NextCard & Priceline

NextCard announced a major strategic relationship with to enable customers to create their own customized credit cards beginning in the second quarter. Under terms of the agreement, NextCard will create a unique co-branded NextCard that will enable customers to name the terms they want for those elements of a credit card that are most important to them, and NextCard, using its unique online approval and customization technology, will respond to the customers’ requests with an individualized offer for a NextCard VISA or Mastercard in real time. NextCard will also participate in’s “sponsor dollars” marketing program, which will enable customers to increase the amount of their purchase offers by specified amounts by applying for a ‘ NextCard’ or using the card to complete their online transaction.


CEC Spec

Smart card standards organization, EMVCo, announced Monday the publication of a jointly developed specification describing how EMV smart cards can be used for secure payments over the Internet. The chip electronic commerce or ‘CEC’ specification was created under the auspices of VISA, MasterCard and Europay. The specification was also developed with the assistance of SETCo, the organization that manages the SET Secure Electronic Transaction protocol, and leverages the open, global standard for secure electronic commerce. The CEC spec is available from [][1] or [][2].



Hypercom Buys Golden Eagle

Hypercom Corporation , a global provider of end-to-end electronic and e-commerce payment solutions, announced that it has completed its previously announced acquisition of substantially all of the assets of Golden Eagle LLC and Golden Leasing, a micro-ticket leasing organization for point-of-sale terminals.

As previously announced, terms of the acquisition include an initial payment of $18.5 million in cash and $4 million in stock, with additional earn out payments over a three-year period if certain objectives are met. Golden will continue to operate from its current location in Ridgefield, CT as a standalone business unit.

“We welcome Golden Leasing employees and management to the Company,” said George Wallner, president and CEO of Hypercom. “Golden provides a key capability to the independent sales organization/bank processor market with their POS leasing expertise as we continue to roll out ePic, our web-enabled countertop electronic payment commerce and information platform. Golden’s equipment acquisition and deployment program, which includes purchase, rental or lease options, will allow us to more fully leverage the implementation of ePic, as traditional card payment terminals are replaced with our Internet-enabled, touch-screen ICE terminals. In addition, Hypercom gains access to Golden’s rapidly growing merchant base for cross-selling opportunities and access to hundreds of ISOs with whom Golden currently transacts business.”


Hypercom Corporation (NYSE:HYC) is a global provider of end-to-end electronic payment solutions, including card payment systems, peripherals, network products, software and e-commerce payment solutions that add value at the point-of-sale for consumers, merchants and acquirers.

Headquartered in Phoenix, Arizona, Hypercom(R) markets its products in more than 70 countries through a global network of affiliates and offices in Argentina, Australia, Brazil, Chile, China, Germany, Hong Kong, Hungary, Japan, Mexico, Russia, Singapore, Sweden, the United Kingdom and Venezuela. Hypercom’s Internet address is [][1].



AssetExchange Expands has added key executives and will expand its services to include not only credit card but also commercial mortgage portfolios. John McMenamin, Jr. has joined the company as SVP. He comes to after eight years with MBNA, where he most recently was Portfolio Acquisition Sales Officer. William Greenleaf, also a new SVP, will lead the development of’s newest asset classification, commercial mortgage portfolios. Greenleaf comes from Richmond, VA-based Dynex Commercial. The first business-to-business exchange to offer financial institutions the ability to buy and sell credit card portfolios on the Internet, registered buyers representing over 60% of the U.S. general credit card receivables in 1999.


Web Buyer Satisfaction

While 88 percent experienced Web buyers abandoned their online shopping carts at some point during the 1999 holiday season and 40% reported various problems, they were generally more satisfied shopping online then anyplace else, according to a new Andersen Consulting study. Specifically, 73 percent ranked Internet shopping the highest in terms of overall satisfaction compared to brick & mortar stores (60%) and catalogs (56%), respectively.

“Even though online shopping has its flaws, experienced Internet users love shopping on the web. But the long-term message is clear: Internet retailers must solve their infrastructure problems or suffer consequences,” said Steve Johnson, Andersen Consulting Partner and co-director of the firm’s eCommerce program. “Thirty-five percent of online shoppers who experienced problems on a particular site left that site for another, our study revealed. Given high customer acquisition costs, eTailers can’t continue to lose one of every three consumers and expect to survive. Their top concern must be infrastructure improvements.”

