First Data and Bank One Head to Arbitration

On page 23 of First Data Corporation’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2003, First Data indicated that, to facilitate Bank One’s deconversion schedule, a tentative agreement had been reached for First Data to continue providing card processing services to the Bank beyond the June 2004 expiration of the existing agreement with Bank One. Subsequently, the parties were unable to finalize the tentative agreement. The issue of whether a First Data subsidiary must continue to offer processing services at current rates after the June 2004 expiration date and certain other matters are now the subject of a binding arbitration proceeding, pursuant to the terms of the processing agreement.

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Model Builder for Predictive Analytics Now Available

Fair Isaac yesterday announced the early availability of its new “Model Builder for Predictive Analytics” that delivers a comprehensive modeling environment that includes data preparation and analysis, predictive modeling, model validation and model deployment. Fair Isaac’s Model Builder gives companies and government agencies the power to quickly design and deploy sophisticated analytic models. These models use historical information as a basis for making intelligent decisions about future transactions, business problems, or customer interactions. The software’s precise predictive capabilities are useful in areas such as customer account management and retention, dispute resolution, default and fraud prediction, price determination and other marketing efforts.

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Brooks Brothers Renews GE for Three Years

GE Consumer Finance has signed a three-year renewal with Brooks Brothers to provide account processing, sales authorizations, financing, credit card billing statement production, payment processing, customer service, collections, risk management and marketing support for the retailer’s private label credit card portfolio. The contract extension includes benefits such as 10% savings on the first purchase; e-capabilities to view card balance and purchase activity, no annual fee, pre-sale notification and exclusive cardmember events. Under the agreement, GE Consumer Finance will continue to manage account processing, sales authorizations, financing, credit card and billing statement production, payment processing, customer service, collections, risk management and marketing support for Brooks Brothers’ private label credit card and existing portfolio of accounts.

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ICMA Offers Online Versions of Member & Buyer’s Guide

The International Card Manufacturers Association has expanded its Web site to include online versions of the “ICMA Member Directory” and “ICMA Product/Service Buyer’s Guide”. The online versions are available to members and enables them to access fellow member companies or individual contact information and search for supplier members and specific products. ICMA members can search the directory using a variety of methods, including all members in a certain country, a specific individual, by company name, by member type and many more ways.

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BearingPoint Updates GSA Smart Card Guidelines

VA-based BearingPoint has been selected to update the GSA “Smart Card Policy and Guidelines Handbook”. The handbook is a very important resource that serves as a point of reference for any federal government agency planning to implement or in the process of implementing a smart card project. BearingPoint is working with the Smart Card Alliance, a not-for-profit, multi-industry association working to accelerate the widespread acceptance of smart card technology. As a key component of this project, BearingPoint will conduct interviews with representative users of smart card technologies at various government agencies, industry organizations, and academic institutions.

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CFOs See Brighter Economy with Cost Control

CFOs of mid-sized companies are more optimistic about a near-term economic recovery than they were a year ago. A new American Express survey indicates, however, that CFOs still place top priority on cutting and containing indirect costs and that many are troubled by their companies’ efforts to control expenses, such as office supplies, computer equipment, express delivery, and telecommunications. According to nearly half of those polled in the survey, the economy will grow within the next 18 months, a significant improvement from the 31% who were optimistic last year. In addition, only 17% predicted that the economy would be erratic over the next year-and-a-half, considerably lower than the 30% who felt that way in 2002. Meanwhile, 31% believe the economy will remain flat and 4% said the economy would decline – approximately the same proportions as in the 2002 survey.

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VISA Promotes its Check Card as the Fast Card

To showcase the speed of its debit card over checkwriting, VISA has teamed with two NASCAR drivers to raise money for charity. While complete details are not yet ironed out, the “VISA/NASCAR Fast Cards, Fast Cars for Charity Challenge” will award each driver with $15 for each point earned during the remainder of the Winston Cup Series races. A donation minimum of $5,000 is guaranteed for each of the driver’s charities. The two NASCAR drivers are Rusty Wallace and Kurt Busch. VISA’s NASCAR marketing program also includes an “Ultimate NASCAR Experience,” where VISA cardholders get the chance to win travel to a NASCAR “Winston Cup Series” race in lavish accommodations in VISA’s luxury motor coach, plus a hot lap with Rusty Wallace or Kurt Busch and VIP access to the event.

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E*TRADE ATMs Join ACCEL/Exchange

E*TRADE Access has signed an agreement to add its network of 15,000 ATMs into Fiserv’s “ACCEL/Exchange” network. The addition of the E*TRADE ATMs into “ACCEL/Exchange” will increase the network’s total ATM count to more than 50,000. The agreement will enable more than 80 million “ACCEL/Exchange” cardholders to access E*TRADE ATMs. Last month, E*TRADE Access signed a banking terminal participant agreement to add its network of 15,000 ATMs to the NYCE network. The addition of E*TRADE ATMs will increase NYCE’s total by 14% to over 120,000. E*TRADE Access’ participation in NYCE will, in turn, open its network of ATMs to NYCE’s 55 million cardholders. (CF Library 7/29/03)

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Vital Clears Lipman’s Wireless Terminals

Vital Processing Services has “Class A” approved Lipman’s retail and direct marketing POS application to include restaurants for credit, debit, EBT and commercial card processing for the “NURIT 2085,” “NURIT 3000,” and the “NURIT 3010” terminals. Vital has also Class A Approved the wireless NURIT 8000 terminal to process through Vital’s network. These solutions will be fully supported on Vital’s award-winning merchant help desk. The addition of Lipman’s enhanced POS application for restaurants and wireless terminal solutions to Vital’s terminal offerings provides Vital’s acquiring and Independent Sales Organization clients with additional targeted POS solutions to sell and distribute to their restaurant, retail and direct marketing customers.

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FTC Clears Sears-Citigroup Card Deal

The Federal Trade Commission has provided antitrust clearance to Citigroup for its acquisition of the of Sears credit card portfolio. Sears announced last month that it reached a definitive agreement to sell its domestic private-label and bank credit card portfolio to Citigroup for more than $3 billion, or approximately 10% over the total outstandings. Other terms of the deal include payment for approximately $3 billion of Sears’ net invested capital, related to loan loss reserves. Sears also expects to receive approximately $200 million in annual performance payments from Citigroup based on items such as new account and credit sales generation activities. In addition, Sears expects to realize annual savings of more than $200 million as Citigroup will absorb costs associated with Sears’ zero percent financing program. (CF Library 7/16/03)

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COLES MYER MASTERCARD

Giant retailer Coles Myer has finally decided to go with GE Consumer Finance to issue a co-branded MasterCard. The new card will be issued in October and will be linked to the popular “Fly Buys” loyalty program. Coles Myer currently has a private label card, but began the process of evaluating a co-branded bank credit card partner more than one year ago. “Fly Buys” is the most popular loyalty program in Australia and New Zealand with more than 5.4 million members. Coles Myer has 1.7 million store cardholders. However, GE has had to overcome several roadblocks to issue the card. GE had to negotiate with National Australia Bank over the “Fly Buys” loyalty program. It is also in discussions with the Commonwealth Bank and Woolworths, who have a contract with MasterCard stipulating that no other retailer may issue a MasterCard in Australia. GE Consumer Finance recently applied for a specialist banking license in Australia and is set to launch private label cards with Harvey Norman, Clive Peters, and Freedom next month.

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