InternetCash

NYC-based InternetCash Corp. has signed agreements to expand its distribution to 5,000 retail locations by year’s end. Friday, the Company formed an alliance with In-Person Payments of America to sell InternetCash throughout the New York area and eventually to 1,400 IPP locations in 12 eastern states and the District of Columbia. InternetCash is a prepaid Web-based payment system and is available in $25, $50, and $100 denominations. InternetCash can be used online to purchase products and services from more than 170 Web sites including WWF.com and Sunglasshut.com.

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First Data 3Q

First Data reported yesterday that Merchant Processing Services delivered earnings of $137 million on revenues of $455 million. Merchant sales dollar volume processed was up 24% for the quarter. Card Issuer Services recorded a 1% revenue increase to $363 million and a 14% increase in earnings to $74 million. Card Issuer Services operating margins were up from 17.9% in 1999 to 20.2% in 2000 due primarily to cost management initiatives implemented during the year and restructuring charges recorded in the first quarter. Earlier this month the company converted approximately 45 million JC Penney credit cards on behalf of GE Capital Corp. The conversion raised the number of accounts First Data maintains on file to more than 300 million. In addition, First Data has a pipeline of more than 41 million retail and bankcards to be converted in late 2001 and the first half of 2002. FDC currently processes 100,000 Internet merchants through its bank alliances. As compared to the third quarter of 1999, the dollar volume generated by identifiable Internet merchants tripled to an estimated $5.5 billion. Payment Instruments, comprised largely of Western Union, produced revenue of $596 million and profits of $190 million.

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Safeway SELECT Bank

Safeway Inc. and Amicus FSB, a leading e-banking provider, today announce Safeway SELECT Bank, the result of a strategic alliance between the two companies.

The bank will be initially available in San Jose and Sacramento, California and in Denver, Colorado. Expansion into other western U.S. locations is also planned.

Safeway SELECT Bank is a unique day-to-day banking offer that provides the convenience of an on-line bank with an in-store presence. Customers benefit from no fees, great rates and free groceries.

“Safeway SELECT Bank extends Safeway’s premium Safeway SELECT brand to a financial service,” said Rick Dreiling, executive vice president, marketing and manufacturing at Safeway. “We built our premium private label brands by meeting and exceeding national brand quality and we intend to do the same with this offering,” added Dreiling. “Safeway pioneered supermarket banking in the early 1980’s, successfully providing a one-stop location to offer customers the convenience of banking while shopping for groceries. Safeway SELECT Bank now takes service to the next level and provides the added convenience of banking on-line at home or at the store with live customer service associates,” added Dreiling.

“People want day-to-day banking that combines outstanding value with greater convenience,” adds Gary Gray, president of Amicus FSB – Western Division. “And that’s what we’re bringing to customers with Safeway SELECT Bank.”

Safeway SELECT Bank is an online bank with a twist. It offers all of the benefits and features of an Internet bank including no fees on day-to-day banking, outstanding rates and instant access 24 hours a day – seven days a week. But the Bank also has a physical presence inside Safeway stores where customers receive service from knowledgeable financial professionals, something lacking with pure-play online banks.

Safeway SELECT Bank has developed a full selection of financial products to help customers save time and money including:

— A no fee checking account for day-to-day banking with:

– no fees, no minimum balance, free unlimited transactions,

– unlimited check writing, free unlimited use of Safeway SELECT ATM’s,

– free unlimited phone and Internet banking,

– free use of an ATM card for purchases

– higher interest paid on deposits.

— A savings account that earns money market rates comparable to term deposits with no minimum balance and no administrative fees.

— Easy lower-cost borrowing, whether customers choose a personal line of credit or a loan.

— Savings Awards redeemable for free groceries at Safeway stores.

— Advice from Safeway SELECT Bank Customer Associates about the features and services of Safeway SELECT Bank are available at the store seven days a week and over the phone 24 hours per day.

Safeway SELECT Bank provides safe and secure access to accounts with all products insured by the FDIC. Amicus FSB, a member of the Federal Deposit Insurance Corporation, will employ the in-store Customer Associates, supply all of the banking services and hold all deposits made by Safeway SELECT Bank customers.

“Our alliance with Safeway lets us offer electronic banking services to many new customers in the western United States,” comments Brian Cassidy, CEO of Amicus. “The Amicus model has proven highly successful in other markets and now we’re ready to introduce it to California and Colorado.”

About Safeway Inc.

Safeway Inc. is a Fortune 50 company and one of the largest food and drug retailers in North America based on sales. The company operates 1,680 stores in the United States and Western Canada. Safeway currently offers 2,500 Safeway brand products and over 1,100 premium SELECT brand items.

