OCT DEBT

Credit card outstandings continued to hover around GBP 56 billion
during October. The figure is also slightly below year-ago levels by GBP
800 million. The Bank of England reports the increase in total net
lending to individuals in October of GBP 8.9 billion was larger than in
September and above the previous six month average. However, the
twelve-month growth rate continued to weaken to 10.2%.
Within the total, the increase in net lending secured on dwellings GBP
7.6 billion was larger than in September and the previous six month
average. The increase in consumer credit of GBP 1.3 billion was higher
than in September. The annual growth rate of consumer credit continued
to fall to 10.5% in October.

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RBS Lynk to Offer Access to Debitman

Atlanta-based RBS Lynk is planning to provide access to the Debitman ACH debit network. Debitman is the only provider of a shared network, retailer-issued card. RBS says the primary incentive for retailers to issue store-branded debit cards was to reward consumers through their loyalty programs and keep the card value in their store network. However, with Debitman acceptance, retailers can take an active role in managing their electronic payment costs as well as save on network fees and receive incremental revenue as a card issuer. RBS Lynk says it recognizes Debitman as a debit network utilizing the national ACH system. Wal-Mart Stores recently announced it is accepting “Debitman” cards at the checkout in all Wal-Mart and Sam’s Club locations across the USA. The Debitman network interchange and switch fee is $0.15 per transaction and the network issuer rebate is generally $0.06 per transaction but can range higher. (CF Library 11/15/05)

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Fifth Third’s Second-in-Command Resigns Abruptly

Fifth Third Bancorp announced that EVP Neal Arnold, who headed the Company’s payment processing business, resigned yesterday. Arnold had served as executive in charge of the Company’s investment advisor, payment processing, mortgage and consumer lending businesses. Those businesses will report to George A. Schaefer, Jr., President and CEO of Fifth Third. Fifth Third Bancorp is a diversified financial services company headquartered in Cincinnati, Ohio. with $104.6 billion in assets.

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ACS Signs TransFirst for Card & ACH Processing

The Government Solutions Group of Affiliated Computer Services has inked an agreement for Dallas-based TransFirst to provide credit/debit/ACH processing. Through this relationship, ACS will have access to TransFirst’s credit card processing programs, 24/7 in-house customer support, and the ability to offer business customers multiple payment processing methods including Internet, ACH, batch, wireless and recurring payments. In addition, ACS and its customers will be able to benefit from TransFirst comprehensive online reporting services. ACS will primarily leverage the power of TransFirst proprietary ACS provides business process outsourcing and information technology solutions to commercial and government clients. TransFirst currently processes approximately $22 billion in annual sales volume for more than 155,000 merchants and more than 965 financial institutions.

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GECF to Issue the Clockwork Royal Privilege Card

Success Group International’s Clockwork Home Services has signed a deal with GE’s Retail Sales Finance unit for a new private label “Royal Privilege” credit card. In addition to fast credit decisions, customers will receive competitive interest rates and responsive customer service from GE. As part of the Royal Privilege Program, GE will also be providing a one-call solution for approving Clockwork’s customers. When a customer is unable to obtain approval through GE, the contractor will be automatically transferred to a secondary finance source, eliminating the need to source the application to numerous finance companies. This will enable business owners to manage the consumer financing process more efficiently.

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Johnson Financial Expands STAR Network Access

Wisconsin-based Johnson Bank has expanded its STAR Network access to include both Arizona and Wisconsin, plus Wind River Financial, which is the merchant service provider for Johnson Bank, now provides STAR Network access for thousands of merchants. First Data’s STAR Network is a coast-to-coast electronic payments network and provider of secure, real-time electronic transactions. Johnson Financial Group is a $3.7 billion financial services company. Wind River Financial is a provider of electronic payment services, including credit/debit card processing, check conversion/guarantee, gift and loyalty cards, point of sale solutions and security compliance services.

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Majority of Consumers Limit Online Shopping

A new survey found that 69% of those shopping online will limit their purchasing because of fears associated with misuse of personal information. The TNS/TRUSTe survey revealed that the top five factors that shoppers say might limit or prevent them from buying online this holiday season are, in order, identity theft (49%), spam resulting from online purchases (39%), credit card theft (39%), spyware (38%) and preference for the “touch and feel” of shopping in bricks-and-mortar stores (35%). Among those willing to use e-commerce, nearly 42% prefer using the large, well-known online brands they believe will keep them safer from privacy-related threats.

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Card Personalization Turf Battle is Brewing

A battle may be brewing over front-of-card personalization services. A U.K. company announced today that it intends to enforce its international intellectual patent rights for the technology that allows cardholders to design their own payment card and enables issuers and manufacturers to use digital card images on the fly for just-in-time card manufacturing. London-based Serverside Group, founded in early 2003, says it has become aware of new front-of-card personalization programs entering the market and may take legal action internationally to protect its patents, copyright, trade secret, trademark and database rights. The company has strategic alliances with VISA, Datacard Group and Getty Images. To-date, SSG has seven issuers offering its card personalization to cardholders including Abbey National, America First Credit Union, Capital One, First National Bank of Omaha and Taishin Bank in Taiwan. The Company says it also has signed contracts with additional top 10 regional issuers and has several other deals in the pipeline. Cardholder personalization services have gained popularity in the USA this year. Wal-Mart has added the option to its gift card program and MasterCard recently announced a similar service for its members. MasterCard introduced its proprietary “MasterCard Card Customization Services” two weeks ago that allows issuers to offer consumer and small business cardholders the ability to create their own unique credit, debit or prepaid cards. Wal-Mart Stores introduced its personalized gift card program in early November, charging an $0.88 fee. (CF Library 11/14/05 and 11/21/05)

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Cyber Monday Americans Charge Nearly $1B

Upwards of 60 million Americans went online Monday to shop for the holidays, charging nearly $1 billion on payment cards. Early statistics show that “Cyber Monday” spending was up 26% as traffic rose more than 30% for most retailers. VISA USA’s “SpendTrak” reports consumers charged about $505 million on the Internet using its cards, a 26% jump over the same day in 2004. VISA says between November 1st and 28th, consumers charged over $9.9 billion online using VISA, with an average ticket of $87.85. VISA also noted that the previous high for the 2005 holiday season was on November 15th when consumers spent approximately $461 million. eBay’s Shopping.com reported a 37% increase in year-over-year traffic on “Cyber Monday.” More than 3.4 million unique shoppers visited the site Monday. Among the hottest products for this year: Apple iPod Nano and Panasonic 42 inch HDTV Plasma TV. The NRF’s Shop.org said it estimated that 58.9 million consumers shopped online Monday.

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The CO-OP Network Hires Work from GenPass

The CO-OP Network has hired Leah Work, formerly with GenPass as National Relationship Manager. Work joins CO-OP Network after spending four years at GenPass, where she managed marketing implementation projects and developed strategic business plans and procedures to establish an ISO client relations department. During her time at GenPass, Work also managed technical sales for financial institutions and ISO client nationally. CO-OP Network is wholly-owned by its credit union shareholders and provides volume discounts on products and services that include risk management as well as debit and deposit access.

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20% of Students Turn Down Credit Card Offers

A new report has found that more than 20% of college students surveyed have decided to avoid potential credit card pitfalls by not obtaining even one credit card. More than 30% of students have just one card, according to the research by Atlanta-based NetBank. More than half of the students who have credit cards said they pay their credit card statement in full each month and don’t carry a balance. NetBank also says the survey showed that the first thing students look at when selecting a bank is the amount of fees charged for not maintaining a minimum balance. Their second biggest concern is belonging to a bank that provides easy access to fee-free ATMs.

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