XMA$ 98 Purchases

American consumers will rack up $83.0 billion on major bank credit cards/charge cards, $14.3 billion on store credit cards and $13.2 billion on off-line, debit cards between Thanksgiving and Christmas according to data released this morning by CardData ([carddata.com][1]). During the 28 day period between the holidays, Americans will swipe their credit cards more than 1.4 billion times, charging an average of $3.5 billion purchases per day or $145 million each hour. For the peak shopping days of Nov 27, Nov 28 and Dec 24, consumers will use their credit cards more than 6,000 times per second generating charges of nearly $450,000 per second. VISA and MasterCard-branded off-line debit cards will increase in popularity this holiday season as purchase volume and transaction activity continues to grow more than 50% annually. Last year Americans used of-line or signature-based debit cards approximately 230 million times during the Christmas shopping season.

1998 Xmas Holiday Payment Card Statistics
(for period between 11/27/98 and 12/24/98 inclusive)
Purchases       Transactions       Avg. Ticket     
Major Credit Cards $ 83.0 billion 1,170 million         $70.94
Store Credit Cards $ 14.3 billion 240 million         $59.58
Natl Debit Cards       $ 13.2 billion 354 million         $37.29
Total:                 $110.5 billion 1,764 million         $55.94
Source: CardData (www.carddata.com)

[1]: http://carddata.com


Online Hit

First Union customers using Microsoft’s ‘Money” software for bill payments had their payments deducted twice from their bank account. The problem occured last week and reportedly affected a minimum of 400 accounts. First Union indicated the problem was related to a telecommunications problem with VISA last Monday. The customers affected conducted their bill payments through a dial-up connection, not First Union’s Internet site.


Debit Hit

Fidelity Bank in Wichita was forced to suspend its debit cards last week after being hit with fraudulent charges. The bank says about 1% of the bank’s debit card accounts were affected. MasterCard detected the bogus charges within two hours of the first bad incident. Hackers apparently working through the processor’s system probed for valid account numbers using algorithms. This is the second bank in Wichita to be targeted. Intrust Bank in Wichita was hit last summer after hackers working from Asia ran up bogus charges using a similar scheme.


ATM Outlook

EFT networks, NYCE, PULSE and STAR jointly announced the release of the “1999 ATM Deployer Study” last week. The survey, prepared by Dove Associates, describes the evolution of the ATM industry to date and predicts that the next three years will be characterized by slower ATM deployment, declining revenue and profitability for ATM owners, and more intense competition for all industry participants. Among the study’s strategic findings: the average monthly operating cost for an off-premise ATM is $1,090, with depreciation and first line maintenance the largest components; major cost differences exist by type of deployer, with ISOs averaging a monthly cost of $703 per ATM; 76% of ATM deployers currently surcharge, with an average convenience fee of $1.36 per foreign cash withdrawal; and deployers plan to grow their ATM bases by 29% over the next three years, versus an actual expansion of 126% between 1996 and 1998.



An IL-based company is piloting a MasterCard prepaid gift card issued by KeyBank. SwiftGiftCard is offering the card in denominations of $25, $50, $75 and $100 and will emboss the recipient’s name on the card. The cards will expire three months from the issue date. The company is also including a personalized greeting card to go with the MasterCard gift card. SwiftGiftCard is charging a handling fee of $6.95 to $8.95 for each card. The cards may be ordered via the company’s Web site using a credit card and will shipped within four days. The cards cannot be used at an ATM. The company indicated it expects to issue upwards of 50,000 cards by year end.


Biz Cards

Nearly half of small and mid-sized business owners say they used credit cards to finance their businesses in the past 12 months, up from 34% last year according to the seventh annual survey of small and mid-sized business owners conducted by Arthur Andersen’s Enterprise Group and National Small Business United. Andersen says credit card financing has nearly tripled during the past six years, up from 17.3% in 1993. The number of business owners who pay off their balances each month has dropped by almost half, from 59% in 1997 down to 38% in 1998.  In addition, the number of business owners who say they use credit cards only occasionally to make ends meet has dropped by more than half, from 24% last year to 10% this year.


EDS – First Indiana Deal

First Indiana Bank has signed a seven-year check processing services agreement with EDS that will provide the bank with advanced image-based processing capabilities and team First Indiana with EDS to begin offering these services to other Indiana community banks by the second quarter of next year.

Under the agreement, early next year, EDS will convert the bank from a standard check processing system to an image-capture process in which paper checks are digitized and their images stored on disks, thus reducing paperwork and increasing efficiency. In addition to imaging checks for First Indiana’s retail customers, the conversion will allow First Indiana’s Correspondent Banking Division to offer imaging services to small to mid-sized banks.

