MEI Acquires Currency Specialist VTI

MEI Conlux has acquired the assets of Las Vegas-based VTI, a provider of currency validation products. The acquisition adds the “VTI Vector” and “Matrix” products to the existing MEI “Conlux” product portfolio provided to the retail, transportation, amusement, vending and gaming markets. These two products complement existing technologies and enable MEI Conlux to offer a broader range of solutions to both existing and new customers. ValTech International designs and manufactures professional currency validation products. MEI Conlux holds the world’s largest installed base of unattended payment systems, handling over 2 billion transactions per week in 90 countries.

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Chase Paymentech Expands Globally

Dallas-based Chase Paymentech announced a major European expansion to tap into the market opportunities arising from the formation of an internal market for payments in Europe such as the “Single Euro Payments Area” initiative. To lead the expansion the Company has hired Shane Fitzpatrick as managing director. Fitzpatrick had served as AOL’s director and general manager for European operations and also chaired a number of boards at Time Warner International. He is co-founder and chairman of the European Direct Response Forum, founded in 2003 for ecommerce merchants to share knowledge in the consumer payments, service and fulfillment areas. The Euro-DRF is sponsored by Chase Paymentech. Chase Paymentech established its European operation in 2002, after having processed payment transactions in the region for more than 13 years. The Company also announced that John Shirey, group manager, will undertake a new assignment to further develop Chase Paymentech’s expansion in the Asia Pacific region. For more information on the Chase Paymentech expansion visit CardFlash International ([www.cardflashinternational.com][1])

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

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MasterCard U.S. Q1 GDV Gains Momentum

MasterCard reported that the gross dollar volume for its debit programs in the U.S. rose 41% in the first quarter to $90 billion compared to 1Q/06, and is up 6% sequentially. U.S. credit and charge card GDV grew 4% year-on-year to $148 billion for 1Q/07, compared to a 3% gain for the fourth quarter. Globally, MasterCard’s credit and charge card programs are up about 13% in 1Q/07. Purchase dollar volume for U.S. credit/charge cards rose 8%, while debit programs soared by 45%. At the end of the first quarter, MasterCard had 217 million accounts and 267 million cards for its U.S. credit and charge card products. One-year ago, MasterCard has 210 million accounts and 257 million cards for its U.S. credit and charge card products. As of March 31st, MasterCard had 98 million accounts and 103 million cards for its U.S. debit programs, compared to 80 million accounts and 86 million cards at the end of March 31st, 2006.

U.S. Gross Dollar Volume
1Q/06: $205 billion
2Q/06: $232 billion
3Q/06: $238 billion
4Q/06: $244 billion
1Q/07: $237 billion
Source: CardData (www.carddata.com)

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Gemalto Q1 Transactions Revenue Up 7%

Smart card specialist Gemalto reports that first quarter revenue declined 7% to $491 million due lower revenue in Mobile Communication and Public Telephony offset by solid growth on the back of higher microprocessor card volumes delivered for payment and pay-TV applications. The Secure Transactions unit which includes Financial Services and pay-TV rose 7% to $130 million. Deliveries of microprocessor cards were up by 16%, driven by on-going EMV deployment, primarily in Europe and certain Latin America countries. Average selling prices decreased due to more intense competition in certain high growth markets which are migrating to EMV and to a greater share of modules in total deliveries on the back of rapid development in North Asia. The contactless payment market confirms its strong potential with initial launches in North Asia and the United Kingdom, and new deployments in the USA. Gemalto is currently participating in about 20 mobile contactless payment pilots throughout the world. For complete details on Gemalto’s latest performance visit CardData ([www.carddata.com][1]).

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

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Wright Express Q1 Revenues Rise 11%

Fuel card specialist Wright Express reported revenue for the first quarter of $72 million a year-on-year increase of 11%. However, net income for the first quarter was $8 million, compared with a $11 million in 4Q/05. Total fuel transactions processed increased 3% from one-year ago to 59.9 million. Payment processing transactions increased 16% to 50.6 million, and transaction processing transactions decreased 36% to 9.4 million. The average expenditure per payment processing transaction was up 1% to $49.32 from $48.63 for the same period last year. Total MasterCard purchase volume grew 43% to $385.9 million, from 1Q/06. For the second quarter, revenue is expected to be in the range of $78 million to $83 million. For complete details on Wright Express’ first quarter performance, visit CardData ([www.carddata.com][1]).

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

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Ceridian Hires Small Business Leader

Ceridian has named Vincent Mottola, formerly global solutions leader for MasterCard Advisors, as SVP of Ceridian Small Business. Prior to that, he was senior vice president of development for GE’s Partnership Marketing Group. With Ceridian, Mottola will lead sales and operations for Ceridian’s HR/payroll, tax filing, benefits administration and other employer services offerings to the national small business market. Mottola is a graduate of City University of New York. Ceridian provides managed human resource solutions that include payroll and compensation, staffing, compliance, HR administration and employee effectiveness.

