Flint Telecom to Use EPX BuyerWall

End-to-end payment processor Electronic Payment Exchange has signed a multi-year agreement with NY-based Flint Telecom to process its customers’ payments using EPX’s new “BuyerWall” platform. For Flint’s customers who use debit cards in the non-face-to-face payment environment, Flint will benefit from EPX’s “PINless Debit” product. Merchants who are eligible to accept the PINless Debit transactions for payment experience a significant reduction in the overall expense associated with non-face-to-face payment acceptance. EPX enables clients to take advantage of this payment type on the Star, NYCE, and Pulse debit networks. EPX’s “PINless Debit” is less costly than traditional card interchange fees.

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ECONOMICS MAY

The Korea leading index decreased by 1% while the coincident
index decreased .1% for the month of May 2008 according to the
Conference Board. The leading index’ decline, the first movement in
4 months, is consistent with a 2.9% decline since November 2007 and
is in stark contrast to the 8.2% growth during the 6 months prior.
Meanwhile, the coincident index decrease for the month was the first
decline in five months and was mostly due to wholesale and retail sale
performance. Founded in 1916, The Conference Board is a
business membership and research network to help executives build
professional relationships, expand business knowledge and find solutions
to business challenges.

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NACHA CEBP Offers Payment Exceptions Ed

The NACHA Council for Electronic Billing and Payment has released best practices for reducing online bill payment exceptions. Exceptions are online bill payments sent by bank bill pay sites to billers that are unable to be posted accurately and promptly upon receipt. One of the key causes of exceptions is industry merger and acquisition activity. Consumers can also contribute to exception transactions by entering incorrect account data or by failing to update account information when changes occur, resulting in late fees, service shut off or negative effects on their credit ratings. According to First Annapolis Consulting, these exception items will cost billers approximately $155 million in 2008 with additional costs borne by other stakeholders, including consumers, processors and financial institutions.

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Fifth Third Processing Inks Six CUs

Fifth Third Processing Solutions has signed contracts for electronic fund transfer services, gateway access, debit card processing and ATM driving with 6 new credit unions. These credit unions include The Air Academy Federal Credit Union of CO, the Amarillo Community Federal Credit Union of TX, the Colorado Springs Credit Union of CO, the Hereford Texas Federal Credit Union of TX, the Knoxville News-Sentinel Employees Credit Union of TN and the Postal and Community Credit Union of Missouri. Fifth Third Processing Solutions processes over 26.7 billion ATM/POS transactions per year for more than 2,700 financial institutions and over 157,865 retail locations worldwide for an annual processing volume of $179.1 billion in credit card sales and for assets of nearly $223 billion.

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TransUnion Introduces New Scoring Models

TransUnion has introduced a newly updated “TransUnion Account Management” and “TransUnion New Account” scoring models. The “Account Management Model” is built specifically to help the financial industry manage existing credit accounts while enabling them to identify the most profitable current account holders. The third version of this model, which also predicts the likelihood of an existing account holder becoming 90 days or more delinquent in a 24-month period, revealed a 32.1% improvement in identifying bankrupt accounts in the lowest 5% of scores. The third edition of the “New Account Model” is designed with advanced characteristic evaluation and scorecard segmentation for risk assessment of new prospects and applicants, differs from the “Account Management Model” by predicting the likelihood of a prospective applicant becoming 90 days or more delinquent in a 24-month period.

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Card Issuing Webinar Slated for July 22nd

Mercator Advisory Group and SoundBite Communications will host a one-hour webinar on July 22nd to discuss how integrated, multi-channel communications solutions can be deployed to help address the diverse customer communications needs throughout the cardholder lifecycle. Webinar attendees will receive a complimentary white paper entitled “Winning the Top-of-Wallet and Collections Battle via Multi-Channel Communications,” authored by Ken Paterson and sponsored by SoundBite. Mercator Advisory Group is the leading independent research and advisory services firm focused on the payments industry.

