Barclays Merchant Services selected CyberCash’s secure payment technology Monday as the foundation of Britain’s first bank-owned Internet payment system. Barclays, which handles the credit and debit card purchases at over 125,000 shops and businesses across the UK, will offer ‘ePDQ’, a virtual version of Barclays Merchant Services’ PDQ point-of-sale credit/debit terminals used by UK businesses. The ‘ePDQ’ service is similar to CyberCash’s ‘CashRegister’ Internet payment service already available to merchants in the U.S..Details
Total System Services said Monday it has entered into a strategic alliance to form a marketing partnership with HNC Software to offer HNC’s suite of real-time, transaction-based predictive software solutions for credit, debit, and private-label cards for TSYS’ clients. HNC products covered by the agreement include: ProfitMax; ProfitMax Bankruptcy; Falcon; Falcon Debit; Falcon Select; and Falcon Retail.Details
IVI Checkmate announced this morning the acquisition of Debitek Holding Limited (Debitek) of Chattanooga, TN, was completed effective December 18th. IVI Checkmate acquired all of the outstanding stock of Debitek for $4.95 million in IVI Checkmate stock valued at $5.40 per share. The transaction will be accounted for as a pooling-of-interests. IVI Checkmate says it will integrate Debitek’s software libraries and hardware units with Ingenico’s smart card technology to form solutions that integrate the needs of closed systems and open payment systems.Details
IVI Checkmate Corp. announced last week that its Elite 780 has received certification from the Royal Bank of Canada, and becomes the first fully portable long range wireless terminal available in Canada for both debit and credit applications.
The Elite 780 is one of several wireless terminals offered by IVI Checkmate, and is the first certified by the Royal Bank to accept debit transactions at the point-of-sale. With a built-in modem and thermal printer, the Elite 780 is a complete portable POS solution that is compact, lightweight and ideally suited to portable applications where the terminal is brought to the customer.
The Elite 780 will be targeted by the Royal Bank to mobile and service/hospitality businesses such as home repair businesses, delivery services, portable sales kiosks, taxi cabs and limousines, restaurants and petroleum full-service stations.
“This wireless terminal gives merchants the first portable payment solution that offers consumers the ability to choose between debit or credit whatever best suits their needs,” says Frank Moore, Vice-President, Merchant and Point of Sale Services, Royal Bank. “With the phenomenal growth of debit in this country, unmatched anywhere else in the world, it is important to combine both debit and credit functions into one portable payment terminal.”
With this new terminal, clients of Grocery Gateway will be able to do their shopping online at www.grocerygateway.com and then pay for their purchases with debit or credit when they are delivered to their door. “The Elite 780 terminal with debit capability means our clients can choose between paying with their debit card, the most commonly used form of payment for groceries in Canada, or credit,” says Bill DiNardo, president of Grocery Gateway, a Toronto-based internet grocery shopping company that offers home delivery to the Greater Toronto area. “This is a great step forward for e-commerce in Canada.”
The Elite 780 with debit card functionality has a distinct competitive advantage over other wireless terminals currently available in that IVI Checkmate’s mobile payment terminals have been designed to transmit transactions on Cantel AT&T’s Mobitex network. The Mobitex network is a wireless system that is dedicated to processing data instead of voice, which is the most common wireless signal. As a result, the payment transaction signal carried via Mobitex does not have to compete with voice signals, resulting in greater reliability.
Rogers Cantel has approximately 1.8 million wireless subscribers in Canada. Rogers Cantel Mobile Communications Inc. (TSE:RCM.B); (NYSE:RCN), an 81% owned subsidiary of Rogers Communications Inc., owns and operates Canada’s largest wireless company. Rogers Cantel offers a full range of wireless communication services including voice, data and paging under the co-brand Cantel(R) AT&T(TM).
