Experian yesterday said it has reached an agreement to acquire ConsumerInfo.com from Homestore.com, Inc. for $130 million in cash. ConsumerInfo.com is a major supplier of online credit reports, scores, and related information to consumers in the USA with nearly three-quarters of its revenue derived from membership subscriptions. Founded in 1997, ConsumerInfo.com currently has 778,000 members. Under ConsumerInfo.com’s program, members can access their credit reports as often as desired, monitor their files monthly, and receive advice on managing credit and debt levels for an annual subscription of $79.95. ConsumerInfo.com also sells individual credit reports, credit scores, and other services at prices ranging from $9.95 to $44.95. Since its founding in 1995, the company has provided credit reports to more than 2 million consumers. It was the first U.S. company to offer consumers online access to single-bureau credit reports, three-bureau credit reports, and lender-style credit scores.Details
Chase has become the latest issuer to join the $35 late fee bandwagon, and the issuer is also taking the opportunity to significantly boost APRs for existing cardholders. Beginning May 1st, Chase will raise “preferred” credit card interest rates to prime +11.99% with a 19.99% minimum APR. Credit card “non-preferred” interest rates are going to a fixed 22.99% APR. In the late fee area, Chase is following the tiered pricing structures of other major issuers who recently changed fee policies.
Effective May 1st, Chase will charge a $15 late fee for balances up to $150, a $29 fee for past-due balances between $150 and $1200, and a $35 late fee for outstanding balances over $1200. Chase is also notifying cardholders that it will charge a $12 fee to make an account payment over the phone. Chase becomes the third major issuer to boost fees this year, after MBNA and Discover instituted similar policies this month. Discover and MBNA are now charging a $15 late fee for balances under $100; a $25 fee for balances between $100 and $1,000; and a $35 fee for past due balances above $1,000. Last year, Citibank and US Bank boosted late fees from $29 to $35. In 2000, Fleet Credit Card Services began charging a $35 late fee on all its card products including the new “Fusion smart VISA.” Advanta was the first card issuer to institute $35 fees for holders of its business card products. On average, late payment fees, among issuers with portfolios over $100 million, have increased 145.9% since 1994, from $11.71 to $28.79, according to CardData (www.carddata.com). (CF Library 8/1/01; 8/30/01; 2/7/02; 2/11/02; 3/1/02)
LATE FEE TRACK RECORD
(For February of Each Year Listed)
YEAR FEE CHNG
1995: $12.64 +7.9%
1996: $13.25 +4.8%
1997: $14.62 +10.3%
1998: $19.30 +32.0%
1999: $22.89 +18.6%
2000: $25.99 +13.5%
2001: $27.12 + 4.3%
2002: $28.79 + 6.2%
Source: CardData (www.carddata.com)
Digital Insight Corp. announced its enhanced AXIS Advanced Target Marketing software version 2.1, bolstered with additional administrative tools, visual guides, and expanded options, allowing client financial institutions to implement online promotions faster and easier.
An expanded arsenal of campaign resources includes administrative tools, user-friendly guides, and image libraries for creating new promotions, as well as packaged, ready-to-use promotions and email campaigns.
“AXIS Advanced Target Marketing is key to cross-promoting our eFinance offering,” said Mike Armbruster, senior vice president and chief information officer for Rochester, NY-based ESL Federal Credit Union. “With ATM, we substantially increased our bill payment adoption rate as well as the number of online lending applications.”
New images and image locations for the presentation of the promotions expand the existing campaign resources. Innovative feature functionality makes AXIS Advanced Target Marketing very simple to use:
— The Create Promotion Wizard helps build basic promotional campaigns with information provided by the financial institution’s administrator. Through a series of pop-up dialog boxes, ATM assembles the campaign and presents the online advertisement to a targeted group of end-users at specified locations within AXIS Internet Banking and Bill Payment.
— Out-of-the-Box Promotions are “fully assembled” online campaigns that can be implemented with a few clicks. They enable the financial institution to leverage the power of the online marketing tool with little effort, helping the financial institution to quickly realize the value in targeted campaigns.
— With Email Campaigns, ATM offers direct query functionality enabling administrators to target specific customer groups with specialized promotional offers.
— New images for promoting Account Aggregation and Online Statements are now available. Additionally, promotional areas on financial institutions’ websites have been expanded to include space within AXIS Bill Payment and Online Statement pages.