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ICMA to Hold Green Summit Workshop

The International Card Manufacturers Association will hold two annual Academy Workshops this fall in Illinois, which will include a first ever “Green Summit” and Germany. Workshop topics will cover a range of subjects relevant to each region including lamination challenges, advancements in print technology, personalization and UV curing inks in card lamination. The Green Summit will address the environmental concerns, myths and opportunities associated with card manufacturing. Topics will include green logo usage, problems in recycling caused by green polymers, material choices in green cards and producing green cards. Open to members only, the ICMA Academy Workshops are designed to give a unique learning experience on the many challenges currently present in the plastic card industry. The Academy Workshops are suitable for all card manufacturing and personalization production managers, supervisors, executives and line workers. Speakers include, but are not limited to, representatives from JDSU, Datacard, Oberthur, Eclipse Laboratories, Sun Chemical Screen, Burkle and Spartanics.

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Aconite Acquires Datacard’s Affina Platform

In return for an equity stake in Aconite and future royalties, the Datacard Group has transfered its “Affina” enterprise platform software to the smart card software solutions company. Under this acquisition, Aconite becomes the authorized distributor for the issuance of the “Affina” solutions while Datacard Group becomes the global non-exclusive reseller for Aconite solutions. These solutions include “EMV Transaction Enabler”, “EMV Script Processor”, “Contactless PrePaid” solutions and the “Affina Enterprise Platform” software. Aconite has a local presence in many markets, providing smart card payment solutions and consulting expertise to card issuers and processors around the world, while the Datacard Group provides secure ID and card personalization solutions to its clients in over 120 countries.

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Many Americans in a Credit Score Fog

An annual poll has found that consumers indicated credit scores would rise if one paid off a large credit card balance — up from 62% in 2005 to 67% in 2008 — and would fall if one made a monthly credit card payment more than 30 days late — up from 71% to 78%. From a list including Experian, Equifax, and TransUnion, the percentage of respondents recognizing that Tenneco is not a credit bureau — up from 47% to 54%. The survey by Opinion Research Corporation conducted for Consumer Federation of America and Washington Mutual Bank, also found that 28%, up from 24% in 2007, knew that 700 was the approximate lowest credit score that would qualify one for a low-rate mortgage; and 26%, compared to 19% in 2007, selected 400 or 500 as the score (incorrect) qualifying for a low-rate mortgage. While more than three-quarters correctly understand that making a monthly payment more than 30 days late lowers one’s score, less than three-fifths know that maxing out a credit card by using the entire credit line also lowers scores.

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Payment Rates and Yield Retrench in May

Monthly payment rates, the amount that cardholders pay on their credit card debt, took another turn south in May. After topping 20% in 2006, the MPR dropped 49 basis points between April and May. Among managed credit card outstandings, the MPR declined to 17.54% in May, compared to 18.03% in the prior month and 19.01% one-year ago. The May MPR figure is the lowest in four years. According to CardData ([www.carddata.com][1]), the yield also declined in May to 13.85% from 13.89% in April, but was down 102 bps, compared to year-ago levels.

U.S. PORTFOLIO METRICS
YIELD MPR
May 07: 14.87% 19.01%
Jun 07: 14.93% 18.40%
Jul 07: 14.77% 18.30%
Aug 07: 14.80% 18.99%
Sep 07: 14.71% 18.86%
Oct 07: 14.82% 19.21%
Nov 07: 14.80% 18.89%
Dec 07: 14.63% 18.41%
Jan 08: 13.53% 18.11%
Feb 08: 13.33% 19.10%
Mar 08: 13.68% 18.33%
Apr 08: 13.89% 18.03%
May 08: 13.85% 17.54%
Source: CardData (www.carddata.com)

[1]: http://www.carddata.com

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Consumer Online Security Concerns Grow

A new survey reveals that 65% of adults are more concerned about online security now than they were five years ago. Over a quarter of respondents to Mintel Comperemedia’s survey say they are “significantly” more concerned. Despite their fears, 71% of adults report managing at least one financial services account online. The average American manages three financial services accounts via email and the web. Mintel believes the incidence of identity theft is actually on the decline. According to the DOJ, the number of American identity theft victims fell 12% from 2003 to 2006. Additionally, in 2006 only 8.3% of identity theft cases were the result of online behavior such as computer viruses, hackers or phishing. The majority of actual identity thefts resulted from simple theft such as a stolen checkbook or a dishonest friend. Recent data from Mintel Comperemedia’s email panel confirm the lower-than-imagined threat of phishing. In 2007, less than 1% of emails tracked by the firm were phishing scams.

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