Top 10 Problems Experienced % Internet Buyers
————————— —————–

1. Gift wanted to purchase was out of stock 64%
2. Product was not delivered on time 40
3. Paid too much for the delivery of the product 38
4. Connection or download trouble 36
5. Didn’t receive confirmation or status report on purchase 28
6. Selections were limited 27
7. Web site was too difficult to navigate 26
8. Web site didn’t provide information needed to make purchase 25
9. Prices were not competitive 22
10. The web site didn’t offer enough gift ideas for me 16

A bright future for Internet shopping as Web outperforms brick & mortar

Ninety-six percent of experienced Internet users anticipate they will
use the Web to purchase products next holiday season, and 72
percent will use the Internet for day-to-day shopping in 2000, according to
the study.
The Internet outperformed catalogs and bricks & mortar stores on all
the key attributes that mattered most to online shoppers:
competitive price, obtaining everything from one source, convenience, and
time savings. The study found:

Internet Catalog Stores

– Offers most competitive price 21% 10% 13%

– Offers Everything I need From One Source 12% 7% 10%

– Is Convenient 59% 41% 12%

– Saves Time 62% 33% 3%

Additionally, books – the first product category to be sold en masse on
the Web – remain at the leading edge of shopping in the
eEcomony. Experienced Web users bought more books online than in stores
this holiday season. In fact, according to the survey, books
and videotapes were the only categories in which more online shoppers made
more purchases on the Web than in stores or via catalogs.

Type of Gift Via Internet Via Catalog Via Stores

Toys 48% 33% 57%
Books 47 15 34
Music 42 15 46
Videotapes 35 17 30

Clothing 29 41 81
Computer Hardware/Software 25 10 29
Collectibles/Candles/ 23 26 48
Household Items/Appliances 17 12 34
Consumer Electronics 17 10 25
Cosmetics/Personal Care 16 – 29
Sporting Goods 14 – 16
Greeting Cards 13 – 35
Food/Wine 11 10 17
Gift Certificates 9 6 38
Flowers or Gardening Items 9 – 5
Pet Gifts 6 – 21
Subscriptions to Magazines or 5 – 4
3 – 24
– – 8
Other 13 11 8

Product Features That Will Drive Future Spending

When asked which type of product or service feature would increase the
likelihood of purchasing more products or services over the
internet in the future, respondents cited the following features:

Internet Feature % Internet Purchasers
—————- ———————

1. Free product delivery 98%
2. On-time delivery guarantees 95
3. No sales tax 91
4. Coupons/promotions such as “buy three, get one free” 83
5. Customer assistance via a toll-free telephone number 68
6. Live, on-line customer assistance 62
6. Customer reviews or recommendations 62
8. Helpful hints for colors, sizes or other aids 58
8. Free gift-wrapping included 58
10. Gift suggestions 46

Andersen Consulting is an $8.3 billion global management and technology consulting organization whose mission is to help its clients create their future. The organization works with clients from a wide range of industries to link their people, processes and technologies to their strategies. Andersen Consulting has approximately 65,000 people in 48 countries. Its home page is [][1].


Taking respondents from Andersen Consulting’s October 1999 pre-holiday shopping study of 1,492 online shoppers, a total of 541 of these Internet users responded to a follow up poll over an eight-day period beginning Monday, December 27, 1999 through Monday, January 3, 2000. The survey was administered on the Internet. Finally, the data was weighted to the Internet population and a small number of respondents who did not purchase holiday gifts were eliminated from the sample. As a result, the total weighted sample, comprising 502 respondents, will be used throughout the remainder of this analysis.



November Explosion

Following four months of stagnation revolving consumer credit exploded in November. According to preliminary figures released Friday afternoon by the Federal Reserve, Americans piled on more than $4 billion in outstanding revolving credit during November. Since July, revolving consumer credit, mostly credit card debt, has been stuck at $584 billion. During November 1998 Americans paid down $1 billion in revolving credit for an annual growth rate of -2.4%. Overall consumer credit is now growing at a 13.7%, according to the FRB. At the end of November American consumers were $1.387 trillion in debt, exclusive of home mortgages.

