GPN & HSBC Form an Asia-Pacific Firm

Global Payments has agreed to create a joint venture with HSBC to provide payment processing services to merchants in the Asia-Pacific region. Under the terms of the agreement, GPN will pay HSBC $67.2 million in cash to acquire a 56% ownership interest in the joint venture. HSBC will control the remaining 44% and will contribute its existing Asia-Pacific merchant acquiring channel in ten countries and territories to the joint venture. HSBC’s merchant acquiring channel in the region provides services to more than 40,000 merchant outlets. In addition, the bank has agreed to a ten-year marketing alliance in which HSBC will refer new merchant customers to the joint venture for payment processing services. The agreement will cover merchants in Brunei, the Hong Kong SAR (Special Administrative Region), India, the Macau SAR, mainland China, Malaysia, Maldives, Singapore, Sri Lanka and Taiwan.

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Maestro Cards Top 578MM; POS Locations Top 9MM

MasterCard added 33 million “Maestro” PIN-POS cards over the past twelve months, bringing its global “Maestro” portfolio to 578 million cards. At mid-year, cards bearing the “Maestro” brand could be used to make online debit POS sale purchases at more than 9.2 million merchant locations worldwide compared to 7.0 million one-year ago. In the USA, “Maestro”-processed transactions grew 313% compared to 2Q/04. Europe continued to be the largest cardholder base for “Maestro” with 257 million cards, a 2% increase over the same period in 2003. GDV for online debit activity in the region for the second quarter was $308 billion. The number of “Maestro” cards issued in Asia/Pacific was 148 million with GDV of $28 billion for the second quarter. In Latin America, “Maestro” card numbers grew 13% to 83 million cards, compared to the end of the second quarter in 2004. GDV for online debit activity in the region for the second quarter was $15 billion. The South Asia, Middle East and Africa region also experienced exceptional card growth with a 42% increase to 35 million cards at the end of the second quarter, compared to the end of the second quarter of 2004. GDV for online debit activity in the region for the second quarter of 2005 was $21.5 billion.

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NY’s Duane Reade to Accept MasterCard PayPass

New York’s top drugstore chain, Duane Reade, will begin accepting “MasterCard PayPass” at all of its 254 locations by the end of this year. In May, Duane Reade announced it will offer the “American Express Gift Card” throughout the New York Metropolitan Area. The following merchants have announced that they will accept MasterCard PayPass: participating McDonald’s, 7-Eleven stores, Ritz Camera Centers, Boater’s World Marine Centers, Sheetz, Regal Entertainment Group theatres and Meijer Stores. It is also accepted at Qwest Field, M&T Bank Stadium and Lincoln Financial Field, homes of the National Football League’s Seattle Seahawks, Baltimore Ravens and Philadelphia Eagles, respectively. (CF Library 5/10/05)

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U.S. Maestro Cards Top 14MM at Mid-Year

MasterCard this morning reported that the number of “Maestro” cards in the USA hit 14.4 million at mid-year. Totally, the number of cards in the U.S. increased 11.3% to 47.1 million, including 32.7 million “Debit MasterCard” cards. There were 383,000 ATMs in the MasterCard ATM Network and 1.6 million merchant locations where cardholders can make online debit point of sale purchases. MasterCard says that online debit purchase transactions in the USA during the second quarter, increased 313% over the second quarter of last year. At mid-year, cards bearing the “Maestro” brand could be used to make online debit POS sale purchases at more than 9.2 million merchant locations worldwide compared to 7.0 million one-year ago. As of June 30th there were 578.1 million “Maestro” cards worldwide, including 34.5 million MasterCard debit cards.

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High Gas Prices Impact Personal Credit Index

The latest “Experian-Gallup Personal Credit Index” has found that the “Index” is now at 77, down 21 points from last month and at the lowest level since its inception in March of this year. With gas prices reaching an all-time high and expected to continue their upward movement, consumers have apparently become more cautious about their credit situation. Gallup says the decline was driven mostly by consumers’ increased concern about making monthly payments, which is responsible for 10 points of the 21-point decline. Another major factor is consumer’s greater concern about being able to borrow money if needed, which is responsible for seven points of the decline.

