EC & SEPA

The European Commission has launched its consultation on whether
deadlines should be set for the migration of existing payment products
to Single Euro Payments Area (SEPA) products or not. Inviting input from
all stakeholders by August 3, 2009, the Commission hopes to identify the
need for action, and at what level, for such payment solutions as credit
transfers and direct debits. Questions the consultation hopes to address
is whether it should cover only standards or schemes as well, should it
cover only the interbank space or the bank-to-customer space as well and
should it entail full migration or allow the exclusion of certain
products. Also, the EU wants to determine if an end-date is seen as
needed, should there be one common end-date for SCT and SDD migration or
two separate end-dates, should they be set at national level and/or at
European level and should they be left to self-regulation SEPA was
established to complete an integrated market for electronic payment
services in euros using certain business rules and technical standards,
subsequently allowing consumers, companies, merchants and public
administrations to make payments under the same conditions throughout
Europe using its SEPA credit transfer (SCT), SEPA direct debit (SDD) and
payment cards.

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Two Credit Card Interchange Bills Introduced

Senate Majority Whip Richard Durbin (D-IL) introduced the “Credit Card
Fair Fee Act of 2009” which would require Visa and MasterCard to
negotiate interchange fees and be subject to binding arbitration by a
three-judge panel, if necessary. Introduction of the Durbin bill comes
less than a week after House Judiciary Committee Chairman John Conyers,
(D-MI), introduced “H.R. 2695,” also called the “Credit Card Fair Fee
Act of 2009” that requires Visa and MasterCard banks to negotiate with
merchants, but enforcement of the requirement would be up to the Justice
Department. The National Retail Federation says the new bills are the
next step in the credit card reform process that Congress began last
month. The American Bankers Association says
the legislation inappropriately seeks government intervention to
increase their profits at the expense of consumers and the broader
economy. The ABA noted that from the largest financial institutions to
the smallest community banks, interchange revenue provides compensation
for taking on the extensive infrastructure costs required to support our
card payments system, as well as the risk of non-payment, while
providing an adequate return on investment.

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Bling Nation Receives SAS 70 Audit Report

Bling Nation community bank payments network has received its “Statement
on Auditing Standard (SAS) 70” Type I audit report from Ernst & Young
for its operational control objectives and activities. SAS 70 guidance
allows service organizations to disclose control activities and
processes for customers and auditors in a uniform format while its Type
I audit examined Bling Nation’s operational controls to demonstrate its
adequate implementation of secure customer data storage and transaction
processing. Bling Nation local payment network allows banks to convert
potential on-us debit transactions into actual on-us debit transactions
with secure contactless POS solutions.

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PAYMARK REPORT

According to Paymark, New Zealanders are sticking with debit card use
over credit cards with a 7.8% per annum increase and a 0.4% per annum
increase, respectively, seen in the month of May. Additional findings
show $3.45 billion was spent across the country last month, a 0.8%
decrease since the year ago period, while the number of all payment card
transactions was up 6% for the same term. Declines in credit card use
were most felt at video, fuel and agriculture outlets while the largest
spending decline for the month was seen at service stations by 19%-t
hanks to lower fuel prices- and travel by 14%. Clothing and footwear
retailers, however, experienced moderate growth in May with spending up
8 and 7%, respectively. Paymark processes over 60% of all retail
electronic transactions in New Zealand.

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Heartland Offers Four Card Network Settlement

Heartland Payment Systems credit/debit/prepaid card processing, payroll,
check management and payments solutions making things easier for its
merchants customers with the authorizing/settlement for transactions
through all four major card brands. Heartland has been processing Visa
and MasterCard payments since 1997. Most recently, the card processor
has partnered with Discover and American Express, allowing its customers
funding, statements and customer service directly from Heartland.
Heartland Payment Systems payments processor provides its services to
250,000 business locations nationwide and is the founding supporter of
the public advocacy initiative, the Merchant Bill of Rights, to educate
merchants on fair payment card processing.

