Holiday Survey Finds Cash is King

A Western Union survey reveals that 56% of Americans want cash this
holiday season. The respondents indicated that they would prefer to
receive
$100 in cash this holiday instead of a gift card worth $100. The desire
for cash is geared toward the practical this season, as nearly half said
they would use cash to cover basic day-to-day expenses and 57% of
gift-givers indicated they
will give cash as a gift. Western Union is launching a
new campaign, “Cash, the perfect gift.” The campaign features multiple
elements, all of which educate the consumer and reinforce the trend that
cash is the perfect gift.

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52% Believe Obama Can Cut Card Costs

More than half of Americans feel that presidential candidate Barack Obama is the best choice to help Americans reduce or better manage their credit card costs. Only 38% believe that presidential candidate John McCain can help them financially. The CardTrak.com online poll of more than 1,000 consumers also found that 7% believe Ralph Nader is the man to help cut credit costs. Among other minor candidates 2.5% voted for Bob Barr, while 0.5% voted for Chuck Baldwin and 0.6% voted for Cynthia McKinney. Consumer revolving credit stands at $969 billion as of August. Based on current growth patterns consumer revolving credit could still top $1 trillion by the end of this year. Bank credit card debt (excluding store and gas credit cards) at the end of the second quarter was about $825 billion or roughly 85% of total revolving credit, according to CardData (www.carddata.com). Store and gas credit cards had about $109 billion in outstandings at year-end 2007. At the end of August, Americans were $2577 billion in debt, excluding home mortgages.

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Elavon Lands L’Occitane’s Processing

Elavon has completed the rollout of its Electronic Check Service, back-office conversion and gift card services
at specialty retailer L’Occitane’s 166 boutiques across the United States.
Elavon’s “ECS” solution provides retailers a choice of check imaging methods, including point of purchase
(POP), back office conversion (BOC), and accounts receivable conversion
(ARC). In addition, Elavon’s ECS offers real-time processing that
systematically leverages three processing methods including direct
Demand Deposit Account access, Automated Clearinghouse Processing, and Check Replacement Document processing
using traditional
banking networks. The “Electronic Gift Card” solution integrates seamlessly into
any operating environment and can be tailored to deliver online and
in-store functionality. It also supports online gift card registration
by consumers and maximizes gift card sales
with a complete package of marketing features to insure that gift cards
become a revenue-generating solution.

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Jack Henry Launches a Pay-Anyone Service

Jack Henry & Associates has partnered with Myriad Systems and expanded the payment options
available with its “NetTeller Bill Pay”.
This new service allows users to specify payments that require printed and mailed checks
to be generated by MSI and delivered overnight via
Federal Express. Initiating overnight check-based payments through the
familiar “NetTeller” system only requires a few additional mouse clicks.
Users immediately receive a Federal Express tracking number for delivery
tracking and confirmation. Financial institution customers initiating electronic bill payments
that can be paid via ACH can now guarantee the date payments are received.
This new guaranteed payment option will now enable consumers to guarantee
payment receipt on a specified future date. If payments are not received by
the guaranteed date, Jack Henry & Associates will reimburse the consumer
for late-payment-related fees up to an established maximum as long as
transactions were scheduled in accordance with the service’s terms and
conditions. Myriad Systems is a provider of print and mail,
online document delivery, and item processing solutions for financial
institutions.

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AirPlus Intl Hires Industry Veterans

Corporate travel payment provider AirPlus International has hired
Colleen Black , previously with Carlson Wagonlit, to serve as VP, Key
Account Sales and John Callahan,
previously with Visa, as the Regional Sales Director for the Northern
Midwest. Black has worked in the travel industry for over twenty
years, primarily on the corporate travel agency side and serving most
recently as Vice President of Global Sales for Carlson Wagonlit and
prior to that, she worked ten years with BCD. Callahan brings over
twenty years of industry experience to the
AirPlus team. His most recent position at Visa and previous years at
American Express, provide a wealth of knowledge within the corporate
travel payment marketplace. AirPlus International is a global provider
of business travel payment solutions,
offering lodge card accounts, corporate cards and online management
tools.

