Retriever Payment Systems is Recapitalized

Houston-based Retriever Payment Systems has been recapitalized by GTCR Golder Rauner. The transaction was valued at $250 million. Windward Capital and other investors sold their interests in the company as a result of the transaction. During the twelve months ended June 30th, Retriever processed approximately $8.1 billion in transaction volume and ended the period with over 95,000 merchant accounts. Merrill Lynch Capital and American Capital Strategies provided debt financing for the transaction.

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Encore Capital Group Closes its Biggest Deal

San Diego-based Encore Capital Group has closed on the largest portfolio purchase in the Company’s history. Encore paid $13.0 million for a portfolio with a face value of $421 million, at an average purchase price of 3.1%. The portfolio contains 213,000 accounts. During the last four years, Encore has purchased approximately 200 portfolios that range up to $9.5 million in purchase price. The new accounts were financed utilizing Encore’s new revolving credit facility with J.P. Morgan Chase, which closed last week. The remaining 16% of the portfolio consists of credit card accounts financed under the Company’s Secured Financing Facility.

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Axalto Accounts for 26% of Microprocessor Card Shipments

According to Gartner’s “Market Share: Chip Card and Semiconductor Vendors Worldwide 2003” report, Axalto shipped 262 million microprocessor cards last year, accounting for more than 26% of the world’s total 2003 shipments of such high-end cards. “Microprocessor-based cards” are referred to as “smart cards” in the Gartner report. Gartner found that GSM SIM card shipments exceeded the most-optimistic industry expectations, and demand from emerging markets is the main reason for the growth in this sector. The research firm says that despite a slow start, EMV migration is also likely to have dramatic impact on the growth of banking microprocessor card market for the next three years.

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Pipeline Expands its Northern NY Call Center

Pipeline Data announced plans to expand its Northern Merchant Services call center in St. Lawrence County, NY. It has authorized its subsidiary, Northern Merchant Services, which currently employs 24 people in Brasher Falls, NY, to build or purchase a facility that will have an initial capacity of 40 people. The company expects full implementation by 2005, and pending its success, will undertake further expansion into the region. Pipeline Data Inc. provides integrated transaction processing services for all major credit cards.

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The New Online Currency to be Released

Dallas-based eTelcharge.com announced plans to offer an upgraded version of “eTelcharge” to be called “The New Online Currency. New merchants who open a merchant service account with eTelcharge.com will automatically receive our latest version of Telcharge when the new service is launched soon. While existing customers will be able to download the enhanced new online currency option from www.etelcharge.com. eTelcharge offers multiple payment options on the Internet to date. The Company offers the traditional credit card merchant services along with the exclusive new online currency – eTelcharge.

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PAYMENT GAP

This year will be a watershed for Brits as spending on plastic cards will squeak by cash as the the most popular method of payment. Payment volume on credit and debit cards is expected to hit
£269 billion, compared to £268 billion for cash payments, with the gap widening to £179 billion by 2013. According to the APACS’ “The Way We Pay” study, the displacement of cash comes after a year in which the number of plastic cards in use grew by 13 million to 160.6 million, accounting for £243.9 billion of spending. Debit cards accounted for two-thirds of plastic card transactions and more than half of expenditure on plastic in 2003. APACS says plastic card use will be helped by the increasing use of “Chip and PIN,” which will see signatures replaced by PIN authorization of plastic card transactions. The country has invested £1.1 billion in “Chip and PIN” and as a result plastic card fraud has fallen for the first time in eight years.

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Opt Out Regulations Up for Public Comment

Five federal financial institutions supervisory agencies last week issued proposed regulations that would give consumers the chance to “opt out” before a financial institution uses information provided by an affiliated company to market its products and services to the consumer. The proposal generally would prohibit an institution from using certain information about a consumer it receives from an affiliate to make a solicitation to the consumer unless the consumer has been given notice and an opportunity to opt out of the solicitation. An institution that has a pre-existing business relationship with the consumer would not be subject to this marketing limitation. The proposal is being issued by the Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation, National Credit Union Administration, Office of the Comptroller of the Currency, and Office of Thrift Supervision.

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Gemplus’GemAuthenticate Combines with iBIZ’CommerSafe

Gemplus and iBIZ Software announced the launch of their innovative authentication solution for 3-D Secure technology. With the joint solution, based on iBIZ’ “CommerSafe ACS” and Gemplus’
“GemAuthenticate,” instead of using passwords, cardholders are now authenticated in the same way as they do payments at the POS: simply by entering their smart banking card into a reader and their personal PIN code. The companies said that up to 80% of helpdesk calls today are due to password management issues, as these are easily forgotten or stolen. This unique offer can be deployed to all bank’s customers as it is fully compliant with all EMV smart banking cards and payment schemes such as VISA, MasterCard, American Express and JCB.

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Heartland’s Chief Executive Named Top Entrepreneur

NJ-based Heartland Payment Systems’ chairman, CEO and founder, was named “Ernst & Young New Jersey Entrepreneur Of The Year” in the category of Financial Services Carr was selected by an independent panel of judges comprised of local community and business leaders from among 31 finalists nominated in eight different industry categories representing 27 companies in 25 towns across New Jersey, such as retail and biotech firms. The Entrepreneur Of The Year awards program was created and is produced by professional services firm Ernst & Young LLP.

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Infineon to Offer Ten Year Chip Card Controllers

Munich-based Infineon Technologies plans to offer new chip card controllers for improved security of electronic identity cards and passports. Infineon’s “SLE66CLX640P” security controller is designed for tomorrow’s chip card-format electronic ID cards, while the controller
is intended for integration into electronic passports. Until now, chip
cards have been designed for a maximum useful lifetime of five years,
whereas electronic ID cards and passports are generally valid for ten
years. Infineon’s chips are the only products in the world capable of
supporting both of the contactless interface formats that dominate the
marketplace, ISO/IEC 14443 Type A and Type B, which differ in the data
transmission protocols they employ.

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