VISA D FINANCING

Montreal-based VISA Desjardins is expanding its “accord D FINANCING” program after signing a deal with Cantrex Buying Group, the largest furniture buying group in Canada. VISA Desjardins has been offering VISA cards with an alternate credit limit, aside from the regular limit, that consumers can use to finance the purchase of durable goods directly from participating merchants. The financing is processed in seconds over the merchant’s POS terminal. The program has been highly successful in Quebec, with close to one million users, according to the The RAM Report ([www.ramreport.com][1]). There are currently over 2,800 participating businesses in the financing program.

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

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ATM Misperceptions

A new study shows a significant number of consumers are confused about the meaning of signage at ATMs. The study by Analytica for the PULSE EFT network found that 25% of survey respondents believed that the lack of a match between at least one brand on their card and on the ATM means that their card would not work, and 20% believed that if a match did exist, no fees would be charged. The study also revealed that some users still fear that their ATM cards will be “eaten” if inserted in a machine lacking a brand signage match. PULSE says the findings suggest the promotion of ATM brands may be counterproductive. The study also found slightly more than 60% of card users have conducted transactions with their card outside their home state, and almost one in five have used their card outside the country.

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VISA DESJARDINS & CANTREX

Montreal-based VISA Desjardins is expanding its “accord D
FINANCING” program after signing a deal with Cantrex Buying Group, the
largest furniture buying group in the country. VISA Desjardins has been
offering VISA cards with an alternate credit limit, aside from the regular
limit, that consumers can use to finance the purchase of durable goods
directly from participating merchants. The financing is processed in
seconds over the merchant’s POS terminal. The program has been highly
successful in Quebec, with close to one million users. There are currently
over 2,800 participating businesses in the financing
program.

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TSR Impact

A trade magazine serving the telemarketing industry says the proposed changes to the Telemarketing Sales Rule which include a national “Do-Not-Call” list is designed to eliminate outbound telemarketing. Technology Marketing Corporation estimates that roughly 3,500,000 million Americans are actively involved in the outbound telemarketing industry, and that an additional 1.5 million American jobs rely on outbound telemarketers for their viability. TMC says the proposed changes to the TSR would put all of these jobs at risk. TMC says the Direct Marketing Association has maintained a national do-not-call for 25 years with more than four million subscribers on it, plus more than 20 states currently maintain their own do-not-call lists.The publisher also says call center jobs are being driven overseas due to significantly lower labor costs and the fact that telephony can travel globally over the Internet and other networks for virtually no cost. If the new TSR rules go into effect, a company based outside American borders would be able to sell anything over the phone and call countless U.S. households, regardless of any federal do-not-call list.

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Top 10 Issuers

The nation’s top ten VISA and MasterCard issuers produced more than $918 billion in credit card gross dollar volume during 2002, ending the year with an average volume per active account of $4,519. Add American Express and Discover to the list and the total comes in just a tad under $1,250 billion. On average, cardholders of Bank One and American Express racked up the highest dollar volume. However, Citibank, MBNA, and Bank of America, topped $5,000 in annual volume per active account. Meanwhile, card balances among the top ten V/MC issuers came in at $2,616 per active account, and the average number of active accounts settled in at 55%, according to CardData ([www.carddata.com][1]).

ACTIVE ACCOUNT ANALYSIS
(as of December 31, 2002)
ISSUER AA AADB AAV
1. Citigroup 51% $2705 $5297
2. MBNA America 59% $2484 $5000
3. Bank One 53% $3915 $8011
4. Chase 59% $2954 $4850
5. Discover 49% $2261 $4301
6. Capital One 54% $1965 $2636
7. Bank of America 67% $3031 $5103
8. Providian 66% $2481 $2329
9. Household Bank 55% $1466 $3147
10. Fleet 59% $2893 $4518
AVERAGES: 55% $2616 $4519
AA – percentage of gross accounts that are active
accounts; AADB – average balance at EOY per active account; AAV – average
annual volume at EOY per active account.
Source: CardData (www.carddata.com)

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

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Magna Platinum Series Printer

Datacard has introduced the “Magna Platinum Series” card printer, a mid-volume desktop card printer for the issuance of employee badges, membership cards, student IDs, loyalty program cards and government-issued cards. Datacard offers both full-color and monochrome versions of the printer, as well as one- or two-sided printing capabilities. Users also can configure the new Magna Platinum Series printer with any combination of inline magnetic stripe, smart card and proximity card technologies to make cards compatible with access controls and other automated systems. Optional inline application of topcoats or laminates helps improve security and extend card life.