About Amicus FSB

Safeway SELECT Bank is the result of a strategic alliance between Safeway and Amicus FSB. Amicus and its affiliates have formed alliances with a number of North American retailers to offer day-to-day banking that eliminates service fees and makes it easy for people to bank where they live, work or shop.

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$3 Smart Card

The smart card price breakthrough announced last month by VISA and Gemplus is spreading across the industry. Yesterday four more smart card manufacturers agreed to produce ‘Open Platform’ multi-application smart cards starting at less than three dollars each. The news comes from VISA’s announcement yesterday that it is launching a new program to offer VISA member banks low-cost smart cards. ‘VISA Price Breakthrough’ is supported by IBM and Philips Semiconductors, along with four major smart card manufacturers including: Giesecke & Devrient, Oberthur Card Systems, ORGA and Schlumberger. The family of new smart cards is based on the ‘Java Card 2.1’ and the ‘Open Platform 2.0’ specifications. The price of the initial card includes two applications, such as VISA credit/debit and ‘VISA Cash’, loaded to the ROM with room for multiple applications in the erasable memory or EEPROM. Issuers can decide what additional applications to add, such as loyalty or secure Internet access. Applications can be securely added or removed after the card has been issued. Three more card products will be made available, all at significantly reduced prices. The second card will provide public key encryption while the third and fourth cards will see memory size increased from 48k ROM to 96k ROM and 16k EEPROM to 32k EEPROM. These cards will be public key and non-public key versions. Applications can be loaded after the cards have been issued or added to the ROM during chip production freeing EEPROM for other application or service data. The chips are manufactured by Philips Semiconductors and contain new technology developed by IBM. The average price of a microprocessor chip card is about six dollars. (See CF Library 9/12/00)

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Captura Going Public

Captura Software, Inc. announced Thursday it has filed a registration statement with the Securities and Exchange Commission relating to a proposed initial public offering of its common stock.

All the offered shares will be sold by Captura. Captura(R), headquartered in Kirkland, Washington, is a leading provider of automated payment processing solutions for Global 2000 companies. Its technology platform automates the preparation, approval and processing of procurement, travel, entertainment and fleet transactions.

Banc of America Securities LLC will act as the lead underwriter of the offering. Other managing underwriters of the offering include U.S. Bancorp Piper Jaffray, Wit SoundView and Pacific Crest Securities. Prospectuses are not currently available. When available, prospectuses may be obtained from Banc of America Securities LLC at 600 Montgomery Street, San Francisco, CA 94111, phone 415/627-2220.

A registration statement relating to these securities has been filed with the Securities and Exchange Commission but has not yet become effective. These securities may not be sold nor may any offers to buy be accepted prior to the time the registration statement becomes effective. This communication shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any State in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such State.

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ACE Acquisition

ACE Cash Express, Inc., the nation’s largest check-cashing chain and a significant provider of related retail financial services, announced today that it has signed a letter of intent to acquire the assets of 107 check-cashing and retail financial services locations from five privately held companies. The majority of the locations are in California and Texas. The purchase price for the assets would be based on a formula, but it is currently expected to total approximately $30 million.

The letter of intent is subject to completion of due diligence, preparation and execution of definitive documents, arrangement of financing and approval by the boards of directors of the parties. The parties have requested and received early termination of the waiting period for the acquisition under the Hart-Scott-Rodino Antitrust Improvements Act.

“This single acquisition is the largest in ACE’s history and is greater than the total number of stores that the company has acquired in the past three fiscal years,” stated Jay B. Shipowitz, president of ACE. “This transaction which includes the acquisition of approximately 60 stores in Northern California and 40 stores in Texas compliments our existing store network and strategically positions ACE to further expand in these geographic areas. We intend to complete this transaction by the end of this calendar year.”

ACE Cash Express, Inc. is headquartered in Irving, Texas and is the largest owner, operator and franchiser of check-cashing stores in the United States. Founded in 1968, the company, as of August 31, 2000, has a network of 1,084 stores, consisting of 921 company-owned stores and 163 franchised stores in 33 states and the District of Columbia. ACE offers a broad range of financial and check-cashing services and is one of the largest providers of MoneyGram wire transfer transactions. In addition, ACE offers money orders, bill payment services, and prepaid local and long distance telecommunication services. Under ACE’s agreement with Goleta National Bank (GNB), GNB currently makes small consumer loans available to customers at various ACE company-owned stores. The company’s website is found at [http://www.acecashexpress.com][1].

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

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Concordia VISA

Concordia University announced a new Royal Bank affinity credit card partnership. The university’s new affinity cards – offered in Visa Classic and Gold cards – provide the institution’s supporters with a simple, convenient way to link buying power with philanthropic habits. Each time the new card is used, the Concordia University Alumni Association receives funds through a marketing agreement that contributes to the growth of its programs and services.

