VISA U.S.A. reported this morning it processed $721.1 billion in consumer and business purchases during 1999. This compares to $611.0 billion for 1998. Growth in 1999 dollar volume was driven by the ‘VISA Check’ card, which makes up more than 25% of VISA’s today dollar volume. Dollar volume on the ‘VISA Check’ card reached $183.8 billion in 1999, up 36% from 1998. There are now more than 84.5 million ‘VISA Check’ check cards in the U.S. Non-traditional acceptance categories also drove VISA’s growth. VISA volume at movie theaters, for instance, jumped 107% in 1999, as moviegoers spent $195 million with their VISA cards. At fast-food restaurants, where VISA volume rose 66% last year, some $616 million was transacted on VISA cards. Among recurring utility payments via VISA cards, card use for cable TV bills hit $1 billion last year. VISA’s suite of commercial card products also represented a major product growth category for 1999. Volume on bank-issued VISA commercial cards reached $45 billion in 1999, up 42% from 1998. There are now over 9.2 million VISA commercial cards in circulation, up 23% from year-end 1998.Details
Official Payments Corporation announced Friday a new business award with Spokane, County WA.
Under the contract, Official Payments Corp. will provide Spokane County a service by which taxpayers can pay their Real Estate Taxes, Property Taxes and Improvement District Assessments by credit card, over the Internet and telephone. Real Estate and Property Taxes are due in Spokane County on April 30 and October 31. Taxpayers will be able to make their payments by credit card by calling 1-888-2-PAY-TAXSM or over the Internet at [www.officialpayments.com]. Spokane County collects $300 million annually in Real Estate and Property Taxes; the average bill is $1,600.
“Offering our citizens the option to pay their taxes by credit card is part of our ongoing program of innovation and enhanced services,” said Linda Wolverton, Spokane County Treasurer. “In our due diligence in investigating this type of payment option, we found Official Payments’ services to be reliable, safe and secure,” Ms. Wolverton added.
Official Payments Corp. processes credit card payments for over 450 counties and municipalities and operates in 34 states. The company has contracts with seven state governments and the Internal Revenue Service to collect income tax by credit card, over the Internet and telephone.
Official Payments Corp. charges taxpayers a convenience fee for processing these credit card transactions. The fee schedule can be found on the Internet at [www.officialpayments.com]. For example, a taxpayer who owed Spokane County $1600 and charged their taxes would find a total of $1,649 on their credit card statement: $1600 for the tax bill and $49.00 for the convenience fee. American Express, Discover Card, MasterCard and Visa are the credit cards accepted by the program. Taxpayers using credit cards with bonus rewards programs can, depending on their card’s program, earn rewards, points, and cash-back or airline frequent flyer miles for paying their taxes.
About Official Payments Corp.
Official Payments Corporation (formerly U.S. Audiotex Corporation) is a leading provider of electronic payment options to government entities. The company enables consumers to pay government fees and taxes via telephone or the Internet, using their credit cards. The company has partnered with the Internal Revenue Service, several state governments, including California, Connecticut, District of Columbia, Illinois, Minnesota, New Jersey and Oklahoma, and 450+ municipal and county entities in 34 states, in which it collects income taxes, property taxes, real estate taxes, parking fines and other government fees by credit card over the telephone and the Internet. The company is publicly traded on Nasdaq under the symbol OPAY. Official Payments Corp. is committed to making payments to the government go fast, smart and safe.
