VISA & Hilton

VISA U.S.A. and Hilton Hotels have signed a contract to provide enhanced folio data on all “VISA Corporate” and “VISA Purchasing” card payment transactions for corporate travelers. According to a Visa 2002 Procure to Pay Study conducted by Deloitte Consulting and Deloitte & Touche, 69 percent of survey respondents have implemented a T&E card program, reporting one of the greatest benefits aside from the improved data access to be traveler convenience. The study also found that 26 percent of the companies studied have already implemented an enterprise wide expense reporting solution, while 36 percent plan to implement one in the next two years.

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ALPHYRA SALE

Electronic transactions company, Alphyra Group, valued at 91m euros, is
still up for grabs, unless a management buyout is successful. The Sunday
Times reported the latest suitor is Euronet Worldwide, however, the company
says it is not in takeover discussions with Alphyra. Euronet says it did
have discussions with Alphyra in the summer of 2002 regarding a possible
business combination, but that these discussions had terminated months ago.
Last week, Rendina, an entity formed by management as a buyout vehicle for
Alphyra raised its offer to 2.70 euro per share, after originally offering
2.45 euro per share. First Data initially offered 2.80 euro per share, however the
offer was withdrawn shortly thereafter.

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HF Card Sale

Sioux Falls, SD-based HF Financial Corp., the parent company for Home Federal Bank, confirmed Monday the closing of the sale of its credit card loan portfolio. The principal balance of the remaining receivables at closing was $2.9 million and proceeds from the sale were $500,000. The Company’s subsidiary, HF Card Services, LLC will be winding down operations and dissolving during the first quarter. The Company initially recorded a fiscal 2002 loss from the write down of credit card receivables of $1.4 million, net of taxes. HF Financial also owns Mid America Capital Services, Hometown Insurors and HF Financial Group.

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OPENLIMIT ACQUISITION

OPENLiMiT, a developer of Internet enabled smart credit cards, has inked a
deal to be acquired by Canada’s Jure Holdings. The companies expect to sign
a definitive acquisition agreement before the end of February. Afterwards,
Jure intends to change its company name to OPENLiMiT, Inc. and will request
a new NASDAQ trading symbol. The OPENLiMiT product consists of an Internet
smart credit card that utilizes a digital signature, the OPENLiMiT card
reader, and the OPENLiMiT “Signcube” software. Each OPENLiMiT subscriber
receives an immediate credit line, starting at $200 up to $1,000 depending
on the credit evaluation of the individual. Once a credit limit has been
established, each subscriber is granted access to the OPENLiMiT “Tower,”
where customers can transact purchases on the Internet at preferred rates
with the security that comes from using digital signatures.

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Pegasystems UK Deal

EDS has selected MA-based Pegasystems to provide call center software to support a roll-out of electronic card-based accounts being launched through the UK Post Office. EDS was awarded a contract by Post Office Ltd. in March 2002 to provide a full spectrum of business process outsourcing services to support the payment of benefits directly into Post Office card accounts, beginning in April of this year. The UK Government is changing the way benefit payments are made effective April 1st. Benefit claimants will still be able to collect their benefits in cash from Post Office branches from April on by using their existing account if they bank with one of the Post Office’s banking partners, through a basic bank account, or through a Post Office card account. In July of last year, EDS selected Pegasystems’ software as one of the business process management platforms of choice for use within the Inland Revenue in the UK.

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Top 10 Delinquency

Delinquency rates among the top U.S. issuers edged up again during the fourth quarter, thanks entirely to sub-prime portfolios. Discounting the delinquency rates of Capital One, Providian, Household, and Metris, the average delinquency rate among the nation’s top issuers would have declined 20 basis points over the past twelve months, from 5.23% to 5.03%. On average, the top 10 issuer delinquency rate for 4Q/02 is 6.62%, compared to 6.44% in the prior quarter, and 6.17% one year ago. The only non-sub-prime issuer to report an up-tick in delinquency compared to 4Q/01 is Fleet, which edged up by 7 basis points, according to CardData (www.carddata.com). Bank One reported the sharpest decline in delinquency, from 6.39% to 5.82%. Providian’s delinquency rate grew by 230 basis points. For more historical information on delinquency rates visit CardData ([www.carddata.com][1]).