“There are two main advantages of this agreement for the community banks we serve,” said Tim O’Neill, senior vice president of the $1.7 billion-asset bank. “First, these banks will be able to offer the benefits of new technology to their customers. Second, the image processing will be performed near their home offices without the large financial commitment to equipment, space, software and personnel.”

The EDS and First Indiana agreement brings together a perfect team to provide check imaging to community banks. EDS will manage the item processing operations at the bank’s Greenwood, Indiana technology center and execute processing contracts with the correspondent banks.

“First Indiana Bank and the correspondent banks that outsource their check processing to us will have the expertise of EDS, one of the largest processors in the world,” said O’Neill. First Indiana Bank will supply the equipment and software. In addition, First Indiana will be able to help identify future needs and product uses of other community bank customers because of the understanding the bank has of this market. “We are pleased to form this unique services arrangement with an institution of the caliber of First Indiana Bank,” said Ray Maturi, president of EDS’ Community Banking Division. “Together we will bring the latest in check processing technology to community banks throughout the region.”

First Indiana Bank is the principal subsidiary of First Indiana Corporation (Nasdaq: FISB), a diversified financial services holding company. The 80-year-old, full-service financial institution offers a complete line of checking, savings and lending products. First Indiana is the largest locally owned bank in Indianapolis, with 26 offices in Metropolitan Indianapolis, Franklin, Mooresville, Pendleton, Rushville, and Evansville, Indiana. In addition to its retail banking operations, First Indiana has mortgage, construction, and consumer loan service offices throughout Indiana and in Arizona, Colorado, Florida, Georgia, Illinois, North Carolina, Ohio, Oregon and Utah. Visit First Indiana on the Internet at .

EDS offers a full range of professional services to the nation’s community banks. The offerings include core application processing, ACH transaction services, branch automation, cash management, compliance oversight, electronic markets services, infrastructure services, Internet services and payment services. In back-office services, EDS has become the largest third-party provider to the financial industry, processing more than 200 million prime- pass items monthly for more than 1,300 clients. Some of these services include encoding, in-clearing capture and balancing, POD capture and balancing, reject repair, transit processing, exception processing and image services.

EDS, the official information technology services provider for World Cup 1998, is a leader in the global information services industry. The company’s more than 110,000 employees specialize in applying a range of ideas and technologies to help business and government clients improve their economics, products, services and relationships. EDS, which serves clients in 45 countries, reported revenues of $15.2 billion in 1997. The company’s stock is traded on the New York Stock Exchange and the London Stock Exchange. Visit EDS via the Internet at .


7-Eleven Intl Card

The 26th annual World Hello Day, observed by people in 179 countries to demonstrate the importance of personal communication for peace. Anyone can participate in World Hello Day simply by greeting 10 people. 7-Eleven, the leading retailer of prepaid phone cards, is making it especially easy for people to participate.

With the new 7-Eleven/AT&T International Prepaid Phone Card, U.S. citizens can celebrate World Hello Day by calling friends and family around the world for as little as 19 cents a minute. The new international card comes in three denominations: $5, $10 and $20.

International per-minute rates are competitively priced — 19 cents for calls to Canada, as low as 22 cents to Mexico, 25 cents to Italy, 29 cents to Australia, 34 cents to Japan, 44 cents to Hong Kong and 88 cents to South Africa. Each call has a $1 surcharge. The international phone cards also can be used closer to home, with domestic calls costing just 12 cents per minute.

“For $20, a person can make 10 three-minute calls to as far-flung places as Australia, Monaco and Singapore,” said Mike Baldwin, phone card product manager for 7-Eleven. “Phone calls to a single destination have even better rates because you only pay one surcharge. For example, a $20 card buys a 100-minute call to Canada, between an hour and hour-and-a-half call to Mexico depending on the exact location, and over an hour call to many countries in Europe.”

Established in response to the conflict between Egypt and Israel in the fall of 1973, World Hello Day gives people around the world an opportunity to express their concern for world peace. The heads of state of 114 countries have expressed their approval of the event.

With more than 18,000 convenience stores worldwide, operations of The Southland Corporation (Nasdaq: SLCM) include nearly 5,600 corporate and franchised 7-Eleven and other convenience stores in the United States and Canada. In addition, licensees and affiliates operate more than 12,400 7-Eleven stores in the United States, its territories and 17 other countries and foreign territories. The 7-Eleven home page is located at .


AT&T – McKesson Deal

AT&T continues to expand the retail availability of its popular AT&T PrePaid Cards with the signing of a two-year agreement with McKesson Pharmacy Services, a business unit of McKesson Corporation, and its network of ValueRite and HealthMart drug stores. McKesson is the largest health care supply management company in North America.

