ATM Fraud – Key Driver for Smart Cards

A new white paper suggests that growing ATM fraud could accelerate the U.S. conversion to the smart card. UK-based Level Four says the actual cost of ATM fraud, including administrative costs, in the U.S. is approaching $200 million a year and is rapidly increasing. Level Four argues that fraud migration will quickly become apparent as North America’s more immediate neighbors, such as Latin America and Canada, migrate to the EMV standard. EMV becomes standard from January 2005 in Western Europe and some countries in Asia Pacific, and from January 2006 for the rest of Europe, the Middle East, Latin America and Canada.

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Women Prefer Universal Gift Cards

A new survey has found that eight in 10 women prefer to receive a gift card, during the holiday season, that enables them to pick out their own gift at a store of their choosing. The VISA USA commissioned survey found that 40% of women say have been disappointed by a gift they received from a husband, father or brother. A recent ValueLink survey found that 139 million Americans have purchased and/or received a gift card in the past 12 months, nearly double the 2001 figure. Also, the average number of gift cards purchased by a consumer has increased from 4.1 cards per year to 6.9 cards per year since 2001. (CF Library 10/7/04)

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Consumers Warm Up to Cashless Vending

Payment cards and vending machines are coming together, undoubtedly lifting sales. A survey of recent deployments shows that in six months cashless vending transactions rose to nearly a third of total sales. PA-based USA Technologies, developers of the “e-Port” cashless transaction device, said that one survey of six vending machines at one location showed that when cashless was introduced in March, cashless sales were 12%. Over the next six months cashless sales had risen to 32.3% of sales. In total, the six machines generated $17,995 in credit card use between March and October, representing nearly $3,000 credit card use, per machine. Another survey conducted between June and October on 100 glass-front-beverage vending machines showed cashless sales averaged $474 per machine per month, or $5,692 per year. The third USA Technologies survey shows that for a hotel property, that was experiencing high vandalism, “e-Port” was installed to eliminate cash entirely. The average ticket item for cashless transactions in a vending machine is up from $1.32 to $3.39, with 75% of all cashless transactions being multi vends.

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Global Axcess Revenues Rise 24% in Q3

FL-based Global Axcess reported that third quarter revenues increased by 24% and 3/04 operating income rose 43%. The firm has more than 3,500 ATMs nationwide. GLXS says it currently has 59 partners in the “Branded Cash” program, with approximately 711 branded ATMs sites, up from 473 last quarter. GLXS expects to hit 800 by year end. For complete details on Global Axcess’ third quarter performance visit CardData (www.carddata.com).

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Australian Purchase GDV Up 18.5% in Aug

Gross dollar volume for purchases on credit card and charge cards during August jumped 5% from the prior month, and 18.5% from one-year ago. However, total outstandings for August were flat compared to July, and up 12% since August 2003. Revolving balances, or balances accruing interest, increased slightly to A$19.5 billion during August, and up 11% from one-year ago, according to data released by the Reserve Bank of Australia. During August, Australians charged A$12.8 billion in purchases on credit/charge cards compared to A$10.8 billion one-year ago. At the end of August, consumers owed A$27.8 billion on credit cards versus A$24.8 billion for August 2003. Card credit limits reached A$74.8 billion at the end of August, compared to A$66.3 billion for August 2003. There are 11.2 million credit card and charge card accounts in Australia, compared to 10.6 million one-year ago.

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MasterCard Third Quarter Revenues Up 12%

MasterCard reported third quarter net income of $97.5 million compared to $74.4 million one year ago. Revenues for the third quarter were up 12% to $668 million compared to one-year ago. For the year, revenues were up 15%, from $1.7 billion to $1.9 billion. Advertising and market development expenses for the quarter rose 4% to $190 million, compared to one-year ago. Operations fees increased 12% to $419 million in the third quarter, compared to one-year ago. For complete details on MasterCard’s third quarter results visit CardData ([www.carddata.com][1]).

MASTERCARD 10-Q HISTORICAL
NET INCOME
3Q/02: $78 million
4Q/02: -$51 million
1Q/03: -$425 million
2Q/03: $32 million
3Q/03: $74 million
4Q/03: $67 million
1Q/04: $74 million
2Q/04: $66 million
3Q/04: $98 million
Source: CardData (www.carddata.com)

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

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Abanco Completes MCCP Certification

IL-based Abanco International has successfully completed the Ambiron Multi-Card Compliance security certification. Abanco’s information security posture meets or exceeds information security industry best practices including the data security requirements of credit card association data security programs such as American Express DSOP, Discover® DISC, MasterCard SDP, Visa AIS, and Visa CISP. Abanco’s security posture will be evaluated by Ambiron Vital Signs™, a provider of data and compliance services to businesses in the financial services vertical. Abanco International, LLC, is a chief provider of payment processing solutions that develops and markets services to various industries including automotive, healthcare, hospitality, insurance, retail, and transportation industries.

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USPS Selects eFunds’ EFT Software

The United States Postal Service has selected eFunds’ open systems electronic payments software for use at more than 33,000 locations and 70,000 POS devices nationwide. The eFunds solutions will support postal customers’ ongoing purchases of USPS products and services with a credit or debit card which can be used at a post office branch location, POS device, self-serve kiosk, or through the Internet. The USPS delivers 202 billion pieces of mail a year and has annual operating revenues of $68.5 billion. eFunds Corporation is a chief provider of risk management, electronic payments, and global outsourcing solutions.

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Jiffy Lube Greases the Shell MasterCard

Jiffy Lube, Shell Oil, and Citibank have teamed to offer “Shell MasterCard” users a 5% rebate on the first $100 of their daily Jiffy Lube purchases. Jiffy Lube and Shell are working on a campaign to advertise their new offer. Citi Cards issues the Shell MasterCards and is also promoting the rebates through mail coupons and other notices. Along with the rebate program, Jiffy Lube is now accepting Shell gas and fleet credit cards. Shell has 4.654 million cardholders. Jiffy Lube serves roughly 30 million customers at its 2, 200 service centers in North America. and is a wholly owned, indirect subsidiary of Shell Oil Company.

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Voyager 3.2 Platform Goes Enterprise-Wide

Corillian has introduced “Voyager 3.2” which incorporates enterprise-wide applications and services for delivery channels including online, branch, call center, IVR, and ATM. These services enable financial institutions to enjoy unprecedented efficiency by offering services to their customers across channels and multiple lines of business. The Voyager 3.2 platform provides various benefits including best-in-class online banking solutions for all major lines of business, an innovative new Enterprise Access Management system, service-oriented architecture supporting multi-channel interoperability, and unmatched scalability, performance, and reliability. Corillian is the leading provider of online banking solutions for financial institutions.

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Petco Promises Better Online Security

Petco Animal Supplies has reached a settlement with the FTC over security flaws in its Web site that allowed hackers to access consumer records, including credit card numbers. The Web site was vulnerable to Web-based application attacks. Under the settlement, Petco is prohibited from misrepresenting its protection of consumer information. Petco must establish and maintain a comprehensive information security program and arrange biennial audits of the program by an independent third party. Furthermore, the settlement includes record- keeping provisions that allow the FTC to monitor Petco’s compliance.

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