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The De Palma Group Launches ARC in a Box

New Hampshire-based De Palma Group has introduced “ARC in a Box,” a new check processing solution. ARC in a Box facilitates the conversion of checks received at a lockbox or payment processing facility into the Automated Clearing House (ACH) application Accounts Receivable Conversion, or ARC. The De Palma Group, Inc. is a treasury management and emerging payments consultancy. Its clients include processors, billers, corporate practitioners and financial institutions.

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Pure Payment to Market Heuristic Products

Los Angeles-based Heuristic Technologies has signed a three-year “Marketing and Sales Agreement” with Pure Payment Solutions for the marketing of Heuristic’s suite of software products to healthcare providers. Heuristic’s suite includes Pro837, Heuristic’s claims analysis software that allows providers to reduce the number of medical insurance claims rejected by insurers; ProIdentify, an online service that determines patients’ insurance eligibility and ProClaimSubmit, an all-payer clearinghouse that permits providers to submit their claims through a single internet connection to Heuristic. Pure Payment Solutions, LLC is a full-service, registered ISO/MSP of Paymentech LP. Cash Technologies, Inc. develops and markets innovative data processing systems.

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Katrina Lowers Cap One-Hibernia Merger by 9%

As expected, the Katrina hurricane disaster has impacted the Capital One and Hibernia merger. The companies this morning announced, after intensive due diligence, they have renegotiated the purchase price down to approximately $5.0 billion. This represents a reduction in economic value of 9% relative to the previous terms. The companies now expect the transaction will close in the fourth quarter. More than 100 of Hibernia’s 321 locations are in areas impacted by Katrina. So far, 47 of these branches have been reopened, but 21 appear to have sustained significant damage. These 21 branches account for approximately 5% of Hibernia’s deposits. (CF Library 3/7/05)

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InfiCorp Buys TEG FCU’s 4.7K Card Accounts

Atlanta-based InfiCorp has purchased the $4.2 million credit card portfolio of Poughkeepsie, NY-based TEG FCU with the assistance of NH-based Brookwood Capital. Under this agreement, InfiCorp will issue credit cards for the credit union under the credit union’s name. Brookwood Capital provides consulting and advisory services to credit card issuers nationwide.

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Payment Rates Continue to Hover Near 19%

Statistics for all three delinquency buckets, among credit card bonds, remained flat in July as did charge-offs, while yield rose 80 basis points. Monthly payment rates continue to defy gravity posting a strong 18.7% ratio. The payment rate peaked in May and June at 18.9%. According to Standard & Poor’s “U.S. Credit Card Quality Index,” overall consumer attitudes remained upbeat in spite of escalating fuel prices. S&P says U.S. credit card ABS remained healthy in July despite the reported decrease in consumer confidence.

MONTHLY PAYMENT RATE HISTORICAL
Oct 04: 17.1%
Nov 04: 17.4%
Dec 04: 18.2%
Jan 05: 18.9%
Feb 05: 18.8%
Mar 05: 17.5%
Apr 05: 17.7%
May 05: 18.9%
Jun 05: 18.9%
Jul 05: 18.7%
Source: Standard & Poor’s

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Chase Prepares to Unleash the King Kong Card

Universal and Chase are preparing to pounce on the competition with a King Kong credit card beginning October 1st. Universal Pictures is set to release the King Kong remake, its biggest release of the year, on December 14th. Consumers may pre-register for the new “King Kong Limited Edition Universal Entertainment MasterCard” and earn the opportunity to receive King Kong theatrical updates and sneak-peeks at special Kong merchandise. The new card offers one reward point per dollar on all purchases and two points per dollar at select Universal Studios Theme Parks retail locations. Points may be redeemed for movie tickets, DVDs, gift cards, and Hollywood experiences. Chase will support the launch of the limited edition credit card roll-out with branded direct mail packages as well as online and event marketing.

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