American Airlines has promoted Dennis Cary, to president of its AAdvantage Marketing Programs, which services 45 million loyalty cardholders. Cary originally joined American in 1991. He has held management positions within the airline’s Alliance Planning, Cargo and Distribution Planning departments. Before being selected to lead sales efforts in Europe, Cary served as managing director-Revenue Management. American Airlines is the world’s largest carrier. American, American Eagle and the AmericanConnection regional carriers serve more than 250 cities in over 40 countries with more than 3,900 daily flights.Details
While some analysts predicted the decline of 0% interest rate credit card offers, competitive pressures continue to drive the U.S. market. Some issuers are already offering the low ball APRs through next December. FleetBoston is offering a “Platinum VISA” with a balance transfer APR of 0% through next year, and Citibank is offering a 12-month 0% APR on its “Platinum Select MasterCard,” according to CardWatch’s December monitoring (www.cardwatch.com). Chase is currently offering a 12-month 0% APR for purchases and balance transfers on its “Platinum VISA” for applicants who qualify at the “Elite” or “Premium” level. Meanwhile, Bank One is offering a 5-month 0% APR on purchases and balance transfers for its new “Free Cash Rewards Platinum VISA Business.” Advanta is also offering a 0% interest rate through May, on purchases and balance transfers, for its new MasterCard Platinum Business Card With Cash Back.” Mintel’s Comperemedia reported last week that purchase introductory periods got longer in September with more offers for 12 months or more. These periods have been increasing since April, when they hit a low point. Comperemedia says balance transfer periods got slightly longer in September, but not as long as in the beginning of 2003. There were still offers where the rate was good for the life of the balance, but fewer than previously seen.Details
NJ-based phone card provider, IDT Telecom, reported third quarter revenues increased 66.1% over the comparative prior year period, and 11.4% from the previous quarter. Revenues benefited from increased sales of cards outside IDT’s core northeastern U.S. markets. Prepaid calling cards revenue were $292.0 million for the quarter and the gross profit margin was 22.6% for the quarter. The parent company, IDT Corporation reported record revenues of $513.1 million for the quarter. Overall revenues for the quarter increased 5.6% from the prior quarter, and 15.8% over the revenues recorded during the year-ago quarter. The Company also reported a net loss for the quarter of $14.0 million, compared to a net loss of $4.1 million in the prior quarter, and net income of $8.3 million for the comparable period one year ago. For complete details on IDT’s third quarter performance visit CardData ([www.carddata.com]).
Atlanta-based Certegy has signed a multi-year agreement to provide check warranty services to NC-based Belk, the largest privately-owned department store company in the USA with 221 stores in 13 Southeastern and Mid-Atlantic states. With fraud increasing, more retailers are choosing to outsource their check risk management decisions to Certegy. Certegy’s highly sophisticated risk management platform, which incorporates artificial intelligence and proprietary risk modeling capabilities, allows retailers to accept checks with confidence, resulting in more sales, less exposure to fraudulent transactions and a better overall point-of-sale experience for their customers. Belk, Inc. is the largest privately owned department store company in the nation. Certegy provides credit and debit processing, check risk management and check cashing services, merchant processing and e-banking services to over 6,000 financial institutions, 117,000 retailers and 100 million consumers worldwide.Details
Capital One reported Thursday that its “National Mascot of the Year” competition has received more than 3.5 million votes to-date as it approaches its end on December 22nd. While the BCS can’t seem to offer one undisputed national football champion this year, Capital One is at least offering one true BMOC (Big Mascot On Campus) on Jan. 1, 2004. The Capital One National Mascot of the Year will be selected based on a combination of the online popular vote (50 percent) and an expert panel of judges’ previous rankings (50 percent), which were used to select the 12 members of the Capital One All-America Mascot Team. Capital One Financial Corporation is a holding company whose principal subsidiaries, Capital One Bank and Capital One, F.S.B., offer consumer lending products and Capital One Auto Finance, Inc., which offers auto loan products.Details
Dusseldorf-based clothes retailer ESPRIT Europe has signed an electronic gift card deal with First Data’s ValueLink subsidiary. The new “ESPRIT Gift Card” and “Christmas Gift Card” will be offered across 130 stores in Germany, Holland, Belgium, Denmark, United Kingdom, France, Austria and Luxembourg. The gift card looks like a credit card and has a barcode that can identify the card, its current balance and previous transactions. The card will replace ESPRIT’s existing paper gift certificate program. ESPRIT Europe GmbH is the European arm of Esprit Holdings Limited, based in Hong Kong. ValueLink has a worldwide client base of 130 major brands.Details