“Many Canadians like Royal Bank’s affinity cards because they are a simple way to enhance revenues for the non-profit sector,” said Pierre Giroux, Royal Bank’s senior manager, affinity cards. “The cards provide organizations with a payment each time a new card is issued and every time it is used for a purchase. Affinity cards are an easy way for Canadians to supplement their support of some favorite causes.”

With its name drawn from the City of Montréal’s civic motto, “Concordia Salus,” Concordia University was formed in 1974, with the merger of Sir George Williams University and Loyola College. Both founding institutions are steeped in history. Originally part of Collège Ste-Marie, which was founded in 1848, Loyola College became a separate institution in 1896, moving to its present site in 1916. The origins of Sir George Williams University are tied to the founder of the YMCA and the evening classes it offered in 1873.

Today, Concordia has a school of graduate studies and four faculties in downtown Montreal. The university is celebrating its 25th anniversary in 1999-2000, building on the commitment of its founding institutions to open, accessible and innovative education.

Royal Bank of Canada (RY) is a diversified global financial services group and a leading provider of personal and commercial banking, investment and trust services, insurance, corporate and investment banking, online banking and transaction-based services including custody. The group’s main business units include Royal Bank, RBC Dominion Securities, Royal Investment Services, RBC Insurance and Global Integrated Solutions. The group has 49,000 employees who serve 10 million personal, business and public sector customers in 30 countries. For more information, visit Royal Bank’s Web site at [www.royalbank.com][1].

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

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Italian AmEx Card

Deutsche Bank Italia and American Express Thursday launched the first AmEx card to be issued by a bank in Italy. The ‘DBI American Express Card’, which will be available at all of DBI’s 280 branches in Italy, will operate on the American Express global merchant network. DBI will be responsible for all servicing of the card, including billing, accounting, customer service and credit authorizations, as well as for all marketing activity relating to the product. ‘DBI American Express’ cardholders will automatically be enrolled in the ‘Targa’ rewards program, allowing them to earn points each time they spend at a wide selection of hotels, restaurants and gas stations. These points are redeemable against a Fiat group car. ‘Targa’ loyalty program partners include: Hertz, Esso, Shell, Starhotels, Alpitour, and Europ Assistance. The card also features an introductory interest rate of 0.8% per month on all purchases for the first six months, rising to 1.3% per month thereafter. The card carries a fee of 100,000 lira. Deutsche Bank, with its credit card division, is a service provider for more than 800 partner banks and Deutsche Bank Group has more than 2 million cardholders and 300,000 associated merchants.

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SmartCardBus

O2Micro International Limited, a leading supplier of innovative ICs to notebook manufacturers, announces shipment of over 100,000 units of SmartCardBus controllers that contain industry standard smart card reader capability.

Sterling Du, Chairman and CEO of O2Micro, said today “O2Micro’s innovative new SmartCardBus, which provides built-in smart card reader technology for portable computers, simplifies the use of smart cards by eliminating the need for a costly external smart card reader.”

The demand for integrated smart card readers in portable computers is being driven by the acceptance of smart cards worldwide. Smart cards have been widely accepted for some time in Europe and Japan. Led by the American Express Blue Card, the United States market is rapidly moving forward due to the need for security and privacy.

Visa, USA, the U.S. division of Visa International, is also launching smart cards offering a suite of prepackaged services to be determined by its issuers. In fact, three of the ten largest U.S. credit card issuers, San Francisco-based Providian Financial Corp., FleetBoston Financial Corp. and the First USA subsidiary of Chicago-based Bank One Corp., have already announced major smart card programs in conjunction with Visa, USA.

Max Huang, Vice President, Intelligent E-Commerce division of O2Micro, stated, “Building on the success of the American Express Blue Card, Visa’s recent announcements are accelerating the momentum for smart cards in the US. O2Micro’s product strategy of providing low cost smart card readers for notebooks, desktop PCs and Internet appliances will be key to enabling smart card acceptance in the US.”

About O2Micro

Founded in April 1995, O2Micro designs, develops, and markets innovative peripheral components for Notebook computers, Internet appliances, LCD monitors, and wireless communications. Products include AudioDJ(TM), CardBus Controller, CCFL Backlight Inverter, and Battery Management ICs.

O2Micro designs products compliant with the System Management Bus (SMBus) and Smart Battery System (SBS) specifications, a subset of the ACPI specification (ACPI is a requirement for Microsoft’s PC98 and 99). O2Micro maintains an extensive portfolio of intellectual property with 205 patent claims granted, and over 250 more pending. The company maintains offices worldwide. Additional product information can be found on the web site at [www.o2micro.com][1].

