SEPT DEBT

Credit card debt growth remained flat again in September, rising a mere A$55 million to A$44.6 billion. However, credit card volume soared in September to A$19.2 billion, 18.5% higher than September 2007 and up 7.9% sequentially. Year-on-year credit card debt growth has slowed to 8.5%, compared to 10% in June. Credit card volume has been stagnant for prior months reflecting the global economic depression. However, the surge in September was surprising. Three months ago credit card volume was up 16% year-on-year. Credit card limits reached a new high at A$121.9 billion, marking the 25th consecutive month of A$100+ billion. According to the Reserve Bank of Australia there are currently 14.2 million credit card and charge card accounts in Australia, compared to 13.8 million one-year ago.

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Winn-Dixie Offers nFinanSe Discover Card

Prepaid card provider nFinanSe’s “Discover Network Reloadable Prepaid
Card” is now available at all 521 Winn-Dixie grocery stores. For $5.95,
consumers can purchase the Reloadable Card and load funds with no credit
check or bank account needed. The Discover Network branded card can be
used to make purchases at millions of merchant locations nationwide –
including online and over the telephone and to access cash at ATMs. In
addition, one of the “cool
tools” available with an nFinanSe Card is the ability to receive an
email or text message with purchase and balance information after each
purchase.

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NEW POSTILION CUSTOMERS

Self-service banking provider Postilion has signed on Banco Micasa,
Banco Corp Banca, Banco Banorte and Banco Mercantil Santa Cruz to its
roster that now includes 32 bank customers across 11
countries. Banco Micasa Venezuela Banco Micasa will use the Postilion
solution for ATM owners and deployers to drive approximately 150 ATMs
and connect with the MasterCard Debit and Visa networks. Micasa is a
credit union, currently engaged in changing its profile to a
full-service bank. Banco Corp Banca selected Postilion to replace its
legacy payments platform and to interface with American Express
International and Consorcio Credicard (CC), a Venezuelan network.
Banco Banorte Venezuela Banco Banorte has chosen the Postilion
solution for merchant acquirers to drive approximately 10,000 POS
terminals across Venezuela and Banco Mercantil Santa Cruz Bolivia
selected the Postilion solution for ATM owners and deployers to drive
more than 150 ATMs connected to their core banking solution, FISA, and
the local network, ATC.

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GE Money to Issue a Volvo Credit Card

Volvo has signed a multi-year agreement with GE Money to provide a new
no-fee consumer credit card that offers instant
financing on service, parts and accessories.
Volvo owners can apply for and use the credit program at participating
authorized Volvo service workshops throughout the U.S. GE Money’s
internet-based finance management system, “AdvanceDesk” provides Volvo
dealerships with an easy, secure way to offer instant credit to
customers for auto repair and services. Convenient online account
management is also available for cardholders.

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IKOBO & M2 GLOBAL

E-payment provider M2 Global has acquired all assets of iKobo, an
international person-to-person remittance firm. iKobo’s card-based money
transfer service uses a Visa Prepaid Card issued by Global
Bank of Commerce. M2 Global’s e-business infrastructure will integrate
iKobo’s customers to provide a secure and smooth transition for
cardholders. iKobo’s Visa Prepaid Debit Card program has been a proven
transfer service for over 5 years, and the business provides an ideal
addition to M2 Global’s payment solutions and will be added to M2’s
portfolio of prepaid debit card products that include GlobeWallet, and
will managed with M2 Global’s established technology platform.

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Charge-Off Momentum Does Not Slow in Oct

Charge-offs continued their march upward in October hitting 6.27%, compared to 6.19% in the prior month and 4.89% one-year ago. A consensus is building that charge-offs may exceed the 8% ratio in 2009. This week Capital One reported that charge-offs for its U.S. Card business jumped for the third consecutive month in October, rising 20 basis points from the prior month. Charge-offs for October were 6.54%, compared to 6.34% in September, and up 12 basis points from the prior 2008 peak set in July. Among credit card-backed securities “prime” charge-offs in September increased 11 basis points month-to-month to 6.57%. This is an 182 basis points increase from one year ago. BofA posted third quarter charge-offs of 6.40%, compared to 5.96% in the prior quarter and 4.67% one-year ago. Citi reported 3Q/08 charge-offs of 6.10%, compared to 5.72% in the prior quarter and 3.86% one-year ago for its Visa and MasterCard domestic programs. Chase, the nation’s largest issuer, posted third quarter charge-offs of 5.00%, compared to 4.98% in the prior quarter and 3.64% one-year ago For more details on October portfolio performance visit CardData ([www.carddata.com](http://www.carddata.com))

CHARGE-OFFS 2008
Jan 08: 5.55%
Feb 08: 5.51%
Mar 08: 5.61%
Apr 08: 5.82%
May 08: 5.93%
Jun 08: 6.04%
Jul 08: 5.88%
Aug 08: 6.14%
Sep 08: 6.19%
Oct 08: 6.27%
Source: CardData (www.carddata.com)

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CB SEPTEMBER

The Conference Board reported that the
leading index for Germany declined 1.1% and the coincident index
decreased 0.4% in September. The leading index declined for the eleventh
consecutive month, led by large negative contributions from new orders
in investment goods industries, stock prices, and the yield spread. Over
the past six months, the leading index has declined by 4.8% (about a
-9.3% annual rate), well below its 2.7% decline between September 2007
and March 2008 (about a -5.4% annual rate). In addition, the weaknesses
among the leading indicators remain very widespread. Two of the seven
components in the leading index increased in September. The positive
contributors to the leading index are inventory change series, and gross
enterprises and properties income*. Negative contributors are new orders
in investment goods industries,
stock prices, yield spread and new residential construction orders.The
coincident index, a measure of current economic activity, declined in
September, its fourth decline in the last seven months, as a result of a
large fall in industrial production and a smaller decrease in retail
sales. Consumer confidence remained unchanged in September.

