CREDIT BOOM

Mercator’s recent International Advisory Service report has provided an
overview of the Brazilian payment card market demonstrating the
Brazilian market is destined for massive growth with projections of
being the third largest behind only the U.S. and China by 2013. Since
2001, Brazil has more than tripled its number of cards in circulation,
the number of transactions and total transaction value to become one of
the leading card markets outside of North American and Western Europe.
The report shows Brazil now has a sizable market for payment cards, a
very advanced industry infrastructure, there is increasing competition
among issuers and debit cards have seen the fastest growth, but credit
cards are sure to soon take off with innovative products and services.

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Handling Card Fraud Hits Bottom Line

A survey has found that this week’s federal indictments for massive
credit card fraud can be the “moment of truth” for credit card issuers
and users. The Deloitte research found that nearly one-third of
consumers polled would reduce their business or terminate their
relationship entirely if they became a victim of fraud and it was
handled badly. On the other hand, if trust is continuously reinforced
and any problems that arise are handled promptly and correctly it can
expand the relationship. Fraud is perceived as a growing problem by 84%
of card users, and 89% feel that an incident of fraud could have a major
negative impact on their lives. However, Deloitte survey found that 40%
of fraud victims had been pleasantly surprised by the service and
assistance they received, saying that their level of trust in the
provider involved had actually increased as a result of the fraud
incident. And, surprisingly, the majority of those surveyed who had
experienced fraud actually rated their providers higher than those who
had not experienced a fraud related event.

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ACH Direct Slates a Webinar

ACH Direct and the Upper Midwest ACH Association will host “WEB and TEL
Entries,” the sixth in a series of free webinars on ACH topics on
Tuesday, August 12. This session discusses requirements for originators
and companies for WEB (Internet Initiated Entries) and TEL (Telephone
Initiated Entries) as well as authorization and authentication details
for each application. The webinar series, produced and presented by the
Upper Midwest ACH Association (UMACHA), is designed to provide a basic
to intermediate education on ACH to merchant participants with a
concentration on specific aspects of ACH targeting merchant’s needs.

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Consumer Spending Remains Stagnant

A monthly survey reveals that consumer spending confidence is stuck in the mud, even though gas and food prices have eased a bit. The poll also found that more than 69% of consumers have cut back on entertainment expenses and 62% have changed their vacation plans during July. The latest “Discover U.S. Spending Monitor” rose a mere one-tenth of a point to 86.1 for August. The Monitor revealed for the first time that declining home values and investment portfolios are affecting consumer spending. Nearly half of consumers who expressed concern over decreasing home values said they’ve reduced spending. And 52% of consumers concerned over decreasing investment portfolios also cut back on their spending. Major purchases like a new car, vacations, computers or appliances were the first spending area to cut by consumers concerned about decreasing home values (42%) and decreasing investment assets (41%). Discover also noted that its “Monitor” would have declined to new low had it not been for the late drop in oil prices.

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VASCO.CO.JP

VASCO Data Security International software security company has launched
its Japanese website, www.vasco.co.jp, focusing on content relevant to
the local market. The website features VASCO’s “Identikey Server” to
secure web applications, “DIGIPASS Packs,” “DIGIPASS” range and the
“VACMAN” authentication platform to allow Japanese consumers to find
information on authentication solutions for e-banking, healthcare,
enterprise security applications and corporate information such as press
releases. VASCO authentication and e-signature solutions bring banking
level security to over 50 different industry sectors with a customer
base of over 7,600 companies in more than 100 countries.

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Consumer Confidence Settles Down

Consumer economic sentiment has settled down, ending its downward spiral this year. However, the ongoing decline in house prices, continued tight credit conditions, and soft jobs market indicate that while sentiment might be in the process of bottoming at a very depressed level, it has not likely begun an upward trend. The latest “RBC CASH Index” (Consumer Attitudes and Spending by Household) rose 19.2 points in August to 33.8, compared to 14.6 in July, which was an all-time low
since inception of the “CASH Index” in 2002. RBC noted that although still in negative territory for the eighth consecutive month, the “RBC Expectations Index” increased 50 points to -4.7 in August. The shift in the index is due largely to an improvement in Americans’ expectations for personal finances and the economy as a whole. This month, nearly one in three consumers believes their personal financial situation will be stronger six months from now (compared to 25% in July). In addition, nearly one in four believe their local economy will be stronger six months from now (compared to 18% last month).

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U.S. Navy Yard Card Expands

KS-based loyalty marketer Visible Results has enabled the United States
Naval Academy “Yard Card” program to be expanded to include more
locations at the Academy. The cards will be
initialized and customized for each Midshipman, plus a $5 bonus will be
added to the card as part of the Yard Card program expansion
celebration. Approximately 25% of the
student base signed up for the program last year and with the expansion
of the participating locations, an increase in enrollments is expected.
All incoming Midshipmen will be given a new Yard Card. Parents will now
have the ability to visit http://www.navyonline.com to
start a new Yard Card account for their Midshipman, refresh the balances
on their Midshipmen’s card, as well as request notifications of when
their Midshipmen’s card balance falls below a certain dollar amount.

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Alaska/Horizon Airlines Confirm Fraud

Alaska Airlines and Horizon Air have confirmed that customer credit
data was recently compromised. The two airlines, subsidiaries of Alaska
Air Group say that a former call center employee misused the payment
card information provided by some customers between August 2006 and June
2008. The airlines notified about 1,500 customers this week.
Alaska Airlines and Horizon Air together serve 95 cities through an
expansive network throughout Alaska, the Lower 48, Hawaii, Canada and
Mexico.

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Tier Adds Heasley to its Board

VA-based e-payment processor Tier Technologies has appointed Philip G.
Heasley, President and CEO of ACI Worldwide, to its Board of Directors.
Heasley has served as President and Chief Executive Officer of ACI
Worldwide, Inc., a developer of electronic payment software products,
since March 2005. He previously served as Chairman and Chief
Executive Officer of PayPower LLC, an acquisition and consulting firm
specializing in financial services and payment services, from October
2003 to March 2005. Mr. Heasley has also served as Chairman and Chief
Executive Officer of First USA Bank from October 2000 to November 2003.
From 1996 until November
2003, Heasley served as Chairman of the Board of Visa USA and a
member of the board of Visa International.

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Global Axcess 2Q/08 Revenues Up 4%

FL-based ATM specialist Global Axcess reported a 4% increase in second quarter revenues to $5.8 million. The increase was due to surcharge/convenience fees on selected ATMs beginning in the first quarter. The Company says this represented an increase of approximately 4.4% over 2Q/07. The Company recorded net income for the second quarter was $450,300, compared to $170,900 for the year ago period. Through its Nationwide Money Services subsidiary, the Company owns and operates approximately 4,300 ATMs in its national network spanning 44 states. For complete details on Global Axcess’ second quarter performance visit CardData ([www.carddata.com](http://www.carddata.com)).

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