M-PAYMENTS FORECAST

The mobile payment industry will grow at a 35% CAGR for the next five years. A new research report has found that the number of mobile payment users worldwide will total 73.4 million in 2009, up 70% from 2008’s 43.1 million users. Gartner predicts that the number of mobile payment users will reach more than 190 million in 2012, representing more than 3% of total mobile users worldwide. The research firm expects Asia/Pacific and Japan to maintain a larger share of the market
through 2012. While mobile payment penetration in Western Europe is
expected to rise from 0.9% in 2009 to 2.5% percent in 2012, and
from 1.7% to 3% in North America; penetration in Asia/Pacific and Japan will rise from 2% in 2009 to 3.8% in 2012. Mobile payment penetration in Eastern Europe, the Middle East and Africa (EMEA) and Latin America is also expected to exceed 3% by 2012. Gartner defines a mobile payment as paying for a product or service using mobile technology such as a short message service (SMS), Wireless Application Protocol (WAP), Unstructured Supplementary Service Data (USSD) and NFC.

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Credit Card ABS Charge-Offs Near Double Digits

Charge-offs among prime and sub-prime credit card-backed securities set
a new record in April coming in just shy of double digits. ABS 30-day+
delinquency continues to hover at record levels, but did edge down
slightly in April thanks to tax-refund season. According to Moody’s
“Credit Card Index” the charge-off rate was 9.97% for April, almost 60%
higher than a year ago. After a steady rise from the 4.45%
level in June of 2008, to last month’s 6.40% level, the delinquency rate
actually declined to 6.34%. The payment rate for April decreased to
16.18%, the result of lower purchase volumes among convenience users as
well as the diminished ability of revolvers to make payments. The yield
index went in a negative direction during April, dropping to 16.18%.
Moody’s noted that the magnitude of the pull-back in yield for April was
unexpected and bears close watching in the months ahead. The combined
rise in charge-offs and slide in yield drove the monthly excess spread
index below 5%, with practically every issuer experiencing substantial
declines. With the April decline, the three-month average for the index
is now 5.32%.

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INSIDE & HID

Secure identity provider HID Global has combined with INSIDE Contactless
MicroPass
contactless payment platform featuring Visa payWave capability to enable
the industry’s first converged payment card solution that
incorporates identity and access control. In the pilot,
users were able to make purchases using the U.S. Bank’s “AccelaPay
Visa Card”, a prepaid payroll account, then turn around and present the
same card for physical access to their building or facility. Drawing
upon HID’s 13.56 MHz iCLASS technology, the converged
card offers a unique value proposition to campus and enterprise
environments by enabling them to do more with a single card solution.
Not only do systems managers within these campuses benefit from the
greater utilization or display of student or corporate ID’s, users can
appreciate the convenience of carrying a single card.

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Eight out of Ten Consumers Favor Card Regs

Results from a survey by Western Union indicate 79% of consumers
favor regulations that place limits on credit card fees.
Another 60% of
consumers are strongly in favor of tighter regulations and 27% of
consumers reported using cash more often than in the past. The survey
also revealed that while the use of cash offers
consumers better ways to control spending, and helps avoid accumulating
debt, 66% of those surveyed cannot make online
purchases.

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G&D BOARDS

Giesecke & Devrient’s new Supervisory Board
and Advisory Board has elected Dr. Peter-Alexander
Wacker was elected as the new chairman of the Supervisory Board and
Advisory Board. Wacker has been a member of G&D’s Advisory and
Supervisory Boards since 2007. He succeeds Dr. Peter Mihatsch. The
members of the Supervisory Board and Advisory Board of G&D are as
follows: Supervisory Board: Dr. Peter-Alexander Wacker (Chairman),
Walter Bogner (Deputy Chairman), Ralf Gerlach, Dr. Dietrich Hoppenstedt,
Verena von Mitschke-Collande, Jens Mueller, Prof. Gunther Reinhart,
Michael Reinhard, Claudia Scheck, Peter Johann Stark*, Johannes
Ignatius van der Velde, Dr. Susanne Weiss (employee representatives)
Advisory Board: Dr. Peter-Alexander Wacker (Chairman), Dr. Dietrich
Hoppenstedt (Deputy Chairman), Franz Haniel, Verena von
Mitschke-Collande, Prof. Gunther Reinhart, Johannes Ignatius van der
Velde, Dr. Susanne Weiss.