Royal Bank (ticker symbol: RY) is Canada’s premier global financial services group and a leading provider of personal and business banking, corporate and investment banking, and wealth management services. As one of North America’s largest financial institutions, Royal Bank and its key subsidiaries Royal Trust, RBC Dominion Securities, RBC Insurance, and Royal Bank Action Direct have 60,000 employees who serve 10 million clients through more than 1,500 branches and offices in 36 countries.
IVI Checkmate Corp. also announced last week an order for its eN-Check 430 check reader from Chicago-based LaSalle Bank Group.
LaSalle, a subsidiary of ABN AMRO Bank N.V., is installing the eN-Check 430 as part of its branch-wide implementation of a state-of-the-art teller system. The eN-Check 430 is a key component in LaSalle’s effort to improve customer service through automated accurate check reading and check fraud deterrence. LaSalle is the tenth financial institution this year to implement IVI Checkmate products in their bank branches.
Maureen Murphy, First Vice President & Manager, of LaSalle’s Retail Bank Group, commented, “The acceptance of the eN-Check 430 by our tellers has been nothing short of outstanding. We have exceeded our productivity goals for improved check acceptance by a wide margin. The MICR reading accuracy and `hand back/hold away` features of the eN-Check 430 have contributed to our tellers ability to service more customers in a shorter time period.”
Greg Lewis, President and CEO of IVI Checkmate’s U.S. Operations, said, “Banks are increasingly looking towards technology to improve customer service and reduce operating costs. LaSalle and many other banks have found immense value in the eN-Check 430’s superior reliability, outstanding read accuracy and industry leading fraud detection capabilities.”
The LaSalle Bank Group, which consists of LaSalle Bank FSB, LaSalle Bank N.A., and LaSalle National Bank, are subsidiaries of ABN AMRO Bank N.V., the 8th largest bank (by Tier 1 capital) in the world, with approximately $490 billion in assets and more than 1900 locations in 71 countries around the globe. ABN AMRO’s holdings in North America also include EAB, a commercial and retail banking subsidiary servicing the New York Metropolitan area, and Troy, Michigan-based Standard Federal Bank, which provides retail, mortgage and commercial banking services throughout Michigan.
IVI Checkmate is the third largest electronic payment solutions provider in North America. IVI Checkmate is a full-service solutions provider in the U.S., Canada, and Latin America serving the retail, financial, hospitality, banking, healthcare and transportation industries. With offices in the U.S. and Canada as well as established strategic alliances and worldwide partnerships, IVI Checkmate is well positioned to deliver leading products and global technologies to our customers.Details
Cybergold, Inc. announced this morning it has signed-up of its millionth member. Cybergold offers a pay-for-performance program that lets clients reward consumers with cash and other incentives for taking action on the Web. Among Cybergold’s clients: Microsoft, AOL, Disney Online, AT&T and VISA. Cybergold ran a “One Million Member Sweepstakes,” in which the millionth person to sign up for a Cybergold account won $500. Additionally, five current members who earned from ads the day the millionth member signed up also won $100 each. Cybergold also indicated this morning that its member demographics show: the majority have an income between $50-$75K; 68% are between the ages of 26 and 50; and 75% have used a credit card online.Details
NH-based Bottomline Technologies has launched ‘PayBase – Secure WebPay Series’. The ‘WebPay Series’ provides organizations with the ability to create electronic or paper-based payments, deliver electronic remittance advices, and access real-time transaction information from any desktop browser.The ‘WebPay Series’ features five distinct Internet-enabled functionalities that can be implemented separately or in tandem. The functions include: Electronic Payment Request; Check Payment Request; Message Delivery; Participant Administrator; and Query and Reporting.Details
PT-1 Communications, Inc., filed action in federal district court in New York City Friday charging rival IDT Corporation with trying to deceive or confuse customers by copying the distinctive trade dress of PT-1’s long-distance calling cards. A show-cause hearing on the injunction request has been scheduled for this morning. Specifically, PT-1 asserts that IDT copied the name, packaging, and trade dress of PT-1’s New York, New Jersey, Connecticut, Florida, Texas, Georgia, California, and Maryland/ Washington, D.C. cards in marketing what IDT called its “New York Exclusive,” “New Jersey Exclusive,” “Connecticut Exclusive,” “Florida Exclusive,” “Texas Exclusive,” “Georgia Exclusive,” “California Exclusive,” and “Maryland/D.C. Exclusive” cards.In its filing, PT-1 asked the court for a restraining order that would prohibit IDT from manufacturing, distributing, selling, or advertising nine of its pre-paid long-distance cards.Details
The Internal Revenue Service announced Friday details on proposed rulemaking and posted a notice of public hearing in regard to a communications excise tax on prepaid telephone cards or PTCs. IRS Section 4251 imposes a 3 percent excise tax on amounts paid for three communications services: local telephone service, toll telephone service, and teletypewriter exchange service. The tax is paid by the person paying for those communications services and, under section 4291, is collected by the person receiving that payment.
