Heartland and Voltage Security Team for Encryption

Heartland Payment Systems has partnered with Voltage Security to develop
end-to-end encryption payment processing software.
Heartland’s new “E3” solution will significantly enhance the security of
payment card information throughout the processing lifecycle. The
Voltage “SecureData” product line, based on its “Format-Preserving
Encryption” and “Identity-Based Encryption” approaches, will power the
software component of Heartland’s E3 solution.
Heartland also employs “Voltage “SecureMail” and Voltage “SecureFile” to protect personal
information throughout its corporate and extended business network.

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Veritec to Power Security First Gift/Debit Cards

Mobile banking solution provider Veritec has signed a license and
maintenance agreement for its mobile banking platform with CA-based
Security First Bank to issue debit and prepaid gift cards
The cards will be issued on Veritec Financial Systems mobile
banking platform and VTFS will provide back-end card processing
services to the Bank for all cardholder transactions. Veritec is a pioneer and developer of proprietary two-dimensional
matrix technology whose portfolio of products includes the
“VeriCode” and “VSCode” 2D matrix symbology solutions, “BioID – VSCode”
multi-purpose card solutions, and suite of products known as
“PhoneCodes” for delivering electronic tickets, coupons and gift cards to
mobile devices.

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Metavante Technologies to Implement MC rePower

Metavante Technologies has made the first live implementation of the MasterCard “rePower” POS prepaid card reload service. Available to MasterCard and Maestro prepaid cardholders across Europe, “rePower” makes available its network of top-up locations. Utilizing the combination of the MasterCard merchant infrastructure through acquiring partners and its existing POS infrastructure, Metavante will process the new implementation for Advanced Payment Solutions’ prepaid card programs. Advanced Payment Solutions European prepaid card provider offers cardholders its personalized, embossed, Chip and PIN prepaid MasterCard cards.

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Big Gap in Parent-Child Financial Awareness

A new survey shows that only 41% of the children know what a credit score is vs. 75% of parents; 28% understand how APRs accrue vs 73% of parents; 22% are concerned about having enough money to finish college vs 46% of parents; 38% are concerned about a career path vs 52% of their parents; and 21% are concerned about the U.S. stock market vs 41% of parents. However, the Wells Fargo research also showed that 95% of parents are confident their children will attain their financial goals while 5% of the children feel the same, 92% of parents feel budgets are effective while 95% of their children feel otherwise and parents are more likely to maintain a hard copy budget versus online while only 50% of youth would maintain a hardcopy. Wells surveyed more than 1,000 parents and 600 young adults.

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Travelex Signs U.S. Bank for its Cash Passport

Foreign exchange Travelex has signed a new agreement with U.S. Bank that allows the Bank’s branch network
to offer Travelex’s “Cash Passport” and banknotes.
After an initial contract between the two companies was signed in 2003,
Travelex entered an onsite agreement with U.S. Bank in January of 2005. The two
companies signed an amendment to their agreement to allow Cash Passport, a prepaid
card denominated in Euro and British Pound Sterling to be sold in U.S. Bank
branches in August of 2008. Travelex is the world’s foreign exchange, business payments specialist
and leading provider of travel insurance, operating through subsidiaries and
branches in these regions: the Americas, United Kingdom; Europe, Asia Pacific; and Middle
East and Africa (EMEA).

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MasterCard and Hyatt Launch a Summer Promotion

MasterCard and Hyatt Hotels has launched a new “Hyatt Gold Passport” bonus point promotion for Gold Passport members to earn
2,500 bonus points per stay when paying with a MasterCard debit or
credit card. The number of bonus points that can be earned is unlimited
and points never expire. After only two stays, members will earn enough points for a free night
or a room upgrade. With the newly redesigned “Hyatt Gold Passport”
program, members can now take part in a wider range of exclusive
privileges, including free night awards with no blackout dates,
complimentary Internet access, suite upgrades and exclusive check-in
areas for elite members. With the opening of 30 new hotels in the past year, and 18 more
properties slated to open in 2009, “Hyatt Gold Passport” members have more
opportunities to experience Hyatt and the benefits of membership.

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Citizens Financial Deploys the MC Payment Gateway

RBS’ Citizens Financial Group has agreed to utilize the full functionality of the “MasterCard Payment Gateway” as part of its suite of corporate payments solutions. The MasterCard solution is modular and includes buyer-initiated P-Card straight through processing, and features a single interface for all payment processing needs for both
buyers and suppliers, user interface/Web oortal for payment status and reporting; end-user integration (with current ERP/AP systems) for buyers and remittance information regardless of payment type for suppliers.
The bank says the “Citizens Gateway” supports multiple payment types and enables the “touchless” routing of electronic payments from buyer to bank to supplier.

