VISA Europe Supports the EU Action Plan 2004

VISA Europe is openly supporting the European Commission’s “EU Action Plan 2004 – 2007” which is aimed at preventing fraud on non-cash means of payment. The “Action Plan” builds on the European Commission’s initial plan launched in February 2001. Since then VISA has taken a lead role in migrating Europe to smart cards, providing a EUR162 million investment towards bringing about its pan-European implementation. The European Commission has been a strong supporter of EMV chip migration.

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Lafayette Services and Certegy Team

Lafayette Services, a leading European provider for card, credit, and loyalty programs for retail and end consumers has signed a MOU with Certegy. The MOU contains the basic terms upon which Certegy intends to provide a wide range of card and loan processing services to LaSer subsidiaries throughout Europe. Under the terms of the MOU, Certegy intends to provide private label, bankcard, chip card, and consumer loan processing and support services to LaSer subsidiaries located in five countries throughout Europe, including: Creation Financial Services and Sygma Bank (United Kingdom); PrimeLine Services B.V. (Netherlands); Credifin (Portugal); Banco Sygma Hispana (Spain); and Fidexis (Belgium).

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Hatton National Bank and ICICI Launch Money2Lanka

Hatton National Bank of Sri Lanka and ICICI Bank Canada have launched a cross-border product that will allow non-resident Sri Lankans residing in Canada to transfer funds to Sri Lanka generally within one working day. The new “Money2Lanka” service is targeted at 200,000
Sri Lankans living in Canada. ICICI Bank Limited is India’s second largest bank with an asset base of $28 billion.

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KeyCorp to Acquire AmEx Business Finance Corp

KeyCorp’s Key Equipment Finance has inked a deal to acquire the equipment leasing unit of American Express’ small business division, American Express Business Finance. American Express Business Finance (AEBF) is a leading commercial finance company, providing capital for small and middle market businesses. It has a portfolio of roughly $1.5 billion (as of September 30, 2004) and lease solutions ranging from $25,000-$75,000 for capital purchases. Key Equipment Finance (KEF) is currently the nation’s third-largest bank-based equipment financing company, with a portfolio of about $10 billion. The acquisition will make KEF a leader in the “small ticket” lease segment, increasing KEF’s office network for small-ticket lease solutions to the widest geographic reach of any provider in that segment. Pending approval, the transaction is expected to be complete in the fourth quarter. Key Equipment Business, an affiliate of KeyCorp, provides business-to-business equipment financing solutions to many types of businesses. American Express Business Finance, a division of American Express, provides fast and reliable financing for business equipment via enrolled vendor partners.

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Europe – Most Lucrative Card Market

The International Card Manufacturers Association’s “Sixth Annual Card Manufacturing Global Market Survey” found that Europe continues to be the most lucrative market as measured in dollars. Major findings revealed that globally, in 2003, approximately 11.7 billion cards were manufactured, a 9.3% growth rate. The global card marketing measure in U.S. dollars increased 27.1% to $6.1 billion. The survey found that traditional cards represent 83.8% of the units and 21.3% of the
dollars while chip cards represent 16.2% of the units and 78.7% of the
dollars on a global basis; non-secure cards represent 42.9% of the global card unit market; and that financial hologram cards represent 11.9% of the global card unit market.

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Rewards Network Sales & Profits Slip in Q3

Chicago-based Rewards Network reported that total operating revenue for 3Q/04 was $23.1 million, a decrease of 7.2% compared the same period last year. Sales declined 3% to $86.8 million. Net income for the quarter was $3.0 million compared to $4.4 million for 3Q/03. The Company closed the quarter with 3.7 million active members, up 12.7%. Nearly 22,000 merchants now participate in the Company’s programs including 10,611 restaurants and 11,111 hotels. Rewards Network provides loyalty and rewards programs for restaurants and hotels via its registered credit card platform. The Company recently expanded into Canada. For complete details on Rewards Network third quarter performance, visit CardData ([www.carddata.com][1]).