Section 1034 of the Taxpayer Relief Act of 1997 added section 4251(d), effective November 1, 1997, which provides special rules for the treatment of PTCs. Under section 4251(d), a PTC is any card or similar arrangement that permits its holder to obtain communications services and to pay for such services in advance. The face amount of the PTC is treated as an amount paid for communications services and that amount is treated as paid when the PTC is transferred by any telecommunications carrier to any person that is not a carrier.
Explanation of Provisions These proposed regulations provide rules relating to the imposition of tax, the determination of the face amount upon which tax is imposed, and the identification of the person liable for tax and the person responsible for collecting tax. The purpose of the rules for determining the face amount is to implement Congressional intent that the tax be imposed on a PTC’s retail value, whether a carrier sells a PTC at retail or at wholesale to a transferee reseller. In certain limited circumstances, these rules permit the use of a safe harbor under which the face amount is equal to $0.30 per minute of service provided. Because the IRS and Treasury expect the retail value of PTCs to change over time and intend to review the per-minute rate at regular intervals, this safe harbor expires on December 31, 2001.
For purposes of determining whether a transferor is a carrier and whether a transferee is a person that is not a carrier, the proposed regulations adopt the definition of telecommunications carrier used by the Federal Communications Commission. In general, this definition treats any provider of telecommunications service as a telecommunications carrier. In addition, the proposed regulations provide that a transferor carrier is not responsible for collecting the tax if it has been notified, in writing, by the purchaser of the purchaser’s status as a carrier and has no reason to believe otherwise. Providing that notification does not relieve the purchaser from liability for tax if the purchaser is not, in fact, a carrier. Furthermore, the rules in the Excise Tax Procedural Regulations (26 CFR part 40) relating to collectors of tax under chapter 33 of the Internal Revenue Code do not apply to noncarrier purchasers.
During the development of the proposed regulations, the IRS and Treasury received inquiries concerning the treatment of multi-use cards and enhanced services cards. Multi-use cards are PTCs that can also be used to purchase items other than communications services, such as gas, groceries, etc. Enhanced services cards are PTCs that can also be used to purchase nontaxable informational services such as stock quotations or access to a 900 number. The proposed regulations do not include special rules for multi- use or enhanced services cards. However, the IRS and Treasury request comments on this issue.
The regulations are proposed to be effective at the beginning of the first calendar quarter after they are published as final regulations. Carriers and transferees may, however, rely on the proposed rules in determining the treatment of PTCs transferred before the effective date.
Special Analyses It has been determined that this notice of proposed rulemaking is not a significant regulatory action as defined in EO 12866. Therefore, a regulatory assessment is not required. It also has been determined that section 553(b) of the Administrative Procedure Act (5 U.S.C. chapter 5) does not apply to these regulations. It is hereby certified that the collection of information in these regulations will not have a significant economic impact on a substantial number of small entities. This certification is based on the fact that the time required to prepare or retain the notification is minimal and will not have a significant impact on those small entities that are required to provide notification. Furthermore, notification is provided only once to each seller. Accordingly, a Regulatory Flexibility Analysis under the Regulatory Flexibility Act (5 U.S.C. chapter 6) is not required. Pursuant to section 7805(f) of the Internal Revenue Code, this notice of proposed rulemaking will be submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on its impact on small business.