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MC CPV

MasterCard has qualified Collis’ MasterCard “Card Personalisation
Validation” (CPV) module on its EMV Personalization Validation Tool
(Collis EMV PVT), strengthening its position to accept card payments
worldwide. In addition to worldwide acceptance, Mastercard
evaluation/qualification for CPV provides Collis testing on its
EMV/PayPass contactless and swipe cards and ensures the tool complies
with test specifications version 2.0, PDS 2008 and PayPass PDS 1.3 for
perso bureaus and MasterCard issuers. This allows the issuers to prepare
for the formal Card Personalisation Validation sessions. Collis
Consulting Services, Test Tools, Test Services and Training Courses in a
range of industries has provided proven testing tools and expert
consultancy to the Payment/EMV, e-Identification and 3G/GSM markets
while MasterCard Worldwide serves consumers and businesses in more than
210 countries and territories.

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AMEX BUSINESS SAVINGS

American Express has expanded its “Business Savings Program”
exponentially in a push to offer “Business Gold Rewards Card” and
“Business Platinum Card” members discounts and savings on business
expenses. With benefits embedded within the member’s card, the “Business
Savings Program” eliminates any need for coupons for discounts on
purchases with any program partners, which currently include; ClubLink
Canada; 411.ca; Food & Wine; HP; MDG; Monster.ca; OneConnect Services
Inc; Toronto Board of Trade and Travel + Leisure; Delta Hotels; and
Hertz. On top of the partnership discounts, cardmembers continue to earn
Membership Rewards points on purchases while American Express currently
employs 3,700 Canadians. Specific of available discounts are listed as
follows;

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Recession, Security, Regulation Nag the Industry

Aite Group’s latest report examines issues affecting segments of the
U.S. card industry. Based on interviews with 23 card industry executives
for various issuers, card processors, ISOs, acquirers and technology
vendors, the report concludes the card industry is struggling to
overcome internal contradictions in business issues, data security and
regulatory pressures concerning credit cards, debit cards, card
issuers and merchant acquirers. Data for the report was collected from
Alliance Data, American Express, Bank of America, Barclays, Capital One,
Chase Paymentech, Citigroup, Discover, EDS, Elavon, Fidelity Information
Services, Fifth Third Bank, First Data, First National Merchant
Solutions, Fiserv, Global Payments, Heartland Payment Systems, HSBC, JP
Morgan Chase, MasterCard, Metavante, NYCE, Pulse, RBS WorldPay,
Revolution Money, Star Network, TSYS, Visa, Wells Fargo and Wright
Express. Aite Group research and advisory firm, focused on financial
services, concludes in the report solutions to these issues will be
developed only when the various segments work together.

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VisaVue Travel Service Mines Transaction Data

After launching a pilot program in 2008 to select states and
convention visitors bureaus in the U.S., Visa has rolled-out a new
service that provides insights into spending by international visitors
to the U.S. The new “VisaVue Travel” data service includes aggregate
international cardholder spending on Visa debit, credit, commercial and
prepaid cards, and offers comprehensive and distinct reports which
isolate leisure and business traveler spending; data on the number of
Visa cardholders visiting a region or state, as well as total sales and
average purchase size; analysis of tourist spending based on country of
origin; and a detailed view of tourist spending across thousands of
merchant categories. Last year “VisaVue Travel” revealed that U.S. Visa
cardholders spent more than $42.4 billion on their Visa payment cards in
the top 225 destination countries, while international visitors spent
more than $52 billion on their Visa payment cards in the U.S., and the
greatest share of Americans’ spending while abroad is in Canada, Mexico
and the United Kingdom, with U.S. Visa cardholders spending a combined
$13.4 billion in those countries in 2008. General retail continues to be
the biggest expenditure for travelers, representing 36% of Visa
transactions by Americans in 2008, totaling more than $15.8 billion.

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