Euronet Buys Up 3 More Prepaid Concerns

Euronet Worldwide recently completed acquisitions of three new prepaid companies. The firm acquired 100% of the assets of Dynamic Telecom in the USA, all of the assets of Telerecarga in Spain and an additional 41% in UK-based ATX Software. Dynamic Telecom specializes in selling prepaid services, including wireless top-up, long distance calling cards and financial services products such as credit cards and stored-value cards via POS terminals in convenience store retail chains. Madrid-based Telerecarga specializes in the electronic distribution of prepaid wireless airtime and other prepaid products through approximately 10,000 POS terminals and over 14,000 other points of sale through electronic cash register integrations in Spain. ATX Software is a provider of electronic prepaid voucher solutions with customers in more than 25 countries. Euronet reported that its Prepaid Processing Segment had annual revenues for 2004 of $289.8 million, compared to $136.2 million reported for 2003.

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Asia Pay and Beijing Purple Stars Appraisal Team

Asia Payment Systems has signed an agreement with Beijing Purple Stars Appraisal Co. to establish an international standard credit bureau in Beijing. The BPS/Asia Payments Systems agreement provides for a working committee made up of representatives from both parties to coordinate the development of both a China Credit Bureau, as well as development related to further deploying Asia Pay’s China credit card processing systems. Beijing Purple Stars Appraisal Co., Ltd. is an official appraisal agent licensed by the Chinese government to provide appraisal services to the Beijing Municipal Government and to the public. In addition, BPS provides credit files and credit rating services to banks and financial institutions in Beijing. Asia Pay is developing a credit card processing network that provides clearing services to merchants, oil companies, and financial institutions in
China, Japan, and other markets of interest in Asia.

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MC Triples Premium Cardholder Incentives

MasterCard has tripled the number of exclusive offers available to the 245 million cardholders of its “Global Premium Collection,” which includes “Gold,” “Platinum” and “World” cards. Affluent cardholders now have access to more than 75 high-value incentives including special new offers from Abercrombie & Kent, Tumi, Crystal Cruises, Harrods, and Le Meridien. MasterCard reports that the number of “Premium MasterCard” cardholders increased by 15 million last year, adding an additional $30 billion in spending volume. MasterCard has a consumer Web site dedicated to premium cardholder incentives. In addition to providing re-established travel offers, MasterCard also delivers a turnkey solution that enables customer financial institutions to access promotional materials. Participating customer financial institutions can view all information related to the MasterCard Global Premium Collection in real-time via MasterCard’s proprietary online “PiXi.”

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Cencosud Acquires Almacenes Paris 1.3MM Cardholders

Chile’s largest retailer and second largest supermarket operator has added 1.3 million credit cardholders to its portfolio. The expansion came as Cencosud acquired control of Almacenes Paris for about $834 million. Almacenes Paris’s credit card customers pay interest rates as high as 50% per annum. Almacenes Paris also has more than 30 times the number of active accounts of Cencosud. The combined companies had more than $3 billion in sales during 2004.

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Top 10 Average Balances Up 3.3% in 04

The average balance per active account among the top 10 issuers increased 3.3% last year to $2,356. Compared to five years ago, average balances are up about 4%, indicating that consumers are spreading their balances over multiple accounts. The nation’s top issuer, Chase, had a 1.3% decline in average balances last year. MBNA’s average balance also fell by nearly 3%, according to CardData ([www.carddata.com][1]). Citi, the nation’s #2 issuer, experienced a 6.7% increase in average balances during 2004. Other top gainers are HSBC +18%, Wells Fargo +12% and Providian +7%.

AVERAGE BALANCES AMONG TOP 10 ISSUERS
(per active account)
ISSUER 2004 2003 CHNG
1. Chase $3411 $3457 – 1.3%
2. Citi $1690 $1584 + 6.7%
3. MBNA $2475 $2548 – 2.9%
4. BofA $3118 $3057 + 2.0%
5. Cap One $1854 $1801 + 2.9%
6. Disc $2452 $2325 + 5.5%
7. AmEx $2240 $2362 – 5.2%
8. HSBC $1734 $1469 +18.0%
9. Prov $2439 $2288 + 6.6%
10. Wells $2146 $1923 +11.6%
AVG $2356 $2281 + 3.3%
SOURCE: CardData (www.carddata.com)

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

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HSBC Exec Named to MC International Board

The Global Board of Directors of MasterCard has elected Siddharth N. Mehta to become a director, representing the U.S. region. Mr. Mehta fills a vacancy since the resignation of another director in July 2004. Mr. Mehta is currently Vice Chairman of HSBC Finance Corporation and is expected to become Chief Executive Officer of HSBC North America Holdings Inc. in April 2005. Mr. Mehta has served on MasterCard’s U.S. region board since March 2000.

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Cubic Wins the PATCO Fare Payment Contract

Cubic Transportation Systems has been awarded an $11.3 million contract from Philadephia’s Port Authority Transit Corporation (PATCO) for the design and integration of a contactless smart card-based automated fare collection system to link rail and parking services. The automated customer service features will include credit-debit payment, internet-based ticketing and the ability to automatically load value onto the card. Cubic Transportation Systems, Inc. is the world’s leading full-service solution provider of automated fare collection systems for public transportation in 40 markets worldwide.

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UCE and Trycera Partner for a STV Card

Universal Cash Express has partnered with Trycera Financial for development and delivery of an Association-branded UCE stored value debit card program. Universal Cash Express is a division of Universal Express, Inc., specializing in logistics and transportation. Trycera Financial,Inc. offers customized and turnkey prepaid programs partnerships to self-banked consumers.

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Regions Financial Renews its NOVA Contract

NOVA Information Systems announced it has extended its marketing alliance agreement with Alabama-based Regions Financial Corporation. NOVA support operations, processing and customer services represents more than $2.3 billion in processing volume. Regions Financial Corporation is a full-service provider of retail and commercial banking, securities brokerage, mortgage, and insurance products and services through 1,400 locations in 15 southwestern states with assets of $84.1 billion. NOVA Information Systems is a wholly owned subsidiary of U.S. Bancorp, serving more than 750,000 merchant locations in the US, Canada and Europe.

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Federal Regulators Issue Security Guidelines

The federal bank and thrift regulatory agencies yesterday jointly issued new guidelines on the handling of security breaches. The guidance interprets the agencies’ customer information security standards and states that financial institutions should implement a response program to address security breaches involving customer information. The response program should include procedures to notify customers about incidents of unauthorized access to customer information that could result in substantial harm or inconvenience to the customer. Under the new rules alerts can be sent by mail, telephone, or e-mail. The guidance defines personal information as name, address, telephone number, SSN, driver’s license number, PIN, passwords, or payment card information. Under the guidance, a financial institution should notify its primary federal regulator of a security breach involving sensitive customer information, whether or not the institution notifies its customers.

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