BofA Expands Corporate Purchasing Card

Bank of America Global Treasury Services has upgraded its corporate purchasing card to connect an enterprise’s pre-approval workflows straight through to the card network. Bank of America can now connect an enterprise’s pre-approval workflows straight through to the card network, enabling purchasing cards to become the payment vehicle of choice in business- to-business transactions. While previous credit card programs mandated intense interaction between banks and corporate program administrators, the Payment Manager technology simplifies that process and offers clients faster and more accurate service. The Global Treasury Services division of Bank of America provides integrated working capital management and treasury solutions to clients that include multi-nationals, correspondent banks, governments and global 1000 businesses.

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Two New Optimum Terminals Hit the Market

Hypercom has rolled-out its third and fourth terminal in the “Optimum” series this year. The countertop “Optimum T4100” and the handheld, wireless “Optimum M2100” are designed for speed and performance.

The “Optimum T4100” offers credit/debit card authorization and value-added services such as gift cards, cash and promotion/loyalty cards, prepaid, age and/or ID verification, and payroll or government check cashing.

The terminal is PED and EMV certified, and is powered by Intel “XScale” technology. It also features magnetic stripe and smart card readers, a high contrast LED backlit display, one-touch shortcut keys, a 35 key-full keyboard or optional 19 key keyboard, Ethernet connectivity to the Internet with built-in modem for dial back-up, standard 200 MHz processing speed and multiple high speed communications options. The “Optimum M2100” supports Bluetooth, GPRS and GSM. The GPRS version is designed with an ‘always online’ communication link that shortens transaction times to a fraction of the time of PSTN. It features 32-bit architecture, a vertical magnetic stripe reader, smart card reader and high contrast LED backlit display and function keys. The new handheld, wireless terminal also features a long-life battery enabling up to 100 transactions and an ‘always on’ GPRS wireless modem. The new “M2100” is now in certification with all major gateways.

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TSYS Realigns Business Units, Promotes 8

TSYS has created a new management committee, realigned many of its business units, and is promoting eight executives to lead the change. Four group executives were promoted to EVP including Gaylon Jowers, Connie Cartledge Dudley, Stephen Humber, and Colleen Kynard. The Company also named three new SVPs including Kenneth Tye, William Pruett, and James Lipham. Additionally, Dorenda Weaver has been promoted from group executive to chief accounting officer. Jowers will be responsible for sales, strategy and emerging markets; Cartledge Dudley will be responsible for product and client development. Humber has also been named CTO for software development. Kynard will be responsible for customer care. Yesterday, TSYS reported that its first quarter revenues increased 13.5% to $285.2 million, as net income rose 2.6% to $32.6 million. Separately, TSYS bid for the NYCE network has reportedly been rejected by First Data.

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ePort Sales Set a Record in the First Quarter

PA-based USA Technologies says its quarterly sales for the “e-Port” cashless transaction solution increased 125% in the first quarter as it shipped product to 19 separate “e-Port” customers. The aggressive program aims to bring wireless data connectivity and cashless vending to the entertainment, travel and hospitality industries across America. USA Technologies is a leader in the networking of distributed assets, wireless non-cash transactions, associated financial/network services and interactive media technology and energy management.

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Comdata First Quarter Revenues Climb 3.8%

Ceridian Corporation reported that its Comdata business posted first quarter revenues of $81.5 million, a 3.8% gain over last year. Net income the TN-based Comdata subsidiary was $26.8 million for the first quarter, an 11% increase over 1Q/03. During the quarter, Comdata launched the first business payment card in the USA to offer both credit and debit functionality. The new “BusinessLink Corporate MasterCard” is also the first in the transportation industry to offer virtual card capability as part of its fleet solution. The “BusinessLink” card offers corporate credit card functionality as well as PIN-based debit capabilities, providing, for the first time, a one-card, B2B payment system, that allows employers to distribute company-provided personal funds to employees for access at ATMs and via purchases at point-of-sale debit terminals. Comdata is a payment processor and issuer of credit cards, debit cards and stored value cards, primarily for the trucking and retail industries in the USA. For complete details on Ceridian’s first quarter performance visit CardData (www.carddata.com).

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Singapore Bans Unsecured Cards for the Poor

The Monetary Authority of Singapore this week amended the country’s credit card regulations to prohibit issuers from issuing unsecured credit cards to consumers who do not meet the minimum income requirement of $18,000 and who have less than $6,000 in savings deposits. The new rules, which take effect April 15th, also continue to limit credit lines to no more than two times monthly income in order to discourage Singaporeans from spending beyond their means, according to this week’s issue of CardFlash International (cardflashinternational.com). However, the MAS ended the requirement for an issuer to perform income verification checks before issuing additional cards to an existing cardholder. In such cases, no additional credit is made available since the regulations already require an issuer to aggregate the credit limits under all cards issued to a cardholder, and ensure that the total does not exceed two months income. The MAS credit card and charge card regulations represent amendments to the Banking Regulations issued on January 19th. Under current regulations, consumers over the age of 55 must have an annual income of at least $9,000 to qualify for an unsecured credit card. Card issuers who violate the MAS rules face a fine up to $15,000 and, in the case of a continuing offense, an additional fine not exceeding $1,500 for every day or part thereof during which the offense continues.