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Mobile Wallets to Top 1.4 Billion by 2015

MasterCard reports that its “Mobile Partner Program,” launched last
year, now has more than 30 companies in the program. Last month,
MasterCard introduced the “Over-the-Air Provisioning Service” which
enables issuers to perform over-the-air personalization of their
cardholders’ mobile devices. Also this year MasterCard inked an
agreement with Obopay for an on-demand P2P mobile payment service in the
USA and MasterCard announced a four month “PayPass” trial in Canada on
Bell Mobility’s wireless network. Additionally, in 2008 MasterCard,
Garanti Bank and Turkcell announced a pilot in Turkey and in January
U.S. Bank, MasterCard and Nokia announced the introduction of
a mobile payments pilot program in Spokane, Washington. Among mobile
financial services providers participating in the “Mobile Partner
Program”: Affinity Global Services, Firethorn, Obopay and ViVOtech.
More than 600 million mobile wallets are expected to be in use by 2011
and that number is expected to rise to 1.4 billion by 2015, or a CAGR of
about 19%, according to Edgar, Dunn and Company.

M-WALLET FORECAST
2011: 600 million
2012: 714 million
2013: 850 million
2014: 1010 million
2015: 1400 million
Source: Edgar, Dunn and Company

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XOOM LATIN AMERICA

Xoom.com has launched its “Bank Deposit” service to Banco
Cuscatlan, Banco Uno, now Citibank, in El Salvador, Guatemala, Honduras,
Nicaragua, Panama and Costa Rica. With “Bank Deposit” service, money
sent directly to a bank account in El
Salvador, Guatemala, Honduras, Nicaragua, Panama or Costa Rica during
business hours usually arrives in 15 minutes. In addition to Bank
Deposit, Xoom customers can send money to their
beneficiary for Cash Pickup at more than 1,800 locations throughout
Central America starting at just $2.99 and can choose
from a variety of ways to fund the transaction online, including a U.S.
checking account, a credit card or with a PayPal account. Xoom offers
money transfers to 17 countries in Latin America, including
Argentina,Bolivia, Brazil, Chile, Colombia, the Dominican Republic,
Ecuador, Mexico, Peru, Paraguay, Uruguay and Jamaica.

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Merit’s Megatouch Adds USA Tech’s ePort

USA Technologies and Merit Entertainment announced an agreement
to install USA Technologies’ “ePort” software in thousands of Merits
new Megatouch touchscreen entertainment systems. Merit will install the
“ePort” cashless transaction software in all new
domestic Megatouch products manufactured over the next three years. USA
Technologies will act as the exclusive provider to Merit of card
processing and credit-debit card data services. USA Technologies’
“ePort Connect” is a cashless payment solution available for unattended
point-of-sale terminals, kiosks and vending machines.

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MERCHANT SOLUTIONS

Merchant Solutions first anniversary on November 19 with tens of
thousands of merchants signed with Standard Chartered across nine Asian
markets. During the past year, Merchant Solutions has rolled out a
stream of products and services to help businesses capture more card
payments such as a range of terminals from VeriFone, Spectra and
Hypercom, and an Internet payment solution developed by Direct Payment
Solutions (DPS) that can turn any Internet-ready computer into a POS
device. The merchant acquiring products let merchants add payment
gateways to their Web sites; simplify recurring
billing using a batch processing tool; and a Dynamic Currency Conversion
function that enables merchants to accept foreign currency payments.
Merchant Solutions offers MICROS Payment Gateway, developed
by MICROS Systems, an integrated property management system for
diversified operations like hotels. Despite high penetration of
financial cards, the bigger story for Hong Kong businesses is China: as
cross-border economic integration brings more mainland visitors carrying
China Union Pay cards, businesses equipped with Standard Chartered’s CUP
acceptance facility will be especially well positioned to capture sales.

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Verient to Pilot NYCE’s SafeDebit

NYCE Payment Network has signed a contract with CA-based Verient to
conduct a pilot of NYCE’s “SafeDebit”, to enable online shoppers to make
purchases without sharing their PIN or account information. Consumers
who want to use the SafeDebit option when
making purchases online will choose “NYCE SafeDebit” on the merchant’s
Web site during the checkout process. The system redirects them
to their financial institution’s online banking site, where they log on
as usual through that site’s existing security protocols. The SafeDebit
system then generates virtual debit card information for one-time use
and automatically populates the merchant’s checkout screen with this
information, with no additional keystrokes required from the consumer.
The consumer’s actual debit card number is never
disclosed to the merchant, and a PIN is not required for these transactions.

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