CRYPTOMATHIC & BBS

Cryptomathic has initiated litigation against
BBS AS for patent infringement of its patent in BBS’ “BankID”
products related to digital signatures and user authentication using a
central server for key storage and signature generation.
In its complaint, Cryptomathic alleges that BBS has infringed and
continues to infringe, contributes to and induces the infringement of
Cryptomathic’s patent by making, using, offering for sale and selling
products and services without being licensed by Cryptomathic to do so.
BSS’s “BankID” solution is used by approximately 1.75 million end-users to
authenticate themselves by having messages or content signed centrally
on their behalf with individual private keys.

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Consumer Spending Slowly Rebounds in Feb

A monthly index has found that falling oil prices and reduced tax burdens are giving consumers the wherewithal to spend. The Deloitte “Consumer Spending Index” rose in February to 1.53%, from an upwardly revised gain of 1.27% a month ago. The tax burden continues to fall with the weakening of the economy. Unemployment claims rose again in the most recent month and are up 72% from a year ago. Real wage growth continues to post strong growth. Real wages are up 4.6% from a year ago and on an annualized basis are up 13.5% over the last six months as energy prices have given a big boost to consumer purchasing power. However, home prices continue to fall. Renewed efforts to forestall foreclosures coupled with a tax credit for home buyers may bring some stability to this market. The decline in home prices has made home buying much more affordable. What is lacking is mortgage financing. Deloitte says the rebound in the “Index” coupled with anticipated tax cuts point to a better selling environment for retailers this spring.

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Operating Expenses Top 7% for the First Time

Operating expenses for credit card issuers rose to an unprecedented 7.11% in January, about 121 basis points above one-year ago. The figure was up 24 basis points from the prior month, according to CardData (www.carddata.com). Operating expense is determined by dividing monthly gross operating expenses by the average managed card outstandings and then annualizing. Operating expense includes such items as credit processing, call center servicing, billing, collections, fraud management, and card issuance.

OPERATING EXPENSE
Aug 08: 6.25%
Sep 08: 6.49%
Oct 08: 6.55%
Nov 08: 6.61%
Dec 08: 6.87%
Jan 09: 7.11%
Source: CardData (www.carddata.com)

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Morgan Drexen Offers an EDAF

CA-based debt settlement service Morgan Drexen is
offering up to a $1000 cash advance as part of the “Emergency Direct
Assistance Fund” to assist cash-strapped American families
to reverse credit card debt. Morgan Drexen’s nationally-recognized
services to law firms include debt
settlement programs, including EDAF, with the supervision of local
attorneys. Legal counsel review all settlements and consumers cash is
held in a trust account pending settlements. Morgan Drexen works with
local and regional attorneys to
substantially lower credit card and other unsecured debt, to protect
clients from threats and harassment, and to help consumers build a
secure financial future.

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Unstrung/TechWeb Issues an M-Commerce Report

A new report, “Dial M for Commerce: Mobile Payment Market Gains
Traction”, reveals the U.S. is one of the fastest-growing markets for
m-commerce, despite
having a highly developed payment infrastructure and greater concern
over security issues.
The report from research firm Unstrung Insider and TechWeb’s Light
Reading analyzes the
m-commerce sector, providing an overview of the market – including how
m-commerce
works, how various solutions are developing, and the potential
applications for mobile
payments. It identifies vertical markets that various vendors are
tapping into and global areas of interest for the service and examines
what to expect for
the next 12 to 18 months in the m-commerce market, including challenges the
industry faces. Additionally, the funding, acquisitions, and
partnerships of vendors are
discussed and the report provides a comparative analysis of nine of the top
vendors in the m-commerce sector. Other findings include: Security
continues to be one of the biggest concerns plaguing m-commerce,
followed closely by a need for consumer education; need to define the
various components that constitute m-commerce remains a
challenge for the industry; several vendors have recently announced or
are developing m-banking
applications; the increasing value-added revenues beyond that of
ringtones is seen as
one of the many benefits provided by m-commerce and peer-to-peer
payments will be one of the hottest m-commerce
applications for the next 12 to 18 months.

