Free Credit Scores

E-LOAN, Inc. announced that effective July 1, 2001, its California customers will benefit from the new California credit score disclosure law, which E-LOAN began advocating in February 2000. The new law requires E-LOAN and other lenders to provide all Californian mortgage and home equity applicants with the credit score(s) used to determine whether they’re approved for a loan and at what interest rate. Nationwide, the most common credit scores used in mortgage, home equity and auto lending decisions are FICO(SM) scores.

As a staunch advocate of full disclosure, including consumer access to credit scores, E-LOAN started providing FICO(SM) credit scores in February 2000 free of charge to consumers via its website. It was the first time consumers ever had ready access to these scores. More than 25,000 borrowers logged onto the site to access their scores before credit reporting agencies — under intense pressure from the creator of the scores — forced an end to the practice.

“The passage of this law is a giant step forward for California consumers, but there’s still more that needs to be done,” said Chris Larsen, E-LOAN’s Chairman and CEO. “This is information that should be readily and freely available to consumers nationwide. There should be very little difference between getting information about a stock or mutual fund and finding out your credit score. Just like consumers can research an investment before they commit their money to it, consumers should have free access to information about their credit score before they apply for a loan.”

Because credit scores have become so profoundly important in determining a consumer’s participation in the credit markets, E-LOAN has actively lobbied and testified at the national and state level in favor of guaranteeing consumers’ right to access credit scores used for lending, employment and insurance decisions. While E-LOAN’s efforts helped pass the Figueroa bill in California, the company continues to advocate legislation at the national level.

“We also believe that consumers have the right to know the positive and negative factors impacting their score, as well as specific actions they can take to improve their score,” added Mr. Larsen. “Simply providing consumers with generic information to interpret their score does not go far enough to help them understand this key component of their overall financial picture. We’ve done our best to arm consumers with this breadth of information through our existing CreditXpert Credit Score(TM) offering, which is available for free to consumers nationwide.”

Consumers nationwide seeking to better understand their credit standing and profile before they apply for a loan can take advantage of E-LOAN’s free CreditXpert Credit Score(TM) offering. By logging onto, clicking on the “Free Credit Scores” link and answering a brief series of questions, consumers can access their CreditXpert Credit Score(TM) and analysis online.

The confidentiality and security of all personal information is protected through advanced encryption technology, password protection, and E-LOAN’s stringent privacy policy and practices, which are independently audited by PricewaterhouseCoopers. E-LOAN does not sell consumer data to any third parties and will not share consumer data with any third parties without their consent except for the express purpose of completing a loan transaction or obtaining credit score information.

About E-LOAN, Inc.

E-LOAN, Inc., a leading online lending company, offers consumer loans and debt management services online at [][1]. E-LOAN has reinvented the consumer loan process by offering a broad choice of products from many lenders for mortgages, home equity loans, auto loans, credit cards and small business loans in a secure online environment, combined with comprehensive personal service from dedicated loan consultants. Through the first quarter of 2001, E-LOAN originated over $4.6 billion in consumer loans. The company’s loan processing centers are located in Dublin, CA and Jacksonville, FL. E-LOAN, Inc. is publicly traded on the Nasdaq system under the symbol EELN.



Score Power

As a new California law goes into effect next week requiring providers of mortgage and home equity loans to furnish applicants with free credit scores, Equifax and Fair, Isaac reported yesterday that more than 40 million unique visitors nationwide have checked out their fee-based credit score delivery service. The ‘Score Power’ service was launched in March by both companies at an introductory price of $12.95 per report. The service is the only online credit score delivery service for consumers that includes Fair, Isaac’s ‘FICO’ credit risk score. Last year, CA-based E-LOAN began offering free ‘FICO’ scores to consumers but was quickly shutdown following complaints from Fair, Isaac and the major credit bureaus. More than 25,000 borrowers logged onto E-LOAN’s free service before it was terminated. E-LOAN continues to offer free credit scores under the ‘CreditXpert Credit Score’ service. Fair, Isaac and Equifax also announced Wednesday they are expanding the ‘Score Power’ service to offer a subscription service for $38.85. Under the subscription plan, consumers access their personal credit score four times within a year from the date of purchase. (CF Library 2/28/00; 3/19/01)