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BANQUE RAIFFEISEN ATMS

Banque Raiffeisen has signed a five-year contract with Diebold for
maintainence and management of its network of ATMs in Belgium and
Luxembourg. Under the terms of the contract, Diebold will take full
responsibility for the “Monetic Server Luxembourg” through which Banque
Raiffeisen’s ATM network is routed. The “MoSeL server,” developed by
Diebold in the early 1990s, manages the operations of the country’s 360
self-service terminals. Diebold already carries out ATM maintenance and
software support for Banque Raiffeisen. The company is also the preferred
self-service terminal provider to all of the country’s leading banks.

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Dialing for Deception

The Federal Trade Commission has secured $1.4 million from two firms engaged in an advance-fee credit card scheme. The case, brought through the FTC’s April 2002 “Dialing for Deception” law enforcement sweep, targeted defendants who allegedly placed ads in magazines or mailed postcards to consumers to pitch advance-fee credit cards to prospective buyers deceptively. As a result, the FTC filed a complaint against Thomas Gregg Holloway, First Freedom Financial Corporation, and Southern Telmark Corporation. According to the Commission, since at least 1996, the defendants used advertisements in magazines and on postcards to deceptively pitch consumers an unsecured credit card in return for a fee averaging between $79 and $229. The FTC alleges that when consumers responded to the ads by calling a toll-free number, the defendants offered either a Visa or MasterCard credit card with no security deposit, regardless of the consumers’ credit history. The defendants allegedly said the application fee was a one-time processing fee. The FTC alleges that none of the consumers received the promised card after paying the fee.

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Fifth Third & Masco

Fifth Third Bank Processing Solutions has been selected by Masco Corporation, one of the world’s largest manufacturers of brand-name consumer products, to provide merchant services for its credit and debit card transactions and Fifth Third’s back-office management system. With Fifth Third Direct, Masco Corporation will be able to conveniently and seamlessly handle their back-office through automated access to transaction, deposit and chargeback data as well as the ability to scan receipts, handwritten notes, or other documents into their system for quick reference.

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THIN LOYALTY CARDS

Black Sun and MORI have released a report on loyalty cards that shows 57%
of the U.K. population have one or more of the 39 million loyalty cards in
circulation; yet 25% of cardholders never redeem their points; only 40% say
that having the card makes them shop at the store; 69% say they are not
swayed by having a card; and 85% of card holders regard lower prices as
preferable to loyalty points. Speaking this week at “Cards Europe 2003,”
Black Sun`s Knowledge Management Director explained that the key reason for
this is that the current loyalty programs are strong on volume and weak on
value. Black Sun says the current loyalty programs are little more than
thinly disguised discount programs. Not only is the discount “thin”, its
usually 1%, but also the fact that it is simply a discount scheme is only
slightly disguised by the issuing of points for earnings and redemption.
Black Sun cited the “Nectar” loyalty card as an example.

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iPIN Joins MPF

Belmont, CA-based iPIN has joined the “Mobile Payment Forum,” founded by American Express, JCB, MasterCard, and VISA. ith extensive experience developing and implementing multi-carrier payment networks, iPIN looks forward to collaborating with the members of the Mobile Payment Forum and believes that its insights on payments and interoperability will be valuable to the ongoing development of global mobile payment standards. Since its inception, iPIN dedicated significant time and resources to ensure that its product suite remained open and flexible.

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SEARS MASTERCARD

Sears Canada confirmed yesterday it plans to expand its “Sears
MasterCard” program across the country this year. The company launched the
MasterCard in September in Ontario only, and at year-end 2002, had
activated 125,000 accounts with $150 million in outstandings. Sears Canada
has nine million retail cardholders, the largest store credit card program
in Canada. At year-end 2002, the Sears Canada card had $2,753,000,000 in
card outstandings. Sears Canada is a multi-channel retailer with a network
of 123 department stores, 40 furniture and appliances stores, over 2,100
catalogue pick-up locations, 140 dealer stores, 17 outlet stores, 45 floor
covering centers, 52 auto centers and 111 Sears Travel offices. In the
U.S., Sears has $12.3 billion in outstandings in the “Sears Gold
MasterCard” program, compared to $5.3 billion on year ago.
U.S.-based Sears has $18.5 billion in store card outstandings.

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