“We are excited about the new promotional images, and look forward to using it to market Online Statements,” said Armbruster. “The ability to create specific promotions for a qualified group of our members makes cross-selling services even easier with these new features.”
“For financial institutions, one of the biggest benefits of its Internet branch is the opportunity for cross-selling. Marketing is an essential element to making this happen — that’s why Digital Insight is committed to providing our clients with the tools for taking the right cross-sell message to the right customer,” said Dale Walker, chief operating officer and president for the Company. “That’s just part of the business partnership Digital Insight builds with clients.”
For more information about AXIS Advanced Target Marketing, go to .
About Digital Insight
Digital Insight(TM) Corporation is the preferred eFinance enabler for visionary financial institutions. Through its comprehensive portfolio of outsourced, Internet-based financial products and services built upon the company’s unique architecture, Digital Insight moves banks and credit unions beyond Internet banking to become the trusted transaction hub for their retail and commercial customers. Digital Insight provides retail and commercial Internet banking, electronic bill payment and presentment, eCommerce portal technology, wireless channel delivery, advanced targeted marketing, website development and maintenance, as well as online and call center lending services. Each Digital Insight product and service reinforces the brands of its client financial institutions.Details
Enhancement Services Corporation, a leader in the loyalty marketing industry, has added a well-known advocate in the industry to head up their customer group. Lars Holmquist joined the company as Executive Vice President, Business Development and Consulting. Holmquist, previously with MasterCard, comes with more than 15 years of experience in the financial services and travel industries. As VP – Loyalty Consulting Services at MasterCard, he managed the U.S. business development and client management areas. Lars has also consulted with many card issuers in designing and managing profitable rewards programs. His vast experience has led Lars to be well-recognized in the loyalty marketing industry, often asked to speak at major banking conferences and cited in national publications.
Prior to MasterCard, Lars spent 2 years with Brierley & Partners, a targeted marketing loyalty agency, and nearly 9 years with American Express. Lars also gained international experience while at American Express. He was stationed in Sweden for nearly five years where he managed the corporate card business unit and several travel businesses for American Express. At ESC, Lars will be charged with profitable company growth, while heading up Sales, Marketing, and Client Relations. He will be working closely with other areas such as IT, Operations, and Customer Service to achieve ESC’s business and financial objectives.
ESC ([www.escloyalty.com]) specializes in customized, technology-driven loyalty programs that serve as strategic, business-building solutions for top financial institutions. In Atlanta since 1986, ESC has grown to over $100 million in revenues and 150 employees. Among ESC’s client roster are Chase Manhattan, Wells Fargo & Company, SunTrust, First Citizens Bank, Bank One, and others.
The company’s scope of services includes loyalty program design, data processing set-up and administration, database segmentation, automated and web-based points tracking and reporting, merchandise and travel redemption, customer service and marketing communications. ESC’s diverse experience ranges from acquisition, activation to retention programs.
Located in Roswell, Ga., the privately owned company is led by founder Steve Wilson, President and Chief Executive Officer.
The Federal Open Market Committee decided Tuesday to keep its target for the federal funds rate unchanged at 1.75%. The Committee said that even though the economy is beginning to expand at a significant pace, there is still uncertainty over the degree of strength in consumer demand. However, the Feds are expected to raise interest rates this summer for the first time in 15 months. Credit card interest rates have been inching up since the first of this year. The 11 rate cuts last year drove average credit card APRs down to 14.21% from 16.57% at the beginning of 2001.Details
Global Payments reported that revenue for the third quarter of fiscal 2002 ending Feb 28, was $115.3 million, a 43% increase over the prior year. Net income of $10.3 million compares to $5.8 million in the prior year. For the nine months ended Feb 28, revenue was $341.9 million, a 38% increase from the prior year period’s normalized revenue of $247.6 million. Net income grew 56% to $34.8 million from $22.3 million in the prior year period. For complete details on GPN’s latest performance visit CardData ([www.carddata.com]).
Centerpost Corporation announced an alliance with HNC Software Inc., the leading provider of high-end analytics and decision management software. The combined technology will help credit and debit card issuers respond to potential fraud by automatically contacting customers over any communications channel, including voice, wireless, email, fax, and instant messaging. With this enhanced service, card issuers will improve their ability to prevent fraud while lowering the cost of communicating with customers through automation.