Comments and Public Hearing Before these proposed regulations are adopted as final regulations, consideration will be given to any written comments (a signed original and eight (8) copies) that are submitted timely to the IRS. All comments will be available for public inspection and copying.
A public hearing has been scheduled for Wednesday, May 5, 1999, at 10 a.m. in room 2615, Internal Revenue Building, 1111 Constitution Avenue NW., Washington, DC. Due to building security procedures, visitors must enter at the 10th Street entrance, located between Constitution and Pennsylvania Avenues, NW. In addition, all visitors must present photo identification to enter the building. Because of access restrictions, visitors will not be admitted beyond the immediate entrance area more than 15 minutes before the hearing starts. For information about having a visitor’s name placed on the building access list to attend the hearing, see the FOR FURTHER INFORMATION CONTACT caption.
An outline of the topics to be discussed and the time to be devoted to each topic (a signed original and eight (8) copies) must be submitted by any person that wishes to present oral comments at the hearing. Outlines must be received by April 14, 1999.
The rules of 26 CFR 601.601(a)(3) apply to the hearing. A period of 10 minutes will be allotted to each person for making comments.
An agenda showing the scheduling of the speakers will be prepared after the deadline for receiving requests to speak has passed. Copies of the agenda will be available free of charge at the hearing.
Drafting Information. The principal author of these regulations is Bernard H. Weberman, Office of Assistant Chief Counsel (Passthroughs and Special Industries). However, other personnel from the IRS and Treasury Department participated in their development.
List of Subjects in 26 CFR Part 49 Excise taxes, Reporting and recordkeeping requirements, Telephone, Transportation.
Proposed Amendments to the Regulations Accordingly, 26 CFR part 49 is proposed to be amended as follows:
PART 49-FACILITIES AND SERVICES EXCISE TAXES Paragraph 1. The authority citation for part 49 is revised to read as follows:
Authority: 26 U.S.C. 7805, unless otherwise noted.
Section 49.4251-4 also issued under 26 U.S.C. 4251(d).
Par. 2. Section 49.4251-4 is added to read as follows:
Section 49.4251-4 Prepaid telephone cards.
(a) In general. In the case of communications services acquired by means of a prepaid telephone card (PTC), the face amount of the PTC is treated as an amount paid for communications services and that amount is treated as paid when the PTC is transferred by any carrier to any person that is not a carrier. This section provides rules for the application of the section 4251 tax to PTCs.
Carrier means a telecommunications carrier as defined in 47 U.S.C. 153.
Comparable PTC means a currently available dollar card or tariffed unit card (other than a PTC transferred in bulk or under special circumstances, such as for promotional purposes) that provides the same type and amount of communications services as the PTC to which it is being compared.
Dollar card means a PTC the value of which is designated by the carrier in dollars (even if also designated in units of service), provided that the designated value is not less than the amount for which the PTC is expected to be sold to a holder.
Holder means a person that purchases other than for resale.
Prepaid telephone card (PTC) means a card or similar arrangement that permits its holder to obtain a fixed amount of communications services by means of a code (such as a personal identification number (PIN)) or other access device provided by the carrier and to pay for those services in advance.
Tariff means a schedule of rates and regulations filed by a carrier with the Federal Communications Commission.
(1) To a holder at a price that does not exceed the designated number of units on the PTC multiplied by the carrier’s tariffed price per unit; or (2) To a transferee reseller subject to a contractual or other arrangement under which the price at which the PTC is sold to a holder will not exceed the designated number of units on the PTC multiplied by the carrier’s tariffed price per unit.
