Trumpet Mobile Wallet Takes-Off

Affinity Mobile reports that its mobile wallet Trumpet Mobile have seen 50% of customers activating a mobile wallet at the point of sale. The Trumpet CashCard offers consumers financial freedom and independence without having to carry cash or fits the needs for those who do not have a traditional bank account. It also allows consumers to take advantage of a number of mobile wallet features, including the ability to make Western Union money transfers within the U.S. and to Latin America and the Caribbean from their mobile phones. Trumpet Mobile is the first to use Affinity Mobile’s MADE platform to enable secure mobile financial services capabilities. This includes debit card (PIN) purchases, ATM withdrawals wherever STAR cards or NYCE cards are accepted and reloading Trumpet Mobile airtime using money on the Trumpet CashCard. The Trumpet CashCard is issued by The Bancorp Bank, Member FDIC.

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Delta to Offer AmEx Prepaid Cards

Delta Air Lines is offering a $50 American Express prepaid card for selected round trip flights between New York City and the West Coast. Customers can take advantage of this deal by registering for this offer or enrolling in the SkyMiles program at delta.com/fifty; booking and purchasing a round-trip, nonstop flight between New York-JFK and Los Angeles, San Francisco, San Diego, Portland, Ore. or Seattle at delta.com with any American Express Card; and completing travel between May 1 and June 30, 2008 Each additional round-trip flight purchased at delta.com within the qualification period will raise the American Express-branded prepaid card value by $50.

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Discover Launches New Brighter Ads

Discover Card has begun running new advertisements nationwide in print, online and broadcast outlets through early June. The ads are an extension of the “Brighter” campaign, but also address a timely subject matter for consumers. The ads focus on the newly-launched “Paydown Planner,” as well as a mission to help people spend smarter, manage debt better and save more so they achieve a brighter financial future. The easy-to-use tool gives cardholders the personal information they need to pay down their balances by finding the right payment options to reach their financial goals. Users of “Paydown Planner” start with a monthly payment and see the approximate time period it will take them to reach their pay down goal or start with a target date and see an estimate of how much they will need to pay each month to reach that goal. (CF Library 2/28/08)

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Chase to Invest in Target’s Portfolio

Target and Chase have announced a deal under which Chase will invest in Target’s credit card receivables. At closing Target would sell an undivided interest in its credit card receivables to Chase for cash proceeds of approximately $3.6 billion. This interest would represent approximately 47% of the principal amount of Target’s outstanding receivables at that time. Under terms of the deal, Target will continue to control all aspects of creating and implementing its financial services strategy, provided that future portfolio performance remains sufficiently strong. Alternatively, in the event that substantial unanticipated portfolio deterioration were to occur in the future, Chase would gain certain rights to direct Target’s credit card team to implement alternative underwriting and risk management practices, until portfolio performance improved. The transaction is expected to close before the end of May.

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MC Intros a Priceless U.S. Travel Platform

Figures show 55 million American households to plan/book travel online by 2011, demonstrating a growing shift to distributing offers online, which also happens to be the most cost-effective channel. In response, MasterCard has launched an online domestic-focused travel platform on Priceless.com, providing users with travel offers and domestic opportunities for popular destinations. Focusing on travel to California, Hawaii, Florida, Nevada and New York, the travel platform emphasizes the growing popularity of adventure travel with tips/ideas. In doing so, MasterCard recommends relaxing at a spa in Las Vegas, biking in Hawaii, wine tasting in Sonoma County, California, dolphin watching off the coast of Naples, Florida and attending Broadway shows in New York City.

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USA Technologies Q1 Revenues Rise 58%

PA-based USA Technologies reported that revenues for the first calendar quarter rose 58% to $4.3 million. Gross profit rose 182% for the three months ended March 31st. During the quarter the Company processed approximately 3.2 million transactions totaling approximately $9 million in value for our customers, compared with approximately 1 million transactions, totaling approximately $5.5 million during the quarter. This represents an increase of 220% in transaction volume and 64% in dollars processed. As of March 31st, there were approximately 31,000 e-Port devices connected to the Company-™s USALive network, more than double the approximate 14,000 devices that were connected one-year ago. For complete details on USA Technologies first quarter performance visit CardData (www.carddata.com).