ShopNow.com Inc. unveiled, last week, new versions of its ‘PCCharge’ products including ‘PCCharge Express’, ‘PCCharge Pro’ and ‘PCCharge DevKit’. The products, collectively called the PCCharge Alliance, are software programs designed to enable electronic transaction payments. The upgraded ‘PCCharge’ products include additional anti-fraud features that cater to both card-not-present and card-present circumstances. Features include ‘CVV2’, a verification feature currently certified with six processors; Magnetic Strip Verification; definable user level security; and adoption of a convention (in compliance with a new California law) mandating secure receipts that truncate the credit card number and omit the expiration date. The products are also bolstered with two legacy anti-fraud features: Address Verification Services and data file encryption. ShopNow’s transaction processing division has over 16,500 customers.Details
Verza.com, a VC-backed Dutch-American start-up, has launched a package of technology and services for small Internet merchants. Verza’s turnkey solutions include a proprietary anti-fraud protection model. Verza offers a suite of payment services that includes virtual online shopping applications, anti-fraud screening, real-time processing of direct debit and credit card transactions, integrated reseller marketing programs, shipment tracking facilities, and billing and multi-tiered end-user support. Verza’s integrated, cost-effective, and sophisticated anti-fraud system to prevent online credit card fraud utilizes cross-checking a number of parameters at the transaction level. Each card transaction is scored against an anti-fraud database prior to processing. Verza’s services are available in 31 Internet countries around the world, offering local support in ten languages, both online and off.Details
Providian Financial opened a new customer service center in Henderson, Nevada last week. The center, which will support the company’s expanding Internet-based Aria credit card, is Providian’s first e-commerce facility outside of California.
Providian has experienced outstanding success in its e-commerce business over the last year, which in turn has created a need to add resources. Less than a year old, the company’s Internet-based Aria Visa has already surpassed 220,000 accounts and continues to grow. Internet-sourced retail deposits in Providian CDs and money market accounts recently hit the $750 million milestone. In addition, consumer loan referrals from the Providian-owned financial marketplace Web site, [http://www.getsmart.com], have markedly increased.
Providian’s 63,000 square feet of space at 2280 Corporate Circle Drive in Henderson will be home to approximately 700 employees dedicated to providing customer service for the company’s e-commerce customers. (Individuals who are interested in employment opportunities in Henderson and have prior call center experience should fax their resumes to 702-992-3251.)
At last week’s opening celebration, local business leaders and elected officials, as well as representatives of the Henderson Chamber of Commerce, Nevada Development Authority, and City of Henderson, joined Providian senior management and employees in a ribbon cutting ceremony.
“The tremendous success of Providian’s Web-based businesses, including Aria Visa, Providian retail deposits, and GetSmart.com, has the company’s e-commerce division rapidly outgrowing its current facilities. Henderson’s hospitable business climate, state-of-the-art communications infrastructure and strong and qualified labor force make it an ideal home for Providian’s newest e-commerce facility,” said James Rowe, Providian’s executive vice president and head of Providian’s e-commerce business. “Providian is proud to join the Henderson community and we plan to be an active member of it.”
As a part of its community commitment, today Providian made a $25,000 donation to the Economic Opportunity Board (EOB) of Clark County. Providian’s donation will support the EOB’s Child Care Assistance Division, which works to provide affordable, accessible, reliable, caring and stimulating child care for the children of Southern Nevada through subsidy, education, and other support programs. Providian’s donation is part of the company’s national Providian Child Care Initiative.
Providian Financial employs more than 11,000 people in the United States and in the United Kingdom, with facilities in Henderson, Nevada, as well as Arlington, Austin and San Antonio, Texas; Fairfield, Oakland, Pleasanton, Sacramento, and San Francisco, California; Salt Lake City, Utah; Louisville, Kentucky; Concord and Tilton, New Hampshire; and London, England.
San Francisco-based Providian Financial Corporation ([http://www.providian.com]) is a leading provider of lending and deposit products to customers throughout the United States and also offers credit cards in the United Kingdom. The sixth largest bankcard issuer in the U.S., Providian Financial was recently named one of America’s Most Admired Companies by Fortune magazine.
Providian serves a broad, diversified market with loan products that include credit cards, secured cards and membership services. With a commitment to 100% customer satisfaction, Providian’s mission is to help customers build or rebuild, protect and responsibly use credit by providing a quality borrowing experience that leads to active and lasting customer relationships. Providian has more than $23 billion in assets under management and over 12 million customers.