TOP TEN VISA/MASTERCARD ISSUERS –
QUARTERLY DELINQUENCY

DAYS 4Q/02 3Q/02 2Q/02 1Q/02 4Q/01 Y/Y CHG
1. Citigroup: 90+ 1.86% 1.88% 1.84% 2.13% 1.98% -12 bps
2. MBNA: 30+ 4.88% 4.79% 4.80% 4.97% 5.09% -21 bps
3. Bank One: 30+ 5.82% 5.73% 5.55% 6.23% 6.39% -57 bps
4. Chase: 30+ 4.67% 4.47% 4.17% 4.58% 4.77% -10 bps
5. Cap One: 30+ 5.60% 5.36% 4.54% 4.80% 4.95% +65 bps
6. Providian: 30+ 11.11% 11.23% 10.16% 10.22% 8.81% +230 bps
7. BofA: 30+ 5.65% 5.29% 5.54% 6.11% 5.87% -22 bps
8. Household: 60+ 4.12% 4.14% 3.90% 4.39% 4.10% + 2 bps
9. Fleet: 30+ 4.12% 3.83% 3.74% 3.97% 4.05% + 7 bps
10. Dir Merch: 30+ 11.10% 10.80% 10.20% 9.80% 9.40% +170 bps
30+ DAY AVG*: 6.62% 6.44% 6.09% 6.34% 6.17% +45 bps
NR- not reported * 60+ day and 90+ day are not meaningful
SOURCE: CardData (www.carddata.com)

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

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Alphyra Sale

Irish electronic transactions company, Alphyra Group, which is valued at $97 million, is in play, unless a management buyout is successful. The London Sunday Times reported that Euronet Worldwide is now looking at a possible deal. However, the company says it is not in takeover discussions with Alphyra. Euronet says it did have discussions with Alphyra in the summer of 2002 regarding a possible business combination, but that these discussions had terminated months ago. Last week, Rendina, an entity formed by management as a buyout vehicle for Alphyra raised its offer to $2.88 per share, after originally offering $2.62 per share. First Data initially offered $3.00 per share, however the offer was withdrawn shortly thereafter, according to The RAM Report. Alphyra has 80,000 merchants in its network spanning ten European countries.

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CheckPoint

MA-based International Wireless has introduced its “MobileVision” suite of wireless productivity and mobile commerce software which includes “CheckPoint” that allows a mobile merchant to scan the MICR number on the bottom of a check to verify the funds using a camera enabled mobile device such as a cell phone or PDA. These applications together with the Company’s “CodePoint” software are expected to make the new generation of digital camera-enabled cell phones and hand held computers (PDA’s) more effective personal productivity and m-commerce tools for the average users. These enhanced devices are expected to also drive increased cell phone usage and improve revenues for wireless carriers (ARPU).

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CO-OP Offers Debit Fraud Tool

CO-OP Network has introduced Fair, Isaac’s “Falcon Fraud Manager” system to member credit unions to fight debit card fraud. Falcon Fraud Manager prevents losses by calculating and assigning scores to incoming transactions using both data-modeling and member profile histories. The result of the system is a neural network that quickly identifies potentially fraudulent activity while generating fewer false positives on cardholder transactions.

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GPN & APRIVA

AZ-based APRIVA said Monday that its intelligent wireless gateway and POS product line has received certification with Global Payments. APRIVA POS is an end-to-end wireless solution that enables merchants to process credit card transactions from any location using major credit card processors like Global Payments. The product, which includes both hardware and software, is powered by APRIVA’s intelligent gateway and delivers highly secure, efficient and reliable transaction processing in a ready-to-install package.

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ATMEL CB CARDS

Sagem has selected Atmel’s “secureAVR AT90SC9608RC” as the silicon
platform for the development contract of the next generation for chip-based
French bank cards. Sagem was awarded the smart card contract by Groupement
des Cartes Bancaires. Currently there are in excess of 45 million “CB”
cards in circulation, which will be replaced by the new EMV cards starting
in 2004. The “AT90SC9608RC” is an 8-bit/16-bit RISC microcontroller, having
96K of ROM, 8K of EEPROM, 3K of RAM, with a 16-bit high performance RISC
co-processor.

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