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Secure Vault Payment Pilot Gets Underway

NACHA Electronic Payments Association has deployed Secure Vault Payments’ Automated Clearing House (ACH)-based Internet payments pilot program network to test online consumer purchases and bill payments. Secure Vault Payment allows consumers to conduct e-commerce and bill payment transactions without sharing personal account information by operating on partner organizations’ existing financial institution platforms to provide real-time payment authorization. NACHA Electronic Payments Association is a not-for-profit association overseeing the Automated Clearing House (ACH) Network, exchanged 18 billion payments in 2007 and represents over 11,000 financial institutions through direct membership.

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UKASH & SHELL

Ukash has teamed with Shell to offer its vouchers through 200 terminals
located in Shell shops across South Africa to consumers wishing to make
online payments without a payment card. With values of between $6.50 and
$197, the voucher discloses a unique 19-digit code allowing the consumer
to conduct payment transactions online. The payment solution has proved
a success in Europe, with 226 million users, and is designed to tap the
market of 5 million South Africa Internet users with the
first-of-its-kind online payment product.

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Microfinance Report Calls for Interoperable Platforms

Global microfinancier CGAP has released a report, “The Early Experience with Branchless Banking”, which calls for the development of interoperable payment platforms to reach unbanked and underbanked people around the world. Payments and funds transfers dominate mobile financial services for many reasons, the report finds. Mobile operators in particular prefer to market payments services as this is more aligned with traditional revenue models. These services are also less likely to cause operators to run afoul of banking regulation. The report finds that in cases where market conditions are not driving broader banking services such as credit and savings, there may be a role to play for policymakers and those who advocate for increased financial access. CGAP (The Consultative Group to Assist the Poor) is the world’s leading resource for the advancement of microfinance.

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FRB Releases an Unfair Practices Report

As a means of protecting consumers from unexpected increases in rates charged on pre-existing credit card balances, legislation is being introduced to forbid banks from imposing interest charges using the “two-cycle” billing method. Additional terms of the legislation would require consumers are allowed a reasonable amount of time to make credit card payments, prohibit the use of payment allocation methods unfairly maximizing interest charges and protect consumers that use overdraft services offered through their bank. The Federal Reserve Board is proposing the revisions to the policies required under the Federal Trade Commission Act (FTC Act) to ensure card issuers fairly treat their customers.

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HPY Q1 Processing Volume Rises 18%

Heartland Payment Systems card processing has reported its 1Q earnings reflecting a share growth of 35%. Moreover, processing volume has grown over 18%, operating income grew 36% and net income grew 31% since the year prior while payroll/payment services netted income of $9.0 million. Since 1Q07, transaction processing volume was up 18.3%, net revenue was up 19.9%, total merchant clients was up 15.1%, operating margin on net revenue improved 210 basis points, same store sales growth was 0.6% and the restaurant segment declined by 0.4% while total revenue was $340 million. For 2008, experts project net revenue to grow by 16% – 18%, operating income to grow 20% – 21% and an earnings per share of $1.13 – $1.17. Heartland Payment Systems provides payment card processing, payroll, check management and payment solutions to more than 165,000 businesses nationwide. For complete details on Heartland’s first quarter results visit CardData ([www.carddata.com][1]).

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

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Card Issuers Concerned w/Liquidity Problems

A recent survey examines perspectives of executives in the banking and credit card industries on liquidity problems, 33% of whom were found to consider this as a systemic threat/severe challenge to their respective institutions while 50% regard recent increases in credit delinquencies/fraud among fundamental catalysts. Additional survey findings show 55% of respondents regard the current credit crisis as a manageable setback, nearly 50% of respondents have a fraud solution in place and 80% expressed interest in applying detection to credit risk rather than fraud or collections. This survey was conducted by TowerGroup on behalf of Fair Isaac Corporation, targeting 108 senior risk management and credit executives at U.S. banks and card issuers, 39% of who represent consumer banks, 23% of who represent credit card issuers and 38% of who represent other lending institutions.

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