Proton World announced today the launch of Proton Prisma Mobile Profile (MP), a new product package in the Proton Prisma family, which brings the features of Proton Prisma to mobile phone SIMs, and is targeted at mobile telephony operators and their financial-sector and other m-commerce partners. Using Proton Prisma MP on a Java™-based SIM will enable the delivery of the next generation of secure m-commerce services.

Proton Prisma MP dramatically lowers the total cost of ownership of the SIM, increases its life-cycle and provides financial-sector-level security. This means that the SIM issuer can create and maintain secure domains on the SIM, enabling the “leasing” of secure domains to service provider partners, such as banks, financial institutions and retailers. This provides a new source of revenue, widens the typical mobile phone customer base and reduces churn.

Proton Prisma MP suppresses the security discrepancies between financial-sector payment applications, m-commerce applications and typical SIM applications, so that their financial-sector partners could load their applications directly onto the SIM, enabling the end-users to access a whole range of secure financial services via their mobile phone handset. As in other sectors, Proton Prisma offers guaranteed application interoperability, independent of individual SIM manufactuers.

A PKI toolkit and an authentication application engine are two of the standard features of Proton Prisma MP. They can be used to develop WIM (Wireless Identity Module) applications. Mobile telephony operators can also integrate their own secure applications, such a pre-paid airtime re-load and premium services payment. The security domains concept offers a unique opportunity for mobile telephony operators and financial institutions to jointly-offer payment solutions (e.g. e-purse for micro-payments, EMV credit/debit for higher-value payments etc.) on the same mobile phone, with each partner retaining control of their respective applications.

Using Proton Prisma MP to combine multiple applications on one SIM, and moving to dynamic over-the-air application management will reduce the overall SIM infrastructure cost. Proton Prisma MP also offers financial institutions the chance to extend their electronic payment systems into a new customer base through collaboration with mobile telephony operators, extending their existing payment brands into new integrated solutions.

Proton Prisma MP can be used in all of the emerging m-commerce hardware models: single SIM handsets, dual-SIM handsets and single-SIM dual-slot handsets, (where a conventional bank-issued smart card can be used).

The first pilot test of Proton Prisma MP was launched in Belgium earlier this month by the Belgian Proton licensee Banksys, in collaboration with the mobile telephony operator Mobistar. In the first phase, customers using Mobistar’s prepaid Tempo package will be able to top-up their airtime account by using their handsets, equipped with Banksys’ banxafeÔ secure payment application, to transfer value from their bank account to their Mobistar account. Future phases may involve payments in shops and at web sites and access to banking services.

After an initial test period using members of the Mobistar staff, handsets equipped with the Proton Prisma MP SIM will be issued to selected customers in Q4 2001, and the Proton Prisma MP SIM will become standard issue to all Mobistar Tempo customers from Q1 2002 onwards.

Adrian di Fede, Vice-President, Products & Innovation at Proton World, said “Proton Prisma MP offers the secure payment and multiple-application solution that mobile telephony operators and their partners need. By bringing bank-level security to the SIM, introducing SIM-manufacturer-independence and a secure multiple-application platform, Proton World is offering both mobile telephony operators and financial institutions a new generation of secure solutions that will take m-commerce further along the path to maturity.”



The six banks that make up The Swedish Banks’ ID Consortium (Bankernas ID-konsortium) have now signed contracts with IBM for the supply of the technical services needed to realize the Swedish Banks’ ID Service.

The Swedish Banks’ ID Service (Bankernas ID-tjanst) is a collaborative project between Danske Bank (in Sweden), ForeningsSparbanken, Handelsbanken, IKANO Banken, SEB and SkandiaBanken. The banks will launch the service in 2002.

