MasterCard China Board Meeting

MasterCard recently held its Asia/Pacific board meeting in Beijing, the first time that the organization has held a regional board meeting in Beijing. MasterCard was the first international payments organization to enter China in 1988. MasterCard has been working closely with China UnionPay to extend its services to cardholders. There are currently over 7,000 ATMs accepting MasterCard international cards. In December, MasterCard cards were accepted for the first time in Beijing by Starbucks. Today, 17 Starbucks outlets in Beijing accept MasterCard credit cards.

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Mobile Banxafe

Banksys, Mobistar, and Gemplus have launched the first national mobile payment application in Belgium. When using the new “mobile banxafe,” the customer will receive a description of the transaction, displayed directly on his/her mobile phone screen. To authorize this, the customer will enter his “mobile banxafe” PIN code, or digital signature, which is then verified by the applet. If the PIN is correct, the signature is sent to the authentication server via the SMS channel, which authorizes the transaction to be processed. Payment commissions are fixed and shared in collaboration with the banking sector, which is responsible for the authorization, risk management, clearing and settlement. Mobistar had a total of 2,305,390 active customers at year-end 2002.

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Rewards Gift Card

AL-based AmSouth Bank has launched an innovative VISA card that converts reward points into “VISA Gift” cards. The new “AmSouth VISA Rewards Card” rewards cardholders with points equal to 1% of card purchases. The points can be redeemed in the form of an “AmSouth VISA Rewards Gift Card,” in denominations ranging from $25 up to $1,000. Cardholders may accumulate up to $1000 annually in “VISA Reward” points. AmSouth is offering a six-billing cycle fixed APR of 1.9% followed by APRs from prime +4.9% to prime +11.9%. AmSouth is offering the card in “Gold” and “Platinum” versions. The card also offers an optional link to an AmSouth personal checking and/or investment account. At the end of 2002, AmSouth had 310,000 credit card accounts and $385 million in card outstandings, according to CardData ([www.carddata.com][1]).

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

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Debit Suit Severance

MasterCard International Friday asked U.S. District Court Judge John Gleeson to sever the plaintiffs’ claims against MasterCard in the Wal-Mart antitrust suit against MasterCard and VISA. MasterCard says a joint trial with VISA would be prejudicial to MasterCard and could cause substantial jury confusion. In its motion to sever, MasterCard says the law clearly states that evidence concerning one party cannot be offered against the other unless it is first established by a preponderance of the evidence that there was a conspiracy between the two organizations. MasterCard says this is a standard that is higher than that required in the summary judgment motion currently before the court. MasterCard has a motion pending before Judge Gleeson to dismiss the case on summary judgment. The trial has been scheduled for April 28th in Brooklyn, NY. VISA has a 75% share of the off-line debit card market, according to CardData ([www.carddata.com][1]).

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

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VISA EMV Cards

VISA Asia Pacific reported this week that thirty members are implementing EMV chip programs, more than ten million VISA EMV smart cards have been issued in the region, and over 70,000 EMV point-of-sale terminals have been deployed in eight markets. In the Australia/New Zealand market, ANZ Bank has issued more than 400,000 EMV-compliant VISA cards and deployed 35,000 EMV terminals. In Japan more than 10% of VISA cards now carry an EMV chip, with over 7 million cards in circulation. In South Korea, five VISA members and SK Telecom have collectively issued 1.1 million “Moneta” EMV chip cards and are now issuing “GlobalPlatform” chips on mobile handsets known as “Moneta Plus” phones.

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BOARD MEETING

MasterCard recently held its Asia/Pacific board meeting in Beijing, the first time that the organization has held a regional board meeting in Beijing. MasterCard was the first international payments organization to enter China in 1988. MasterCard has been working closely with China UnionPay to extend its services to cardholders. There are currently over 7,000 ATMs accepting MasterCard international cards. In December, MasterCard cards were accepted for the first time in Beijing by Starbucks. Today, 17 Starbucks outlets in Beijing accept MasterCard credit cards..

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Soccer Sponsorship

MasterCard International announced this week it has renewed its sponsorship of international soccer’s five most prestigious events. The events include the “2006 FIFA World Cup” in Germany, “2004 UEFA European Football Championship” in Portugal, “UEFA Champions League” (through 2006), “2004 CONMEBOL Copa America,” and “2003 Copa Toyota Libertadores.” As an official sponsor of these five major properties, MasterCard’s exclusivity as the official payment system includes all real and/or virtual payment and/or account access systems (including credit cards, charge cards, ATM cards and networks, and travelers cheques). In addition to the high-profile properties, MasterCard has also enjoyed a long-standing relationship with soccer great Pelé.

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Card Debt 2002

At the end of 2002, American households, with at least one credit card, owed an average balance of $8,940 on all credit cards, up 8.5% over 2001. The $750.9 billion in credit card debt that consumers owed at the end of last year includes $660.9 billion for bank credit cards and $90 billion for retail credit cards. About 18.5%, or $138.9 billion of this debt was subsequently paid off in January under interest-free grace period policies. There the average household balance subject to a finance charge at EOY 2002 was $7,286, according to CardWeb.com’s CardFacts service ([www.cardfacts.com][1]). Approximately 84 million American households have at least one credit card out of a total universe of 105 million American households.

AVERAGE HH CREDIT CARD DEBT
(includes all credit cards and U.S.
households with at least one credit card)
1990 $2966 1997: $6247
1991 $3103 1998: $6618
1992 $3275 1999: $7031
1993 $3646 2000: $7842
1994 $4301 2001: $8234
1995 $5213 2002: $8940
1996 $5875

Source: CardFacts ([www.cardfacts.com][2])

[1]: http://www.cardfacts.com
[2]: http://www.cardfacts.com

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UFJ SECURE-SITE

UFJ Card has selected Cyota to provide the “Verified by Visa” Internet payment security service for its seven million cardholders. UFJ Card’s “VbV” program is the first large scale commercial implementations of VISA’s new program in Japan. UFJ Card is the card division of UFJ Bank, created through the merger of Sanwa bank and Tokai bank. UFJ’s service is provided through Intelligent Wave, Cyota’s partner in Japan. Triangle Technologies, which has helped form numerous strategic alliances in Japan for its clients, assisted in signing the distribution agreement between Cyota and Intelligent Wave. Cyota’s “SecureSuite” has already been implemented by seven of the world’s largest issuers, and is available as a hosted or non-hosted solution.

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