Sky Pearl Card

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.

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SafeTPay

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..

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Metris Projections

Metris Companies announced Thursday it expects earnings per share for the first quarter to range from $0.70 to $0.75 per share. The increase in expectations is driven in part by stronger revenues from both the credit card and fee-based businesses, stronger margins and improved credit quality than earlier estimated. Metris also increased its earnings guidance for full year 2000 to $2.80 to $2.85 per share.

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eCashP2P

eCash Technologies yesterday announced ‘eCash P2P’, a person-to-person e-mail payment service. ‘eCash P2P’ is available for immediate implementation by financial institutions serving the United States. Already deployed in Germany through a partnership with Deutsche Bank 24, the ‘eCash’ person-to-person solution is a payment product that can be installed directly at financial institutions or accessed seamlessly through a hosted service.

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Vital Update

Vital Processing Services announced the launch of POS-partner 2000, a PC-based point-of-sale software product that enables retailers and direct marketers to accept and process many kinds of payment vehicles from multiple point-of-sale venues, and to capitalize on the information gathering as part of the payment process. Vital Processing Services also announced it has expanded its integrated debit solution to include EBT processing at the merchant point-of-sale. Finally, Vital announced the promotion of Barb Gregg to SVP of product development.

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eCashPads

eConnect will announce this morning an agreement to supply 1,000 free ‘eCashPads’ to Kanakaris Communications. eConnect also announced this week it has structured a licensing arrangement with PalmPilot to enable first-ever wireless hand-held Internet terminal transactions. The eConnect ‘eCashPad’ simply attaches to the consumer’s computer keyboard, enabling Kanakaris customers to download entertainment programs with a card swiped “bank eyes only” cash ATM card and PIN payment or a credit card payment, whereby Kanakaris Communications never sees the credit card data nor is the credit card stored at the KKRS Web site. eConnect says it expects to distribute 100,000 ‘eCashPads’ to major Internet business sites. The PalmPilot deal is part of a joint venture deal with FL-based Pilot Island Publishing’s ‘PocketPay’ solution. EConnect’s has been a high-flying stock this week.

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Emerging Markets

MasterCard said Thursday that the public sector and recurring payments represent huge growth opportunities for payments cards in the next few years. Out of annual Federal and State tax payments of almost $450 billion, today only one percent is paid using payment cards. Similarly, only five percent of the $37 billion Americans spend at the Post Office each year is paid using payment cards, and two percent of the $14 billion collected by Motor Vehicle offices around the country. Utility bills, cable TV, insurance, Internet service providers, and newspaper delivery are areas where recurring payments are now popular. On-line services now account for 80 percent of recurring payments. MasterCard’s research shows that 56 percent of current credit card users would consider recurring payments for other bills. Nineteen percent of those not participating in recurring payments would at least consider a trial using their credit card.

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SafeDebit

QSI Payments launched the ‘SafeDebit’ credit card issuance system, which allows consumers to securely pay for purchases on the Internet with funds withdrawn directly from their checking or savings accounts. The development of the ‘SafeDebit’ system is the result of a strategic partnership with NYCE Corp. By relying on a CD-ROM card and an electronic personal identification number, ‘SafeDebit’ enables secure purchase transactions anytime, anywhere from any PC that has Internet access and a mini-disk capable CD-ROM drive. Upon virtual checkout, consumers insert their ‘SafeDebit’ cards into the computer’s CD-ROM drive and enter the e-PIN provided by their financial institutions.

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DoD Smart Cards

Datakey, Inc. and CyberTrust announced they will provide their information security technologies to the Department of Defense for its ‘Commercial PKI Security Assessment Pilot’. The one-year pilot program, which will be implemented by General Dynamics Communication Systems, is designed to help the DoD evaluate the feasibility of having commercial organizations provide high-assurance (Class 4) digital certificates to the DoD and other government agencies. Datakey smart cards form an important component of the DoD pilot because Class-4 certificates must be stored on cryptographic hardware tokens such as smart cards. A private key, the private portion of a user’s digital credentials, is generated and permanently stored on the Datakey smart card, and all encryption using the private key is performed on the card so the key is never available for someone to steal or copy.

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PC Pay Acquisition

MerchantOnline.com Inc. announced today it has agreed to acquire 90.1% of Phoenix-based Innovonics Inc. in exchange for five million shares of MerchantOnline.com common stock. Innovonics invented, developed and manufactures the ‘PC Pay’ card-swiping device that plugs into personal computers. The ‘PC Pay’ device, which accepts ATM, debit, credit and smart cards, incorporates a patented encryption technology. The patented technology used in the PC Pay device is unique in the world of eCommerce, in that sensitive information is encrypted within the secure device, about the size of a PC mouse, before entering the potentially vulnerable PC.

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e-Signia

IVI Checkmate Corp. announced the release of ‘e-Signia, a comprehensive image capture and retrieval solution that significantly reduces operating expenses associated with handling and retrieving credit card receipts. ‘e-Signia’ assist retailers in reducing the expenses, penalties and losses that result from credit card chargebacks. ‘e-Signia’ is now available and is being sold through IVI Checkmate’s direct salesforce and their value-added reseller network to supermarket, department store, mass merchandise, discount store and specialty retail chains throughout North America.

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NextCard Network

NextCard and E-Commerce Exchange yesterday announced a reciprocal marketing agreement to reach the 40,000 NextCard Affiliates and 30,000 E-Commerce Exchange Merchants and Affiliates. Under the terms of the agreement, NextCard will offer merchant accounts to its Affiliates and customers. In addition, ECX will offer their merchant customers and extensive network of Affiliates the opportunity to apply for and re-sell the NextCard Internet VISA.

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