Firethorn Beefs-Up its M-Commerce Solution

Qualcomm’s Firethorn has beefed up its mobile banking solution to broaden its m-commerce functionality. The upgrade came as the result of a recent survey which revealed that 62% of consumers would be likely to use their mobile device to obtain bank account balance information; 28% would like to track loyalty accounts on their phone; and 32% want to receive coupons, while 23% want to receive product information on their mobile device. In response to the findings Firethorn has added three new
service features designed to give expanded marketing opportunities, “Offers Feature,” “Rewards Feature,” and “Customization Feature.” The new “Offers Feature” provides the ability to extend targeted promotions to users regarding products or services. The “Rewards Feature,” coupled with institution rewards programs, enables consumers to track their loyalty points for their financial institution accounts and, in the
future, for their merchant relationships. The “Customization Feature” allows providers to customize their services as programs evolve by adding desirable new functions in designated areas throughout the
application.

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Advanta Relaunches KivaB4B for Small Biz

Advanta has re-launched “KivaB4B.org”, an online community for small business owners share best charitable
practices, highlight their philanthropic models and develop new ways to
give back. The Project also helps small business owners increase the impact of
actual grants – large and small – to entrepreneurs in developing countries through
Kiva.org. If a small business owner uses an Advanta credit card to make a grant through
Kiva to an entrepreneur, Advanta matches the grant, dollar for dollar, up to $200 per account,
per month. KivaB4B.org provides participating small businesses with information and
resources to market their philanthropic activities to their community. In
addition, every week the site profiles a business owner who supports entrepreneurs in the
developing world through Kiva. Advanta recently released a new KivaB4B credit card for business
professionals who don’t own a business entity.

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LEVEL FOUR & POLARIS

Dunfermline-based ATM software provider Level Four has established a new global partnership with Polaris Software Lab Limited to offer a complete end-to-end outsourced testing solution. Customers who deploy BRIDGE:test as part of an outsourcing strategy with Polaris can achieve an optimal balance of cost and control as well as greater overall efficiency. Testing phases are shorter through a greater degree of automation and tests will be executed by testing professionals with specific ATM sector knowledge, according to a specially developed methodology by Polaris. Level Four’s BRIDGE suite of open standards ATM software products has been developed to address the needs of ATM deployers seeking to maximize their investment in the ATM channel.

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TransCard and Fishback Financial Partner

Stored value card provider Transcard has partnered with SD-based
Fishback Financial to offer bank sponsorship, card issuing, transaction
settlement and
many other fundamental services for TransCard’s prepaid card programs.
Fishback Financial Corporation has assets totaling more than $1.5 billion.
TransCard handles $1.4 billion in electronic transactions annually and
is a provider of prepaid debit card solutions branded
with Discover Network, MasterCard® and STAR associations.

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NCR SelfServ ATMs Certified by Major Nets

NCR has completed certification testing for
its new NCR SelfServ family of automated teller machines (ATMs) with
strategic ATM networks which include First Data, Elan, Metavante, Visa, Jack Henry,
Shazam, NETS, CSFI, ACI Worldwide, Inc., Postilion, Fifth Third
Processing System (FTPS), Fiserv and Fidelity National Information
Systems, formerly EFD (eFunds). The unique self-healing technology in NCR SelfServ allows the ATM to
automatically and quickly recover from “soft” failures with no need for
service intervention. In addition to increased consumer availability,
several NCR SelfServ enhancements make servicing faster and simpler,
especially for branch or cash-in-transit staff performing first-line
tasks. For example, NCR’s Self-Service Assistant, a robust graphic
operator panel with video and other unique capabilities, is an important
differentiating factor. It facilitates easier training of personnel who
can then manage any basic issues that may arise. This is another
important element of the overall efficiency built into this
first-of-its-kind technology.

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Sinking Economy Heightens Buyer’s Remorse

Besides sagging sales, retailers are reporting that consumers are
experiencing more buyer’s remorse this season as a result of the down
economy, as they return more unworn and unused merchandise to stores. The
NRF found that return rates this will likely reach 8.7% of sales, up
from 7.3% one year ago. The amount of merchandise returned to stores
this year is estimated to reach $219.1 billion, with $47.1 billion of
those returns coming from holiday purchases. The NRF’s third annual
“Return Fraud Survey” also found that the number of retailers who said
their holiday return policy will loosen compared to last holiday season
will triple, from 3.4% to 11.0%. About 17.1% of retailers said their
return policy will tighten this holiday season, up slightly from 15.3%
last year. According to the survey, return fraud continues to plague the
industry and will cost retailers an estimated $3.54 billion this holiday
season, down slightly from $3.6 billion last year.

