VISA Plans to Go Public

The rapidly evolving landscape in the payments industry has picked up even more steam as VISA announced this morning it is planning to go public. VISA is planning to combine VISA USA, VISA International and VISA Canada to form a single global public company called VISA Inc. VISA Europe will remain a membership association owned and governed by its 4,500 European banks. It will become a licensee of VISA Inc. VISA says it expects the proposed restructuring will take between 12 to 18 months to complete. Under the new structure the public will own a majority of the new company and the majority of the directors will be independent. A search for independent directors and a CEO for VISA Inc. is underway. VISA is the largest payment card network in the world with more than a 1.4 billion cards in circulation, and is twice as large as it nearest competitor by nearly all measures.

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Q3 Report Critical for MC Stock

After going public in mid-May, shares of MasterCard’s stock have soared by 84%, peaking at $75 per share late last week. However, there is a consensus among analysts that the stock may have plateaued for now. This week the stock has been hovering around $72 per share. Nevertheless, there is much anticipation of the payment card network’s third quarter performance. MasterCard will release its latest earnings report on November 1st. This week, Citigroup cut MasterCard shares to “Hold” from “Buy” and Goldman Sachs downgraded it to “Sell” from “Neutral.” In August MasterCard posted a 9.7% year-on-year increase in revenue for the second quarter of $846.5 million, driven by a 16.4% jump in gross dollar volume. MasterCard’s gross dollar volume hit $485 billion and worldwide purchase volume rose 17.5% to $351 billion during the second quarter. The recent surge in MasterCard’s stock has raised its market value from $5.5 billion to about $10 billion. (CF Library 5/23/06; 8/2/06)

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Wawa Joins Debitman’s Retailer’s Network

Mid-Atlantic convenience store chain Wawa has joined “The Retailer’s Network” operated by CA-based Debitman Card. Under the partnership a private-label “Wawa Check Card” will be issued. The card will reward customer loyalty with an initial $5.00 gift card after the first use, followed by cash rebates on every purchase. The initial phase is expected to last 90 days, followed by a potential chain-wide implementation. Wawa operates more than 550 stores. More than 200,000 merchant locations in the U.S. participate in Debitman’s “The Retailer’s Network,” including Wal-Mart, Sam’s Club and CVS. In August, WESCO Stores joined the Debitman Card payment network and is now issuing its own branded debit cards to customers at its 51 Michigan locations. Last month, Debitman Card was granted a patent for “Method And System For Facilitating Electronic Funds Transactions.” (CF Library 8/22/06; 9/28/06)

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VISA EUROPE STATUS

VISA’s plans to become a publicly traded company does not include VISA Europe. VISA Europe will remain a membership association owned and governed by its 4,500 European banks. However, VISA Europe will be a minority stockholder in the proposed new global company, and the new VISA will have a minority investment interest in VISA Europe. VISA announced it is planning to combine VISA USA, VISA International and VISA Canada to form a single global public company called VISA Inc.
VISA Europe will become a licensee of VISA Inc. VISA says it expects the proposed restructuring will take between 12 to 18 months to complete. Under the new structure the public will own a majority of the new company and the majority of the directors will be independent. A search for independent directors and a CEO for VISA Inc. is underway. VISA is the largest payment card network in the world with more than a 1.4 billion cards in circulation, and is twice as large as it nearest competitor by nearly all measures. Last year VISA Europe posted more than one trillion euros in gross “Consumer Expenditure Value.”

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Pay By Touch Debuts the TrueMe Device

San Francisco-based Pay By Touch has introduced “TrueMe,” the first secure, on-demand biometric authentication service on the Internet. TrueMe (http://www.trueme.com) gives PC users a fast, easy and secure way to identify themselves, interact and transact on the Web using their fingerprints. By simply sliding a finger on a TrueMe-certified finger sensor, users can securely access their Web-based accounts with no need to remember IDs, passwords or account numbers. TrueMe is quick and easy to use and, most importantly, safe. Pay By Touch (www.paybytouch.com) is wowing the world one touch at a time as the leader in biometric authentication, personalized marketing and payment solutions.

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AmEx Expands/Enhances Starwood Cards

American Express has beefed-up its co-branded Starwood Hotels & Resorts cards with the introduction of a small business credit card and an upgraded consumer credit card. Both cards will now offer a bonus of 10,000 “Starpoints” for the first purchase, which is enough for up to three free nights. Other new features include double “Starpoints” on Starwood stays and an automatic upgrade to “Gold Preferred Guest” membership status by spending $30,000 on the Card in each calendar year. Additionally, both cards will offer double points and access to private sales with select Starwood retail outlets. The “Starwood Preferred Guest Business Credit Card” will also include the “OPEN Savings” program and expense management reporting. Starwood and AmEx have had a co-branded card partnership since 1996, when AmEx first launched the “ITT Sheraton ClubMiles Card.”