The sub-prime credit card segment remained the top performing segment for 1999 in the US. London-based RAM Research Group Ltd. reports this morning the sub-prime segment, as a group, grew 36% in receivables between 4Q/98 and 4Q/99. Providian, the leading sub-prime issuer, grew an astonishing 61%. Other top sub-prime performers include SD-based First Premier Bank, up 93%, and OR-based First Consumers National Bank, up 55%. RAM’s ‘Bankcard Barometer’ also shows that credit unions increased receivables by 14% last year compared to an industry average of 7%.
SECTOR MONITOR (4Q/99 vs 4Q/98 Receivables)
Co-branded/Affinity: +6% Sub-Prime/Secured: +36
Low Rate (>$3 B): +3% Low-Rate (www.ramresearch.com)
[! Click Here]
TowerGroup, a leading research and consulting firm specializing in the impact of technology in the financial services industry, Friday announced the appointment of Mark Sievewright as President and Chief Executive Officer.
Mr. Sievewright was previously President of PSI Global, a division of NFO Worldwide, a provider of custom research and syndicated market information to all segments of the financial services industry. Mr. Sievewright joined PSI Global in 1995 from Europay International, where he had overall responsibility for marketing, corporate communications, IT/business management, and brand management. He began his career in 1978 at Midland Bank, part of HSBC, in London.
Diogo Teixeira, founder of TowerGroup, will step down as Chief Executive Officer. However, he will continue to actively conduct research for TowerGroup, and will remain a director of TowerGroup. “TowerGroup faces an exciting future as technology and the Internet continue to reshape the global financial services industry. I am looking forward to spending more time on thought leadership initiatives and working with our clients,” Mr. Teixeira said.
On November 12, 1999, Reuters, the global information and news group, acquired a controlling interest in TowerGroup. Brad Hanson of Reuters and Chairman of the Board of TowerGroup, and Diogo Teixeira jointly recruited Mr. Sievewright to the firm. “Mark Sievewright is a strong, proven leader to take the vision already crafted by Diogo Teixeira to the next level,” said Mr. Hanson. “His strong experience in managing client relationships and his sales and marketing background and international experience will make a significant impact on TowerGroup’s market position.”
“I’m very excited to be joining TowerGroup and am looking forward to working closely with TowerGroup’s existing management team to build a large, global business” said Mr. Sievewright. “With the rapid pace of technological change in the financial services industry, there are tremendous opportunities to translate trends into actionable information that will help our clients to make informed investment decisions. Our partnership with Reuters will enable TowerGroup to grow its research coverage and distribution into global markets, and to serve our growing client base better than any time in the past.”
TowerGroup ([www.towergroup.com]) is the leading provider of information technology research, advisory and consulting services focused exclusively on the global financial services industry. TowerGroup conducts research addressing securities, investments, banking, and insurance information technology, products, vendors, markets, investment trends, and issues. TowerGroup serves a global client base, including some of the largest financial, technology, and consulting firms in the world.