On Track Innovations, a supplier participating in the “MasterCard PayPass” program in the USA, is seeking to raise $7.4 million in new equity financing. The contactless microprocessor-based smart card solutions provider also announced it is appointing a new independent auditor. OTI will hold a special shareholder meeting on December 30th to vote on the issues. The Company want to appoint Somekh Chaikin, a member of KPMG International, as its independent auditor. OTI also wants to name Eli Akavia, its current auditor, to the board of directors. Besides MasterCard, OTI’s other clients include BP, Scheidt & Bachmann, EDS, First Data Resources, Repsol, the Government of Israel and ICTS.Details
Barclays Bank has extended its commitment to use Fair Isaac’s “Falcon Fraud Manager” to protect its credit, debit and corporate card portfolios from payment card fraud for another five years. Barclays also extended its commitment to use “Falcon” as the exclusive fraud protection solution for its “Monument” credit card portfolio. In addition to Fair Isaac’s fraud detection solution, the issuer is currently utilizing Fair Isaac’s “TRIAD” adaptive control system for both customer and account management. Barclays is Europe’s largest card issuer with more than 19.5 million debit and credit cards.Details
GE Retail Sales Finance has launched credit cards for Aprilia and Moto Guzzi brand motorcycles, accessories and apparel at 250 dealer locations nationwide. Customers looking for increased purchasing power will have the opportunity to apply for closed-end financing on any new Aprilia or Moto Guzzi model, as well as instant credit financing on an Aprilia or Moto Guzzi branded credit card. Other key benefits of the program for both brands include low merchant discount rates for revolving promotional financing, prompt funding of sales, seasonal manufacturer sponsored promotions and comprehensive customer service. Aprilia has aggressively expanded in the American market and is now available in more than 125 dealerships and boutique stores across the country. Moto Guzzi, Europe’s oldest continuous manufacturer of motorcycles, was founded in 1921 in Mandello del Lario, Italy, where the motorcycles are still manufactured today.Details
Kazkommerzbank of Kazakhstan has inked an agreement with Brussels-based OpenWay Group and Texas-based iBIZ Software to purchase “Way4CommerSafe.” The “Way4CommerSafe” is a “3-D Secure” solution jointly developed by the two firms. Kazkommertsbank is already offering acquiring services under the “Verified by VISA” acquiring program which performs real-time cardholder authentication and is planning to also use “MasterCard SecureCode.” The bank will also launch a “Verified by VISA” and “MasterCard SecureCode” issuing service. Kazkommertsbank has its own processing center. It operates 172 ATMs and over 685 POS-terminals in the principal cities of Kazakhstan. OpenWay is one of the first vendors launching MasterCard “EMV Full Grade” and VISA “EMV Full Option.” The iBIZ “CommerSafe Product Suite,” is suitable for both “Verified by VISA” and “MasterCard SecureCode.”Details
Credit Unions are reporting higher average balances and volume than most other credit card segments. However, the growth in card balances of credit union portfolios is only up 2%. At mid-year, the co-branded/affinity card segment posted the strongest growth at 7%, while the low-rate market segment was up 6%. According to the November issue of RAM Research Group’s Bankcard Barometer, average balances, per active account, among credit union portfolios are $2,754 compared to an average balance of $2,583 for the top ten U.S. issuers. Based on 2Q/03 data, credit unions reported an average second quarter volume of $2,949 per active account versus $2,616 for the co-branded/affinity sector. According to Brookwood Capital, approximately $268 million in credit union credit card portfolios have changed hands so far this year. Through the third quarter, 43 credit unions with portfolio of over $1 million in outstanding balances have sold their credit card portfolios, with six of them being greater than $10 million in outstanding balances. (CF Library 12/3/03)
SECTOR MONITOR (2Q/03 vs 2Q/02)
Co-branded/Affinity: $2616 $2744
Sub-Prime/Secured $1914 $ 870
Low Rate >$2 Billion $2627 $2692
Low Rate <$2 Billion $1770 $2628 Non-Bank $2291 $1558 Credit Unions $2754 $2949 Top Ten $2583 $3444 BAL- average balance per active account; VOL - average year-to-date volume per active account Source: Bankcard Barometer (www.ramresearch.com).
Vancouver-based Fincentric Corporation reports that Standard Chartered Bank has purchased software licenses for its “Wealthview Banking” system. The deal came via Standard Chartered’s reentry into South Africa in August with the purchase of 20twenty, a digital financial services organization. It is expected that 20twenty will re-launch during the first quarter.
20twenty, based in Cape Town, South Africa, has utilized Fincentric’s platform since its inception, when it was launched in July 2001 as the first digital-only bank in the region. “Wealthview Banking” supported 20twenty’s customer base as it grew to over 40,000 within its first six months of operations. Standard Chartered Bank operates in excess of 500 locations across the Asia Pacific Region, South Asia, the Middle East, Africa, the United Kingdom and the Americas.