More Americans Regifting via eBay

A new survey has found that 64% of consumers admit to secretly giving unwanted gifts to others. The survey commissioned by eBay also found that 20% of survey respondents indicated they have sold unwanted gifts over the Internet. eBay says the online reselling trend represents a new twist on regifting that allows people to turn tepid gifts into cold cash — enabling them to get what they really wanted for the holidays or to pay down holiday credit card bills.

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JCB Takes a One-Third Interest in EMVCo

Japan’s JCB has joined EMVCo, the EMV chip card standards body jointly owned by MasterCard and VISA, as a 33% owner-member. JCB has been deploying an EMV-compliant infrastructure since 2001, with half of its 51 million branded cards predicted to be EMV compliant by April 2005. All three members now have equal interests in the organization and EMVCo’s management structure has been altered to reflect this. JCB will appoint representatives to the EMVCo Board of Managers and the Executive Committee as well as its working groups. JCB cards are now issued in 18 countries and territories, with 51.6 million card members.

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JCB Becomes Owner-Member of EMVCo

JCB has joined EMVCo, the EMV chip card standards body jointly
owned by MasterCard and VISA, as a 33% owner-member. JCB has been deploying an EMV-compliant infrastructure since 2001, with half of its 51 million branded cards predicted to be EMV compliant by April 2005.
All three members now have equal interests in the organization and EMVCo’s management structure has been altered to reflect this. JCB will appoint representatives to the EMVCo Board of Managers and the Executive Committee as well as its working groups. JCB cards are now issued in 18 countries and territories, with 51.6 million card members.

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Zion’s Ranked #1 for its Online Services

UT-based Zions Bank has been ranked #1 for its online bill payment system, according to an Internet study by Javelin Strategy & Research. While most banks offer Internet services, Zions Bank’s diverse online bill payment and presentment features set the bank apart from competitors, according to Scott Anderson, Zions Bank president and CEO. Zions Bank’s Online Bill Pay customers can take advantage of e-mail notifications regarding their account activity, schedule regular repeating payments and reminders, view payment activity, receive e-bills, and manage their list of payees with the ease and click of a mouse. In addition, customers can view electronic check images, see recent credit card activity, transfer funds, and open an online safe deposit box.

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Discover’s Card Profits Rise 33% in Q4

Morgan Stanley reported this morning that its Credit Services division, including the “Discover Card,” posted $279 million in pre-tax profits for the quarter ending August 31st, compared to $209 million for the year-ago quarter. Managed outstandings were flat for the fourth quarter, transaction volume increased nearly 12%, and delinquency and charge-offs fell sharply compared to one-year ago. Merchant and cardholder fees declined 5% to $485 million, due to lower over-limit and late payment fees. Managed credit card loans of $48.3 billion at quarter end were down slightly from one-year ago. Total transaction volume increased 11.7% to $25.7 billion, the second highest quarterly volume ever. The account base expanded during the fourth quarter by 200,000 accounts. Active accounts declined 5% from 4Q/03 to 19.7 million. The credit card net charge-off rate was 5.45%, 142 basis points lower than a year ago, and down 31 basis points from the prior quarter. The charge-off ratio was the lowest in three years. The over-30-day delinquency rate also declined 142 basis points from 4Q/03 to 4.55%, and the over-90-day-delinquency rate declined 64 basis points over the same period to 2.19%. For complete details on Discover’s fourth quarter performance visit CardData ([www.carddata.com][1]).

DISCOVER CARD PORTFOLIO SNAPSHOT
4Q/03* 1Q/04* 2Q/04* 3Q/04* 4Q/04* Y/Y CHNG
Outstandings: $48.4b $47.3b $46.8b $47.1b $48.3b -0.2%
Volume: $23.0b $24.2b $24.4b $25.4b $25.7b +11.7%
Accounts: 46.1m 45.9m 46.0m 46.0m 46.2m -0.2%
Actives: 20.8m 20.3m 19.9m 19.6m 19.7m -5.2%
Chargeoffs: 6.87% 6.31% 6.48% 5.76% 5.45% -142bps
**Delinquency: 5.97% 5.80% 4.88% 4.81% 4.55% -142bps
Yield: 12.05% 12.20% 11.88% 11.69% 11.59% -46bps
* 4Q/03 ended 11/30/03; 1Q/04 ended 2/29/04; 2Q/04 ended 5/31/04; 3Q/04 ended
8/31/04; 4Q/04 ended 11/30/04. ** delinquency is 30 day only; excludes 90 day
rate. Source: CardData (www.carddata.com)