Private individuals will then be able to obtain from their bank an electronic key known as a Certificate. This will allow them to identify themselves in a secure way to the websites using the service and thus gain access to personal information stored there. They can also place orders and sign agreements.

Public bodies and companies will be able to purchase ID services from any of the banks in the consortium. This will give them the means of achieving secure electronic communication with all individuals who have obtained Certificates from any of the six banks.

“We believe that our service will contribute to better Internet security and hence to increased use of the Net,” says Hakan Nyberg, chairman of the Consortium.

“This will be of great value to the public sector, to companies and to individuals. Our system has the potential to achieve a significant breakthrough since we are responding to market forces. There are obvious economic incentives to use the service and go on developing it.”

The collaborative project between the banks and IBM includes a “Certificate Factory,” which uses a common Certificate standard. The Certificate Factory, to be supplied by IBM, will produce Certificates for individuals, and is where public bodies and companies check Certificates. IBM will also supply the software that organizations, companies and individuals need to use the Certificates.



Fast on the heels of
successfully partnering on the largest new financial services conference in
Europe in recent years, Lafferty Group and BAI today announced that they will
jointly present a new retail financial services conference and exposition
developed specifically for Asia-Pacific.

The conference and expo, Retail Finance Asia-Pacific 2002, will be held in
Singapore between 13 – 15 March. Building on the theme “Breaking Old
Models — Building World-Class Banks,” the conference will combine timely
presentations from an impressive array of international retail financial
services leaders with an exhibit floor featuring many of the leading solutions
providers to the financial services industry. The conference will incorporate
sessions focusing on retail banking, cards, payments, wealth management and
private banking with top-level speakers drawn from leading-edge players in
Europe, North and South America as well as in Asia Pacific.

“We were greatly encouraged by the success of Retail Finance Europe 2001,
which had over 800 attendees,” said Michael Lafferty, chairman of Lafferty
Group. “We’re convinced that BAI and Lafferty Group can meet the market’s
demand for a similar event in Asia-Pacific, and build on the success in

“‘Strategic alliance’ is a phrase that has been greatly overused during
the past few years,” commented Thomas P. Johnson, Jr., president and CEO of
BAI. “But our international partnership with Lafferty Group is proof that the
whole can be greater than the sum of its parts. Each alliance partner has
brought specific strengths to the effort, and with one success under our belts
we are well-equipped to meet the challenges of mounting a new effort in the
Asia-Pacific region.”

Neither Lafferty Group nor BAI is a stranger to the Asia-Pacific market.
Lafferty has detailed client research currently underway in Asia-Pacific
retail financial services and has produced successful conferences in the
region. BAI has been able to attract strong attendance from Southeast Asia
and the Pacific Rim to its Retail Delivery Conference, the world’s largest
retail financial services conference. Retail Delivery 2001 will be held 11 to
14 December in Anaheim, California.

Confirmed speakers for Retail Finance Asia-Pacific 2002 include Tharman
Shanmugaratnam, Managing Director of the Monetary Authority of Singapore;
Philippe Paillart, Vice Chairman and CEO, The Development Bank of Singapore;
Will Horie, President of Korea First Bank; Bo Harald, Executive Vice President
of Nordea Group; Richard Vague, Chairman and CEO of Juniper Financial;
Dato’tan Teong Hean, CEO of Southern Bank; James Jones, President of
Providian; Rupert Keeley, President of Visa International Asia Pacific;
Francois Julien-Labruyere, Member of the Board and International CEO of
Cetelem; Dr. Herbert Walter, Member of the Board of DB24 – Deutsche Bank’s
Retail Bank.

Lafferty Group is the global financial services publishing, business
intelligence and research company. BAI is the leading U.S. professional
organization devoted exclusively to improving the performance of financial
services companies through strategic research and information, education and
training. Retail Finance Europe 2001 was held in London between 18 – 20 June
and is a partnership between Lafferty Group, BAI and EFMA. It will be held
again in London between 17 – 19 June, 2002.


