Efforts to limit ATM fees at the federal level appear to have little chance of success this year. Yesterday, the House of Representatives Banking Committee adopted a measure to require ATM operators to make better disclosure to consumers of any fees for using ATMs. The new measure would require operators to post notices prominently on their machines and to include fee information on screen during the transaction process. Most ATM networks are already in compliance either by voluntary action or state laws. The amendment was sponsored by Committee Chairman Jim Leach (R-IA), and ranking Democrat John LaFalce (D-NY). It was passed by a 48-1 vote. Leach says that although many lawmakers are advocating a complete ban of ATM fees, yesterday’s amendment was about as progressive as the committee could be at this time.Details
Hypercom announced yesterday at the ETA ’99 Annual Meeting in Hawaii, the newest member of its series of POS terminals. The new ‘Hypercom T8’ is a low-cost POS terminal that supports draft capture, debit, check and proprietary card processing, smart card-based credit/debit cards and stored value cards, as well as PINpads. The ‘T8’ also includes a 35-key keyboard for single-stroke “Hot Key” function activation, a high-contrast, 2 x 20 backlit LCD display and 256K of memory to store more than 1,000 transactions. The ‘T8’ supports most common printer types and can be used in dial or leased line environments.Details
Bond R. Isaacson has joined Visa U.S.A. as executive vice president of Member and Merchant Relations. Based in Charlotte, N.C., Isaacson will oversee the leading bankcard association’s financial-institution and merchant programs nationwide.
Isaacson, 41, will report to Carl F. Pascarella, president and chief executive officer of Visa U.S.A.
“Bond has an outstanding record in leading strategic business partner relationships, which are essential to delivering superior products and services,” said Pascarella. “His addition to Visa U.S.A.’s leadership team ensures that we will continue to deliver value-added solutions to our member banks and merchants in this rapidly changing and increasingly competitive marketplace. We must remain responsive to our customers and continuously look for innovative ways to help grow their profits and build their businesses.”
Prior to joining Visa, Isaacson enjoyed a 19-year career at IBM, where he gained substantial experience in finance, marketing and sales. Most recently, as a financial services marketing executive, Isaacson directed IBM’s sales and IT-implementation efforts for the retail and global-finance business units of Bank of America. He also worked with the bank-holding company (formerly NationsBanc) to negotiate the formation of the Integrion Financial Network, a leading home-banking and electronic-commerce joint venture among 18 banks based in the United States and Canada.
Isaacson earned a bachelor of arts degree in Economics from Wheaton College and participated in a range of corporate-education programs throughout his career at IBM.
As the World’s Best Way to Pay, Visa is the leading card brand and the largest consumer payment system worldwide, providing payment solutions for consumers, industry and government. It plays a pivotal role in advancing new payment products and technologies to benefit its 21,000 member financial institutions, their cardholders, and the global economy. Visa is the only payment system to facilitate $1 trillion worth of purchases of goods and services in a fiscal year. Visa’s more than 630 million cards are accepted at over 15 million worldwide locations, including more than 450,000 ATMs in the Visa/PLUS Global ATM Network. Visa’s Internet address is [www.visa.com].
American Express announced the nationwide launch of Ticket TRAX, a new service for corporate customers which finds and refunds unused electronic tickets that travelers have forgotten to turn in for refunds. In the first four months of in-market trials, American Express’ new Ticket TRAX service identified and refunded more than $2.5 million in lost electronic tickets for 47 corporate clients.
“Ticket TRAX offers corporate travel managers peace of mind about tracking unused electronic tickets,” said Brigitte Baumann, senior vice president of Corporate Services Interactive. “There’s no extra work for the traveler, the travel manager or the travel office. Ticket TRAX takes care of the full refund process.”
Electronic tickets offer travelers several advantages over paper tickets; for example, no worries about misplaced tickets and no extra overnight delivery fees for last-minute reservations. However, without a paper ticket in hand after a trip, travelers often forget to turn in a ticket or trip segment that was never used.
During the pilot test, American Express found that nearly two percent of all electronic tickets contain at least one refundable segment that was never used. For a company that spends $20 million annually on air travel, if half of its employees use electronic tickets, Ticket TRAX could save $200,000 a year.
Ticket TRAX offers companies the only full-service solution to recapturing this lost money. “Ticket TRAX offers American Express Business Travel customers a unique advantage,” added Baumann. “Other electronic ticket refund services may identify unused tickets and send reminders to travelers or travel agents to initiate refunds, but only Ticket TRAX takes care of the entire process — without adding hidden costs in employee time or agency overhead.”
