Amazon.com and Citibank Cards have teamed up to launch a private label credit card without a physical card. The ‘Amazon Credit Account’ is initially offering new, virtual cardholders three months of no payments and interest-free holiday shopping on orders over $200 placed through January 31, 2002. The 90-day free finance offer offer does not apply to purchases made from Amazon Marketplace, Auctions or zShops, or Circuit City. The interest rate is currently set at a fixed 22.90%. The credit program will reach out to customers without bank credit cards. The virtual store card program is being run by Amazon.com Financial Services, Inc., a subsidiary of Amazon.com, Inc. and Citi Commerce Solutions, a division of Citibank Cards. Last week, Amazon.com began offering merchandise from Target Corp. to expand its selection to include furniture, clothes and jewelry. Seattle-based Amazon, slowly edging towards profitability, reported a third quarter pro forma net loss of $58 million compared with a loss of $89 million for 3Q/00. Third quarter revenues were $639 million.Details
Continental Airlines announced Friday the launch of an incentive program that awards companies using the Continental Airlines Universal Air Travel Plan card, points redeemable for first class upgrades and free travel. Under the new ‘Businessbonus’ program, companies receive points for tickets charged to the Continental UATP card for travel on Continental and more than 230 participating airlines and Amtrak. Companies that purchase tickets through Continental Airlines can earn up to 100 ‘Businessbonus’ points for every $1,000.00 in qualifying purchases charged for travel on the Continental UATP card. ‘Businessbonus’ points do not expire and are earned in addition to other awards program benefits such as ‘OnePass’ mileage.Details
GA-based HERO Inc. has developed technology that can layer cash rewards loyalty program features onto cards that have already been issued, on an opt-out basis. The HERO (Health Education Retirement Organization) program offers the first payment card loyalty program that offers a turnkey technology platform with no upfront fees or development costs for an issuer. The program offers cash rebates provided by a network of program merchants so that participating cardholders may accumulate funds and invest them for their own chosen savings goal . The cash rebate earned by the cardholder is deposited into a trust account for the program?s cardholders. Cardholders may choose to donate a percentage of their rebates to a charity that is registered with the card issuer. HERO says major benefits for issuers include program revenue-sharing, gaining new customers, increased account transaction volume, and cross-selling potential. HERO?s technology platform is also available to operate separate loyalty programs with customized redemption options.Details
Coinstar, DataWave Systems, and Standard Federal Bank, which recently merged with Michigan National Bank, have expanded their prepaid MasterCard program from a five-store test in the Seattle area to a 52-store pilot in three cities. In addition to Seattle, people can now purchase prepaid Standard Federal Bank-issued MasterCard cards from select Coinstar machines in and around Portland, Oregon and Raleigh, North Carolina. Consumers can purchase the cards using cash, coins, or a credit or debit card from a Coinstar machine. The company has machines deployed in nearly 9,000 locations throughout North America as well as in the United Kingdom.Details
According to the Yankee Group’s annual Technologically Advanced Family Survey, measuring consumers’ experiences and interaction with over 100 products and services, consumers continue to show a growing interest in using the Internet as a bill payment medium. Data from the 2000 TAF Survey showed that 5.1% of consumers are paying bills online, demonstrating a steady growth pattern.
The relatively low adoption rates have been due in part to poor marketing of electronic bill presentment and payment (EBPP) services in the past by billers such as communications service providers, ISPs, and even banks. Since then, many have refocused their efforts to drive consumer adoption, and the results are showing. For consumers showing interest in using EBPP, 28.7% stated that the convenience of eliminating check writing was the primary benefit, and 14.9% stated time-savings as their primary benefit.
“Consumers are now much more aware of EBPP than ever before, thanks to a big marketing push by service providers, banks, credit cards, and even online brokerages,” commented Paul Hughes, director of the Billing & Payment Application Strategies research and consulting practice at the Yankee Group. “Ultimately, the provider that can offer simple log-in and password access, and provide the consumer with the largest bill access point, will own them in the long term. Currently, our data shows that consumers look to their banks as the ultimate bill consolidator, but it is still early enough in the game for any of the above mentioned service providers to capture and own these high-level customers.”Details
Datacard Group provided a preview of a new high-speed card issuance system code named ‘Project Mercury’ today at CarteS 2001 in Paris. The new system is designed to meet emerging and next-generation card issuance needs of financial institutions, service bureaus and other high-volume card issuers.
The new DatacardÂ® high-speed card issuance system will deliver up to 3,000 cards per hour and offer a full range of card issuance capabilities, including smart card personalization, embossing, indent printing, topping, magnetic stripe encoding, thermal graphics printing and laser engraving.