The unprecedented success of PayPal.com’s email payment system among ebay.com customers has created a mad dash by competitors. One of most formidable competitors to join last week’s list of companies offering email payment services is the nation’s fourth largest bank holding company. Bank One unveiled ‘eMoneyMail’, to enable U.S. consumers to send or receive, via email, up to $500 in cash at one time. The Bank One system requires the use of a ‘VISA’ credit card, ‘VISA Check’ card, or a checking account. However a user does not have to be a Bank One customer or open a separate account with ‘eMoneyMail’. Bank One says it will soon give receiving customers the option of having a paper check sent in lieu of having funds transferred to a ‘VISA’ card or a checking account. Under the ‘eMoneyMail’ system the sender pays a $1.00 convenience charge for each transaction. There is a $1.00 convenience charge for recipients only if a paper check is requested. Funds sent using a ‘VISA’ credit card or debit card are available for use by receivers immediately. But funds sent from a checking account will take the usual three to four business days to clear. Bank One is offering the new system to business partners as a cobranded program. eCash Technologies also introduced last week its email payment system, ‘eCash P2P’ (CF Library 3/10). Other competing email payment systems have recently been launched by X.com and dotBank.Details
Among the new payment gizmos announced at last week’s ETA show in Las Vegas is Schlumberger’s ‘MagIC 1100’. The new smart PIN-pad is designed specifically for customer-activated smart card payments, including credit/debit transactions, loyalty applications and e-purse functionality. The hand-held ‘MagIC 1100’ integrates a smart card reader, two-line display and key pad to meet consumer need for control of the e-purse throughout the payment process. Fully EMV compliant, the new PIN-pad gives the consumer a simple and discreet way of authorizing a payment. The ‘MagIC 1100’ is ready for immediate deployment as a key part of the EMV infrastructure migration, through direct connection to the ‘MagIC 6000’ payment terminal. All electronics and software are totally self-contained within the ‘MagIC 1100’, so no modifications to the ‘MagIC 6000’ are required.Details
i-Escrow Inc., the largest provider of online transaction settlement services, Friday announced the appointment of Daniel R. Eitingon, former president of the global support services group at Visa International, to the company’s board of directors.
In addition to strengthening and enhancing Visa’s core services and products — such as credit, debit and VisaNet — Eitingon, who has more than 30 years of financial and technology industry experience, evaluated and developed strategies to capitalize on emerging technologies and strengthen Visa’s competitive position in the global payment industry. A member of Visa’s management executive committee, he worked closely with Visa members and staff worldwide to advance strategic objectives in such areas as multi-application chip cards, debit products and Visa’s next generation of system architecture.
“Dan brings global perspective, a breadth of experience and an intimate understanding of the payment industry, all of which will be valuable assets as we expand our product suite to serve the B2B market,” said i-Escrow Founder and CEO Sherman Kwok.
Eitingon formerly was executive vice president and head of First Interstate Bank’s technology banking group as well as a member of the bank’s executive operating committee. He previously directed the bank’s 400-branch network throughout California and was directly responsible for that unit’s financial performance. He serves on the boards of NextCard and onGain.com, and holds a BS in electrical engineering from Cornell University, a MSEE in computer sciences from the University of California at Berkeley and an MBA from the University of Chicago.
“i-Escrow’s intention to parlay its experience as a trusted intermediary in consumer e-commerce into the B2B market has tremendous potential,” said Eitingon. “My aim is to tap into strategic resources to advance i-Escrow’s ability to offer the full range of transaction settlement services the B2B market needs.”
About i-Escrow Inc.
i-Escrow Inc., the largest provider of online transaction settlement services, enables safe and convenient Internet transactions by protecting businesses and consumers as they exchange goods for payment. Partners include proven and emerging brands in business-to-business, business-to-consumer and consumer-to-consumer e-commerce. Users include corporate buyers and sellers, unbranded retailers, active hobbyists, avid collectors and casual shoppers who frequent auctions, classifieds, storefronts and newsgroups on the Internet. The company’s financial backers include Infinity Capital, U.S. Venture Partners, AIG Financial Products and Red Rock Ventures.Details
Frequent flyer cards are catching on in The People’s Republic of China. China Southern Airlines announced this weekend that its ‘Sky Pearl’ frequent flyer loyalty club now has 122,871 active cardholders. The program was launched in November 1998. China Southern says it is now beefing-up its customer service operations to meet the growing demands of ‘Sky Pearl Club’ members. To bolster the program, Bank of China Credit Card Ltd. announced it plans to solicit its 600,000 credit card members to join the ‘Sky Pearl Club’. Bank of China card members who join China Southern Airlines’ ‘Sky Pearl Club’ may exchange their credit card points into kilometers. Every eight credit card points will equal 1 kilometer of ‘Sky Pearl Club’ mileage. Ranked No. 1 in passengers carried in China for the past 20 years, China Southern Airlines connects to more than 80 cities around the globe.Details
Internet start-up SafeTPay announced a new service last week that allows consumers to purchase goods and pay bills over the Internet using their existing ATM-card with PIN (Personal Identification Number). The service enables Internet merchants to accept ATM-card payments in a safe and secure manner. This benefits consumers, merchants and card issuing banks, and lowers fees paid by merchants. This unique service also makes credit card transactions more secure.
