52% of Consumers Pay No Monthly Bank Fees

A new survey shows that two-thirds of consumers spend $3 or less in monthly fees for bank services such as checking account maintenance and ATM access. The poll by the American Bankers Association also reveals that more than half of consumers pay no bank fees, a 9% increase from 2006. When asked how much they estimate they spend on fees for banking services each month, such as checking account maintenance and ATM access, consumers provided the following responses: 52% said they pay nothing; 13% said $3 or less; 9% said $3-$6; 3% said $6-$8; 5% said $8-$10; and 13% said they pay more than $10.

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Bankers Embrace Bulk Check Deposit ATMs

A new survey of Southeastern U.S. bank executives shows that most executives plan to implement bulk check technology in the near future. The research conducted by Wincor Nixdorf also showed that 95% agreed or somewhat agreed that bulk check deposit ATMs provide a better banking experience; nearly 60% of the respondents indicated their financial institutions will migrate to bulk check deposit ATMs in the near future. Wincor Nixdorf?s bulk check deposit ATM enables consumers to deposit up to 50 checks or notes at the same time, through a single deposit slot, without the need for envelopes. Under “Check 21,” banks can utilize the images of checks scanned at an ATM to process the deposited funds far more rapidly than can be done with physical checks.

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CU Card Portfolio Sales Maintain Pace

The average credit card portfolio sold by a credit union declined to $6.7 million for the first half of this year, compared to $7.1 million for the same period one-year ago. During the second quarter 18 credit unions with portfolios of more than $1 million in outstanding balances sold their card business, compared to 17 in 1Q/07. According to NH-based Brookwood Capital, total balances sold during the first half of this year were approximately $233 million. The brokerage firm says that since 2002, more than 13% of all credit union credit card issuers with credit card portfolios of over $1 million in receivables have outsourced their card programs to third party partners. Brookwood notes that the latest results indicate that credit unions of all sizes are continuing to take a strategic look at their credit card product lines. While these portfolios are nearly always profitable, many smaller issuers are trying to find ways to issue a stronger product set, lowering their institutional credit risk and fraud exposure and improve the bottom line. Brookwood Capital specializes in credit union credit card portfolio sales.

CU PORTFOLIO SALES
Year Total Outstandings Average
2002 41 $285 million $7.0 million
2003 59 $419 million $7.1 million
2004 67 $459 million $6.9 million
2005 65 $481 million $7.4 million
2006 69 $466 million $6.7 million
YTD2007 35 $233 million $6.7 million
Source: Brookwood Capital

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Shell Adopts VISA’s New Prepaid Policy

Shell Oil Products US has begun implementing VISA USA’s partial authorization policy for prepaid VISA cards. The VISA solution prevents declined transactions when the balance on a VISA prepaid card is less than the typical cost of a full tank of gas. If the card only has enough funds to pay for a portion of a total gas purchase, the transaction will no longer be declined, prompting the cardholder to “see attendant.” Instead, the pump can now be instructed to shut off when the funds on the Visa prepaid card reach zero. According to VISA research, partial authorization can help average approval rates increase by up to 25% at automated fuel dispenser merchants who use VISA’s solution. Shell is in the process of expanding this service at stations across the U.S.

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Equifax Hosts a Credit Webinar Today

Equifax is hosting a webinar today called “Today’s Credit Forecastâ¦Tomorrow’s Economic Outlook” with Moody’s Economy.com senior economist Juan M. Licari, and Lisa Zarikian, vice president, Equifax Predictive Sciences as keynote speakers. They will address trends in today’s economic landscape and the impact of key factors on consumer households to include whether or not the impact of the mortgage market on consumer credit quality translates into credit quality erosion in other markets, such as bankcards and autos; the latest solutions to help businesses look beyond today’s market conditions; the value of scoring models in navigating the dynamics of a changing economy in an effort to manage risk. The one-hour webinar is free to members of the media, consumer credit risk professionals, lending officers, marketing professionals, business and operations managers and compliance officers.

