The NextCard ‘eCommerce Index’, released yesterday, shows the top five online merchants for May are: AOL, Amazon.com, Earthlink, eBay and Buy.com. The NextCard index is a monthly listing of the top Web sites based on the number of online transactions by more than 330,000 NextCard cardholders. Consumers continue to use their credit cards to pay for ISP service. Nine Internet service-providers were among the Top 30 in May including America Online, Earthlink, MSN, CompuServe and Prodigy.Details
Motorola, Inc. announced the successful completion of the Automatic Fare Collection system field trial implemented for the Transport Authority of Berlin. The smart card electronic ticketing solution achieved a new standard of passenger convenience and operator efficiency.
“The ERG Motorola Alliance implemented the system on time and it performed exactly as planned,” said Francois Dutray, vice president and general manager, Motorola Worldwide Smartcard Solutions Division (WSSD). “The pilot established a clear business case by meeting all of the BVG’s goals: more efficient utilization of assets, helped reduced operational costs, increased customer convenience and improved operating information for transportation providers. They were able to measure passenger streams with much greater accuracy, allowing them to synchronize resources with demand. We were proud to take the lead in implementing this global showcase of next-generation AFC and multi-application smart card system technology,” said Dutray.
Dozens of transportation organizations from around the world visited to gain first-hand experience with the groundbreaking system. Many are considering contactless solutions and were impressed with the enhanced convenience, shorter lines and improved asset management – all of which were on display in Berlin.
“We were particularly pleased to be able to demonstrate the ability of the Alliance to deliver such a sophisticated system in a relatively short time frame,” commented Peter Fogarty, ERG Group’s chief executive.
Work began on this innovative system in March 1999, when the BVG contracted with the ERG Motorola Alliance to conduct a field trial to provide transport riders in Berlin and the surrounding greater Brandenburg area with an efficient smart card payment option. The first phase of the trial began in October 1999. Full pilot program implementation began January 15, 2000 and ended April 15, 2000.
During the field trial of the AFC “tick.et” system, a select group of public transit riders throughout Berlin and Brandenburg paid time- and distance-based fares using one smart card to access and transfer between buses, trains and trams run by the BVG, the S-Bahn Berlin GmbH (Rapid Train System of Berlin), and the VBB (Transport Authority of Berlin- Brandenburg). Public transport “units,” purchased with cash or electronic transfer payments, were loaded directly onto a smart card and then debited by special contactless check-in/check-out terminals at the stations or in buses and trams. Users were able to keep track of their available units by inserting the cards through readers at points-of-sale, information terminals or with the help of pocket-sized balance readers.
“Using bus and rail will become much easier in the future with cashless smart cards and the end of tariff zones,” said Peter Strieder, Berlin Senator for Urban Development. “That surely is a step in the right direction for the BVG because each and every passenger is important.”
“For the economy, electronic ticketing is of great importance,” said Wolfgang Branoner, Berlin Senator for Economy and Technology. “It will result in unique know-how, allowing Berlin to become the prototype for the development of similar solutions for other major cities in the future.”
What the future holds
The BVG’s ultimate objective is to design a multi-application smart card-based AFC system that can be applied to all national transportation services in and around Berlin, and also to the regional transportation services offered by Deutsche Bahn AG. An essential capability of the system will be to calculate the cost of a fare based on both the time and distance traveled. The BVG’s goal is to have this kind of system implemented by the end of 2002.
Eventually, public transportation authorities can award discount points to frequent users, redeemable for more public transport credits or for reduced admission prices to area events. In addition, retailers can offer discount points or special prices to shoppers using smart cards. The groundwork exists for e-purse applications allowing riders to purchase a cup of coffee and a newspaper, board a bus, and transfer to a subway or taxi without searching for cash. The smart card can be reloaded via ATM-style add-value machines.
“It is of paramount importance that electronic ticketing with multi-application capabilities be introduced to the entire network,” said Peter Giesecke, Chief Administrative Officer of the Teltow-Flaming District and Head of the Supervisory Board of the Transport Authority of Berlin-Brandenburg VBB). “The offer of multiple uses, such as information retrieval, payment, loyalty or parking, will generate new incentives to carry and use the card.”
The Technical University of Berlin (TU Berlin)
Motorola currently is implementing a smart card system with multiple applications for the Technical University of Berlin — an identification card and application platform capable of securely accessing university services over the Internet. It is based on a contacted/contactless dual interface smart card that will be compatible with Berlin’s transit automated fare collection (AFC) system. This will mark the first time in Europe that an ISO 14443 Type B dual interface smart card will be used for a multi-application system, and the first time a university card system will be fully integrated with a smart card transit AFC system. Motorola will provide system integration, smart cards, card accepting devices and consulting for the TU Berlin CampusCard(TM) system.
