Javelin Strategy & Research has released “Predicting Alternative
Payments Vendor
Success: Balancing Needs Among Banks, Merchants, and Consumers” and
reviews the rates and the value of services provided by nine vendors.
Included in the report are vendors with some level of emerging status
(eliminating vendors such as PayPal and BillMeLater), as well as some
level of financial-institution orientation (eliminating Revolution
Money). Vendors evaluated include Acculynk, eBillme, HomeATM, Mazooma,
Moneta, NACHA SVP, Noca, SeerGate, and Verient. According to the
report,the three vendor solutions that come closest to widespread
success are those offered by Acculynk, eBillme and Moneta – with
Verient’s platform finishing close behind with many former alternatives
for online retail transactions are
quickly going mainstream.The emerging payment methods from traditional
payment providers have
the advantage of trusted brands and established networks for issuance,
acceptance and processing and in order to retain and grow valuable
customer relationships, financial
institutions must offer dynamic, alternative payment solutions that meet
consumer, merchant and bank needs.

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BluePay Introduces a New Tokenization Process

To securely process stored or recurring billing credit card information, allowing for credit card and ACH payment processing with minimized risk and liability, IL-based BluePay has introduced its tokenization process. Using an unrelated string of numbers and/or letters to represent and access securely stored credit card information so the card number does not have to be exchanged for payment over the internet, BluePay tokenization can securely process billing data and exceeds PCI requirements, which help facilitate broad merchant adoption of consistent data security measures. Merchant clients never even access customer credit card information, processing account information only through an account code, and don’t have to worry about the associated risk of exposure, expenses or risk.

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SYNOVATE CSI

Synovate Customer Service Index (CSI) quarterly tracking survey of over
36,000 Canadians has concluded most are happy with the service provided
at their primary personal bank, with only 8% having reported any type of
problem over the past six months. Of those having reported service
problems, 24% disclosed account/statement errors, 20% felt staff lacked
knowledge and 17% cited poor quality of investment advice. Additional
research shows 36% of unhappy customers will first contact someone other
than the manager at the branch, 28% will use a toll-free telephone
banking number and 13% will approach the branch manager directly. Nearly
50% were satisfied with how their bank solved the problem, 25% were
somewhat satisfied and less than 25% were either somewhat dissatisfied
or completely dissatisfied. Customer Service Index (CSI) is Synovate’s
retail banking survey to measure customer performance in Canada’s retail
banking industry and are generated quarterly while Synovate is the
market research arm of the Aegis Group, employing over 6,700 staff in 62
countries.

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360FuelCard.com and Comdata Sign a Deal

TN-based e-payment provider Comdata has entered into an agreement
with fleet supplier 360FuelCard.com and will support an environmentally responsible program.
Comdata will provide corporate fuel cards, as well as the
network of fuel and service sites, for 360FuelCard.com customers. This
agreement will enable petroleum marketers to utilize the Comdata
platform to expand their commercial fleet programs, while leveraging 360
sales and marketing programs to enhance business at the fuel island and
inside the store. A critical component of the 360FuelCard.com program is the relationship
with Carbonfund.org. 360FuelCard.com has made an ongoing commitment to
give back by donating 10% of profits to environmental causes
across the U.S., including Carbonfund.org.

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APRIL LEI

The Conference Board Leading Economic Index (LEI) for Germany increased
.4%, following an 18 month rate of decline total of 10.8%, while The
Conference Board Coincident Economic Index (CEI) decreased .2% in April.
With the .4% increase in April, The Conference Board LEI for Germany now
stands at 85.8 (2004=100), which declined 0.9% in March and 2.6% in
February, while the CEI now stands at 101.3 (2004=100), which decreased
0.3% in March and decreased 0.6% in February. LEI positive results for
the month were attributed to stock prices, yield spread, new residential
construction orders, new orders in investment goods industries and
inventory change series while negative results were attributed to
consumer confidence, gross enterprises and properties income.

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CashEdge Launches Pay Other People Money Service

A new person-to-person payments service that enables banks to provide P2P payments from their online or mobile banking applications has been introduced. The “POPmoney” service includes an SMS text messaging application, as well as downloadable mobile applications, enabling banks to extend their P2P functionality to mobile phones. The new “Pay Other People” (POP) service was developed by NY-based CashEdge,
which processed nearly $50 billion in online funds transfers for bank customers in 2008. The Company also released a survey showing that 81% of bank customers would use a P2P service if offered; 77% would prefer a P2P service through their own institution rather than that of an independent online P2P service; 73% felt their bank would offer more security and 69% said their bank would offer more convenience.

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