Centerpost’s multi-channel alerting technology will be integrated with HNC Software’s Falcon Fraud Manager, which currently monitors more than 400 million card accounts worldwide and 84% of all U.S. transactions. Once Falcon Fraud Manager detects suspicious activity on an account, the cardholder is notified in real-time on the device that is most convenient, such as a mobile phone or pager. After receiving the alert, the cardholder is able to verify the transaction through the device or be connected back to the card issuer’s customer service center to investigate the activity further. Card issuers will shorten the customer communications process with automated alerts, improving operations, lowering call center costs, and ultimately preventing fraud.
“HNC is the leader in the area of fraud detection software, so this partnership represents an opportunity for us to provide a valuable service to most of the major card issuers,” said James N. Patrick, Executive Vice President of Sales and Business Development for Centerpost. “Falcon Fraud Manager clients can now leverage their existing software investment to create a powerful communications solution that directly enhances the bottom line. Implementing our service is an extremely effective way for card issuers to remove significant costs from their operations and improve relationships with cardholders by putting them in control.”
“We’re constantly seeking to integrate value-added services and features that address our customers’ most critical business issues,” said John Mutch, CEO of HNC Software. “By identifying fraud more quickly, financial institutions can improve their operations, realize cost savings and service cardholders better.”
By integrating the Centerpost and HNC offerings, card issuers will now have access to the most advanced fraud prevention capability available today. No longer will a card issuer’s call center waste valuable time making repeated attempts to communicate important fraud information to cardholders. Using Centerpost’s technology, a card issuer creates an outbound communications solution that provides a clear, quantifiable ROI, while at the same time enabling its call center to focus on inbound customer service or revenue-generating activity.
Centerpost Corporation is a provider of automated communications solutions for United Airlines, Travelocity, Motorola, and other leading companies. Centerpost’s services enable companies to deliver interactive alerts to customers and employees using voice, wireless, email, fax, and instant messaging. Centerpost is headquartered in Chicago and has offices in Atlanta, Dallas, and Los Angeles. For more information, visit www.centerpost.com or contact Centerpost at email@example.com.
About HNC Software
HNC (NASDAQ: HNCS) is a leading provider of high-end analytic and decision management software and tools that enable global companies to manage customer interactions by converting data and business experiences into real-time recommendations. HNC’s proven software empowers Global 2000 companies in the financial services, insurance, telecommunications, health care, and other industries and governments to make millions of the right mission-critical customer decisions, and take action in real time, substantially improving financial performance, reducing costs and decreasing risk. For more information, visit [www.hnc.com].
InterCept, Inc., a leading provider of banking technology products and services for community financial institutions, announced a major expansion in its merchant processing operations. InterCept has entered into a definitive agreement to acquire the assets of Internet Billing Company, Ltd., a Ft. Lauderdale-based provider of transaction processing for Web merchants. Separately, InterCept also signed a binding letter agreement to acquire Electronic Payment Exchange, Inc., an end-to-end provider of transaction processing services based in New Castle, Delaware.
John W. Collins, InterCept’s CEO, stated, “Since 1996, we have provided merchant portfolio management services to community bank customers. However, our role has been limited to serving as the middleman for our bank customer and the payment processing companies. The acquisitions of iBill and EPX will enable InterCept to become a full-service provider of end-to-end credit card processing solutions for multiple sales channels — Internet, point of sale, call center, mail order, and wireless channels. iBill and EPX fit perfectly into our plan to grow our company through strategic acquisitions of businesses that add large volumes of customers, provide recurring revenue, and offer strong growth opportunities.”
Commenting on the acquisition, Garrett M. Bender, iBill’s President and CEO, stated, “iBill’s turnkey e-commerce solution is designed specifically for online merchants. Our goal is to reduce the costs and risks for merchants who do business online, whether they are small Internet merchants or online divisions of global merchants. Currently, we process approximately $450 million in annual transaction volume. By partnering with InterCept and EPX, we will now be able to offer merchants a multi-channel solution to complement their online business.”