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

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NURIT Terminals EMV 2000 Approved

EMVCo has awarded Lipman Electronic Engineering “EMV 2000” approvals for its “NURIT” POS terminals and PIN pads. These new approvals follow the previous approvals based on the earlier
EMV ’96 specification, previously received by Lipman. In December 2000, EMVCo published the EMV 2000 (Version 4.0) specification, which builds upon the standards set forth in EMV ’96 with improved performance and other enhancements. Lipman develops, manufactures, and markets a variety of handheld, wireless and landline POS terminals, electronic cash registers, retail ATM units, PIN pads and smart card readers, as well as integrated pin and smart card solutions.

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Established Private-Label Portfolios Divest Slowly

Recent private label portfolio deals point to a new trend which shows that companies with very long histories and a deep culture in the card business are finally divesting. However, the deals take much longer than the typical 30 to 90 days to complete as they involve a more complicated decision process, often taking many months just to arrive at the decision to sell. Thousand Oaks, CA-based R.K. Hammer recently completed the sale between AL-based Marvin’s Building Materials and Home Centers and NJ-based Shoppers Charge Accounts. Hammer also facilitated the sale of Sunoco private label consumer and commercial card accounts to Citigroup. Hammer says both deals involved companies that have been in business for well over 50 years and the sale process took considerably longer than the typical closing period. Hammer has closed 117 card deals to-date, generating over $367 million in pre-tax profits for clients. Over 827,000 card accounts have now been sold through the Hammer firm in the first three quarters of 2004. (CF Library 6/4/04; 10/15/04)

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VISA Commercials Card GDV Hits $200 Billion

VISA International reported that dollar value of all purchases and cash withdrawals made with “VISA Commercial” payment solutions hit $200 billion for the four quarters ending June 30th. The figure was up 26% over the same period last year. VISA says it took 10 years for VISA to reach the $100 billion milestone and just three years to achieve $200 billion in annual commercial volume. VISA’s nine commercial products posted volume of $177.5 billion in 2003, an increase of 19% over the year-ago period. In the U.S., VISA reported that commercial cards produced a second quarter sales volume of $28.2 billion, a 23.9% increase year-on-year. As of June 30th, VISA had 22 million commercial cards in the USA.

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Palm Recognition VISA Launched in Japan

The Bank of Tokyo-Mitsubishi has launched a new credit card with biometric security and wireless technology, according to CardFlash International. The “Super IC Card Tokyo-Mitsubishi VISA” uses hand recognition technology that allows special ATM machines to compare blood vein patterns in the hand with the user’s unique pattern. The new VISA card also contains Sony’s “EDY” wireless technology, which allows for non-contact, wireless transactions to be made at special terminals in subways, vending machines, and many retail stores. The “Super IC Card Tokyo-Mitsubishi VISA” is the first Japanese card that offers a revolving credit feature issued by a Japanese bank under its own name. BTM says it expects to issue one million cards each year with a goal of 200-300 billion yen within the first three years. The Brand Architect Group handled the card’s design.

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French Egg Credit Card Deal Goes Forward

The French Works Council has given its blessing on the sale of Egg’s
credit card business in France. Banque Accord agreed to pay Egg
140 million euros for 66,000 customers and net assets of approximately
205 million euros. Egg also has a pending offer from ING Direct France
for its savings and online brokerage business in France, which includes
approximately 45,000 accounts. In July, Prudential, majority owner of
Egg, announced it was exiting France after racking up nearly GBP100
million on losses. The partial disposal with Banque Accord will result
in the re-deployment of approximately 100 of Egg France’s 450 workforce.
Banque Accord has 3.5 million clients in Europe including more than 2.0
million in France, and employs more than 700 people in France, Warsaw,
and Lisbon. Banque Accord has a call center in Tours. For the second
quarter, Egg produced an operating profit for its British “Egg VISA”
card of GBP19.4 million versus an operating loss of GBP16.5 million for
its French “la Carte Egg VISA.”

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