Sub-Prime Mortgages Not Impacting Delinquency

The results of an analysis of consumer payment behavior in the sub-prime lending market shows that, surprisingly, such consumers are paying credit card bills ahead of the mortgage payments. The findings confirm that trend observed by the sub-prime credit card ABS market which shows steady and slightly declining delinquency ratios over the past year. The sub-prime analysis by Experian reveals that the mortgage delinquency rate has grown at 13.2% over the past four years. The same delinquency trends are present across each geographic region in the U.S., however, the western region experienced the sharpest growth in delinquencies rising 15.3% for mortgage and 6.4% for bank credit cards. Experian defines sub-prime as consumers with Experian credit scores of 620 or lower. Historically, consumers have paid mortgage debt over bankcard debt as people traditionally view their home as their most valuable asset which should be protected at all costs.

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2Checkout.com Adopts PBT’s ATM Direct

Pay By Touch has announced that 2Checkout.com is adopting its “ATM Direct” service to allow shoppers to use PIN-debit cards online. The “ATM Direct” service is the Internet’s only software-only PIN-debit solution which allows for rapid, no-cost distribution. By adhering to PIN-debit industry standards, the ATM Direct service also enables networks, banks and card issuers that already accept PIN-debit to accept Internet PIN-debit transactions with few to no changes to their infrastructure. 2Checkout.com, Inc. (2CO) is an online reseller for over 300,000 tangible or digital products and services. ATM Direct, a division of Pay By Touch, provides secure payment and authentication services to the Internet economy.

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MasterCard Unique Experiences is Unveiled

MasterCard has introduced a new program designed to offer a unique set of benefits to its U.S. “World MasterCard” and “World Elite MasterCard” cardholders. “MasterCard Unique Experiences” offers access to fine dining, plush spas, high-end shopping, live performing arts events, golfing, and other unique experiences. The “Unique Experiences” program is available in major markets across the U.S., including: Atlanta, Boston, Chicago, Dallas, Houston, Las Vegas, Los Angeles, Miami, New York, Phoenix/Scottsdale, San Diego, San Francisco, Seattle, and Washington D.C. MasterCard’s “Global Premium Collection” has also been updated for this year to include a greater breadth of offers across a variety of merchant categories. featuring more than 100 offerings and experiences.

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Thales Joins the SCA Leadership Council

Thales has joined the Leadership Council of the Smart Card Alliance. Thales has been a member of the Smart Card Alliance since September 2002 and through the Leadership Council will now take a larger role in the shaping of alliance policy and activities, which accelerate the adoption of smart cards throughout the world. Thales is increasing its presence in the United States with its SafeSign product line, providing flexible, Federated ID services for FIPS 201 compliant solutions, Real ID and airport access control and credentialing to these markets. The Smart Card Alliance’s councils on Identity, Physical Access Control Systems, Transportation and Contactless payments provide thought leadership and solid educational materials enabling the use of smart card technology in solutions that are secure, sensitive to privacy concerns, scalable and reliable. Thales is a leading international electronics and systems group and generated revenues of $13 billion in 2006.

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CPN Technology in the U.S.Triples Since 2004

A new analysis has revealed growth rates of 60%+ to 90%+ in cardholder spending using “Controlled Payment Number” technology. Ireland-based Orbiscom say this more than tripling of business over the 2004-2006 period comes from a combined look at results across the Company’s clients which include three of the top five credit card issuers in the U.S. Growth in consumer online spending has risen approximately 24% annually in the past two years, exceeding $100 billion in the U.S. for 2006. Orbiscom’s “CPN” product provides cardholders with a substitute card number, expiration date and security code is generated at the point of online checkout to protect real credit card details. Orbiscom “CPN” is offered for free in the U.S. for credit cards under the various brand-names including “VAN” (Virtual Account Numbers) at Citibank, “ShopSafe” at MBNA and Bank of America, and “Secure online account numbers” at Discover Card. PayPal has recently introduced a version of this product, marketed under the name “Virtual Debit Card”.