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AmEx ExpressPay Adds More Merchants

Office Depot and Braum’s Ice Cream and Dairy Stores are now accepting “ExpressPay” from American Express. American Express was the first issuer to launch contactless cards nationally with the rollout of “Blue” with the ExpressPay feature in June 2005. Office Depot is the first office supply company that plans to accept contactless payments at its 1100 locations nationwide and will roll out the technology later this year. Braum’s Ice Cream and Dairy Stores is a regional merchant with 276 retail stores throughout Oklahoma, Kansas, Texas, Missouri and Arkansas that already accepts the contactless technology at all their locations. “ExpressPay” is also embedded in the Starwood Preferred Guest Credit Card, Clear from American Express Card and available via a key fob that can be linked to any American Express Card.

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RED EXEC

Retail Decisions (ReD) has appointed Sue Hando as Managing
Director of prepaid cards. Hando’s objective will be to oversee strategy,
business development, sales and service delivery for ReD’s gift cards,
online gift vouchers, refund cards, insurance claim cards, prepaid fuel
cards, payroll and staff cards. She brings with her 15 years of experience,
previously with Insurance Australia Group as Head of Customer
Strategy and Management. Other experience includes senior management
at Qantas where Hando was General Manager of Frequent Flyer and
“Qantas Club” Programs responsible for the launching of “Qantas Telstra”
Visa card. ReD is a payment card issuer and provider of card fraud
prevention and payment processing. The company has 19 years
experience and is Australia’s largest prepaid card provider.

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RBS Inks NYC’s D’Agostino Supermarkets

NYC-based D’Agostino Supermarkets with more than 5 million card-based purchases annually, has selected RBS Lynk to provide payment processing services. D’Agostino is headquartered in Larchmont, NY, and operates 20 stores in the Manhattan and Brooklyn boroughs of New York City as well as Westchester County. RBS Lynk will process credit, debit and other payment card transactions, including electronic benefits transfer payments for the supermarket chain. RBS Lynk is a single-source provider of electronic payment processing services.

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SAMBA & FAIR ISSAC

Samba Financial Group has made agreements to utilize Fair Isaac’s
consultation and analytical services, through Cadmus, to meet compliance
needs, determine credit risk and growth in services with its Basel II
internal
ratings based compliance. The services will enhance the the bank’s
consumer card, mortgage and personal loan portfolios. The Basel II Accord
is a method used for calculating capital reserves to determine credit risk,
which experts project will be implemented as the standard for banks and
institutions by January 1, 2008. Cadmus is Fair Isaac’s local agent that
serves
41 clients in 9 countries in the Middle East. Fair Isaac has clients in 80
countries for which the company implements solutions to increase customer
loyalty, cut fraud, manage credit risk, and meet regulatory demands.

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Dupaco Community CU Debit Card Compromised

MasterCard’s Fraud Management Department has notified Dupaco Community Credit Union that its “Money Card” may be at risk for fraud due to security breach of debit card numbers contained in a merchant database. This breach occurred at a local merchant, and Dupaco was in no way responsible. Members whose cards have been affected will be receiving a letter of notification the week of August 20, 2007. Dupaco will be reissuing new Money Cards to those whose cards were included in this security breach. The new cards will have the same account number as the current cards, however the expiration date and three-digit security code on the back of the card will change. The new cards will mail by the end of August.

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PAYMENT CARD TRENDS

In New Zealand, there were 79 million card transactions for the month
of July 07, according to Statistics New Zealand. Totaling $4.6 billion,
these findings reflect a 0.1% decrease in card spending since June 07, an
8% increase since July 2006 and in the retail area alone, a decrease of 0.4%
since June 2007. For 1H07, the average number of card transactions
made per person in New Zealand was 215, with an average annual value
of $12,549.

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