Transferee means the first person that is not a carrier to whom a PTC is transferred by a carrier.
Transferee reseller means a transferee that purchases a PTC for resale.
Unit card means a PTC other than a dollar card.
Untariffed unit card means a unit card other than a tariffed unit card.
(c) Determination of face amount -(1) Dollar card. The face amount of a dollar card is the designated dollar value.
(2) Tariffed unit card. The face amount of a tariffed unit card is the designated number of units on the PTC multiplied by the tariffed price per unit.
(3) Untariffed unit card -(i) Transfer to holder. The face amount of an untariffed unit card transferred by a carrier to a holder is the amount for which the carrier sells the PTC to the holder.Details
Schlumberger and fashion watch maker, Swatch, have launched a pilot that enables bus users in Tampere, Finland to use their watches as a contactless smart card to pay for bus fares. Travelers in Tampere can now buy Swatch watches which operate in exactly the same way as the contactless Schlumberger ‘Easypass’ ticketing card used by the city’s bus network. Schlumberger and Swatch are already working on the second generation of e-watches which will have their own operating system. Schlumberger’s ‘FastOS’ operating system is compatible with the International Airline Transport Association specification for airline travel and with EMV. Swatch indicated Friday the new technology could offer the future capability of paying for goods and services. Finland has launched ‘Matkahoulto’, a nationwide program for e-ticketing for buses, trains and subways.Details
InteliData Technologies Corp. announced Friday that Boston-based USTrust has selected InteliData’s ‘Interpose’ software to implement a complete in-house online banking and bill payment solution via the Internet. Using ‘Interpose’, USTrust customers will be able to access real-time account information and pay bills electronically using standard HTML browsers via USTrust’s Boston based Internet Web site. Customers will also be able to access real time bank account information and pay bills via popular personal financial management software.Details
The CEPS Group (Europay International, Visa Espana/SERMEPA, Visa International and ZKA) announced last week that specifications to enable the world’s electronic purse programs to work together will be published on 30 December. The development of the Common Electronic Purse Specifications (CEPS) is a major step forward in creating an open, global standard for the electronic purse and will help to further the growth of smart cards world- wide.
The CEPS Group involved in the development of the Specifications will make them available to security labs for review. Once the evaluation period is complete on January 31, 1999, a final version of the Specifications will be made public. As most of the electronic purse developments are taking place in Europe, input from European institutions, including ECBS (European Committee for Banking Standards), has been instrumental in establishing the Specifications. Consequently, it is anticipated that the first programs to migrate will be in Europe where the introduction of the euro is an additional driver behind the need for a common standard. Once implemented, CEPS will enable cardholders to use their electronic purse cards both at home and abroad.
Organisations from 22 countries, representing more than 90 per cent of the world’s electronic purse cards have agreed to implement the CEPS standard. These include Visa International, Visa Espana/SERMEPA, ZKA, Europay International, Proton World International, SSB in Italy, NETS in Singapore, the Swedish banks supporting the ‘Cash’ purse scheme, and Europay Austria. Groupement des Cartes Bancaires is also committed to this initiative and to becoming an active member of the CEPS Group.
CEPS defines the requirements needed by an organisation to implement a globally interoperable electronic purse program. It requires compatibility with the EMV Specifications for chip cards and defines the card application, the card-to- terminal interface, the terminal application for point-of-sale and load transactions, data elements and recommended message formats for transaction processing. It also provides functional requirements for the various electronic purse scheme participants and uses public key cryptography for enhanced security.
The effort to create a common standard for the electronic purse has gained considerable momentum since the public announcement in June that the world’s largest purse operators had created a working group to develop industry- wide, open specifications. CEPS is the realisation of these efforts.Details
Proton World announced last week it has signed the first distribution contract for its new ‘Proton for Windows NT platform with GFI Informatique. French-based GFI is a systems consulting, integration and software specialist. The agreement will cover France, Spain, Italy, Germany, North Africa and the UK.Details