‘For more than 30 years, Datacard has been the best-selling brand in the card issuance industry and we have been a long-term partner with the world’s leading card issuers,’ said Kent Shields, senior vice president and general manager of Datacard’s hardware division. ‘This new system will complement our 9000 and 7000 series products. These systems combined with Datacard’s smart card solutions and Syntera’ Manufacturing Efficiency System make Datacard an even more valuable partner for card issuers of all sizes.
Shields said the new high-speed system, which will be available in the fall of 2002, will help complete Datacard’s industry-leading portfolio of card personalization solutions.
‘Our intent when we started designing this new system was to anticipate card issuer needs. We considered all the challenges they will face, including issues surrounding smart cards, card security, card functionality, cost control and increasing consumer demand for highly personalized offerings,’ Shields said. ‘This system offers the power and the flexibility our customers will need as they face all of those challenges.’
‘We have designed our card issuance systems portfolio to meet a wide range of needs. We want to make sure our customers get precisely the features, the speed and the power they need for their card programs,’ Shields said. ‘In the next couple of years, many card issuers will face new challenges and they will demand advanced capabilities. By bringing this new high-speed system to market, we will expand our portfolio and be able to provide solutions for every type of program.’
The new high-speed system builds on Datacard’s successful long-term strategy of modularity and flexibility. Customers can choose features and functionality based on their needs. As their programs grow, they will be able to add new features, new modules and increased performance. ‘Datacard wants to provide our customers with real, lasting investment protection,’ Shields said. ‘We understand that every card issuer and each card program has unique needs. The flexible, modular design of this new system will give our customers the ability to buy what they need and upgrade the system as their needs evolve.’ Shields said he expects initial demand for the new high-speed system will come from financial institutions, service bureaus, telecommunication companies, healthcare card issuers and retailers. ‘But other card issuers, such as government agencies and transit providers, will be close behind. We think interest in this new system will come from a number of markets as issuers accelerate their plans to implement smart card programs. With the solid reputation of the 9000 and 7000 series card issuance systems, and the strength and reputation of the Datacard name behind it, we expect this new system will enjoy great success worldwide.’Details
Smart cards have failed to find a valuable application to support in the US market. Now firms are touting smart cards as fun and trendy in an attempt to win over converts.
According to Celent’s latest report, Smart Cards in US Banking: Is the Chip Hip’, smart cards are unlikely to find their way into the wallets of the masses without a mandate for conversion from the card consortiums. While there is renewed interest, a strong case for smart cards continues to be elusive. The stored value, or e-purse, application bombed several years ago and the reception to securing online shopping purchases with smart cards has been lukewarm at best. In their latest manifestation, smart cards are positioned as cool gadgets to carry with the potential to offer numerous value-added benefits.
“Smart card usage continues to flourish in Europe,” comments Meredith Hickman Outwater, author of the report. “But without a serious problem to solve, such as fraud reduction, or consensus from a major banking consortium to transition in unison, smart cards are expected to languish in the US market.” The report examines the evolution of smart cards in the US market, arguments for and against adoption, spending estimates for launching a smart card program, penetration rates by region, and future prospects. The report also highlights the efforts underway by the three major industry players: American Express, MasterCard, and Visa.
The report is available from Celent Communications, [www.celent.com].
AmaTech USA, a world leader in the manufacture and development of contactless smart card systems and components announced that its WavePass Internet Smart Card Network won the prestigious Sesame 2001 Award for Best Application in E-Commerce. The WavePass Internet Smart Card Network represents a major technological advance in e-commerce, providing a seamless and secure bridge between the Internet and the traditional bricks and mortar economy.
The Sesame Awards are a feature of the Cartes Exhibition ([http://www.cartes.com]) held in Paris in October and are considered to be the highest industry award honoring innovation in smart card technology. Winners are chosen by a panel of judges made up of international experts in smart card technologies. The decision is based on the product’s innovativeness and benefits provided to users.
“Smart cards have been successful in Europe and Asia for some time — especially contactless smart cards,” said Ray Freeman, chief technology officer of AmaTech USA. “This award represents a significant step in bringing this technology to America. The WavePass Internet Smart Card Network is a big first step in creating the necessary infrastructure.”
The entertainment industry is the first to reap the benefits from the WavePass Internet Smart Card Network. Online ticketing venues have suffered from the lack of a truly seamless interface between their online sites and the theaters or other venues that they represent. Customers using the WavePass system enjoy a new world of convenience and security.”
