Passage Services

3-G International, Inc. announced Friday the availability of ‘Passage Services’, a comprehensive menu of technical and project management services for building and implementing smart card systems. 3GI’s ‘Passage Services’ offering is structured to provide specialized, standards-based integration support and technology development for a wide spectrum of smart card system types, including branded financial payment cards supporting standard industry card operating systems and platforms and stored value systems involving open and closed purse schemes, and additional value-added applications

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SmarTalk Deal

AT&T completed the asset-only purchase of bankrupt SmarTalk Teleservices Inc. last week for $145 million or about 25% less than first expected. AT&T said that nearly all of SmarTalk’s approximately 170 employees will be offered employment. SmarTalk, a leading provider of prepaid cards and prepaid wireless services, has distribution agreements with the U.S. Postal Service and leading mass merchandisers, consumer electronics retailers, supermarkets, hotels, home office superstores and convenience stores throughout North America and the U.K.

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Italian Optical Cards

CO-based BSI2000, Inc and Italy-based Infodec Company announced this morning they have signed a contract, on an exclusive basis, to form a strategic marketing partnership to bring optical cards into the Italian markets. Infodec has also, as part of the agreement, purchased initial optical card equipment from BSI2000. BSI2000 designs and sells software/hardware products for the medical, EBT/social benefits, and drug & alcohol testing markets that substitute highly efficient and fraud-proof optical cards for older paper-based transaction systems.

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FUSA Preview Deal

Preview Travel, Inc. announced this morning a multi-year, multi-million dollar marketing agreement that includes a co-branded credit card program with First USA. The Preview Travel co-branded MasterCard will be launched online this summer. Preview Travel has more than 7 million registered members. According to the terms of the deal, Preview Travel could realize millions of dollars in revenue, of which a portion is guaranteed.

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VISA NFL

VISA says its fifth NFL campaign will be the most extensive ever. The integrated marketing program for the NFL 1999-2000 season will include national advertising and consumer promotions, direct mail, public relations, retail and online marketing, a national fan search and league support. The theme will be: “VISA. It’s Everywhere NFL Fans Want To Be”. VISA will create two commercials spotlighting NFL fans with the spots scheduled to break in August. This year VISA will offer nine “Once-in-a-Lifetime NFL Fantasies” which includes watching playoff games with NFL players and eating lunch with an NFL quarterback. To encourage merchant participation in the “Fantasy” promotion, VISA is offering three trips to the Pro Bowl in Hawaii as prizes in a sweepstakes that rewards merchants who display point-of-sale promotional signage. VISA will also conduct the “VISA Hall of Fans” program, a season-long fan search that culminates with 31 fans being honored in the VISA-branded exhibit at the Pro Football Hall of Fame.

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Easypay Europe

Philips Semiconductors and Shell Nederland BV yesterday launched the contactless ‘Easypay’ program in Europe. The introduction of ‘Easypay’ is the first large scale application of contactless gas payment in Europe. The system is based on Philips Semiconductors’ ‘MIFARE’ chip and eliminates the need for debit or credit cards. Initially the system will be introduced in 100 specially selected large Shell outlets throughout The Netherlands. Following that trial the system may be introduced in the other 650 outlets in the Netherlands and then internationally.

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Euro Mondex

The first Euro denominated Mondex cards will be issued in France by the largest acquiring bank and second largest card issuer in France, Credit Mutuel. The bank says it will issue 50,000 cards in France by year end and several million in the second half of 2000. Hitachi will supply a Mondex transaction handling server and two sets of related application programs to Credit Mutuel. The “One Box Solution for Mondex” will be linked to the bank system’s host computer and will make it possible to transfer Mondex value between the bank and cardholders via ATMs, POS terminals, telephones and mobile GSM, and to check and update account balances.

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Fast Platform

Mag-Tek announced Wednesday a new smart card platform that can deliver the shortest transaction time possible for smart cards capable of supporting a transfer rate of 115K bits per second. The new platform supports read write for all ISO 7816 T=0 and T=1 microprocessor cards as well as most widely used memory cards. It also provides an on board interface for up to seven Secure Access Modules. EMV certification is underway. Mag-Tek is integrating this new platform into manual insertion as well as motorized card readers, PIN selection and verification systems, and instant card issuing systems.

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VISA ’98 Stats

VISA U.S.A. reported yesterday it captured 52.8% of USA general purpose card volume last year and is set to surpass $1 trillion in USA card volume by the year 2002. For calendar year 1998, VISA captured $610.3 billion in consumer/commercial card volume with a total of 322.5 million cards-in-force in the USA market. VISA also reported that it captured 10.5% of USA personal consumption expenditures in 1998, up from 9.6% the prior year. VISA says the PCE share increase represented $52.3 billion in new VISA spending. CardData (www.carddata.com) will release USA general purpose card stats, by brand, for 1998, this coming Monday.

VISA USA 1998 SNAPSHOT

CARDS VOLUME TRANSACTIONS CARDS
Credit 443.8b (+8%) 4.8b (+6.8%) 241.0m (+3%)
Debit 134.7b (+43%) 3.0b (+46%) 73.8m (+26%)
Commercial 31.7b (+41.7%) 190.8m (+43.9%) 7.7m (+85.8%)
Total 610.3b (+16%) 8.0b (+21%) 322.5m (+8%)

b-billions; m-millions; percentage indicate change from 1997; volume
total does not add due to rounding

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Citi – Mellon

Citibank, a unit of Citigroup, said Wednesday that it has completed its previously announced acquisition of Mellon Bank’s credit card business. Terms of the transaction, which has received necessary regulatory approvals, were not disclosed.

Under the agreement announced March 23, 1999, Citibank agreed to acquire $1.9 billion in credit card receivables, establish an agent bank relationship with Mellon to market credit cards under the Mellon and Dreyfus brands and to acquire the credit card operations center in Pike Creek, Delaware. This acquisition is in keeping with Citibank’s overall strategy to focus on the core strengths of its consumer business.

On Jan. 15, 1999, Mellon announced its plans to sell its credit card business, as well as its mortgage business and network services transaction processing unit as part of an initiative to sharpen its strategic focus on businesses with the highest growth and potential for return to its shareholders.

Citibank is part of Citigroup, the world’s most global financial services organization. Citigroup’s consumer businesses cover a broad range of financial services in 57 countries – retail and private banking, credit and charge cards, mortgage lending, consumer lending, personal financial planning, personal insurance and investment brokerage and counseling. These services are marketed through Citibank, Commercial Credit, Primerica, Travelers Life & Annuity and Travelers Property Casualty. Today, Citigroup serves more than 100 million customers – including consumers, businesses, governments and financial institutions – in 100 countries and territories.

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