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Capital One Offers Biz Debit Card Rewards

Capital One has introduced a free checking account that offers rewards
miles for day-to-day business banking transactions and then allows small
business owners to combine those miles with those earned on their
personal Capital One accounts. The new “Capital One Bank Small Business
Rewards Checking” product also offers rewards miles for first-time debit
card usage and unlimited debit rewards, enabling small business owners
to earn rewards miles faster than ever before. Business owners can earn
automatic rewards for everyday business transactions including: 20 miles
for each online bill pay or pre-authorized payment (up to 200
miles/mo.); 20 miles for every debit card purchase; and 10 miles for
each check or account withdrawal (up to 100 miles/mo.). Plus, they earn
“BONUS” rewards: 1,000 miles upon opening their account; 1,000 miles for
the first debit card transaction; an anniversary bonus of 1,000 miles;
and 5,000 miles for opening a personal Rewards Checking account and
signing up for direct deposit.

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CardinalCommerce and CyberSource Integrate

CardinalCommerce has established a strategic partnership with CyberSource and has integrated the “Cardinal
Centinel Platform” with CyberSource’s payment management services to
provide CyberSource merchants with continued, strengthened support for
“Verified by Visa” and “MasterCard SecureCode”. By utilizing Cardinal’s hosted platform,
CyberSource customers will also have the benefit of improved reliability
and speed for VbV and MCSC transactions. Enhanced transaction
performance and Cardinal quality assurance review are designed to create
an optimized authentication experience for both merchants and their
customers. CyberSource is now able to leverage Cardinal’s
team, which provides active monitoring and quality assurance so
participating merchants receive the maximum benefits of VbV and MCSC —
including the potential for fraudulent chargeback protection and
interchange savings. CyberSource is a provider of electronic payment and
risk management solutions. CardinalCommerce enables
authenticated payments, secure transactions and alternative payment
brands for both eCommerce and mobile commerce.

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Merchant e-Solutions Integrates Cashbox

Payment software provider Vindicia has integrated its “CashBox” billing
system with CA-based Merchant
e-Solutions e-Commerce payment platform. The joint offering from
Vindicia and MeS will provide online merchants
with secure, cost-effective payment processing, optimized subscription
and one-time billing. Capabilities include processing in more than 150
global currencies and payment types
including credit and debit cards; real-time, web-based reporting, and
consolidated reporting across
domestic and international transactions for easy reconciliation;
optimized subscription management to drive customer retention and
automated chargeback management to reduce losses and enhance overall
efficiency. Merchant e-Solutions currently processes more than $14
billion dollars in
payments for more than 65,000 merchants, supporting 150 global
currencies and all major credit, debit and alternative payment
solutions. Vindicia offers an integrated, on-demand billing and fraud
management
solution for online merchants. Vindicia “CashBox” is a best-of-breed
billing system for creating and managing recurring and real-time
payments and helps merchants improve customer retention and maximize
profit.

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TowerGroup Says Protectionism is Fatal

A new report shows that unfettered protectionism from national governments, in response to the financial crisis, could pose significant risks for the global financial services industry and its stakeholders worldwide. TowerGroup says that although a short-term economic lift often results from governments’ use of protectionism, history has shown it to be an artificial solution that limits sustainable growth and puts a nation behind the global economic curve. The threat of protectionism will exist throughout 2009 and 2010, posing risks to the international competitiveness of financial institutions and the technology vendors and service suppliers that serve them, as well as to global economic recovery itself. The research also found that under a narrowed definition of the financial marketplace, the number and variety of products and services available will decline, leaving the industry powerless to foster new economic wealth around the globe and eestrictions to the global flow of capital and access to financial services would severely undermine the role of the industry to help restore business momentum, sustain growth, and crystallize synergies between developed and emerging economies.

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Acculynk Inks ShoppersChoice.com

Online specialty retailer ShoppersChoice.com is now processing purchases
made with Acculynk’s “PaySecure” PIN debit service.
PaySecure is the first product to gain approval by four EFT networks,
including ACCEL/Exchange from Fiserv and NYCE, to run Internet PIN debit
transactions and meets consumer demands for increased security and
convenience, while providing merchants lower interchange fees, reduced
fraud and charge-backs, guaranteed funds and simple implementation with
the online checkout. PIN debit is an ideal
online payment method because it provides an extra layer of security for
consumers and cost savings for merchants, while offering attractive
margins to issuers and a new revenue source for EFT networks.

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MINT CTFS CARD

Mint Technology and Canadian Tire Financial Services Limited have signed a deal to introduce a new Canadian Tire branded prepaid MasterCard product. The prepaid card will be available to residents of the Province of Ontario. A self-serve website will also be launched where prepaid card customers can load funds to their card and view transactions. Located in Welland, Burlington and St. Catharines Ontario, Canadian Tire Financial Services Limited is a wholly owned subsidiary of Canadian Tire Corporation, Limited. Mint Technology is Canada’s first provider of prepaid credit card programs.

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