Merrill Lynch has launched the “Ultimate World Tours Sweepstakes” for cardholders of the “MERRILL+SM VISA” and the “Merrill Lynch VISA Signature Rewards” cards. The winner will select one of three tours and receive $225,000 in cash. Merrill Lynch is a financial management and advisory company with offices in 36 countries and total client assets of approximately $1.6 trillion.Details
Juniper Bank and West Marine, a major specialty retailer of boating supplies and accessories, have teamed to unveil a “Platinum MasterCard.” Linked to West Marine’s membership programs, this exclusive card allows cardholders to personalize their card with a picture of their boat and earn up to six percent on purchases at West Marine and BoatUS locations, and one percent at all other stores. Juniper Financial Corporation, a member of the Barclays Group, is a leading full-service credit card issuer. West Marine, Inc. has more than $680 million in annual sales.Details
MasterCard’s signature debit card business continues to expand rapidly, as gross dollar volume jumped 29% in the first quarter, compared to 1Q/04. During the first three months of 2005, MasterCard added 2.8 million off-line debit cardholders in the USA to its network. Overall, MasterCard reported that its U.S. gross dollar volume for credit and debit cards for the first quarter increased 9.0% over 1Q/04 to $174.5 billion, compared to a 11.5% annual growth rate for the prior quarter. The number of U.S. credit cards grew by more than six million to 277.8 million since the fourth quarter. MasterCard ended the first quarter with 63.3 million off-line debit card accounts representing 69.1 million cards. In the prior quarter, MasterCard had 61.0 million signature debit card accounts representing 66.3 million cards. One-year ago, MasterCard had 49.6 million signature debit card accounts representing 54.4 million cards. Credit card volume was up 3.8% year-on-year to $131.6 billion. During the first quarter, MasterCard processed 1.26 billion credit card purchase transactions and more than 622 million debit card purchase transactions in the USA. For complete details on MasterCard’s 1Q/05 results, visit CardData ([www.carddata.com]).
HISTORICAL DEBIT VOLUME
4Q/02: $31.1 billion
1Q/03: $29.4 billion
2Q/03: $31.2 billion
3Q/03: $30.4 billion
4Q/03: $31.4 billion
1Q/04: $30.8 billion
2Q/04: $34.5 billion
3Q/04: $37.0 billion
4Q/04: $41.7 billion
1Q/05: $42.9 billion
Source: CardData (www.carddata.com)
Canada’s RBC Royal Bank and Esso have teamed to integrate their rewards programs. Under the agreement, members of both “RBC Rewards” and “Esso Extra” programs will have the ability to transfer blocks of points between the each program. “Esso Extra” is the first loyalty program for which RBC Royal Bank developed a reciprocal points exchange process. Esso and RBC Royal Bank began their relationship in 2000 with the launch of the “RBC Esso VISA.”Details
The Federal Reserve Bank of Kansas City will open its “2005 Payments Conference” tomorrow in New Mexico. The conference will focus on the interchange system in the USA. MasterCard’s general counsel Noah Hanft has been selected to be a keynote speaker and he plans to highlight the benefits and efficiencies of the present interchange system. However, the Merchants Payments Coalition says its about time the Federal Reserve questions “high-interchange” debit cards as it “undermines the Fed’s ability to measure and manage the nation’s money supply.” The Coalition also says current interchange fees represent a “hidden tax that is driving up the cost of merchandise and services for American consumers every day.” The group, represented at the conference by Duncan, Hatcher and Zlotnikoff, includes American Petroleum Institute, the Food Marketing Institute, the National Association of Chain Drug Stores, the National Association of Convenience Stores, the National Council of Chain Restaurants, the National Grocers Association, the National Restaurant Association and the National Retail Federation, among others. (CF Library 1/20/05)Details
Carlson Wagonlit Travel and its CWT Solutions Group have upgraded their benchmarking, travel modeling and interactive intelligence tool. “PowrPac” takes booked travel, credit card and expense management data and synthesizes it into actionable program recommendations. The new 1.5 version offers smoother navigation, improved archive storage system, additional reporting and benchmarking options, help functionality and a high level of customization. “PowrPac” was introduced in 2004.Details
Charge-offs among card-backed securities, especially sub-prime portfolios, soared in March as a record number of bankruptcies were filed during the month. However, delinquency (60+ days) continued to fall for prime ABS card portfolios. Sub-prime delinquency (60+ days) dropped for the fifth consecutive month. Prime charge-offs climbed 21 basis points to 5.97% from February, but are 78 basis points below March 2004. Sub-prime charge-offs shot up 112 bps in March to 15.06%, but are 221 bps below one-year ago. According to the “Fitch Credit Card Index,” prime delinquency (60+ days) fell to 2.89% in March, 46 bps lower than March 2004. Sub-prime delinquency (60+days) declined to 7.40%, the lowest level since July 2001. The monthly payment rate declined sharply in March to 16.32% and the yield jumped 144 bps from January to 17.71%.
ABS CHARGE-OFF HISTORICAL
Month Prime Sub-Prime
Mar 04: 5.19% 17.27%
Feb 05: 5.76% 13.94%
Mar 05: 5.97% 15.06%
Source: Fitch Ratings
VISA USA has signed a new five-year agreement with Churchill Downs to become sponsor of the “Kentucky Derby” in 2006. The partnership will enable “VISA Signature” cardholders to gain access to a Churchill Downs “Finish Line Suites” and box seats to the Kentucky Derby. VISA says it intends to create a limited number of “Finish Line Suite” trip packages exclusively for “Signature” cardholders, offering tickets, stable area tours, and access to coveted invitation-only events during horse racing’s biggest weekend. Under terms of the partnership, VISA will be named as “proud sponsor of the Kentucky Derby” and VISA will be the only card that enables cardholders to purchase tickets to the event. VISA USA began its affiliation with horse racing in 1996 when it was named sponsor of the “VISA Triple Crown Challenge.”Details
GE Consumer Finance’s Retail Sales Finance unit has inked a private label credit card deal with Ohio-based Universal Trailer Corporation, a specialist in the enclosed trailer market. Universal Trailer is the largest specialty trailer manufacturer in North America with facilities in seven states and offers a wide variety of trailer products ranging in price from under $3,000 to over $100,000. GE Consumer Finance, a unit of General Electric Company, is a leading provider of credit services to consumers, retailers and auto dealers in 41 countries around the world with more than $151 billion in assets.Details
First Data has received MasterCard’s “Issuer Authorization Availability” and “Issuer Call Referral Availability” awards. The awards recognize First Data’s ability to manage a portfolio of existing and evolving technologies to give clients efficient, effective and proven solutions. First Data is a provider of electronic commerce and payment services.Details
Global Debit Cash Card has suspended its operations and has moved from New Jersey to Las Vegas to restructure. When operations begin again shortly, Global expects to make strong marketplace inroads with its offer of a $5 fee for worldwide transfers of amounts of up to $1,000 a day and also plans to expand its product line by enhancing its three-card package with the introduction of two- and one-card packages. Global Debit Cash Card specializes in international money transfers and the issuance of debit cards.Details
The Reserve Bank of India is asking credit card issuers to clean up their act with the implementation of new guidelines. The RBI’s new credit card policy includes better disclosure of terms and conditions using simple language and penalties for making a misleading card offer. The guidelines also address privacy issues, telemarketing practices and unsolicited credit cards. The RBI has also asked the Indian Banks Association and other credit card issuers to develop a code of conduct.
The RBI says it has been receiving a growing number of complaints about credit card issuers operating in the country.