Raymond Moyer, EPX’s President and CEO, stated, “EPX offers a single source for payment solutions, eliminating the need for businesses to establish multiple relationships with banks, front-end system providers, gateways, independent sales organizations and back-end processing companies. Presently, we process approximately $5 billion in annual transaction volume. We believe the combination of our payment processing solution, InterCept’s financial strength and iBill’s sales and marketing expertise will enable us to meet the demands of all types of merchants of any size.”
Commenting on the synergies provided by EPX and iBill, Mr. Collins said, “Our goal is to provide community financial institutions with the technology solutions necessary for them to remain competitive. Presently, our merchant processing division provides services to approximately 160 community banks with over $1 billion in transaction volume. The addition of iBill and EPX to our merchant processing division will enable us to provide our community financial institution customers with a transaction processing solution that they can offer to their customers at competitive rates, enabling them to further solidify their relationship with their local merchants.”
Mr. Collins added, “Together, InterCept, iBill, and EPX will offer a full-service, end-to-end transaction processing solution for both traditional ‘brick and mortar’ companies and online merchants. By adding the advanced payment solutions offered by iBill and EPX to our existing merchant processing division, we believe InterCept can become a market leader in transaction processing.”
InterCept believes the iBill and EPX transactions together will contribute additional revenues of approximately $49-$52 million and EBITDA of approximately $9-$10 million for the remainder of 2002, and $92-$94 million in revenues and $22-$24 million in EBITDA in 2003. Additionally, InterCept believes this transaction will add $0.01-$0.02 to its earnings per share for the remainder of 2002 and will add $0.08-$0.10 to 2003 earnings per share.
Robertson Stephens acted as exclusive financial advisor to InterCept in connection with the acquisition of iBill. Credit Suisse First Boston acted as financial advisor for InterCept’s acquisition of EPX.
Conference Call and Webcast Information
InterCept has scheduled a conference call to discuss these transactions at 10:00 AM EST on Wednesday, March 20, 2002. InterCept will also provide an online Web simulcast and rebroadcast of the call. Live broadcast of the call will be available online at .
To listen to the live call, please go to the web site at least fifteen minutes early to register, download and install any necessary audio software. An online replay of the call will be available shortly after it ends and will continue to be available through April 20, 2002.
iBill provides secure transaction services that enable Web merchants to accept and process real-time payments for goods and services purchased over the Internet. It also manages all back-office functions including reporting, tracking, customer service and sales transactions. The company’s service is powered by proprietary technology that integrates online payment processing, fraud control, affiliate management and financial reporting and tracking. For more information about iBill, go to .
EPX is a full-service electronic payment processing company that specializes in enabling businesses to accept credit card, debit card and electronic check payments. EPX’s system is completely Internet-based and provides straight-through processing that eliminates a business’s need to use a gateway or invest in front-end technology to process, whether their transactions take place online, over the telephone or at the point of sale. For more information visit .
InterCept is a single-source provider of a broad range of technologies, products and services that work together to meet the technology and operating needs of community financial institutions. InterCept’s products and services include core data processing, check processing and imaging, electronic funds transfer, data communications management, and related products and services. For more information about InterCept, go to http://www.intercept.net or call 770.248.9600.Details
Pipeline Data has acquired SecurePay, Inc., an integrated provider of transaction processing services, gateway services, related software application products, and value added services to wireless and Internet merchants.
The acquisition transitions Pipeline’s business plan from solely that of an information outsource service provider in the healthcare industry to an information and money transactions platform for government and merchant Internet users.
SecurePay supplies transaction processing support for all major credit and charge cards, including Visa, MasterCard, American Express, Discover, Diners Club, and JCB. The company also offers access to check verification services.
SecurePay provides merchants with a broad range of transaction processing services, including transaction authorization, data transmission, and billing dispute resolution. The company is an industry leader in the development of software applications that can be delivered through its proprietary host network.
SecurePay utilizes multiple channels to market its products and services. The company holds various strategic alliances with PDA device manufacturers and software developers, as well as with industry leaders in Internet banking and processing.
The agreement to acquire SecurePay was approved by the unanimous consent of the Board of Directors of Pipeline and SecurePay and will take effect on March 19, 2002. As a result of this transaction, SecurePay becomes a wholly owned subsidiary of Pipeline. The acquisition of SecurePay calls for a stock for stock exchange in which Pipeline acquires all of the issued and outstanding common stock of SecurePay in exchange for the issuance of 7,600,000 newly issued shares of its common stock. The former shareholders of SecurePay have certain earn-in capabilities based upon revenue milestones achieved within a specified period of time.