[1]: http://www.o2micro.com/

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YCard Changes Name

EarlyRain Inc., a company focussed on profitably implementing smartcard technology across North America – was publicly launched Thursday as shareholders approved the name change from Yes I.C. Technologies Inc. and the completion of its qualifying transaction.

EarlyRain at the shareholders meeting on October 11, 2000, approved the acquisition of all the issued and outstanding shares of Yes I.C. Smart Cards Inc. (“YCards”) and the name change to EarlyRain Inc.

“EarlyRain will now move strongly forward to profitably launch smartcard technology applications in our core specialized fields of healthcare, golf, and advanced retailing services,” said Hal Walker, a prominent Calgary businessman and chairman of the new company. “We intend to be an industry leader as the emerging benefits of cost-effective smartcard applications spread across North America.”

The purchase of all YCards shares effective October 12, 2000, was made pursuant to an Offer to Purchase and Take Over Bid Circular (“Offer”) made by the corporation dated September 20, 2000. The Corporation has as a result issued 8,105,217 common shares in exchange for all the YCards shares.

An aggregate of 5,690,065 of the common shares issued in connection with the Offer are subject to escrow provisions: 10% will be released following issuance of the Final Exchange Notice and an additional 15% will be released from escrow on the 6, 12, 18, 24, 30 and 36 month anniversaries of the date of the completion of the YCards acquisition.

In addition, the Corporation issued 744,000 options to purchase Common Shares to eligible employees, directors, officers and consultants of the Corporation and its affiliates. The options to purchase Common Shares are non-transferable and exercisable at a price of $0.20 per Common Share for a period of five years.

The Corporation is a capital pool company and the acquisition of the securities of YCards constitutes the Corporation’s qualifying transaction pursuant to the Policies of the Canadian Venture Exchange. On receiving the final approval of this transaction by Canadian Venture Exchange the Corporation will no longer be a capital pool company.

EarlyRain Inc., is a Calgary based company led by an accomplished well-known team of business executives, who combine a solid record of business success with industry-leading technological expertise in the smartcard field. Its board includes directors with solid expertise launching successful technology companies.

The primary focus of EarlyRain is to fully exploit the profitable implementation of affordable smartcard technology in the growing healthcare, golf, and leading edge merchandising sectors. Through existing subsidiaries, new acquisitions, and exclusive strategic alliances with established North American leaders, EarlyRain also has the ability to integrate the Internet, E-commerce, and advanced data exchange systems to provide cost-effective solutions.

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Bankruptcy Bill

The U.S. House passed the bankruptcy reform bill yesterday and the U.S. Senate is likely to take its vote on the same bill next week. President Clinton immediately threatened to veto the 420-page bill. The White House says Clinton has problems with two provisions, one that permits wealthy bankruptcy filers to keep their homes and another that allows violent demonstrators at abortion clinics to use the bankruptcy laws to discharge fines and damages. In general, the bill makes it harder for consumers to file for Chapter 7 when there is some ability to repay debts. Many consumers will be forced into a Chapter 13 debt repayment plan. The bankruptcy reform bill has slowly made its way through the reconciling process after the House and Senate passed different versions of the bill early this year. The delay has been attributed to the inclusion of consumer-protection provisions such as the requirement that lenders disclose how long it will take to pay off a credit card, if only the minimum payment is made. Despite intense lobbying by the credit card industry, the bill passed yesterday does require card issuers to include on billing statements a chart that shows the costs associated with making minimum payments. (See CF Library 5/8/00)

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Web Penetration

Paris-based NetValue released August Internet results for the US, the UK, France, Germany and Mexico this morning. The US remains way ahead in terms of Internet penetration with over 52 million households connected. The UK has 7.3 million connected households. Germany tops the European list with 8.8 million households. France has 4.2 million households online. Users across measured countries are connected an average of 9.9 days to the Internet per month, somewhat less than the average U.S. user, who is connected an average of 12.2 days. Internet usage by age, particularly in the 35-64 age bracket, varies only slightly in each country. In the U.S., Internet users who are 15 or under account for 8.1% of users; however, in Germany, this age group accounts for a mere 2.7% of Internet users. Interestingly, Internet users who are 65+ are far more advanced in the U.S (where they represent 5.5% of users), compared with Germany, where they account for less than 2%. In the UK, by contrast, ‘silver surfers’ are increasingly logging on to the Internet, and are rapidly catching up with younger users. Across all markets, the 35-49 age bracket makes up the majority of Internet usage, accounting for 29.8% of users in the UK. Internet users in Mexico tend to be much younger. 37% of Internet users are aged between 15-24, with 67% of all users aged 34 and under.

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