The Ticket TRAX system logs a record of all electronic tickets booked by a corporation’s employees through American Express Travel. Then, it checks the computer reservations systems (CRSs) after a specified period of time to determine if all segments of the ticket were used. Unlike most other electronic ticket refund services, Ticket TRAX can research tickets as far back as 13 to 22 months, depending on the data stored by the airline.
Monsanto, a life sciences company based in St. Louis, has been using Ticket TRAX since the first of November. Rose Holmes, Corporate Travel Manager, is delighted with the results.
“Ticket TRAX has already refunded over 70 unused electronic tickets that had been forgotten by Monsanto travelers,” Holmes said. “Many of these tickets were partially used, and travelers were unaware that there was any value to refund. Ticket TRAX has given us an easy and accurate way to find and process unused refundable electronic tickets. We estimate this service saved Monsanto $75,000 last year, and will save $120,000 in 1999.”
For each unused, refundable ticket, Ticket TRAX automatically initiates a refund request to the airline and, if the company chooses, it can also notify the travelers by fax or email to expect the refund, so they can correct their expense accounts. Ticket TRAX also provides the travel manager with a monthly report documenting the amount of money Ticket TRAX has saved. Internal audit groups can use the report to ensure employees process their expense reports in accordance with company policy.
Similar to international value-added tax refund services, Ticket TRAX costs only a nominal amount based on the amount recovered. There are no implementation or maintenance fees. This ensures that companies using Ticket TRAX never pay more for the service than they recover in unused tickets.
American Express operates the largest travel agency in the world, recording $19.9 billion in worldwide travel sales in 1998. Through its Corporate Services group, the company counts nearly 75 percent of the Fortune 500 as customers of its business travel, Corporate Card and Corporate Purchasing Card programs. More information on expense management tools from Corporate Services can be found at .
The American Express Company is a diversified worldwide travel, financial and network services company founded in 1850. It is a leader in charge and credit cards, Travelers Cheques, travel, financial planning, investment products, insurance and international banking.Details
With the marketing saturation of platinum credit cards some issuers are now looking for the next point-of-differentiation. First USA was ahead of the curve with the introduction last year of its ‘Titanium VISA’ card. However titanium is far less precious than platinum. This morning, the Colorado Springs Gazette has come up with some better suggestions for new card products: Iridium, Rhodium and Astatine. Iridium is the strongest pure metal. Rhodium is the most expensive metal at $900/oz compared to platinum’s $375/oz. Astatine is the rarest element. Therefore Iridium could be associated with the largest credit line, Rhodium with the highest value/annual fee and Astatine as the most difficult to qualify for.Details
Digital Courier Technologies, Inc. announced Wednesday it has agreed to acquire DataBank International SKB.
The acquisition will dramatically expand Digital Courier’s business of processing electronic credit card payments for goods and services purchased over the Internet. DataBank is an international credit card transaction processing company that provides credit card authorization and capture services to a wide array of Internet merchants around the world. DataBank’s unique technology also enables financial institutions to process e-commerce transactions. DataBank is currently processing approximately $25 million, representing over one million transactions, per month.
Digital Courier will issue 12 million shares of its common stock to acquire all of the outstanding shares of DataBank. The Company will issue up to 10 million additional shares if profits from DataBank exceed $8 million and $12 million, respectively, in each of the next two years. The acquisition is subject to approval by Digital Courier’s stockholders.
“The acquisition of DataBank creates an extremely powerful competitive advantage for Digital Courier and our netClearing subsidiary,” said James Egide, Chairman of Digital Courier. “This transaction will put our payment processing and e-commerce services at the hub of Digital Courier’s operation and will become the focus of our business going forward,” said Egide. DataBank and Digital Courier together become one of the leading companies to provide online businesses with a suite of Internet-based payment processing products. “The merger with DataBank accelerates our strategy to position Digital Courier at the hub of this market,” Egide stated.
“Digital Courier’s technology platform and relationships with key Internet companies will enable us to immediately scale our business to capitalize on a much broader, global market opportunity,” stated Don Marshall, President of DataBank. DataBank’s revenues for calendar 1998 (8 months) were $4.2 million, with net income of $2.3 million. “Approximately 80% of our 1998 revenues were achieved in the last quarter, as our business has grown dramatically each month since May of last year,” Marshall stated.