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CO-OP Financial to Help Fund the Interchange Fight

CA-based CO-OP Financial Services is providing $30,000 to the Electronic Payments Coalition to support their efforts to inform
legislators of the facts surrounding interchange while opposing changes
to the current interchange fee structure.Interchange revenue is derived from the payment by a retailer’s bank to
a member’s credit union when the retailer chooses to accept that
member’s credit or debit card for payment. It is a key revenue source
for credit unions that helps to partially reimburse them as card issuers
for the activities they perform and the risk they take on each transaction.
While the “Credit Cardholders’ Bill of Rights,” placed tighter restrictions
on credit card issuers, the legislation did not include changes to
current interchange practices. It did, however, authorize the Government
Accountability Office (GAO) to study the issue, which could result in
future legislation that threatens interchange.The “Credit
Card Fair Fee Act of 2009,” would allow merchants to
negotiate credit card transaction fees with financial institutions. The
proposed legislation excludes credit unions regulated by the National
Credit Union Administration (NCUA) and those under $1 billion in assets.
The EPC is working to fight this bill and sustain existing fee
regulations. On June 9, Senator Richard Durbin introduced S. 1212. This
bill would allow the U.S. Attorney General to appoint a panel of
Electronic Payments System judges who would act as agents in setting
interchange fees. EPC is a Washington, D.C.-based organization funded by more than 60
credit union, bank and payment systems organizations.

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PSCU Issues Call Center Innovator Awards

Fl-based PSCU Financial Services honored four innovative credit unions at the 2009 Financial Service Centers Cooperative annual meeting
in Las Vegas. Hawaiian Tel Federal Credit Union, University of Hawaii
Federal Credit Union and Hawaii USA Federal Credit Union and Hawaii Community Federal Credit Union
received the “Call Center Innovator” award. These credit unions conducted cultural training to better align Total
Member Care service representatives with the needs of their members.
PSCU Financial Services’ Total Member Care business unit also received
the “2009 FSCC Globe Award for Outstanding Service”, which honors credit unions and
industry partners who demonstrate exceptional service and a commitment to shared
branching. Through its 24/7call center and software solutions, Total Member Care
processed nearly 3 million shared branching transactions in 2008. PSCU Financial Services is the
nation’s largest credit union service organization (CUSO), and serves more than 1,300
financial institutions nationwide.

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V/MC Settlement Produces a Discover 2Q/09 Profit

Discover’s U.S. Card unit reported that pretax income for the quarter
ending May 31st rose 26%, compared to one-year ago, and more than double
the prior quarter, due largely to income from its antitrust settlement
with Visa and MasterCard. However, outstandings were flat sequentially,
volume declined by 4% year-on-year and charge-offs may approach 9% in
the third quarter. Pretax income was $387.9 million in the second
quarter as compared to $309.1 million for the second quarter of 2008.
Proceeds from the Visa and MasterCard settlement were $473 million
pretax for the quarter. Sales volume in the second quarter declined 4%
from the prior year to $24.3 billion. Sales volume declined 8% in the
prior quarter. Managed loans ended the quarter at $51 billion,
essentially unchanged from the prior quarter and up 7% from the prior
year, reflecting lower cardholder payments and growth in both personal
and student loans, partially offset by decreased consumer spending. The
over 30 days delinquency rate on managed loans was 5.08%, down 17 basis
points from the first quarter and up 127 basis points from the prior
year. The managed net charge-off rate increased to 7.79% for the second
quarter, up 131 basis points and 280 basis points from the prior quarter
and the prior year, respectively. Third-Party Payments segment volume
grew 25% from the prior year to $37 billion, including $6 billion of
Diners Club International volume. Net yield on loan receivables rose to
9.26%, an increase of 15 basis points from the prior quarter, and 70
basis points from the prior year. The increase from the prior year
reflects lower cost of funds, accretion of balance transfer fees and an
increase in revolving balances, partially offset by higher interest
charge-offs and lower yields on variable rate assets. For complete
details on Discover’s latest performance visit CardData (www.carddata.com).

U.S. CARD PRE-TAX PROFITS
2Q/08: $309.1 million
3Q/08: $245.2 million
4Q/08: $646.4 million
1Q/09: $167.0 million
2Q/09: $387.9 million
Source: CardData (www.carddata.com)

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U.S. Leading Economic Index Points Higher in May

The leading economic index for the U.S. increased for the second consecutive month. While the coincident economic index is still declining, it appears the
recession is losing steam. The Conference Board “Leading Economic Index” for the U.S. increased 1.2% in May, following a 1.1% increase in April, and a 0.3% decline in March. Seven of the ten indicators that make up “LEI” for the U.S. increased in May. The “Lagging Economic Index” declined 0.2% in May, following a 0.8% decline in April and a 0.6% decrease in March. The negative contributors were average duration of unemployment, commercial and industrial loans outstanding, change in labor cost per unit of output, and change in CPI for services. The Conference Board says if these trends continue, expect a slow recovery beginning before the end of the year. However, employment will take longer to turn around.

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WESTPAC & ACI

ACI Worldwide international electronic payments software provider has
implemented its “Proactive Risk Manager” for IBM Enterprise Risk
solutions on the “IBM System z” at Westpac New Zealand Bank. Providing
more than 150 banks, processors and retailers transaction monitoring,
“Proactive Risk Manager” is designed to strengthen its fraud detection
and fraud prevention in a cost-effective, comprehensive solution, for
which Westpac NZ has implemented its set of configurable rules and a
scoring engine to monitor suspicious transactions during authorization.
Westpac New Zealand has utilized ACI “BASE24” for its payment processing
for 20 years to handle an average of 1.6 million transactions per day,
and now can do so in a safer manner with this development. Westpac New
Zealand serves 1.2 million active customers through its nearly 200
branches and over 500 ATM while ACI solutions serves 800 customers in 88
countries.

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