The SafeTPay service will be marketed to Internet merchants by Banks and ISO’s (Independent Sales Organizations). Universal Payment Processing, a wholly owned subsidiary of Universal Savings Bank, a leader in merchant processing, has signed an agreement with SafeTPay making them the first reseller for this service.
Consumers use a low-cost device, attached to their PC, to safely perform the transactions. This device reads the magnetic stripe on the consumer’s card, and in the case of ATM cards, encrypts the consumers’ PIN. Internet merchants have indicated an interest in deploying these devices to their frequent customers, in order to lower their transaction fees. SafeTPay devices will initially be provided by Innovonics. Additional vendors may be certified in the future, and the needed equipment will eventually be built into new PCs at the factory.
Ken Biel, Chairman & CEO of Universal Payment Processing, adds; “SafeTPay offers merchants significantly lower fees by enabling PIN entered Debit transactions through the Internet. And by requiring that the card is present, the system greatly reduces the risk of fraudulent transactions and chargebacks. SafeTPay, combined with Universal’s other services, provides a comprehensive payments solution for Internet merchants. We are very excited to be the first organization to offer SafeTPay”.
Using a simple installation program SafeTPay designed into the system, most merchants will be able to implement SafeTPay in less than one day, with no outside assistance. The system works with merchant web sites on UNIX, Windows NT, and LINUX platforms.
According to Harry Hargens, President and co-founder of SafeTPay, “The SafeTPay service is a real breakthrough for merchants, consumers and card issuers. For consumers, the benefit is security in using cards for Internet transactions that involve their credit and debit accounts”.
“With SafeTPay, the consumer’s card data is heavily encrypted before leaving their PC, and the encrypted data goes directly to a bank processor, without passing through the merchant’s hands. Security methods used by SafeTPay include and exceed standards followed for transmitting transactions from ATM and POS machines”.
“There are over 120,000,000 ATM Cards in use today. All those consumers can now use SafeTPay to pay Internet merchants in a way that is safer for all, and lowers fees paid by merchants. SafeTPay has filed for a patent to protect this unique process”.
“Until now, consumers had to send card numbers over the Internet relying only on SSL security, which according to a NY Times article has been broken. They also had to rely on merchants to keep card data safe. Consumers do not trust this payment method, as demonstrated by reports that over 50% of shopping carts are abandoned when the time comes to enter credit card data. The recent incident where 300,000 card numbers were stolen validates consumers’ fear. The benefit to merchants is obvious, more transactions and lower transaction fees. For card issuers, it enhances the value of their credit and debit cards by encouraging Internet transactions”.
“We began manufacturing our patented encryption devices several years ago to provide the best solution for credit-, debit-, and smart-card eCommerce transactions”, stated Dereck Clark, President of Innovonics. “We are pleased that SafeTPay selected our products for their exciting eCommerce solution. We have customers in 40 countries, and our products have even been used via the Internet to load eCash to smart cards. However, SafeTPay is the first company in the USA to integrate our products in an eCommerce system for true on-line debit.”
This SafeTPay System is especially attractive to Internet merchants with frequent shoppers such as Retail, Grocery, On-line Brokerage, Airlines, Utilities, Bill Payments, Pharmacy, Fast Food, etcetera, etcetera, etecera..Details