Paychek Plus! Payroll Debit Card Lands Another Client

OH-based Kellermeyer Building Services has become the sixth building services contractor to offer American EPAY’s “Paychek Plus!” debit payroll card, taking delivery of 10,000 cards. The debit card enables KBS to credit an employee’s pay electronically to the card, which employees can use to access their money at ATMs. They can also receive their pay at any U.S. Post office during each pay period through the Paychek Plus! ™ program. Cards can also be used at over 25,000 surcharge-free ATMs across the country, saving money at all major grocery stores. Money can be added from second jobs or government benefits and card-to-card transfers are available to send funds to family members in other countries. Employers also benefit from this service because the system is similar to direct deposit accounts for payrolls, eliminating the need for ESCHEAT compliance. American EPAY™ has been working on “punch-to-pay” solutions and serves clients in janitorial and building services, security and protective services, hotel management, and retail industries. Kellermeyer Building Services is the largest janitorial service in the U.S. specializing in retail.

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LML Puts Heat on Lawsuit Defendants via PRNews

Vancouver-based LML Patent/LML Payment Systems says it is ready to litigate its patent infringement complaint after the court granted two extensions to some of the defendants. In July, LML filed lawsuits in the U.S. District Court for Delaware against Telecheck Services, Electronic Clearing House, Xpresschex, and Nova Information Systems. According to LML, three defendants, ECHO, Xpresschex and Nova all recently switched lead counsel, resulting in the delays. LML says the defendants have 15 more days to file a response. LML claims that the four companies infringed on its three e-check patents. LML is represented by Kirkland & Ellis. (CF Library 7/15/04)

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Symbio Technologies and Next Wave do a VAR Deal

NY-based Symbio Technologies, a developer of server software that manages diskless thin client networks running Windows and Linux applications, has signed a VAR agreement with several companies including Compuclaim Inc., Next Wave. Inc., Omniis Ltd., Quad-C, and Tangent Systems. Symbio Technologies uses an international network of authorized VARs to market to business, education, and government users. Symbio Technologies has 14 VARs in the U.S., Canada, Europe, Africa, and Asia.

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BabyMint Now Enables Student Loan Payments

Atlanta-based BabyMint has expanded its college savings program to enable members to direct their shopping rebates towards the outstanding balance of their student loans. Consumers can receive a rebate up to 30% on purchases made through BabyMint’s network of over 500 retailers. The rebates are tracked and deposited into any 529 college savings plan or Coverdell educational account that the consumer chooses. Such rebates have the potential to represent an incremental $1.1 billion per year in assets for individual investors. The new program enables members to pay off their debts quicker. BabyMint is the flagship brand of Vesdia Corporation, the nation’s leading microinvesting technology company. BabyMint’s “savings engine” helps consumers save money toward their child’s college education.

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AmEx/Costco Launch a New T&E Card – Traveling & Eating

American Express and Costco have rolled-out a new set of co-branded credit cards that offer bonus rewards for eating out and traveling. The new “TrueEarnings Card” and the “TrueEarnings Business Card” features a unique rewards structure, earning 3% cashback for eating out; 2% cashback for traveling; and, 1% cashback on all other purchases. Cardholders receive an annual rebate as a coupon that can be redeemed for cash or used for purchases at Costco warehouses. Both cards carry no annual fee and offer a 0% intro rate for the first 90 days on purchases. The on-going APR is prime +8.99%. The American Express-Costco relationship began in 1999 with the launch of the “American Express Costco Cash Rebate Credit Card” and the “American Express Costco Business Charge Card.” Costco currently operates 321 warehouses in the USA. (CF Library 11/18/99)

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MasterCard Advisors Finds a New President

MasterCard has hired Keith Stock as its new president to replace the retiring Henry Mundt. Stock previously worked for Capgemini, f/k/a Cap Gemini Ernst & Young, as managing director of the banking group. He also served as head of the Financial Institutions group at A.T. Kearney and spent nearly ten years at McKinsey & Company serving international financial institutions. He also founded First Financial Investors and served as Chairman and CEO of Treasury Bank. MasterCard Advisors provides access to experts across payments strategy, information solutions, cardholder services, customer relationship management, information technology, marketing, operations, research, rewards programs and risk management.