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ITPS Becomes National Processing Company

Iron Triangle Payment Systems has changed its name to National Processing Company following its recent acquisition of a BA Merchant Services business unit. NPC will continue to support multiple brands in the market, including Retriever and the registered marks of its ISO clients. Based upon the number of merchants served, the combined business will rank as the 6th largest merchant acquirer in the United States and process more than $25 billion in purchase volume. BA Merchant Services is part of Bank of America and is responsible for providing card processing services to more than one million merchant locations. NPC is the largest provider of payment processing services exclusively focused on small and medium sized merchants in the United States, and the leading merchant acquirer focused on the ISO segment.

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VISA Adds Healthcare List for FSA & HRA

VISA will become the first organization to adopt a new healthcare industry standard list designed to more clearly identify items that qualify as an eligible medical expense for health benefit accounts. The comprehensive list, developed by the Employee Benefits Institute of America, will be available to merchants who have implemented VISAâ™s auto-substantiation enhancement. More than 3,500 over-the-counter medical items are eligible for FSA and HRA reimbursement. EBIA will issue updates to merchants quarterly. The new capability also provides plan administrators with a more streamlined claims adjudication process and helps eliminate the need to seek receipts from participating employees after a qualified medical expense is paid.

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EXS Introduces the FREE 2 Sell Program

Atlanta-based Electronic Exchange Systems has expanded its free terminal program with the launch of the “FREE 2 Sell” program wherein agents can chose to place a free terminal and receive up to $500 upfront cash bonus per account, or sell (or lease) the same terminal to the merchant and pocket the full price of the terminal. The new free terminal program is based on the state-of-the art Hypercom T4100 dual-comm terminal. There are also optional packages available to agents that include a free VivoTech contactless reader or a free MagTek check imager/reader as well. EXS ranks among the top 50 processors in the nation and currently handles merchant accounts for over 15,000 customers and processes over 1.5 billion dollars annually.

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Acies Names a New Indirect Sales Exec

NYC-based Acies has hired Matthew Hosey as the Company’s new VP/Indirect Sales. With over 15 years experience in sales and management serving the financial and payment services industries, Hosey brings Acies a proven ability to build market presence and revenue growth within highly competitive markets. Prior to joining Acies, Hosey served as Manager of ISO Recruitment and Support at Cynergy Data, where he led the build-out of the New York-based payment processing company’s ISO and independent agent sales channel and oversaw the daily management of its operational service and support. ies Corporation is a financial services company that, through its wholly owned subsidiary, Acies, Inc., specializes in providing payment processing and online banking services to small, medium, and large-size merchants across the United States.

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Germany’s Grandy M-Payments Comes Ashore

Germany’s “Crandy” mobile phone-based payment system is now being offered in the USA. “Crandy” has over 350,000 users in five European countries. Users register by calling an 800 number to open a free mobile bank account and receive a registration SMS. The mobile number is also the “Crandy” account number. Users reload their “Crandy” account by credit card and can transfer money anonymously to other Crandy users. NCS also offers “Mcells” in the USA, an e-Wallet which banks can easily connect and consequently add to their existing payment systems. “Mcells” works as a white label ASP-solution, which is hosted in a secure, bank standard-compliant data center in Germany.

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Bankruptcy Filings May Hit 2MM in 07

Rising interest rates and declining house prices may likely push consumer bankruptcy filings to pre-reform levels by 2007. The uptick is already being felt by consumer bankruptcy attorneys who report filings have increased significantly in the third quarter and will likely remain strong through the fourth quarter. A recent survey of 700 members of the National Association of Consumer Bankruptcy Attorneys found that more than two-thirds reported that bankruptcy filings were up in the third quarter, compared to the first half of the year. But, the NACBA says the new bankruptcy laws are creating more paperwork hassles and higher expenses for already cash-strapped consumers. More than three quarters of bankruptcy attorneys said that the time involved in preparing a bankruptcy filing has gone up by 50% or more. The NACBA also noted that contrary to what proponents of the law projected, fewer than a third of bankruptcy attorneys are seeing an increase in forced Chapter 13 repayment filings.

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