FEMA and Red Cross Offer STV Cards

The Federal Emergency Management Agency and the American Red Cross are using stored value cards to distribute assistance benefits to victims of the recent hurricane disaster. The “FEMA E-funds MasterCard” and the “American Red Cross Client Assistance MasterCard” are both issued by Chase. The amount of money being distributed through the FEMA expedited assistance program is $2,000 per household. The Red Cross is distributing between $850 and $1,600 via its card program to hurricane victims, depending on family size. However, the Red Cross can load as much as $5,000 on the card under terms of its program. The Red Cross card cannot be used at merchants such as liquor stores and has “NO ALCOHOL, TOBACCO OR WEAPONS” printed on the card. While the Red Cross card program has been available for about three years, the FEMA program is new. FEMA says it is testing the product at some shelters before expanding it to all victims of the disaster.

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PDS to Issue Carmen Electra Cards

Texas-based Payment Data Systems has signed an agreement for exclusive marketing and distribution rights of Carmen Electra-branded transaction cards. An estimated 70 to 100 million credit-challenged consumers such as students, low income earners and recent immigrants are turning to prepaid debit cards for online and offline transactions. Carmen Electra is a singer, actress, dancer and businesswoman. Payment Data Systems, Inc. is an integrated payments solution provider.

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Modell’s Platinum MasterCard Launches

Metris Companies/Direct Merchants Credit Card Bank and Modell’s Sporting Goods launched a cobranded MasterCard that awards one point for every dollar spent at Modell’s and one point for every $5 spent elsewhere, which are automatically redeemed at 400 points for a $20 Modell’s “Award Certificate”. Metris Companies Inc.is one of the largest bankcard issuers in the United States. Modell’s Sporting Goods is America’s largest and oldest family-owned and operated sporting goods, footwear and apparel retailer with 127 stores.

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MasterCard Opens More Card Face

MasterCard unveiled a new card design option that gives issuers 10.5% more card face to decorate. The network is moving the hologram to the back of the card and will integrate it with the mag stripe. MasterCard will use the “HoloMag” technology from American Bank Note Holographics. MasterCard says the new card layout is not intended to replace existing branding options. The current MasterCard design will continue to be available. The new flexible format card design is currently available for all MasterCard card programs. In March, VISA announced a change in its brand identity and card design. Like MasterCard, VISA relocated its dove hologram to the back of the card and is also using “HoloMag” technology. However, VISA is transitioning all its cards to the new format by 2010. Korea’s Woori Bank, Lotte Card and Korea Exchange Bank became the first in the world to issue the newly-branded VISA card on September 1st. (CF Library 3/15/05; 9/2/05)

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ADS/Epsilon Acquires Bigfoot Interactive

Alliance Data Systems’ Epsilon subsidiary has inked a deal to acquire NYC-based Bigfoot Interactive, a full-service provider of strategic ROI-focused email communications and marketing automation solutions, for $120 million. Bigfoot Interactive represents approximately 165 brands and divisions across its client base and has a strong presence in the financial services and retail sector. Bigfoot’s management will play a key role in Epsilon’s business as well as in the continued development and expansion of Alliance Data’s growing loyalty and marketing services. Alliance Data Systems is a leading provider of transaction services, credit services and marketing services, managing over 105 million consumer relationships.

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Relay Capital Issues Actor Payroll Cards

Talent management company Artist International Management and Relay Capital have agreed to develop and launch pay transfer cards. A pay transfer card serves as a virtual bank account, eliminating the need for printing, cutting and mailing paper payroll checks. Each pay period the card is loaded with the employee’s net pay. The employee can use the card at ATM and POS terminals and make PIN-based transactions. Artist International Management is an entertainment holdings company, producing theatrical motion pictures, television programming and recorded music for both traditional and new media formats. Relay Capital is a developer and marketer of a wide range of financial services including pre-paid stored value cards.

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Axalto’s Americas Revenues Rise 52%

Axalto reported that it shipped close to 204 million microprocessor cards during the first six months of this year, a 32% increase in volume compared the year-ago period. Overall revenues were up 16% to $498 million and net income soared by 71% to $33 million. The Americas recorded the fastest revenue increase, both in absolute terms, adding $40.2 million, and in percentage terms with a 52% jump in sales to $118 million. Axalto has 4,500 employees and worldwide sales of more than three billion smart cards to-date. For complete details on Axalto’s latest performance, visit CardData.com ([www.carddata.com][1])

[1]: http://www.carddata.com

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MedCom to Build Cards From its Patent

Arizona-based MedCom USA is releasing new cards based on the “MedCom Renewable” card system patent. The patent covers the technology and process for taking a card with a magnetic strip or other data capture mechanism and activating the card by downloading a determined monetary value onto the card for use at a later date for different types of transactions for prepaid phone cards, gift cards and affinity cards. MedCom USA, Inc. provides healthcare and financial transaction solutions for electronically processing HIPAA compliant transactions within the healthcare industry.

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Universal Processing & FTC Settle

A payment processor and its principal who attempted to process more than $1.2 million in unauthorized charges on consumer checking accounts have agreed to settle FTC charges. Universal Processing Inc. and its principal, Rey Pasinli, made the unauthorized debits on behalf of a business known as Pharmacycards. In May 2004, the FTC charged “Pharmacycards.com” with electronically debiting thousands of consumers’ accounts for $139, without consumers’ knowledge or consent. According to the FTC, Pharmacycards attempted to debit more than $10 million from consumers’ checking accounts in less than three months. More than 70% of the debit transactions were returned. Under terms of the settlement, Universal Processing must monitor the return rates for payments processed for clients and investigate the cause for any return rate that exceeds 2.5% and cease processing for any client engaged in unfair or deceptive acts or practices.

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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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