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First Data Invests in ViVOtech NFC

The contactless push in the U.S. gained even more momentum as First Data confirms it has made a strategic investment in ViVOtech. FDC will also deploy ViVOtech’s collection of emerging technologies such as “Near Field Communication” terminals and mobile commerce enablement. Currently, ViVOtech has more than 250,000 units in 22 countries. The Company was the first vendor to deliver stand-alone contactless readers for “MasterCard PayPass” customers. FDC’s investment will come in the form of the company’s participation as lead investor in ViVOtech’s Series C round of financing. FT Partners acted as exclusive strategic and financial advisor to ViVOtech and its Board of Directors in this transaction.

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Synergent to Offer VSoft to CUs

VSoft Corporation announced that ME-based Synergent has chosen to expand its existing “VSoft” imaging suite of solutions to include ATM Image Capture for member credit unions. VSoft’s ATM Image Capture interfaces with any image-based ATM, allowing members of Synergent’s credit unions to deposit checks directly into the ATM. Once the image is captured at the ATM, the software sends it to the central check-processing site. Each check is positively matched against the ATM records, and a complete audit trail is maintained for clearing purposes. Synergent provides business, financial and marketing needs of credit unions. VSoft Corporation is a global provider of financial technology solutions.

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Hypercom First Quarter Revenues Up 6%

Hypercom posted a 6% increase in revenue for the first quarter compared to the year ago quarter despite a significant sales decline in North America. However, gross profit declined 12% for the first quarter compared to 1Q/06 due to the impact of lower margin revenue in Brazil, as well as a reduced volume of higher margin North American product sales. Revenue for the first quarter was $64.8 million, compared to $61.0 million of revenue in the same quarter of 2006, and flat sequentially. During the quarter, the Company announced that its “P4100 PIN Pad” is now “PCI PED” approved and includes a choice of contactless, EMV Smart Card, or magnetic stripe payment, and also includes a touch screen display. Also, Apriva “Class A” certified Hypercom’s “Optimum T4100” IP-enabled payment terminal for use on Apriva’s Intelligent Gateway. Additionally during the first quarter, Hypercom came under pressure from some investors to sell or merge. For complete details on Hypercom’s first quarter results, visit CardData ([www.carddata.com][1]). (CF Library 3/20/07)

HYPERCOM REVENUE HISTORICAL
1Q/05: $50.6 million
2Q/05: $60.2 million
3Q/05: $66.5 million
4Q/05: $68.1 million
1Q/06: $61.0 million
2Q/06: $66.1 million
3Q/06: $56.7 million
4Q/06: $64.8 million
1Q/07: $64.8 million
Source: CardData (www.carddata.com)

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

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Comdata First Quarter Revenues Rise 12%

Minneapolis-based Ceridian reported that its first quarter revenues rose 5% to $406 million, while its payment processing and card issuing subsidiary posted a 12% gain over 1Q/06. The Comdata subsidiary, which primarily serves the trucking and retail industries, reported $117 million in first quarter revenues. The Company said Comdata’s growth was driven by robust demand for gift cards, both in the U.S. and internationally, and from growth within the core transportation business and through expansion into adjacent markets. Ceridian projected that Comdata revenue will grow in the low to mid-teens on a percentage basis, during 2007. During the quarter, two antitrust lawsuits seeking class action status were filed against Comdata alleging the company has harmed competition by using its market dominance to impair the ability of rival card issuers to challenge Comdata’s monopoly. In the prior quarter, the Company announced it was exploring strategic alternatives to enhance shareholder value, which could include a Comdata spin-off. For complete details on Ceridian/Comdata’s first quarter performance, visit CardData ([www.carddata.com][1]).

COMDATA REVENUES
1Q/06: $104.4 million
2Q/06: $115.8 million
3Q/06: $123.8 million
4Q/06: $121.3 million
1Q/07: $117.4 million
Source: CardData (www.carddata.com)

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

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Contactless to Top 2B Transactions by 2011

A new report projects that total contactless credit and debit cards in the U.S. will reach 109 million by 2011. The study says last year there were only 27 million contactless payment cards in circulation in the U.S. The research by Packaged Facts also says total purchase volume in the U.S. via cards with a contactless feature neared an estimated $15 billion last year, registering a 700% CAGR from 2004 to 2006. That figure should increase significantly as the number of contactless transactions-nearly 777 million in 2006-are expected to reach 2.2 billion by 2011. Packaged Facts says the percentage of retailers having contactless payment systems is also expected to nearly triple within two years.

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Gas Rebate Added to the TrueEarnings Card

American Express and Costco have added a 5% annual rebate on automobile gas purchased at Costco and stand-alone gas stations for their “TrueEarnings Business Card”. The 5% annual rebate complements the current “TrueEarnings Business Card” benefits which include a simple, rewards structure: 3% cash back for eating out; 2% cash back for traveling and 1% cash back virtually everywhere else, inside or outside of Costco warehouses. The “TrueEarnings Business Card” incorporates programs and services tailored specifically to the needs of small business owners, including the OPEN Savings program which gives automatic discounts on purchases and provides expense management reporting, an online spend tracking system, and the ability to add spend limits to employee cards. TrueEarnings Business Cardmembers receive their annual cash rebate as a coupon that can be used for purchases or redeemed for cash at Costco warehouses around the United States. There is no fee for this card with a paid Costco membership. Costco currently operates 508 warehouses.

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