The announcement of the completion of the Berlin field trial was made at the Smart Card Forum’s Quarterly Conference, “Cards on the Move,” hosted this week by Motorola’s Worldwide Smartcard Solutions Division at Motorola University in Schaumburg. The event showcases smart card transit applications from around the world and offers attendees – leading users and technologists from the public and private sectors — to examine how financial institutions, universities, government agencies and retailers are connecting to transit, toll and parking projects to use smart cards for multiple purposes.
About The ERG Motorola Alliance
The ERG Motorola Alliance combines ERG’s world-leading smart card and magnetic ticket based integrated fare collection application expertise with Motorola’s innovative M-Smart(R) world of flexible smart card platform solutions, its systems integration and its operational management capabilities. Complementary strengths of the Alliance include complete wireless voice and data communication systems; location tracking and management; revenue management expertise; systems integration and operating services capabilities; and electronic purse operating experience.
About Motorola Inc.
Motorola, Inc., (NYSE:MOT) is a global leader in providing embedded electronic and integrated communications solutions. Sales in 1999 were $33.1 billion. Motorola’s Worldwide Smartcard Solutions Division (WSSD) provides complete multi-application smart card system solutions including smart cards, application development, systems integration and operations management. The company’s platforms allow organizations to quickly deploy and build value-added smart card applications in areas such as transit, access control, campus, government and healthcare.
About the ERG Group
ERG Group is a world leader in the development and supply of technologically advanced smart card systems and services, automated fare collection products and systems and telecommunications products and services. ERG provides turnkey solutions to customers, from design and manufacture to supply, installation, commissioning and ongoing service and maintenance. ERG operates globally and has 22 offices in 14 countries. ERG is listed on the Australian Stock Exchange and ranks in the S&P – ASX Top 50 Index, as well as the MSCI (Morgan Stanley Capital International Index). For more information about ERG please visit: [www.erggroup.com]
New York City-based M2card and Inciscent, a wired-to-wireless, applications service provider announced a strategic alliance to develop wireless transaction services designed to complement M2card’s products and services. Set to launch in late summer, the ‘M2card’ offers teenagers a pre-funded cash card that can be used at all merchants that accept major credit cards. The collaboration with Inciscent brings ‘M2card’ into the mobile e-commerce marketplace, as customers can check payment balances wirelessly before POS purchases or to access real-time content from M2card. Inciscent and M2card are also jointly developing other billing and payment solutions for the mobile consumer to provide the ability to transact from handheld wireless devices.Details
First National of Nebraska announced another acquisition yesterday. FNN says it is acquiring the $49 million credit card portfolio of Eastern Financial Federal Credit Union of Miramar, FL. The credit union serves more than 155,000 members through 14 branch locations in Florida. Last week FNN announced it is also acquiring Atlanta-based InfiCorp Holdings, a privately held credit card portfolio management company. InfiCorp Holdings includes subsidiaries: Infistar, InfiBank, InfiLink and InfiCU. FNN expects to close the InfiCorp deal in July while the conversion of the EFFCU customer accounts is slated for October.Details
PaySys International announced that it has signed a licensing agreement with Sears, Roebuck and Co., the nation’s second largest retailer, for use of the TRAMS (Transaction Routing and Management System) transaction processing software.
Sears will utilize the PaySys software to process point-of-sale transactions for its approximately 3,000 domestic stores. TRAMS provides a multi-purpose, front-end data collection, processing and routing system that processes transactions from a variety of different sources. It is a part of PaySys’ VisionPLUS card management system that combines retail, bankcard and consumer loan billing and administration in one system.
! “Working with a retail giant like Sears is a great opportunity for PaySys,” said Stephen B. Grubb, PaySys CEO and President. “Sears’ choice of PaySys reflects the fact that we have solutions that will enhance the efficiency and profitability potential of very large credit operations such as Sears portfolio of 38.9 million active accounts.”
“The flexibility and functionality of PaySys’ processing software will allow us to consolidate the high volume of transactions from our extensive network of retail locations, reducing costs,” said Tom Foley, Credit IT director.
PaySys’ TRAMS software accepts multiple transaction types and prepares them for any destination, consolidating numerous application front-ends into a single input system. It also provides extensive job tracking, settlement, warehousing, reporting, reject and online reject and suspense handling capabilities.
PaySys experts will install the system and will provide training and operations assistance on a consultancy basis.
Sears, Roebuck and Co. is a leading U.S. retailer of apparel, home and automotive products and services, with annual revenue of nearly $40 billion. The company serves families throughout the country through approximately 860 department stores, more than 2,100 specialized retail locations, and a variety of online offerings accessible through the company’s Web site, [http://www.sears.com].