Decision Analytics

After three years in development Fair, Isaac has introduced the next generation of decision technology, decision analytics. Fair, Isaac says it has found the missing link in the decision technology paradigm, the ability to develop decision strategies empirically rather than subjectively. The first application of the new strategy science, ‘Credit Line Strategy Optimization’ service, has been developed expressly for the financial services industry. First USA will become the first issuer to implement the CLSO service to manage their credit card accounts. Fair Isaac says CLSO represents the convergence of a pooled-data model, 40 years of financial services and analytics leadership, new software and help from the company’s best clients. For credit card companies currently running Fair, Isaac’s ‘TRIAD’ adaptive control systems, CLSO can be up and running in a matter of weeks.


Nextcard Milestone

NextCard confirmed yesterday it surpassed the one million account milestone during June. The pioneering, Internet-centric VISA card issuer, was among the first to introduce instant, online approvals for bank credit cards. The company was also on the leading edge of online balance transfers and online bill payments. The ‘NextCard VISA’ was first introduced in December 1997. NextCard, which went public in May 1999, expects to break-even by the fourth quarter of this year. During the first quarter NextCard post a loss of $16.6 million compared to a of $17.7 million in the year-ago quarter. At the end of the first quarter, credit card receivables stood at $1.6 billion and operating revenue at $70.5 million. NextCard’s acquisition cost per account in the first quarter was $49. The issuer operates a network of more than 90,000 online affiliates. (CF Library 4/26/01; 5/17/99)

2Q/01: 1.0m 2Q/00: 443k 2Q/99: 85k
1Q/01: 881k 1Q/00: 337k 1Q/99: 56k
4Q/00: 708k 4Q/99: 220k 4Q/98: 37k
3Q/00: 577k 3Q/99: 134k 3Q/98: 29k
Source: CardData (



SCM Microsystems, Inc., a leading provider of solutions that open the Digital World, has signed a strategic agreement with MAXIMUS to deliver secure authentication to government agencies, using smart card technology. Under the agreement, SCM will become a supplier to MAXIMUS of several smart card reader models over a 15-month period.

MAXIMUS, a systems integrator to the government sector, will integrate SCM’s high-speed serial, USB and PCMCIA readers to meet the stringent cryptography requirements needed for secure authentication. Local, state and federal agency customers will benefit from a complete, cost-effective solution that supports multiple interfaces, applications and standards based on individual department needs.

Smart card technology enables government officials to provide security measures for a variety of functions such as entering buildings, sharing medical information, filing benefit reports online and accessing e-government programs.

SCM recently introduced its family of next generation EMV compliant, PC/SC smart card readers based on its STC II single chip micro-controller. This integrated solution contains on-board Flash for convenient and efficient firmware upgrades in the field. MAXIMUS currently supplies smart card solutions to various agencies including the U.S. Army, Navy, Air Force, Department of State, Department of Veterans Affairs and General Services Administration.

“MAXIMUS has established the necessary relationships to secure a solid foothold within the government sector,” said Jason Schouw, Vice President, Americas for the PC Security division of SCM Microsystems. “Federal agencies are re-engineering business processes, developing new security applications and implementing e-government programs — and smart cards offer secure solutions for all environments. Our new high-speed, single chip readers will be able to meet the government’s needs for many years to come. This partnership shows our strength as a company and a leading manufacturer of cost-effective smart card readers which can deliver solutions to meet any industry requirements.”


MAXIMUS is one of America’s largest government services companies devoted to providing state and local governments with program management, information technology, and consulting services. The company has more than 4,400 employees located in more than 130 offices across the United States.

