Online Banking to Hit Some Speed Bumps

A research report by Celent concludes that the pace of household online banking adoption will lessen. While best of breed banks have attracted upwards of 50% of households, the remaining 40% of banked households won’t necessarily be as easy. Celent also says most of the banking industry has moved from product-centric to relationship-centric pricing, and that personal financial management capabilities have continued to play a more primary role within online banking. To work well, these services must be tightly integrated within both bill payment and online banking applications and core processors. Additionally, Celent says that expedited payments involving good funds models will surface more frequently and provide speed of payment at a competitive price and that new Web 2.0 technologies will begin to have a significant impact on future online banking applications.

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Comdata’s New Paperless Fuel Tax Service

TN-based Comdata has acquired MN-based Inter-Tax, a provider of paperless fuel tax services. The customer benefits will include fuel tax service with best-in-class automated fuel tax reporting, proprietary trip-based technology for carriers to manage out-of-route travel, toll costs, off-road refunds with fleet performance benchmarking based on the industry’s most comprehensive operational database, and complete web-based, DOT compliant log management system, which allows carriers to replace all driver logs with scanned images, completely audited and available online within 48 hours of receipt. The Inter-Tax customer base will benefit from access to Comdata’s suite of solutions including temporary permitting, pilot car procurement, licensing, paper based fuel tax, driver log auditing, driver retention, document retention and drug and alcohol testing solutions. Comdata provides electronic payment solutions ranging from credit and debit cards, gift and loyalty cards, fleet, fuel, payroll, purchasing and T&E. Inter-Tax processes more than 300 fleets and 100,000 vehicles each month.

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Diebold Imaging Solutions Cost-Effective

OH-based Diebold has introduced its “ImageWay” distributed capture solution set, enabling financial institutions to quickly implement a cost effective imaging model that minimizes the need for infrastructure investments. Complementary solutions under the “ImageWay” name include payment processing, document imaging and archiving, and compliance monitoring services. A recent report from Dove Consulting estimates that check volumes will decrease by 10 percent between 2000 and 2010 due to card usage. As a result of this declining check volume and the Federal Reserve Bank’s decision to move away from paper check processing, financial institutions are experiencing increased per item operating costs associated with check processing. Diebold reported revenue of $2.9 billion in 2006.

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First Data Expands CUP Card Acceptance

First Data and China UnionPay have inked an alliance to expand the acceptance of “CUP” cards. FDC will provide Chinese visitors to Australia access to its “Cashcard” ATM network. “CUP” cardholders now have access to more than 5,800 “Cashcard” ATMs across Australia. In addition, the companies have reached an agreement to expand their relationship to promote the acceptance of CUP cards in other markets outside China. Together, First Data and CUP will promote the acceptance of CUP cards in certain global markets at ATM locations and merchant point-of-sale locations using First Data systems. First Data will also provide transaction routing and payment processing services. At the end of 2006, 1.175 billion Chinese bankcards have been accepted via the “CUP” network. Also, 189 member institutions have issued “CUP” cards and 520,000 merchants accept the cards.

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QuikTrip to Launch its Own Debit Card

CA-based Tempo Payments and OK-based gas retailer QuikTrip Corporation have introduced a company-branded debit card that will provide customers with lower-priced gas at the pump. QuikTrip will begin a phased roll-out of a debit card that can be used at 200,000 other retail outlets nationwide that accept payments via Tempo, including Wal-Mart, Sam’s Club and CVS. QuikTrip is a marketer of motor fuel and convenience store merchandise. Tempo provides all card-accepting merchants with a low fee per transaction that is significantly less expensive than traditional credit and debit cards.

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AmEx/NYT Travel Show Hits a New Record

The “New York Times Travel Show,” presented by American Express reported nearly 30,000 attendees for the fourth annual event held in New York City. Visitors were able to research, plan and book vacations to all parts of the world; attend cooking demonstrations and learn food and wine travel tips from some of today’s top chefs; get exclusive discounts to hundreds of resorts from around the world; and attend seminars led by some of the travel industry’s leading experts.

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Mobile Payments Headed for Critical Mass

A new study has found that more industry executives this year believe that mobile payments will achieve critical mass sooner. About 29% of respondents in the survey say mobile payments will hit critical mass within two to five years, compared to 17% in 2006. The Edgar Dunn research also found that more than half of payment professionals say critical mass in mobile payments will happen between five and ten years. When asked which participants in the mobile payments value chain will be the most crucial in achieving critical mass, 70% say it is merchants while 65% say it is consumers. Only 20% believe card issuers are the most critical. Edgar Dunn also found that the most significant barrier to adoption is consumers at 58% and merchants at 54%. Nearly half of the respondents said agreement on a common mobile payment platform was the most significant barrier.

Mobile Payments – Critical Mass
2006 2007
0-2 Years 2% 1%
2-5 Years 17% 29%
5-10 Years 51% 51%
10+ Years 30% 20%
Source: Edgar Dunn & Company

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Debit Rewards Gather More Steam & Punch

Debit card issuers are expanding the types of reward programs offered to cardholders. A new report has found that of those offering debit rewards 58% offer points for rewards as opposed to 16% offering miles and 16% offering cash-back. The report by Dove Consulting also found that points can drive increased transaction activity, between 13% and 46%. Some issuers offering cash-back found a 29% lift in average transaction size and a 15.5% decrease in closed accounts. Active card rates have also risen due to mileage rewards, some reporting an 85% active rate compared to 71% overall. Industry wide, Dove found that 37% of issuers currently offer debit rewards programs to some or all of their customers. Among rewards program issuers, 63% offer rewards for signature debit transactions. “VISA Extras” is the most common rewards program offered by issuers.

Debit Card Rewards
Points 58%
Miles 16%
Cash 16%
Other 10%
Source: Dove Consulting

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Apollo Collections Offers The Affirm Card

CA-based Apollo Enterprise Solutions has entered into an strategic partnership with Card Acquisition to provide debtors access to the “Affirm Card Balance Transfer Program” through Apollo’s web-based “Intelligent Debt Solution” system. The combination of these collection tools is expected to increase the recovery and netback to portfolio owners up to 30% or more, while reducing the cost of collections by as much as 60%. Apollo Enterprise Solutions provides enterprise-class web-hosted solutions for receivables management and debt collections.

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Ceridian Names a New CFO

Ceridian Corporation has reached a mutual agreement with Douglas C. Neve, who resigned as CFO March 8 and has appointed Gregory Macfarlane as its chief financial officer. Macfarlane joins Ceridian from the General Electric Company, where he most recently served as executive vice president and chief financial officer for GE-WMC Mortgage. He was heavily involved in WMC’s capital markets strategy and execution, and was a leader in developing WMC’s in-house securitization capability. Previously, Macfarlane served as the senior vice president and chief financial officer at GE Partnership Marketing Group from 2001-2004. Macfarlane holds an MBA from the Kellogg Graduate School of Management at Northwestern University. Ceridian Corporation is an information services company.

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