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Sagging Retail Sales Shocks Stocks

The Commerce Department this morning reported that retail sales collapsed by 1.2% in September, a figure much larger than expected, forcing the stock market into a yet another tail-spin. The Dow sank nearly 400 points this morning. There is now a growing consensus that a U.S. recession is underway, that will likely spread globally. The Deloitte Research “Leading Index of Consumer Spending” also fell in September. The “Index,” comprising four components — tax burden, initial unemployment claims, real wages and real home prices — fell to 0.51%, from a revised gain of 0.94% a month ago. Unemployment claims are up 35% from a year ago and house prices fell by 11% in the most recent month.

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Discover and Visa/MasterCard Settle

MasterCard
Incorporated confirmed that it has reached an agreement in principle
to settle its outstanding litigation with Discover Financial Services Inc.
The parties are working on settlement documentation. Details of the terms
of the settlement will follow.

About MasterCard Incorporated

MasterCard Incorporated advances global commerce by providing a
critical economic link among financial institutions, businesses,
cardholders and merchants worldwide. As a franchisor, processor and
advisor, MasterCard develops and markets payment solutions, processes over
18 billion transactions each year, and provides industry-leading analysis
and consulting services to financial institution customers and merchants.
Through its family of brands, including MasterCard(R), Maestro(R) and
Cirrus(R), MasterCard serves consumers and businesses in more than 210
countries and territories. For more information go to
http://www.mastercard.com.

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FNIS & CERTEGY

Card processor and issuer Fidelity National Information Services has
completed the previously
announced sale of the operating assets of Certegy Australia to
Flexigroup Limited for $30 million in cash and other
consideration. Based on the current exchange rate and the collection of
accounts receivable which were not included in the sale of assets, FIS
expects to realize incremental net cash of approximately $110 million, with
the majority of the receivables expected to be collected within 18 months.

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AMEX & HYATT PROMO

The Hyatt Regency Vancouver is offering a two night “Family Fall Retreat
Promotion” between September and December 28, 2008. Cardmembers who
book and pay with any American Express card will receive a $50 US Dollar
credit. Global Hyatt Corporation, one of the world’s premier hotel companies,
offers today’s travelers more than 730 hotels and resorts around the
world in 45 countries.

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CONTACTLESS BRAZIL

INSIDE Contactless has teamed with American Banknote (ABnote) Brazil to produce a
MasterCard type-approved contactless payment card. INSIDE is supplying ABnote Brazil with its
“MicroPass 4003”, a contactless payment processor designed from the
ground up for “MasterCard PayPass” applications, and has worked closely
with them to obtain type approval, implement in-house
pre-personalization capabilities and ensure their products achieve
optimal performance. The “MicroPass”
intelligent payment platform has achieved its unprecedented success by
continuing to deliver superior performance and flexibility and is designed to power open standard
contactless and dual-interface bank card payments along with other
value-added applications in all global regions. Based upon a RISC
architecture and optimized to the demanding requirements of contactless
transactions, each of the “MicroPass” family of products is designed to
meet the demands of issuer organizations in the bank card payments,
transit and access control markets. American Banknote SA is a provider of solutions involving smart
cards, contactless cards, magstripe cards, phone cards, RFID, ID systems
and print management.

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Restaurant Gift Cards to be Popular

This could be the toughest holiday sales period since 2001, and
perhaps since the ‘Volcker recession’ of 1981. Archstone Consulting
predicts that holiday retail sales will nominally increase 0.5% to 1.0%;
lagging the core inflation rate of 2.6%. This represents a significant
contraction in real terms. Archstone also found in its “2008 Holiday
Gift Card Survey” that restaurant/fast food gift cards will be the most
purchased cards this season, followed by pre-paid bank cards that have
the flexibility to be used almost universally. The research firm noted
that consumers can no longer take on debt to pay for holiday spending. .
Typically, three quarters of the holiday season consumers use a credit
card during this period.

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Aite Hosts a Credit Crisis Webinar

Aite is hosting “The Credit Crisis: How We Got Here and Where We’re Going” webinar.
Aite senior analyst John Jay and other members of Aite Group’s Securities & Investments team will share
insights and answer questions on the current credit crisis. Topics discussed will include the mortgage market,
credit default swaps, the impact of structured products, CDSs and leverage on the
financial system and the current and expected impact of the credit crisis.

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