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CGA REPORT

A new report by the Certified General
Accountants Association of Canada, “Where Has the Money Gone: The State
of Canadian Household Debt in a Stumbling Economy,” reveals that
household debt has reached an all-time high of $1.3 trillion in 2008,
yet Canadians perceive their financial condition to be better than it
is. The survey asked Canadians to reflect on the changes that had
occurred in their household finances over the past three years, with a
focus on household debt, income, assets, wealth, spending and savings.
According to the report, Canadian families are financing consumption
activity with unearned money as they increasingly reach for credit to
finance day-to-day living expenses with 49% of Canadian families with
one or more children under the age of 18 reported that their debt had
increased. Lines of credit and credit cards account for the largest
proportion of consumer debt, with 85% of Canadians reporting that they
have outstanding debt on a credit card. Some 21%
of Canadians who are in debt say that they are in over their heads and
can no longer manage their debt load.

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Future ATM Experiences Must be Personalized

A new report form Aite Group looks at the evolution of the ATM channel
through 2010. As banks embrace the potential to add additional features
and functionalities to ATMs, they realize that they must first update their
underlying technology. In five years, 91% of ATM executives indicate it
will be important or extremely important to their bank’s strategy to
create a differentiated ATM experience through customer personalization.
If the foundation is not yet built, banks will not be able to provide
the level of personalization their peers are currently starting to
implement.

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MEDMOBILE

Hypercom Corporation announced that German
health care organization Gematik has notified the company that its
medMobile(TM) terminal is now BCS (Basic Command Set) approved. medMobile
is an ultra secure mobile device specifically designed to support the
thousands of physicians who make house calls/visits throughout Germany
and those that practice at hospitals, pharmacies and geriatric
institutions, such as residential care homes. Hypercom’s medMobile sets
a new benchmark for mobile health care
devices. The innovative terminal for physicians on the go features a
high contrast graphical display, built-in PIN Pad, integrated Health
Professional Card (HPC) and electronic health card (eGK¹) readers,
long-life Li-ion rechargeable batteries and USB connectivity for fast
downloads to physicians’ computers.

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PAYPOINT 2008

Online payment service provider PayPoint.net announced significant
growth in revenue, profits, transaction volumes and consumer spend during
2008-09. The business reported revenues of GBP8.0 million during the year
ending 29 March 2009, a 63% increase over the previous financial
year, while transaction volumes increased by 40% and online
spending increased by 36%. Highlights of the past year include the
launch of the PayPoint.net brand following the integration of SecPay and
Metacharge; 350 new merchants secured; the partnership with PayPal; the
launch of PayCash, a service enabling shoppers to pay in cash for the
goods they buy online and extensive upgrades to PayPoint.net’s fraud
management platform for gaming providers, enabling them to set
sophisticated fraud detection rules.

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CPI & ISO

CPI Card Group announce that CPI – Liverpool has successfully completed
and passed its reaccreditations to both the International Standards ISO
9001:2000 (Quality) and ISO 14001 (Environment). The ISO 9001:2008
version introduces several new concepts into Quality
Management Systems, including considerations for regulatory and
statutory compliance, control of customer specific intellectual data,
warranty, maintenance, recycling and final disposal information. In all,
it looks at the overall business in terms of risks and business
continuity plans. The latest changes to the previous version also
include realigning the clauses of the ISO 9001 Quality Management
Standard with the ISO 14001 Environmental Management Standard for
clarity. In addition to the
reaccreditations, CPI will be upgraded to the new ISO 9001:2008
standard, which is a unique achievement in the card industry. To our
knowledge, we are one of the first card personalization bureaus to
achieve automatic upgrade to the new standard.

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