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Sub-Prime Portfolios Shrink 25% Since Mid-Year 2002

Regulatory tightening, economic weakness, and vigorous litigation have taken a toll over the past two years on the pure sub-prime market. Excluding major players with sub-prime segments, the nation’s top five sub-prime specialists have experienced, on average, a 25% decline in outstanding balances, and an 18% erosion in their account bases over the past two years. Bucking the trend is SD-based First Premier Bank, which peaked in the fourth quarter of 2002, but managed to post a 10.5% gain in outstandings, and a 22% increase in accounts since 2Q/02. While First Premier’s growth has been organic, UT-based Merrick Bank posted a whopping 65%+ gain in its portfolio, thanks largely to its acquisition of Providian and NextCard accounts in 2002. Among the losers is DE-based Cross Country Bank, which has seen its portfolio cut in half over the past two years. CCCB has been embroiled in litigation over its business practices. Major players with significant sub-prime segments include Capital One, Providian, Household, and Metris/Direct Merchants. For 2Q/04 details on U.S. card issuers visit CardData ([www.carddata.com][1]).

PURE SUB-PRIME PLAYERS
(2Q/04)
Rank/Issuer RECV 2YR CHNG ACCTS 2YR CHNG
1. CompuCredit $1.96B -13.3% 2.2MM -4.3%
2. Cross Country $1.21B -48.8% 1.8MM -51.4%
3. First Premier $673MM +10.5% 3.3MM +22.2%
4. Bankfirst $522MM -46.7% 853K -46.7%
5. Merrick Bank $513MM +68.7% 567K +66.3%
TOTAL $4.88B -24.8% 8.72MM -17.7%
Source: CardData (www.carddata.com)

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

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Bills.com Doubles its Subscriber Base

San Antonio-based Payment Data Systems says its Bills.com subsidiary has more than doubled its subscriber base over the past year with revenues growing at double-digit rates. Bill.com is currently providing a new version of its consumer online bill presentment and payment service. The service enables consumers to pay anyone possessing an email address transfer money between multiple accounts, view and pay eBills, and receive eBill summaries in their email. Consumers can now track, manage, and archive their bills, payments, and accounts. Bills.com, a wholly owned subsidiary of Payment Data Systems, Inc., provides a convenient source of online bill payment. Payment Data Systems delivers cost-effective solutions to billers and retailers who process and manage electronic payments using the Internet, point-of-sale, customer service representatives, or an Interactive Voice Response.

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[1]: http://www.cardweb.com/images/b/bills/billshomepage.jpg

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Penthouse Flips iBill for a $22MM Paper Profit

Adult entertainment specialist, Penthouse International, has closed a deal to sell its iBill payment processing subsidiary less than six months after acquiring the business from Atlanta-based InterCept. Penthouse’s Media Billing subsidiary acquired iBill in March in a transaction valued at approximately $33 million. Yesterday, Penthouse sold iBill to FL-based Care Concepts I, Inc. for $55 million in stock. As a result of the transaction, Penthouse will initially own 19.9% of the outstanding common stock of Care Concepts. iBill was established in 1996 and serviced primarily the adult entertainment market. According to Penthouse, more than 27 million online consumers have used iBill to make purchases online. In 2003, iBill averaged 1.2 million transactions per month and completed approximately $330 million in online purchases, producing fee income of approximately $45.1 million. Care Concepts says it will use iBill to grow its iBidUSA.com auction business. (CF Library 3/17/04; 3/23/04; 5/25/04; 8/2/04)

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VISA ATHENS 2004

The average transaction value of VISA card purchases at “Olympic” venues during the 17 day event period was up 44% to US$103.50, compared to the “Sydney 2000 Olympic Games.” ALPHA Bank says that the number of VISA transactions it handled in August were up 55% compared to one-year ago. More than 50,000 withdrawals were made from the 17 ATM machines especially installed by VISA and ALPHA Bank, a 41% jump over Sydney 2000 volume. The increased activity was driven by VISA “Olympic” marketing programs by VISA members in 56 countries. In Europe, there were 17 national promotions, and a further 70 members participating in “Olympic” activity. This resulted in over 43 million pieces of “Olympic” marketing material being distributed to cardholders. During the “Games” more than 58,000 merchants in the Attica area, together with the five other “Olympic” venue cities embraced the “Games” by displaying 300,000 pieces of VISA point of sale material. About 5,000 “VISA Money Olympic Games Prepaid” chip cards were issued to the “Olympic” family by VISA and a further 5,000 prepaid cards were issued by ALPHA Bank directly to consumers.

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Catalina Marketing Gets Credit and Building

St. Petersburg, FL-based Catalina Marketing has landed a revolving credit facility up to $175 million and has purchased its corporate headquarters facility. The revolving credit facility can be used to refinance debt, and share repurchases and capital expenditures. J.P. Morgan Securities, Inc. is the leading arranger for the facility, with Bank One, NA and Bank of America N.A. as administrative and syndication agents. The company’s $30 million U.S. revolving credit facility, which was set to expire on August 31, 2004 was replaced by the refinancing. The new facility is also replacing Catalina Marketing Japan K.K.’s 3.5 billion yen Japanese credit facility. Catalina Marketing combines insight into consumer behavior and consumer access, enabling marketers to execute behavior-based marketing programs.

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