PaySys International, Inc. is an established global leader in financial applications, offering web-enabled transaction processing solutions. With industry-leading products such as VisionPLUS, CardPac and VISION21, PaySys has clients in over 30 countries and on 6 continents. Headquartered in Atlanta, GA, PaySys has offices in the United States, United Kingdom, Singapore, China, Costa Rica and Australia. For more information, call PaySys at +1.770.564.8000, or visit the company’s web site at [http://www.paysys.com].
PaySys, VisionPLUS and TRAMS are registered trademarks of PaySys International, Inc. CardPac and VISION21 are trademarks of PaySys International, Inc. Other brands used in this document may be unregistered trademarks of PaySys International, Inc. or trademarks of their respective owners and should be treated as such. No investigation has been made of the registration status of any brand used.
American Express wants to put some “smarts” into its smart card. AmEx has launched a contest for technology developers to create new ‘Java Card’ technology applications for the AmEx ‘Blue’ credit card. AmEx, Oberthur Card Systems and Sun Microsystems jointly launched the ‘Code Blue’ contest that offers a first prize of $50,000. There are over two million ‘Java’ technology developers. AmEx says that through the use of Java technology, AmEx wants to demonstrate its commitment to making Blue an ‘evolving’ credit card by adding new features and services that meet open and interoperable standards. To-date, the smart card feature of the ‘Blue’ card has largely been a marketing ploy to demonstrate leadership in the emerging card technology arena. Currently the AmEx ‘Blue’ smart chip stores a unique digital certificate that, when used with a special smart card reader plugged into a PC, provides extra security when shopping online. The smart card readers are available free for a limited time to AmEx ‘Blue’ cardholders. Contest details are available via CardFlash Online.Details
eBay and Wells Fargo yesterday officially launched a new P2P payment option for eBay’s vast customer base. Called ‘Electronic Check’ the new Internet-based payment system is the result of the ‘Billpoint’ strategic alliance between eBay and Wells Fargo. ‘Billpoint’ was launched in early April to develop a cost-effective alternative to paper checks and credit cards where payment is guaranteed. Customers of eBay currently use other P2P payment systems such as ‘PayPal’, which combine credit cards and email. eBay, the world’s largest personal trading community, has an enormous customer base of 12.6 million registered users who, during the first quarter of 2000, generated annualized gross merchandise sales of approximately $4.6 billion. eBay members add more than 500,000 items to the site daily in more than 4,200 categories. The firm recently introduced a paging system to notify users of the status of personal bids placed through the eBay website.Details
First American Payment Systems, Inc. announced the purchase of 93 automatic teller machines from American Express.
The machines are located in Crown Central Petroleum gas stations and convenience stores in six states throughout the eastern and southeastern United States. Terms for the transaction were not disclosed.
Today’s acquisition is the second major ATM purchase of the year for First American Payment Systems. “The purchase geographically expands First American Payment Systems’ ATM division and furthers the company’s goal of increasing its presence as a national ATM provider,” said Neil L. Randel, president and chief executive officer of First American Payment Systems.
“We are excited about the strategic partnership with Crown Petroleum, and we look forward to the future growth of our relationship with additional ATM placements,” he said.
About First American Payment Systems, Inc.
First American Payment Systems, Inc., a privately owned corporation founded in 1990, provides full-service electronic credit card authorization and payment systems to retail, mail order, telephone order, Internet and home-based merchants throughout the United States. First American’s other divisions include national ATM deployment, Secur-Chex(TM) check guarantee, FirstPay.Net e-commerce payment gateway and Merimac Capital point-of-sale equipment and ATM leasing. For more information on First American Payment Systems, visit the company’s Web site at [www.first-american.net].
VISA yesterday told a panel of Federal Trade Commission and Department of Commerce representatives that VISA’s chargeback rules are not perfect, but they work well. VISA testified that in transactions around the world, its payment system provides U.S. consumers with practical and affordable redress to those disputes that most typically arise between consumers and merchants in both domestic and international transactions. VISA cited statistics showing only a small percentage of total VISA transactions are charged back. In April, for example, VISA-branded cards generated more than 830 million transactions, but only about 780 thousand transactions, or less than 10 basis points, were charged back. There is growing controversy over chargebacks as they relate to card-not-present transactions over the Internet. VISA said, however, it is critical that governmental entities recognize the validity of existing market-driven contractual arrangements, like the associations’s chargeback system.Details
National Australia Group announced it has ordered 200 NCR’s ground-breaking automated teller machines , the Personas 86, for its UK banks this year. The first Personas 86s are destined for Clydesdale branches. Clydesdale’s sister banks, Yorkshire, Northern and National Irish will also receive the machines later this year to replace existing ATMs.
NAG customers can use the new ATMs to deposit checks and cash 24 hours a day, seven days a week. The Personas 86 also has the capability to dispense tickets for theatre and sporting events, order traveler checks, pay bills and approve loans. The ATM offers greater flexibility for all NAG customers, and particularly small business owners, who can make receipted deposits any time day or night.