Under the agreement, McKesson’s network of ValueRite and HealthMart drug stores will have the opportunity to sell AT&T PrePaid Cards in their stores. Consumers who shop at participating ValueRite and HealthMart Drug Stores will find something new in the aisles this week — 15-, 30-, 60- and 100-minute denomination AT&T PrePaid Cards. The popular cards will be available at some of the chain’s 5,000 drug store locations nationwide.

“We’re thrilled to be working with McKesson’s ValueRite network members and HealthMart franchises,” said Mark Evans, general manager for AT&T PrePaid Cards. “AT&T PrePaid Cards are becoming more and more popular with consumers everywhere and we’ve been working very hard to expand the retail distribution of our cards. Teaming up with McKesson is a great opportunity for us.”

Today’s agreement is the fourth major retail announcement this year for AT&T’s PrePaid organization, including recent agreements with Southland Corp. and its 7-Eleven franchise, Barnes & Noble College Bookstores and Red Roof Inns. These agreements have helped triple the number of retail locations carrying AT&T PrePaid Cards nationwide.

AT&T PrePaid Cards can be used to call anywhere in the U.S. and to more than 200 countries from any touch-tone phone. Calls always travel on the AT&T Network, and the Network even keeps track of the balance of minutes left on the card. To use a prepaid card, customers simply dial an 800 number, enter their PIN, hear how many minutes remain on the card, then dial the number.

AT&T is the world’s premier voice and data communications company, serving more than 80 million customers, including consumers, businesses and government. With annual revenues of more than $51 billion and 119,000 employees, AT&T provides services to more than 280 countries and territories around the world. For more information on AT&T, go online to [http://www.att.com][1]. For more information on AT&T PrePaid Cards go online to .

ValueRite(R) and HealthMart(R) are Registered Trademarks of McKesson Corporation.

[1]: httP://www.att.com


WorldPerks Goes Continental

Northwest Airlines and Continental Airlines announced Friday a new alliance to begin code-sharing on substantially all of  the airlines’ domestic and international routes; full reciprocity between the two carriers’ frequent flyer programs; and reciprocity of airport lounge club membership privileges in the U.S.. Northwest also announced a number of changes in its ‘WorldPerks’ frequent flyer program. Effective Mar. 1 ‘WorldPerks’ frequent flyer miles will no longer expire and effective Dec. 6 ‘WorldPerks’ members can earn miles on all Continental, Continental Express and Continental Micronesia flights. Northwest also expanded redemption periods and adjusted award levels.


New E-Loan CFO

E-LOAN (), the leading online mortgage broker, announced Friday that Frank M. Siskowski, formerly of Indus International, Inc., assumed the position of Chief Financial Officer, beginning November 1. In this position, he will be responsible for all financial operations for the company.

Mr. Siskowski brings to E-LOAN deep experience in business management, planning analysis, accounting, real estate, and asset management. Most recently, as Executive Vice President and CFO for Indus International, Inc., Mr. Siskowksi led the merger of the former Indus Group and TSW International. In his role as CFO, Siskowski established and shaped worldwide Finance, Human Resources and Administration functions for this market leading software and consulting services company.

Previously, Mr. Siskowski was the Senior Vice President Controller and Assistant Treasurer for Visa International where he created, staffed and managed Planning, Business Analysis, Accounting, Financial Reporting, Real Estate, Asset Management, Accounts Payable and Purchasing departments for the largest payment services company in the world. Mr. Siskowski received his Business Administration degree in Accounting from Manhattan College and a Masters in Business Administration degree from Fordham University.

“We are proud to have a seasoned professional such as Frank Siskowski as a key player on the E-LOAN team. Frank is a true leader with proven management skills. His reputation and expertise in the financial services industry will help position E-LOAN for its projected future growth and success,” stated Chris Larsen, CEO of E-LOAN.

About E-LOAN E-LOAN, Inc. is the leading online mortgage broker. At [www.eloan.com][1], borrowers can compare, apply for and obtain home loans from the nation’s leading lenders. E-LOAN saves borrowers as much as 75 percent on brokerage fees through the elimination of unnecessary transaction costs, while providing personalized customer service. After closing a loan, E-LOAN can, at the customer’s request, continue to send customized information about new products that become available, helping consumers turn a mortgage into a working financial asset. E-LOAN offers customers 24 hour a day online access to updated information on their loan status through its exclusive E-Track(SM) service. E-LOAN is the exclusive mortgage services provider to loan centers on many leading web sites, including Yahoo!, E-Trade and The Motley Fool. The company is headquartered in Palo Alto, CA, with loan processing offices in Dublin, CA. E-LOAN’s investment partners include Benchmark Capital, Sequoia Capital, SOFTBANK, Technology Partners and Yahoo!.

[1]: http://www.eloan.com