BofA Adds $3 Billion in Card Loans & 400K Accounts

Bank of America reported this morning that its credit card outstandings rose nearly $3 billion in the fourth quarter, producing a 24% increase over the one-year ago quarter. BofA says it added 414,000 new credit card accounts during the fourth quarter. For all of last year BofA opened 4.26 million new credit card accounts compared to 2.67 million in 2002. BofA says the account growth was driven by the development of more competitive offers, improved technology at the point of sale and an increase in direct mail marketing. For 2003, BofA notes that consumer credit and debit card purchase volumes increased 13% and 22%, respectively. Bof A reports that its card income increased 11% to $815 million. Managed credit card profits were $323 million for the fourth quarter, a 3% gain over 4Q/02. Total revenue for its managed credit card portfolio was $1.2 billion, a 3% gain over last year. At the end of the fourth quarter, BofA had $36.6 billion in managed credit card outstandings, a 24% increase over the year-ago quarter. Fourth quarter charge-offs were 5.12%, compared to 5.32% in the prior quarter, and 5.03% one year ago. Managed 30+ day delinquency was 3.93%, compared to 3.84% in the third quarter, and 3.94% for 4Q/02. Managed 90+ day delinquency was 1.77%, compared to 1.76% in the third quarter, and 1.71% for 4Q/02. For complete details on Bank of America’s 4Q/03 performance visit CardData ([www.carddata.com][1]).

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

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VCT and Jet Team to Promote Foil Cards

Versatile Card Technology and Jet LithoColor have teamed to promote, license and protect patents for production of foil laminated transaction cards. VCT’s Qualteq division owns patents for methods of making foil faced transaction cards having graphics and Jet LithoColor owns patents for the method of producing foil laminated cards with double-sided printing. As a globally recognized leader, and the world’s largest manufacturer of plastic cards, VCT produces cards for every application and offers complete fulfillment services and turnkey solutions. Recognized as a leader in the printing and production of plastic gift cards, commercial printed materials and related finishing and fulfillment services, Jet provides customized communication solutions to their customers throughout the Americas.

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AMEX & AEROPLAN

American Express has rolled-out three new co-branded charge cards following the finalization of its recent deal with Air Canada. The new “AeroplanPlus Card,” “AeroplanPlus Gold Card,” and, “AeroplanPlus Platinum Card” reward users with 1.0 mile to 1.5 miles for each dollar charged. “Aeroplan” also joined “Membership Rewards” as part of the agreement. Beginning, February 16th, cardholders enrolled in AmEx’s existing “Membership Rewards” points program will be able to convert their points earned on charge cards into “Aeroplan Miles,” on a one-for-one basis. The blue-colored AmEx “AeroplanPlus Card” earns one “Aeroplan Mile” for every dollar spent on purchases on the card and carries a $60 annual fee. The AmEX “AeroplanPlus Gold Card” earns one “Aeroplan Mile” for every dollar spent on purchases up to $10,000 annually and then 1.25 “Aeroplan Miles” per dollar in purchases over $10,000 each year. Charter members can earn as much as 1.35 “Aeroplan Miles” on annual purchases when they spend over $10,000. New cardholders are also eligible for an Air Canada companion ticket in 2004. The “Gold Card” has an annual fee of $120. The AmEx “AeroplanPlus Platinum Card” earns 1.25 “Aeroplan Miles” for every dollar spent on purchases up to $25,000, and 1.5 “Aeroplan Miles” on purchases thereafter each year. Charter members can earn as much as 1.6 “Aeroplan Miles” on annual purchases when they spend over $25,000. Additional benefits include an Air Canada companion ticket, Air Canada “Priority Check-In” and access to Maple Leaf and Arrivals lounges across Canada and in key international locations. The “Platinum Card” carries an annual fee of $399. Platinum supplementary cards are $175 and Gold supplementary cards are free. Every new cardholder will receive a welcome bonus of 2,500 or 5,000 “Aeroplan Miles,” depending on the card. AmEx won the right to team up with Aeroplan after the court overseeing Air Canada’s restructuring opened up the airline’s card partnership contracts in April. Under the terms of the agreements, American Express is providing Air Canada with an $80 million credit facility, repaid as “Aeroplan Miles” are purchased.