About SCM Microsystems

SCM Microsystems is a leading supplier of solutions that open the Digital World by enabling people to conveniently access digital content and services. SCM’s advanced silicon, hardware and software solutions enable secure exchange of electronic information for digital applications from e-commerce to broadband content delivery by providing controlled access points to platforms such as PCs, digital cameras and digital television set-top boxes. Known as a premier supplier to OEM companies around the world, SCM also serves the retail market through its Dazzle, Microtech and FAST product brands. Global headquarters are in Fremont, Calif., with European headquarters in Pfaffenhofen, Germany. For additional information, visit the SCM Microsystems Website at [][1].



@pos ASG

@pos introduced the intelligent patent-pending Active Screen Guard (ASG) for protecting the touch pad displays of the @pos iPOS TC, TX.C, and 3100eX payment transaction terminals from scratches and wear. The ASG consists of a protective membrane and innovative electronic components that intelligently inform the terminal when the ASG is installed. The patent-pending solution provides a cost-effective option to provide additional ruggedization, extend the overall usage life of the terminal’s resistive touch pad and reduce the need to replace the complete display assembly.

The ASG will be shown by @pos at the Retail Systems Conference, Booth No. 1531, at McCormick Place, Chicago, Illinois, beginning on June 26. “The Active Screen Guard provides an option for our retail customers to extend and protect their significant point-of-sale investments,” said Winifred Liu, @pos Product Manager. “The ASG is simple to install and replace at the retail location for regular and continued maintenance.” Production quantities of the ASG are expected to be available in Fall 2001. The ASG attaches to the bezels of the iPOS TC, TX.C, and 3100eX using patent-pending technology. An LED located on the bezel is activated by the terminal’s internal hardware security circuitry when the ASG is properly installed on the terminal.

About @pos

@pos (OTCBB:EPOS) is a leader in secure, interactive electronic transaction technologies. The company delivers proven technologies that include signature capture pads, web-enabled platforms, smart card interfaces, and encryption engines supporting DES and Triple DES, in addition to offering an extensive suite of software tools. @pos currently markets its products to the retail, government and banking segments for applications that include electronic signature capture, debit and credit payments, display advertisements, promotions, and surveys. For more information, see [][1], email to, or call 408/468-5400.




Pitney Bowes launched a comprehensive Internet payment solution. ‘PitneyPay’ provides users with a variety of payment options including, ACH Debit and an escrow service. The Company says it has formed strategic alliances with Heavynet, and USA Flower Exchange to integrate the ‘PitneyPay’ solution into their respective marketplaces. ‘PitneyPay’ will serve as the exclusive online payment option for all transaction payments.


Delinquency Drops

Thanks to increased debt consolidation and bankruptcy filings, credit card delinquencies made a surprisingly sharp drop during the first quarter. The rise in debt consolidation activity is being fueled by the lowering of interest rates by the Federal Reserve this year and robust competition among home equity loan providers. The uptick in personal bankruptcies is being driven by anticipation of new bankruptcy laws, likely to take effect early next year. Based on the number of credit card accounts, 2.99% were overdue during the first quarter, down 10% from 3.34% in the previous quarter, and 3.28% for first quarter 2000 according to the American Bankers Association’s ‘Consumer Credit Delinquency Bulletin’. First quarter credit card delinquencies, based on total dollars outstanding, were 4.13%, down from the previous quarter’s 4.25% but higher than 3.94% in the same period last year. The 1Q/01 figures are the lowest first quarter numbers reported in more than five years.

(based on total dollars outstanding)
1999: 4.44% 1995: 3.50% 1991: 4.55% 1987: 3.71% 1983: 3.06%
1998: 5.42% 1994: 3.51% 1990: 3.29% 1986: 4.92% 1982: 3.33%
1997: 5.43% 1993: 3.98% 1989: 3.39% 1985: 3.10% 1981: 3.16%
1996: 4.62% 1992: 4.31% 1988: 3.71% 1984: 2.84% 1980: 3.00%
Source: American Bankers Association Delinquency Bulletin