Contactless smart cards represent the wave of the future. WavePass card in hand, patrons can now bypass long lines at the ticket sales and will-call counters, and breeze into movies and other events — having already downloaded tickets, and even e-cash for concession stands, directly from the Internet onto their WavePass contactless smart cards,” stated Dennis Ryan, president of AmaTech USA, Inc. “The WavePass Internet Smart Card Network combines the ease of use, security, and flexibility of contactless smart cards with the full breadth and potential of the Internet economy. Because of the multifunction capability of smart cards, online event ticketing is only the beginning. We plan on expanding the WavePass Internet Smart Card Network to include other uses and industries by making it as easy as possible for other companies to develop contactless smart card applications.”
“Contactless smart cards are already being used every day by tens of millions of people in Europe and Asia in mass transit, telecommunications and other uses. It’s a familiar technology,” said Alicia Espericueta, director of marketing for AmaTech USA. “By combining this technology with Internet functionality the potential applications are limitless. We expect to see more and more companies adopting our contactless smart cards as a means of making e-commerce more friendly and secure for the user. I’m looking forward to winning more Sesame Awards in the future.”
AmaTech USA, Inc. is a wholly owned subsidiary of AmaTech AG, (Security Code Number – WKN 519 280), a world leader in the volume production of radio-frequency identification (RFID) systems and components such as contactless smart cards, smart labels, tags and readers as well as application software and system solutions. This globally operating company holds 72 worldwide patents on products, machines and manufacturing processes in the identification technology sector; an additional 89 patents are still pending, including the patent applied for on the WavePass system. AmaTech USA’s Product Development, Customer Service and Corporate Sales Offices are located at 460 Benson Lane, Suite 12, Chandler, AZ 85224. You can reach the company by phone at 480-726-8800, or via the Internet at [http://www.amatech.com], [http://www.amatechusa.com] and [http://www.justwaveit.com].
Internet pioneer NextCard has begun pulling banner ads from Web sites in response to a 45-day plan to satisfy banking regulators and as part of its immediate quest to find a well capitalized buyer. Prior to the changes in its business operations announced last week, NextCard believed it was on track to achieve profitability in the fourth quarter. However NextCard says it expects to breakeven in the fourth quarter as reduced revenues will likely to be offset by reduced marketing and acquisition costs and lower operating expenses. Following recent consultations with banking regulators, NextCard’s plan is to increase its reserves for loan losses and tightening its underwriting criteria to limit new account originations to FICO scores above 680. NextCard has also stopped issuing secured credit cards, and suspended certain line management programs, re-pricing programs, and fee-based product strategies. Furthermore, NextCard agreed to classify as credit losses certain loan losses which were previously recognized as fraud losses. NextCard says a substantial portion of these losses are related to fraudulent account origination activity specific to the Internet channel. (CF Library 10-31-01)Details
Palomar Enterprises, Inc. announces the company intends to launch a new credit and financial services venture focused on acquiring and collecting on non-performing debt, primarily from credit card holders.
Subject to reaching a Definitive Agreement, Palomar Enterprises will participate in a joint business venture with People Locator Inc., a private Florida-based company, and establish integrated debt acquisition and collection operations.
People Locator Inc. is a provider of debtor information with over 30 years experience in locating debtors for first tier banks and financial service companies. Under the company’s principal Carl MacBride, People Locator Inc. has become one of the Nation’s leading debt locator firms with proprietary systems and success rates up to 75%.
Palomar Enterprises’ strategic relationship with People Locator Inc. will give the company access to existing portfolios of debt.
Fueled by the ever-increasing amount of consumer and commercial debt; the growing use of outsourcing accounts receivable management and other services by credit grantors; and the sale of performing and non-performing debt, collection agency revenues have reached an all time high. Combined revenues of the top ten companies increased dramatically from $910 million in 1995, to $2.5 billion in 2000.Details
Orbicom, a satellite broadcaster, has launched an online, card-based payment service in Accra. The payment network includes a wireless switch linked to POS terminals. The new company will be called: Transaction Management Services. Following the rollout in Accra, the service will be extended to other areas of Ghana. Other partnering companies include: Dart Communications, Cal Merchant Bank, Ecobank, and Trust Bank.Details
MO-based Students in Free Enterprise is launching a national campaign next week to teach their college peers and young adults proper credit usage and smart money management skills. As part of the ‘National SIFE Responsible Use of Credit Week’, student teams across the country will participate in a special competition that will award a projected $13,500 to teams with exceptional projects. SIFE educational events include Web pages, videos, pamphlets, workshops, seminars, game shows and poster contests. A recent SIFE poll found that 80% of college students have at least one credit card. Of those students, 65% received a credit card by the time they were college freshmen, while 25% had received one while a senior in high school.Details