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New Debit MasterCard Targets Public Housing Residents

Lodi, CA-based PayStar/GLOBALCash has launched the prepaid “Community Technology Network Project Debit MasterCard” for “Section 8” and public housing residents. The CTNP program initiative was developed and is administered by Worldwide Communication Group, Inc. Through this innovative Alliance Partnership, millions of Section 8 and Public Housing residents will now have an opportunity to obtain personal computers and Internet access. Worldwide Communication Group, Inc. was founded in 1995 is a commercial telecommunication corporation. PayStar Corporation ([www.paystar.com][1]) provides its distributors and clients with a suite of prepaid, stored value products.

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

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7-Eleven Phone Card Sales Up 5.5% in 2003

7-Eleven reported that gross sales of its prepaid phone cards rose 6.5% in December to $646.3 million. 7-Eleven has begun reporting prepaid phone card sales on a net method instead of a gross method. The gross method includes the face value of the card in merchandise sales, while the net method includes only the gross profit dollars from the sale of the card. 7-Eleven, Inc. is the premier name and largest chain in the convenience retailing industry.

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AmEx Launches Aeroplan Cards

American Express has rolled-out three new co-branded charge cards following the finalization of its recent deal with Air Canada. The new “AeroplanPlus Card,” “AeroplanPlus Gold Card,” and, “AeroplanPlus Platinum Card” reward users with 1.0 mile to 1.5 miles for each dollar charged. “Aeroplan” also joined “Membership Rewards” as part of the agreement. Beginning, February 16th, cardholders enrolled in AmEx’s existing “Membership Rewards” points program will be able to convert their points earned on charge cards into “Aeroplan Miles,” on a one-for-one basis. The blue-colored AmEx “AeroplanPlus Card” earns one “Aeroplan Mile” for every dollar spent on purchases on the card and carries a $60 annual fee. The AmEX “AeroplanPlus Gold Card” earns one “Aeroplan Mile” for every dollar spent on purchases up to $10,000 annually and then 1.25 “Aeroplan Miles” per dollar in purchases over $10,000 each year. Charter members can earn as much as 1.35 “Aeroplan Miles” on annual purchases when they spend over $10,000. New cardholders are also eligible for an Air Canada companion ticket in 2004. The “Gold Card” has an annual fee of $120. The AmEx “AeroplanPlus Platinum Card” earns 1.25 “Aeroplan Miles” for every dollar spent on purchases up to $25,000, and 1.5 “Aeroplan Miles” on purchases thereafter each year. Charter members can earn as much as 1.6 “Aeroplan Miles” on annual purchases when they spend over $25,000. Additional benefits include an Air Canada companion ticket, Air Canada “Priority Check-In” and access to Maple Leaf and Arrivals lounges across Canada and in key international locations. The “Platinum Card” carries an annual fee of $399. Platinum supplementary cards are $175 and Gold supplementary cards are free. Every new cardholder will receive a welcome bonus of 2,500 or 5,000 “Aeroplan Miles,” depending on the card. AmEx won the right to team up with Aeroplan after the court overseeing Air Canada’s restructuring opened up the airline’s card partnership contracts in April. Under the terms of the agreements, American Express is providing Air Canada with an $80 million credit facility, repaid as “Aeroplan Miles” are purchased.

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NTT DATA Partners with CheckFree i-Solutions

NTT DATA Corporation has signed an agreement with CheckFree i-Solutions to develop advanced e-billing solutions for the Japanese business and consumer markets. NTT DATA is Japan’s largest systems integrator and payment service provider, and CheckFree is the leading provider of e-billing technology and payment services. NTT says the CheckFree “i-Series” software proved it could support complex Japanese business-to-business e-billing applications
through its ability to store and manage complex hierarchical data structures, a powerful range of data analysis and graphing tools and the solution’s proven scalability. At the same time, “i-Series” offers a rapid and low cost deployment, facilitated by its open architecture and a comprehensive suite of
powerful application design and administration tools. NTT believes that with Japan’s high Internet penetration and increasing requirement for advanced e-billing services, the company is strategically placed to help billers provide differentiating services and a higher level of value-added functionality than their competition.