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Panda Signs NPC Processing Contract

The Panda Restaurant Group has signed a multi-year credit card processing agreement with National Processing Company. Under the terms of the agreement, NPC will provide authorization and settlement services for MasterCard and VISA transactions. Panda Restaurant Group is the world leader in quality Chinese food service and one of the largest family-owned businesses in the nation. Panda Restaurant Group operates a successful chain of concepts, including Panda Express, Panda Inn and Hibachi-San. National Processing, Inc. through its wholly owned operating subsidiary, National Processing Company, LLC is a leading provider of merchant credit and debit card processing.

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ACS Debit Cards Reloaded at BofA Branches

American Card Services has launched a program that allows the “Ultima Twin-Access Debit Card Pack” to be loaded at over 4,500 Bank of America branches nationwide. ACS provides “unbanked” ethnic groups with a two debit card product as a viable alternative to cash and traditional money transfers. ACS primarily targets the 40 million U.S. Hispanics who spend over $500 billion annually in cash and transfers over $50 billion to Central and South America, $25 billion to Mexico alone. ACS is a full-service company providing data processing, customer service, distributor and sales support, card production, marketing and sales stored-value debit card products and programs.

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Sabre’s Revenue Advantage Streamlines Card Payments

Sabre Travel Network has signed a deal with Merchant e-Solutions to enable its travel agency customers to process different card types through a single payment processor, settle their agency fees, and use Web-based reporting tools within the “Revenue Advantage” product. In addition, the Card Services feature integrates credit card processing into the agencies’ desktop. Merchant e-Solutions was founded in 1999 to provide technology-based solutions to the merchant payment acquiring industry, including banks and middle market retailers. Sabre Travel Network, a Sabre Holdings company, provides access to the world’s leading global distribution system (GDS) enabling agents at more than 53,000 agency locations worldwide to be travel experts.

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Low Income Consumers Restricted to Secured Credit Cards

The Monetary Authority of Singapore has amended the country’s credit card regulations to prohibit issuers from issuing unsecured credit cards to consumers who do not meet the minimum income requirement of S$30,000 and who have less than S$10,000 in savings deposits. The new rules, which take effect April 15th, also continue to limit credit lines to no more than two times monthly income in order to discourage Singaporeans from spending beyond their means. However, the MAS ended the requirement for an issuer to perform income verification checks before issuing additional cards to an existing cardholder. In such cases, no additional credit is made available since the regulations already require an issuer to aggregate the credit limits under all cards issued to a cardholder, and ensure that the total does not exceed two months income. The MAS credit card and charge card regulations represent amendments to the Banking Regulations issued on January 19th. Under current regulations, consumers over the age of 55 must have an annual income of at least S$15,000 to qualify for an unsecured credit card. Card issuers who violate ther MAS rules face a fine up to $25,000 and, in the case of a continuing offense, an additional fine not exceeding $2,500 for every day or part thereof during which the offense continues.

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Card Solicitations Hit an 18 Month High in February

Direct mail volumes for credit card offers increased by 36% in February, compared to January, with an estimated 347 million offers sent out. Mail volume in the credit card sector has not been that high since October of 2002, when mail volume reached 366 million, according to MINTEL’s Comperemedia. Of the top ten credit card mailers, nine of them increased mail in February compared to January. Comperemedia says for the past three months, 53% of all card offers came with a reward program, compared with 45% and 30% in 2003 and 2002, respectively. Cash back is by far the most popular reward with approximately 90% of reward cards offering cash back or a cash rebate.

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Citigroup’s Card Profits Rise 35% in the First Quarter

Citigroup reported this morning that profits for its credit card business in North America increased 35% in the first quarter to $832 million, as revenues for the quarter increased 43%. The gain was driven by its recent acquisition of the Sears store and bank card portfolio and the Home Depot portfolio. Credit card outstandings for North America increased 23% over 1Q/03 to $142.3 billion, which includes $28.1 billion in private label card outstandings. Charge volume increased 19%, from $57.1 billion to $67.8 billion. Citi’s account base at the end of first quarter was 125.6 million accounts, a 45% gain over 1Q/03. However, the number of accounts dropped 3.6 million during the quarter. Citi’s charge-offs increased from 6.25% in the fourth quarter to 6.99% for 1Q/04. Charge-offs for bank credit cards was 6.60%, compared to 5.74% one-year ago. Delinquency (90+ days) dropped slightly from 2.18% for 4Q/03 to 2.10% for the first quarter 2004. Delinquency for bank credit cards was flat year-over-year and down 5 basis points from the fourth quarter. For complete details on Citigroup’s 1Q/04 performance visit CardData ([www.carddata.com][1]).

CITIGROUP
North American Credit Card Net Revenues
1Q/03: $635 million
2Q/03: $659 million
3Q/03: $819 million
4Q/03: $1017 million
1Q/04: $832 million
Source: CardData (www.carddata.com)

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

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