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Third Biggest Bottler Opts for PayPass

The third largest bottler in the U.S. is installing cashless payment technology in vending machines. AL-based Coca-Cola Bottling Company United has begun equipping its vending machines with USA Technologies’ “e-Port G6” to accept “MasterCard PayPass” contactless payments as well as traditional magnetic stripe credit card payments. The cashless vending machines will be deployed in multiple markets in the Coca-Cola Company’s home market, reaching consumers from Atlanta, Georgia, to Baton Rouge, Louisiana. In November MasterCard announced that 5,000 additional self service POS terminals, including vending machines, will be equipped with USA Technologies’ “e-Port” cashless transaction solution to begin accepting “PayPass.” The 5,000 “e-Ports” will be deployed in New York City, Dallas, Chicago, Las Vegas, San Francisco, Los Angeles, Boston, Washington D.C., Denver, Seattle, Miami and Orlando. The deployment follows a successful trial of 1,000 vending machines in the greater Philadelphia area. Last month Taco Bell announced plans to test “MasterCard PayPass.” “PayPass” is now accepted at more than 46,000 merchant locations worldwide and there are nearly 13 million “PayPass”-enabled cards now in the market.

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Kabira Names a Business Development Exec

Kabira Technologies has appointed Chris Clabaugh, former VP of CollabNet, as its VP of business development. Prior to joining CollabNet, he was VP of Application Partner Market Development for Progress Software and was the was co-founder and CEO of Allegrix. Chris has a BS in Computer Science from Tulane University with graduate studies in technical management at the University of California at Irvine. Kabira provides high performance transaction processing software for global enterprises to manage high volumes at a substantially lower cost.

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MasterCard Accelerates Stock Repurchase

MasterCard Incorporated’s Board of Directors approved an amendment to its certificate of incorporation for the conversion of Class B common stock into Class A common stock, the conversion of up to 13.4 million shares of Class B common stock into Class A common stock, and the repurchase of up to $500 million of Class A common stock in open market transactions. Under the terms of the Company’s existing certificate of incorporation, holders of Class B common stock are permitted, subject to a right of first refusal, to convert their shares into an equal number of shares of publicly traded Class A common stock at any time after May 31, 2010, the fourth anniversary of the Company’s IPO. Class B common stock, which is held by the Company’s financial institution customers, currently represents approximately 41% of the total outstanding common stock of MasterCard Incorporated.

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IP Commerce and TransFirst Adopt IPPF

Denver-based IP Commerce and Dallas-based TransFirst will release a new commerce services for merchants, delivered via IP “Payments Framework” (IPPF). TransFirst will broaden its market reach in client-side commerce offerings with three new desktop commerce applications: bankcard processing for Microsoft Office Accounting 2007 and QuickBooks , and credit card processing for a leading golf pro-shop management solution. IP Commerce’s IPPF is an open platform that connects payment processors, service providers, licensees and commerce application developers. TransFirst is a provider of transaction processing services and payment enabling technologies, currently processes approximately $23 billion in annual sales volume for more than 160,000 merchants and more than 965 financial institutions. IP Commerce provides software that enables open payments to allow banks and service providers to deliver payments services.

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Retailers Launch a Database to Fight Crime

The National Retail Federation and the Retail Industry Leaders Association, along with the FBI, have teamed up to launch a secure national database that will allow retailers to share information through the Web to fight organized retail crime. “LERPnet’ was launched yesterday. In their report, retailers can also include photos and video footage to assist in the detention of and prosecution of criminals. The database will also contain information on burglaries, robberies, counterfeiting, and online auction fraud. Data can be imported from virtually any database and LERPnet already links to case management software programs such as LPSoftware. According to the NRF 81% of retailers said they have been a victim of organized retail crime. Nearly half of those polled also had seen an increase in organized retail crime activity in their stores.

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