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OCC Shoots Down FSR/CFA Concessions Pilot

The OCC this week responded to a proposal by The Financial Services
Roundtable and the Consumer Federation of America calling for
a pilot project that allows major credit card companies to dramatically
reduce the amount of money owed by heavily indebted borrowers who do not
qualify for currently-available repayment plans. The OCC says that while
it strongly encourages national banks to work with distressed borrowers,
the agency cannot approve a plan that defers the timely recognition of
losses, since that would compromise the transparency and integrity of a
bank’s financial reports and could lead to a loss of public confidence
in the banking system. The OCC said that the major lenders and credit
counseling firms interested in the FSR/CFA proposed pilot are failing to
differentiate between working with distressed borrowers and a desire to
simply acquire forbearance on loss recognition. Under the FSR/CFA
proposal lenders would forgive up to 40% of the amount consumers owe and
allow borrowers to pay back the remainder over time. (CF Library 11/03/08)

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Alternative Payments – Payment Piranhas?

New research shows that alternative payments may capture nearly $8
billion of this year’s $35 billion online holiday shopping. The study
suggests that a new wave of alternative payments firms will continue to
emerge, further eroding traditional credit card usage online, but
preserving the role of financial institutions in payment transactions.
Javelin Strategy & Research says three emerging alternative payment
methods— eBillme, NACHA SVP and Moneta Value — leverage familiar
consumer processes and provide value to financial institutions by
enabling FI control over the transaction. Also, credit card issuers can
supplement slowing credit card volume with prepaid products and
store-branded and private-label credit cards are projected to have solid
growth, based on consumers migrating purchases from in-store to online.
Javelin noted that the overall projected growth for online payments is
expected to reach $148 billion in 2008, climbing to $268 billion by 2013.

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NCO Group Q3 Revenues Up – But Loss Widens

NCO Group reported that third quarter revenue rose 18% to $381.1
million. However, the collection specialist’s net loss for the quarter soared to $26.5 million, compared to a net loss of $4.6 million for 3Q/07. NCO says the results included an allowance for impairment of
purchased accounts receivable of $32.4 million and $3.4 million of
restructuring charges primarily related to the acquisitions of Systems &
Services Technologies and Outsourcing Solutions. The Company also noted
that the third quarter represented a further transition for its business
as it began the process of managing through meaningful additional
deterioration in consumer payment patterns. All three of NCO’s operating
divisions: Accounts Receivable Management, Customer Relationship
Management and Portfolio Management posted lower revenues for the
quarter than anticipated. For complete details on NCO Group’s latest
performance visit CardData ([www.carddata.com](http://www.carddata.com)).

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The Buckle Renews ADS Private Label Deal

Loyalty marketing Alliance Data Systems has signed a multi-year contract
renewal with NE-based fashion retailer The Buckle, with more than 380
retail stores in 39 states and sales of approximately $620 million to
continue providing private label credit card services. Under terms of
the renewal agreement, Alliance Data will continue providing private
label credit card services including account acquisition and activation;
receivables funding; card authorization; private label credit card issuance;
statement generation; remittance processing; customer service functions; and
marketing services to Buckle. The private label card solution also
includes support of Buckle’s
points-based rewards program, called B-Rewards, where cardholders earn
one point for
every dollar spent, and receive dollars-off certificates redeemable at
Buckle.

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First Data Q3 Revenues Inch Up by 4.6%

First Data reported third quarter revenue of $2.164 billion, an increase of 4.6% over the year ago quarter. However, the net loss for the quarter was $164.4 million, compared to a net profit of $28.0 million for 3Q/07. The loss included $270 million of incremental interest expense and $124 million of incremental depreciation and amortization primarily attributable to the KKR transaction. Merchant Services produced revenues of $1.026 billion, up 9% from 3Q/07. Even though Merchant Services had 9% growth in transactions it was offset by the slowing U.S. economy, which reduced transaction growth for smaller merchants and shifted transactions to some nationwide discounters and wholesalers. Financial Services generated third quarter revenue of $699.8 million, down 5% from the year ago quarter. There was modest growth in the card issuing business offset by lost business and check volume declines in the TeleCheck business. International posted 3Q/08 revenue of $487.0 million, up 19% from 3Q/07. Revenue benefited from 21% transaction growth which was in part driven by acquisitions in prior quarters. During the quarter, First Data named Robert DeRodes as its CTO; mutually agreed to terminate its plans to merge InComm into First Data; and successfully terminated its joint venture, Chase Paymentech Solutions, with JPMorgan Chase. For complete details on First Data’s third quarter performance visit CardData ([www.carddata.com](http://www.carddata.com)).

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