Digital Courier supplies financial institutions, businesses and major web portals with sophisticated and proprietary e-commerce software.Details
ETM Entertainment Network and ICON Software announced Tuesday that they will form the first entity to offer both live entertainment and movie ticketing to consumers over the Internet and other automated channels of distribution. ETM and ICON will enable consumers to purchase movie tickets through ETM’s network including an e-commerce website, etm.com, ETM Ticket Machines, an interactive voice response phone system and live operator call center. ETM also announced Tuesday it has partnered with Safeway to operate 28 ETM ticket kiosks in Safeway stores located in the greater San Francisco Bay Area.Details
Ordering items, like PCs, office chairs, and pens is becoming simpler for employees at Visa International Inc., San Francisco.
With the help of Core Technology Group, the international financial services company is deploying Aribas’ Operating Resource Management System (ORMS), a purchasing system that automates the requisition cycle by linking employees to suppliers’ through electronic commerce.
To date, electronic commerce has had a business-to-consumer emphasis but business-to-business tools may have more of a long-term impact because they can significantly lower operating costs, improve employee productivity, and help companies stay in business. A 5% reduction of purchasing costs can result in a 20% or more increase in profit margins (Killen & Associates).
Because such systems only recently became available, few organizations are using them. Visa has been at the market’s forefront and examined deploying an ORMS in the summer of 1997. Because use of its existing system was limited to only purchasing department and certain cost center management approvals, the ordering process was time consuming and information could be misplaced as it worked its way through the approval chain. A Web based electronic commerce system would enable the company to reduce the costs associated with procurements.
The Ariba software was a good fit because it focuses on automating the ordering of non-production goods and services that businesses need to run their day-to-day operations, such as capital equipment, software, and travel and entertainment expenses. Although these operating resources often account for more than 30 percent of company spending, they are typically managed through paper-based processes, providing few opportunities for automation, control, and leverage.
Once it made a decision to purchase the Ariba software, Visa needed help deploying it. The company selected Core because of its experience with the ORMS software.
In June 1998, Visa began linking the Ariba software, which runs on Windows NT and SQL Server, to its purchasing system. Core was charged with requirements definition and business process design, supplier alignment, and quality assurance.
In addition, the company worked to set-up electronic accounts with key suppliers so Visa would no longer have to deal with paper checks. By November, the financial company began rolling out the new system and currently 1,100 employees have access. The initial results have been positive, and the company expects to have 4,000 employees working with the system by summer.
Established in 1985, Core Technology Group specializes in bringing modern business systems, such as Enterprise Resource Planning, Operations Resource Planning Systems, and E-Commerce Systems, to major companies with both local and global operations. Core has recently performed implementations at companies, such as Plantronics, Specialized Bike, Onsale, VISA, Aurora Biosciences, Cisco Systems, and Novell.
Core’s dedicated team of professionals has compiled a superior track record of quality service, timely responsiveness and teamwork for hundreds of customers.
For further information about Core Technology Group, please visit the web site [www.coretec.com] or call 888/999-CORE. Core is headquartered in Los Gatos, Calif.
CheckFree Holdings Corporation Tuesday announced that its Investment Services Division has acquired privately held Mobius Group, a leading provider of money manager databases and financial planning software to the financial services industry. CheckFree paid approximately $18 million in an all-stock transaction that closed today. The Mobius Group, which generated revenue of $6.6 million in 1998, will allow CheckFree Investment Services to offer the broadest suite of investment consulting services and products in the industry today. (CheckFree’s Electronic Commerce division continues to work with Mobius Management Systems, Inc. which is in no way related to the Mobius Group.)
The addition of the Mobius Group immediately broadens the range of services that CheckFree can provide brokers, investment consultants and asset managers. Investment consultants and asset managers will be able to use M-Vest to determine the ideal asset allocation, use M-Search to determine the ideal investment manager candidates, use CheckFree APL and APL Wrap products to provide the investment management platform and trading tools, and use either M-Watch or CheckFree APL for their investment oversight and reporting to the end client. Financial institutions offering managed account products can now go to one source for all of their analysis, oversight and reporting needs.
The M-Preps, Leonard and soon-to-be released M-Plan financial planning systems will allow CheckFree immediate entry into the financial planner marketplace, a segment of the financial services industry it has not previously served. Financial planning is an increasing part of services being provided to individual investors and these systems will further broaden the comprehensive product offerings.
“The addition of the Mobius Group is a clear fit with our two major strategic objectives of expanding services to our existing client base and moving our portfolio management and reporting services down market to financial planners, high net worth consumers and eventually all consumers,” said Frank Polashock, General Manager of CheckFree Investment Services. “We will continue to expand our product and service capabilities through development, partnerships and such strategic acquisitions as the Mobius Group, to meet and anticipate the needs of our growing client base.”