Pipeline believes that with this acquisition it will have the revenues, infrastructure, and personnel necessary to rapidly expand its services. Jack Rubinstein, Chairman of Pipeline, stated ” The SecurePay acquisition affords our company the ability to offer the healthcare industry, insurance industry, government sector, and a wide array of wireless technology innovators, a suite of products in data and transaction processing that move forward the ability of a provider to interact much more efficiently with any customer. The provider-customer interface is a huge and rapidly growing sector of the American economy. Pipeline intends to be a technology and corporate leader in this space.”
With the acquisition of SecurePay, Mr. Rubinstein will remain as Chairman of Pipeline Data. MacAllister Smith, CEO of SecurePay, will join the board of Pipeline and will become CEO of Pipeline. Mr. Smith has held ownership positions in two transaction processing companies that have successfully merged with public companies, Pinnacle Financial Technologies, Access Services, Inc. Previously, he was regional vice president for NOVA Information Systems, Inc. (NYSE: NIS).
“We are delighted to be aligning our interests with Pipeline Data,” said Smith. “Jack Rubinstein shares our vision of a specialty transaction company capable of proliferating our technologically sophisticated products and services over a broad range of industry segments. The markets we target are vast, and in our opinion, inadequately served at the present. We strongly believe that the merger affords the new company a major strategic advantage in capitalizing on the large and rapidly growing field of specialty electronic payments.”
Ms. Maureen Bell will become the COO of SecurePay. Ms. Bell has many years of management experience in the credit card processing industry on both the acquiring and issuing sides with such major card processing companies as TSYS, Inc. and Lynk Systems, Inc. Anthony Reynolds will become Pipeline’s Chief Technology Officer. Mr. Reynolds has a national reputation in the field of wireless processing and the secure gateway card interface.
Pipeline looks forward to rapidly instituting several pre-planned initiatives and will inform shareholders and the industry as events progress.Details
When it comes to credit card portfolio sales, small deals not normally on anyone’s radar screen continue to dominate the number of transactions, accounting for 71% of all card portfolio sales since 1987. The rate of growth of new deals although, has risen for both small and large deals, with an average of 87 total card transactions per year during the past five years . An average of 104 deals per year are forecast by West Coast Investment bankers, R.K. Hammer, for the next 5-yr. period, 2002-2006. Of the 104 deals per year, an average of 30 per year will be less than $15 million each.
15-Year Card Portfolio Sales Trends
5-year period # Transactions Annual # Deals #1 Reason for Selling
2001-1997 >$15MM 130 26 Buyers has better array
$15MM 103 20 To take advantage of high
$15MM 87 18 To supplement the need
$15MM 320 (29% of total)
Concord EFS is teaming with Travelers Express/MoneyGram to offer a P2P money transfer service via the STAR network. The new service will allow STAR cardholders to initiate “send” transactions at participating ATMs, and will allow recipients to collect the funds via a special STAR MoneyGram card at any of the approximately 209,000 STAR ATMs nationwide. MoneyGram will provide the transaction services for both the “send” and “receive” transactions at STAR ATMs. This unique service concept is protected by Concord patents that cover the use of cards to send and receive money transfers at self-service terminals, such as ATMs. The ATM-to-ATM service is expected to pilot and begin initial rollout in the fall of 2002. The “send” service will be initially available through ATMs that are processed by Concord and eventually available to all participating STAR ATMs on an optional basis.Details
Identity thieves searching for personal information are on the rise in the UK in a practice Brits call “Bin Raiding” and Yanks call “Dumpster Diving.” A new study by Experian found on average one in every five bins contains a whole credit or debit card number linked to an individual name and 80% of these have an associated expiration date. Only 14% of UK household rubbish bins contain absolutely no information of interest to fraudsters. Almost three quarters of bins contain the full name and full address of at least one household member. Bank account details are regularly found in bins and, on average, one in every five bins contains a bank account number and sort code that could be related to the full name and address of a household member. In a second survey commissioned by Experian to find out how widespread the problem of bin raiding is, it was revealed that 75% of local authorities admit that bin raiding is regularly taking place in their area and, of these, 80% that the problem is getting worse.Details