Nov99 Oct99 Sep99 Aug99 Jul99 Jun99 May99 Apr99 Mar99 Feb99 Jan99

%GRWTH: 9.1% -0.5 0.0 2.5 12.1 13.8 4.5 5.6 -0.9 3.4 11.6
$OWED: $588.8 584.3 584.5 584.5 584.6 578.5 572.2 569.9 567.3 567.5 565.9

Source: Federal Reserve; revised figures as of 1/07/00; For complete
historical data visit


Small CU Issuers 4Q/99 Update

Credit unions in the $60 million portfolio range consistently beat the industry averages for growth in outstandings last year.

Security Service (San Antonio, TX) $83,718,565 $84,796,037 -1.3%
Wash. State Employ. (Olympia, WA) $69,207,741 $62,984,861 +9.9%
Desert Schools (Phoenix, AZ) $67,561,007 $65,469,693 +3.2%
Randolph Brooks (Univ.City,TX) $64,033,448 $57,298,511 +11.8%
Visions (Endicott, NY) $62,990,036 $58,697,639 +7.3%

Source: CardData ( 4Q/99


Small Bank Issuers 4Q/99 Update

Whitney National Bank in New Orleans posted extraordinary growth during 1999.

Dial Bank $333,115,436 $280,000,000 +19.0% 275,885 260,000 + 6.1%
FirstMerit $109,369,934 $ 99,847,160 + 9.5% 106,674 90,825 +17.5%
TrustMark $ 65,191,945 $ 61,010,251 + 6.9% 68,116 68,490 – 1.0%
Whitney $ 22,036,453 $ 17,780,748 +23.9% 24,184 18,621 +29.9%

Source: CardData ( 4Q/99 Portfolio Survey


CyberMark & Coin Acceptors

CyberMark announced today a strategic alliance with Coin Acceptors, Inc. of St. Louis, Missouri. The multi-year agreement will provide the smart card marketplace with a comprehensive solution for the use of electronic cash, and a loyalty application with state of the art vending machines from Coin Acceptors.

“Coin Acceptors’ expertise in the development of unattended point-of-sale hardware, coupled with CyberMark’s leading smart card applications, provides our customers with best of breed solutions,” said Kevin Ward, Assistant Vice President of Smart Card Products for Coin Acceptors, Inc. Mr. Tom Burke, Vice President of Marketing for CyberMark describes the alliance as “an extension of a comprehensive product development strategy providing SmartWorld(R) cardholders with a compelling suite of applications for use in closed campus environments and the Internet.”

Coin Acceptors specializes in development, manufacturing, and marketing of coin acceptors, bank note acceptors, smart card readers, and related vending technology. The company is privately held and based in St. Louis, MO, with field sales and support offices in over 14 countries.

CyberMark has teamed with Microsoft, Gemplus, and First USA, via the SmartWorld(R) Partnership Program to offer comprehensive smart card solutions. Founded in 1996, CyberMark is a leading electronic commerce company, specializing in the creation of smart card communities on the Internet and in closed campus environments. Cardholders conduct smart card based transactions using their cards at sites displaying the SmartWorld(R) logo. SmartWorld(R) is a registered trademark of CyberMark.


Smallest Bank Issuers 4Q/99 Update

Card issuers at the bottom of the chain continued to struggle with portfolio growth in 1999.

F&M Natl Bnk (Winchester, VA) $16,203,985 $17,288,077 -6.3%
Bnk of Canton (San Fran, CA) $ 7,269,255 $ 8,033,420 -9.5%
Clinton Natl Bnk (Clinton, IA) $ 1,225,848 $ 1,249,845 -1.9%
Grundy Natl Bank (Grundy,IA) $ 454,485 $ 469,029 -3.1%
Monroe Cty Bnk (Monroeville,AL) $ 457,753 $ 439,621 +4.1%

Source: CardData ( 4Q/99 Portfolio Survey


Creating and building Internet lending profitability will be the focus of a special industry conference to be in Orlando at the end of March. Top executives from Lending Tree, Microsoft HomeAdvisor, Citicorp,, QuickenMortgage, Sallie Mae, Laureate, and other leading Internet Companies are slated to speak at the event. Produced by World Research Group ([][1]), the three-day conference will feature workshops, panel discussions, and special presentations to help diagnose, develop and implement an Internet lending strategy to produce long-term web-based profits. Robert McKinley, CEO of, will handle a first day presentation titled: “Capitalizing on the Web-Credit Card Frenzy”. The event runs from March 29 through 31 and is being held at the Sheraton Studio City.