“Since the inception of the Mobius Group 10 years ago, we have had a vision of providing our clients with a complete suite of decision tools,” said Bob Padgette, president of the Mobius Group. “Until today we were missing a major part of that vision — portfolio accounting. With the merger of the Mobius Group into CheckFree Investment Services, this powerful combination will offer integrated, comprehensive products to our brokerage firm, money manager, consultant, plan sponsor, and financial planning clients, making us an integral part of their continued success.”
Bob Padgette, founder and CEO of the Mobius Group and the 70 employees of the company join CheckFree’s Investment Services division and will maintain the current facility in Research Triangle Park, N.C. The Mobius Group has more than 1,700 clients, including many of the world’s leading financial institutions.
“The transaction will provide strong return-on-investment for CheckFree, and excluding the effects of approximately $2.5 million of annual non-cash amortization, will be two cents accretive in 2000 and four cents accretive in 2001,” said Jim Douglass, Executive Vice President of Mergers and Acquisitions. “Nonetheless, because our repurchase of 4.7 million shares last fall precludes us from applying the pooling method of accounting for this acquisition, the Company will be required to record the amortization for GAAP reporting purposes, resulting in one cent of earnings per share dilution in the fourth quarter and two cents in fiscal 2000. Thereafter, the deal is expected to be accretive,” added Douglass. The Company also expects to record a charge in the third quarter of fiscal 1999 for in process research and development and other costs associated with the transaction.
Founded in 1981, CheckFree ([www.checkfree.com]), the operating subsidiary of CheckFree Holdings Corporation, is the leading provider of financial electronic commerce services, software and related products for more than 2.6 million consumers, 1,000 businesses and 850 financial institutions. CheckFree designs, develops and markets services that enable its customers to make electronic payments and collections, automate paper-based recurring financial transactions and conduct secure transactions on the Internet.
CheckFree Investment Services offers CheckFree APL and CheckFree APL WRAP, which include portfolio accounting, performance measurement, trading and reporting services to financial institutions. CheckFree APL and CheckFree APL WRAP are currently used by more than 225 institutions managing over 600,000 portfolios totaling more than $400 billion in assets.
NBS Technologies Inc announced the acquisition of C&D Data Technologies of Toronto, a leading developer of wireless solutions for processing credit and debit transactions in a mobile environment.
NBS is a leading supplier of integrated POS systems and software services in Canada. As part of the Company’s expansion strategy it will be using this technology in a new cellular, handheld, wireless payment terminal for the Canadian, US and South American Markets.
“The C&D wireless technology is state of the art in terms of compact ergonomic design, the use of high performance radio modems compatible with major network providers and enhanced power management features all offered in an extremely cost effective package. We expect to bring this very competitive product to market in the next few months by teaming with financial institutions and service providers,” Ken Kivenko, President and CEO said.
“Increased usage of credit and debit cards combined with the need for an effective mobile terminal and rapidly decreasing cost of airtime from network providers, will allow NBS to use this new technology to not only provide a new revenue stream but to pull through the existing line of competitive POS systems to new markets. Through this acquisition, NBS intends to be recognized as the ‘provider of choice’ in the mobile, cellular, handheld payment terminal marketplace,” Neil Hudd, President of NBS Transaction Systems business unit stated.
Mobile payment authorization systems open up large new markets for more effective wireless transactions over nationwide networks including, but not limited to, taxis, limousines, delivery services, special events, kiosk and all portable sales outlets. Portable wireless capability is a key element in the progress of electronic commerce and in some parts of the world, the only viable alternative. NBS plans to expand the product line over time by offering smart card options and several new wireless technology features in the Americas and ultimately globally.
The market potential for mobile payment authorization systems in the Americas is considerable. The current installed base of wired transaction terminals exceeds 8 million units. The Company believes that as wireless communication costs continue to decline, the use of mobile transaction authorization systems will expand, both for new applications and through the conversion of the wired installation base, due to greater flexibility, processing speed and security.