The new machines have a superior, larger screen, which allows viewing in strong sunlight and are also adaptable enough to be used for other purposes, such as loading electronic cash onto plastic smart cards.
John Wright, CEO for Clydesdale Bank explains, “NCR has proved they are at the leading edge of ATM technology and we are delighted with our investment in this next generation. The Personas 86 is tremendous news for all our personal and small business customers — it really is a breakthrough in banking, giving more choice and improved access.”
Danny O’Brien, vice president of NCR’s Financial Solutions Group added, “ATMs are well established in UK and the technology is trusted by customers. The Personas 86 gives customers even more choice and convenience, it can connect to the Internet, run full motion video and will enable banks to offer further innovative services. NAG is the first to deploy the Personas 86 and has shown itself to be a step ahead in providing enhanced customer service through technology.”
About National Australia Bank Group (NAB)
NAB is an international financial services organization operating across four continents and 15 countries including the USA, UK and New Zealand. NAB has an asset base of A$250 billion, almost 9 million customers globally and is ranked one of the 50 largest banks in the world. Clydesdale Bank will launch the first of its 75 new ATMs at its Davidson’s Mains Branch, Edinburgh. Other banks in the Group will be receiving – 75 ATMs in Yorkshire, 30 ATMs in Northern Bank and 20 in National Irish.
NCR Corporation (NYSE: NCR) is a recognized world leader in providing Relationship Technology(TM) solutions for the retail, financial, communications, travel, transportation and insurance markets. NCR’s Relationship Technology solutions include store automation, ATMs and privacy- enabled Teradata(TM) warehouses. The company’s business solutions are built on the foundations of its long-established industry knowledge and consulting expertise, value-adding software, global customer support services, a complete line of consumable and media products, and world-leading hardware technology. More information about NCR and its solutions may be found at [http://www.ncr.com].
Transactional Data Solutions this week launched ‘ReTAIL TICKER’, a new service offering free online tracking of Internet versus traditional spending patterns, as measured by total sales volume and volume of transactions. Using a proprietary system, TDS can track up to 80 million anonymous, aggregated MasterCard cardholders and more than 4 million transactions a day. ‘ReTAIL TICKER’ offers customized insights into consumers’ shopping behavior in numerous distinct retail categories (including books, apparel, computers-software, department stores, discount outlets, home furnishings and sporting goods). Trends are reported by industry for “clicks versus bricks” purchases. For some industries, a third data type called “PICS” (Phone, Internet, Catalogs) is tracked. TDS has no access to personally identifiable information, including names, addresses, phone numbers, e-mail or social security numbers.Details
Paymentech, the nation’s largest acquirer and processor of credit card transactions, is currently launching seven credit card and electronic check payment programs for major life/health and property/casualty insurers. Paymentech recently signed five of the top ten property and casualty insurance providers. The effort signals growing interest in card-not-present payments that allow consumers to conveniently pay bills.
The programs include Paymentech’s automated recurring billing product as well as one-time processing for agent sales, phone transactions, and web site applications. Paymentech’s processing menu includes credit cards, off-line debit cards and automatic checking account deduction. Paymentech’s direct response unit featured recurring payments at the Insurance Accounting and Systems Association conference in Washington, D.C. this week. With recurring payments, consumers pre-select a credit, debit, or electronic check option to cover regularly scheduled automobile, property/casualty or life insurance premiums. Customers receive statements for their review and records.
“We are seeing a surprising amount of interest in recurring payments from the insurance industry,” said John Irish, senior director for recurring payments at Paymentech. “Credit cards are a convenient option that many consumers prefer. There are no checks to write, stamps to buy or statements to return. Recurring payment programs can also be used as tools for building consumer loyalty.” For recurring programs Paymentech interfaces with billing systems to obtain a file of non-check payments for authorization and settlement, including those that directly debit a bank account. Insurance providers electronically collect receivables, reduce the payment cycle time, and access funds sooner. Lock box, collection agency and insufficient funds fees are also reduced.
According to Irish, sales channels such as the Internet and call centers are also driving increased credit card usage. “Electronic payments represent opportunities for increased operational efficiencies as it relates to billing and collection.”
“Last year, total annual premium payments for homeowners, auto and life insurance was $306 billion. Credit cards accounted for about $767 million. Credit cards now account for only 5% of all premium payments. Automated monthly or quarterly payments will increase that,” said Irish. Research also suggests that credit card usage can help close initial sales and reduce walk-in payments. Dallas-based Paymentech ([www.paymentech.com]), founded in 1985, is the largest acquirer and processor of bankcard transactions in the United States and a leading commercial card issuer. Paymentech is also the leading processor for non-face-to-face and Internet credit card transactions. Paymentech processed approximately 3 billion total transactions and $93 billion in overall bankcard sales volume in 1999.