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

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E-Spending Rises 28% This Year to $16.7B

Online shoppers in the U.S. spent $16.7 billion during the first six weeks of the this year’s holiday season, rising 28% from the $13 billion spent online during the same timeframe in 2003. According to the “2004 eSpending Report,” music was the fastest growing category year-over-year in revenue during the first six weeks of the 2004 holiday season, jumping 33%. The video/DVD and jewelry categories tied for second place, surging 32% each. Rounding out the top five fastest growing categories, the books category increased 27%, while the toys/video games category grew 22%. The “eSpending Report” by Goldman Sachs, Harris Interactive and Nielsen//NetRatings is based on a weekly national survey of more than 1,000 adult consumers.

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Trilegiant Launches Hotel and T&E Cards

VA-based Trilegiant Loyalty Solutions and Destination Rewards have teamed to offer hotel reward cards and a travel & entertainment card. The “Destination Rewards” hotel reward card provides instant savings at thousands of participating locations nationwide. Via the Web, customers will be directly connected in real-time to thousands of hotel partners offering instant savings from 15-40% off of the lowest unrestricted hotel rates available. “Rewards cash” is applied towards these published prices offered directly from hotels, resorts or other participating suppliers. The new travel & entertainment card rewards customers with savings on a variety of products, from cruise packages and vacation condominium rentals to DVD movies, Samsonite luggage and computer software.

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AVS Impedes Gift Card Usage

ClearCommerce issued a merchant advisory encouraging retailers to closely review “Address Verification System” rules used to process online orders. Use of general purpose gift credit cards has caused many valid online transactions to be rejected because of commonly enforced AVS anti-fraud rules. Because gift credit cards are not issued to a specific consumer, these cards typically do not have a billing address tied to the card. In these cases most of the financial institutions issuing branded gift cards return special codes indicating that the address could not be validated; however, some online merchants have programmed their systems to simply reject transactions that do not obtain a full match AVS response. ClearCommerce says that with an expected spike in post-holiday online purchases using gift cards, all merchants should carefully review AVS rules and policy.

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Equifax and Fair Isaac Launch Score Watch

Equifax and Fair Isaac have partnered to launch a new service to enable consumers to track their “FICO” credit score. “Score Watch” continuously monitors subscribers’ Equifax credit file for changes that can affect their FICO scores. Once a change is detected, “Score Watch” alerts subscribers via email or wireless text message, advising them to visit a secured Web site for a detailed explanation of the change in credit status. If the subscriber’s credit score changes by a significant amount due to changes in their credit file, the “Score Watch” alert will also include their up-to-date score. “Score Watch” subscribers also can preset a target score and be notified when they reach it, a valuable service for consumers who are aiming to qualify for a mortgage, home equity, or auto loan at a lower interest rate. “Score Watch” is available for $7.95 per month or $79.95 for 12 months.

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Chevy Chase Renews its STAR Contract

Chevy Chase Bank, with 850 ATM locations and 650,000 debit cards, has renewed its relationship with First Data’s “STAR Network” for PIN debit services. First Data Corp., with global headquarters in Denver, helps power the global economy. As a leader in electronic commerce and payment services, First Data serves approximately 3.5 million merchant locations, 1,400 card issuers and millions of consumers, making it easy, fast and secure for people and businesses around the world to buy goods and services using virtually any form of payment. Chevy Chase Bank is the largest locally owned financial institution in the greater Washington, DC market with $13 billion in assets and over $9 billion in deposits.

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CO-OP Network Deploys Falcon Fraud Manager

The CO-OP Network has deployed the enhanced “Falcon Fraud Manager” for PIN-based transactions. Falcon Fraud Manager prevents losses by calculating and assigning scores to incoming transactions using data-modeling and individual member history profiles. The result of the system is a neural network that quickly identifies potentially fraudulent activity while generating fewer false positives on cardholder transactions. CO-OP Network (www.co-opnetwork.org), established in 1981 and located in Ontario, Calif., 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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