NBS Technologies Inc. is a multinational company that designs, manufactures and markets an integrated line of card, card issuance, identification and point-of-sale products, services and software. Customers, who cover a wide range of market segments and applications, include financial institutions, retailers, government agencies, and healthcare organizations. The Company is a Toronto-based public company that sells to customers in over 85 countries through facilities located in Canada, the United States and the United Kingdom.Details
After recently shelling-out $475 million in restitution for illegal reaffirmation agreements with bankrupt cardholders and, last month, a $60 million criminal fine for defrauding bankruptcy debtors nationwide, Sears, Roebuck and Co. settled yet another lawsuit Tuesday afternoon for $36 million in cash. Yesterday’s agreement involved a class action lawsuit stemming from an increase in the APR assessed on certain balances of some Sears credit customers.The action was brought on behalf Sears cardholders who had outstanding balances when their accounts were transferred to Sears National Bank from 1994 through 1996, and who had not fully paid off those balances as of the effective dates of an April 1997 ‘Notice of Change in Credit Terms’. The plaintiffs’ principal claim in the litigation was that earlier notices to account holders included a commitment not to increase the rate on the pre-transfer balances. Sears says the change in credit terms was proper but that some account holders may have misunderstood. Terms of Tuesday’s settlement include Sears paying approximately $36 million in cash and $35 million in coupons to approximately 3 million customers whose APR on pre-existing balances was increased as a result of the 1997 change in credit terms. The settlement agreement also calls for Sears to send additional coupons, each with a face value of $7.50, to all 11 million class members.Details
Beginning March 1, the state of New Jersey taxpayers can pay their 1998 state income tax with their credit cards by calling 888/2PAY-TAX. Credit card payments are now available under an agreement between U S Audiotex LLC, an affiliate of Los Angeles-based Imperial Bancorp, and the state of New Jersey.
“We’re obviously delighted to have been selected by the state to participate in such an innovative program,” stated Kenneth Stern, president and founder of U S Audiotex. “Many taxpayers welcome the opportunity to pay their state income tax along with their federal income tax by credit card.
“The convenience and flexibility that are inherent with credit cards coupled with the ease of use and accessibility of 888/2PAY-TAX provide the taxpayer with a viable payment alternative to checks or money orders. U S Audiotex sees the state benefiting from the paperless nature of credit card payments. Also, by accepting credit cards, the state is providing the taxpayer with a convenient payment option,” added Stern.
New Jersey taxpayers, using a touchtone telephone, dial 888/2PAY-TAX and are connected to the U S Audiotex Interactive Voice Response (IVR) System. This computer system prompts the taxpayer (using the numeric keys on the touchtone phone) to select “state of New Jersey Income Tax.” The system then prompts for information including the Social Security Number and the amount of payment.
The computer computes the convenience fee and obtains the taxpayer’s approval prior to the taxpayer entering credit card information. The U S Audiotex IVR System performs an online authorization to verify credit and, upon credit verification, provides the caller with a confirmation number that the payment has been authorized by the credit card issuer.
Only the taxpayer’s Social Security Number and payment data are transmitted by U S Audiotex to the state. Funds are electronically transferred to the state’s bank account. Confidential credit card information is not forwarded to the state.
“We’re pleased with the agreement between our affiliate, U S Audiotex, and the state of New Jersey,” stated George L. Graziadio, chairman of the board, president and chief executive officer of Imperial Bancorp.
“U S Audiotex has successfully been assisting hundreds of governmental agencies around the country through its one-of-a-kind Interactive Voice Response System. This agreement exemplifies Imperial’s style of business, which is to provide innovative financial services and products to our customers,” added Graziadio.
U S Audiotex charges a convenience fee to taxpayers who pay their state and/or federal income tax through this program. The fees charged are very competitive to other credit vehicles.
“A substantial number of our customers find our fees are outweighed by the credit card benefits of air miles, cash back bonus awards or product purchase credits,” said Stern. U S Audiotex fees pay all processing and telecommunications costs in providing this service for taxpayers.
All taxpayers, regardless of the filing form (electronic, paper, through tax preparation services or software programs), may use their MasterCard, American Express or Discover Card through 888/2PAY-TAX. The U S Audiotex system is available to taxpayers seven days a week, 24 hours a day.
U S Audiotex, a closely held San Ramon-based company, was founded in 1986. It currently processes credit card payments for about 300 counties and cities throughout the country. In addition, U S Audiotex processes credit card payments for the IRS and California Franchise Tax Board.
For more information about U S Audiotex and the state of New Jersey credit card acceptance program, visit U S Audiotex’s Web site at [www.usaudiotex.com].
Imperial Bancorp, a diversified financial organization, was founded in 1968. Imperial Bank, the principal subsidiary organized in 1963, serves mid-sized businesses by offering a wide range of financial services tailored to corporate customers, entrepreneurs, and professionals nationwide. Imperial can be found on the Web at [www.imperialbank.com].