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Gas Cards Hot in Hawaii and Alaska

A new survey shows that half of American consumers would consider walking out of a store without making a purchase if their debit cards were not accepted. Furthermore, nearly two-thirds of respondents said their feelings toward a store would be negatively impacted if a merchant stopped accepting debit cards. The findings come from a new Harris Interactive survey, sponsored by MasterCard, also found that 77% considered debit’s transaction speed and ability to save time at the checkout counter as extremely/very important. More than 80% of adults using debit cards noted convenience and safety to be extremely/very important attributes, as opposed to carrying cash. The survey was conducted in early December with a nationwide sample of 2,465 adults.

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Elvis Presley MasterCard Gift Card Introduced

Memphis-based Clarity Payment Solutions has partnered with Elvis Presley Enterprises and KeyBank, to market and issue the “Elvis Presley Limited Edition Prepaid MasterCard” gift card. Clarity will host an e-commerce website, [www.elvisgiftcard.com][1], where consumers can order the limited edition gift cards online. The gift cards can be purchased in amounts ranging between $25 and $100. Elvis Presley Enterprises is aggressively involved in a worldwide licensing program, merchandising, music publishing, and television, film, video and Internet projects. Clarity Payment Solutions is a leading provider of prepaid card solutions that utilize the MasterCard(R), Visa(R), as well as EFT and ATM networks.

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

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Security Service FCU Outsources to CMC

San Antonio-based Security Service FCU has selected CMC to provide chargeback and security/fraud servicing, as well as marketing support, for its VISA and MasterCard portfolios. Security Service FCU is the eleventh largest credit union in the country, having surpassed $3 billion in assets last year. SSFCU has a diverse membership and currently serves more than 500,000 members worldwide. CMC is a leading outsource solution for financial institutions and retailers in the credit and debit card, merchant, and private label business. Through its two multi-channel contact centers and processing partners, CMC provides turnkey and menu-driven superior quality servicing for clients throughout the United States and Canada.

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Cap One Introduces Go Miles Card

Capital One yesterday launched a new air miles card offering low redemption levels. The new “Go Miles VISA or MasterCard” reimburses cardholders for buying a plane ticket on the card. Under the program, cardholders shop for the lowest fares and most convenient itineraries, charge the ticket to the card, and then receive a cash credit for the ticket based on previously earned miles. Capital One says the new program takes the hassle out of free travel since it does not use set mileage plateaus. Reimbursements can be earned with as few as 9,000 miles. To receive a $100 credit, 9,000 miles are required; 15,300 miles for a $170 credit, and, 19,800 miles for a $220 credit. The “Go Miles” card carries a $19 annual membership fee and interest rates that start at 9.9%. Cardholders can earn up to 5,000 bonus miles for transferring balances. The Air Travelers Association this morning ranked the card as #1 due to lower annual fee and 9,000 minimum redemption level. However, the nominal value of the miles under the “Go Miles” program is 1.1 cents each compared to 2.5 cents per mile for co-branded airline programs.

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Precidia Joins Vital’s Integration Partner Program

Ottawa-based Precidia Technologies has joined the Vital Processing “Services Integration Partner Program.” Precidia’s “EtherDial” and “Ether232AT” products are “Class B” approved with Vital. The “EtherDial” migrates transaction data from a dial-based infrastructure to a TCP/IP network, eliminating the merchant’s dependence on a dedicated telephone line for transaction processing. The “Ether232AT” connects existing dial-based payment terminals to an Ethernet LAN, acting as a modem replacement. The Vital “VIP” program consists of software developers, system integrators and third-party vendors with approved POS applications to process transactions on Vital’s network.

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