Online Retail Study

Leading strategy consulting firm, The Boston Consulting Group (BCG) and shop.org, the association for leading online retailers, announced today that they will partner to perform a comprehensive survey of the online retail industry in North America. The survey results, which will be released at eRetailing ’98 in October, will provide a detailed assessment of the size and growth of the online retail channel and an analysis of the industry’s key financial and operational performance metrics.

Details

2nd Quarter Early Highlights

MBNA’s credit card receivables grew slightly more than 4% since the close of the first quarter, while NationsBank’s receivables inched up slightly more than 1%. First National of Nebraska’s card loans grew by more than $200 million in the second quarter due to its acquisition of card receivables from Union Bank of California and Sovereign Bank.  The Navy and Pentagon Federal Credit Unions realized a small increase in their card base during the past three months while Mercantile’s card base dropped by more than 140,000 accounts. Sub-prime issuer First Consumers National Bank reported an outstanding second quarter with a 10% surge in receivables and a 6% growth spurt in its account base. The figures are based on data gathered by CardWeb and available via its new ‘[CardData][1]’ online service.

2Q/98  CARD  PORTFOLIO  UPDATE
ISSUER RECV QVOL ACCTS
MBNA $46,957,591,000     $19,069,766,000         N/A
NationsBank $ 9,847,616,392     $ 6,740,410,000     8,766,941
Frst Natl NE $ 3,412,482,000     $ 1,047,550,000     3,814,581
Navy FCU $   845,690,133     $   461,527,294     544,182
Mercantile $   636,592,270     $   196,629,418     518,727
Pentagon FCU $   355,394,393     $   128,092,550     198,768
Frst Consumers $   330,716,923     $   159,182,653     625,368
Compass Bank $   253,681,570     $    91,167,813     163,772
Beneficial NB $   165,000,000     $   102,000,000     292,000
Simmons NB $   162,156,034     $    78,172,705     224,750
Source: CardData; www.carddata.com

[1]: /carddata/home.html

Details

The Skinny

In other  payment card related developments:  American Express reportedly has pulled out of its partnership with KnowledgeBase Marketing for financial reasons —- The Chairman of the Senate Banking Committee predicts ATM surcharges will rise very shortly to an average of $2 per transaction from the current $1.25 average —American Airlines is raising the mileage redemption requirements for international first-class and business-class travel for its AAdvantage frequent flyer program effective next February — United Airlines is expected to announce a similar adjustment within the next 60 days — Cendant shareholders are calling for the resignation of Chairman Walter Forbes following accounting irregularities in which CUC International booked nearly $300 million in phony revenue prior to its merger with HFS Inc. For details on these inside developments see CardBuzz, the weekly payment card newsletter from CardWeb.

Details

Transactor Networks Names CTO

Transactor Networks, Inc., developer of an innovative suite of “object commerce” and electronic customer relationship products, today announced the appointment of Ted Goldstein to the position of Chief Technology Officer and Vice President of Engineering. While serving as Chief Commerce Officer for Sun, Mr. Goldstein oversaw development of the Java Card, the famous Java Ring and the Java Wallet. He brings more than fifteen years of object-oriented development and network commerce experience to Transactor Networks. In 1997, he was awarded the prestigious Sun President’s Award by Sun CEO Scott McNealy for championing Java Commerce and for creating the Java Card. The Java Card alone transformed smart cards and has catalyzed a projected $15 billion market. In his new role, Mr. Goldstein will oversee the day to day development of the company’s flagship Transactor Commerce System, as well as chart the development of future e-commerce products.

Details

CardGame Returns

CardWeb, Inc. announced this morning the revival of its popular [‘CardGame’][1] feature for online visitors to www.cardweb.com.. The new version of ‘CardGame’ offers consumer visitors the chance to win more than $20,000 in prizes annually. ‘CardGame’ participants simply answer ten demographic questions and complete a ten question quiz on credit card related items. The quiz is based on recent information published via the ‘CardTrak’ news and survey channel. A new contest is offered each month with one grand prize of $10,000 cash to be awarded to one of the monthly winners next July.  ‘CardGame’ previously had a two year run between September 1995 and November 1997, awarding more than $50,000 in prizes. The information gathered from ‘CardGame’ is used to update Web site demographics for current and potential advertisers. CardWeb’s current advertising clients include Chase Manhattan, NationsBank, First USA, People’s Bank, Commerce Bank, Wachovia, Beneficial National Bank and NextCard. CardWeb’s comprehensive Web site, offering more than 10,000 payment card documents to consumers and executives, draws more than 250,000 unique visitors each month generating more than two million document requests per month.

[1]: http://cardgame.com

Details

IBM CyberCash

IBM announced Wednesday that it is working with CyberCash’s ‘ICVERIFY’ unit to develop and market an Internet payment offering that increases the number of options merchants have for processing credit card orders. Both companies also announced yesterday complementary agreements whereby IBM will market CyberCash’s ‘NetVERIFY’ and CyberCash will market IBM’s ‘Payment Server’ through their respective sales channels. As part of the agreement, IBM and CyberCash will create a ‘NetVERIFY’ payment cassette for the newest release of IBM’s ‘Payment Server’ due out in August. By integrating the ‘NetVERIFY’ cassette with the IBM ‘Payment Server’, IBM plans to provide businesses with an end-to-end merchant payment solution that can handle SET and  SSL credit card payments from consumers. Once the merchant has received either a SET or traditional credit card payment, the transaction can be authorized and deposited using IBM’s ‘Payment Gateway v1.2’, which provides acquirer support for both SET and SSL, or using traditional dial-up or leased line acquirer processor connections.

Details

Mexico City Smart Cards

Net 1 U.E.P.S. Technologies, Inc., commenced a tender proposal to government officials of Mexico City today encompassing a contact-less smart card solution for the Mexico City transportation system. The tender follows on from meetings held in Mexico City on June 22 and June 23, 1998 in which NUEP was asked to quote on a Metro(subway) system which handles five million riders each day along with feeder light rail and bus systems.

Details

Cap One UK

Capital One Bank opened ‘Trent House’, the card issuer’s first operations center in Europe, located in Nottingham, East Midlands, U.K..  The operations center will service the needs of its rapidly expanding U.K. customer base and act as a springboard into continental European markets. The formal opening was conducted yesterday by the Deputy Prime Minister following eight months of lobbying by the Board of Trade. Capital One’s 3O million pound investment is the largest by a U.S. firm into the East Midlands in six years. Capital One plans to employ up to 900 people by the year 2000 at the newly named Trent House, a former Boots Printing Works facility.  As of this morning 130 employees are employed at the new facility.

Details

Household Name

Household International named Michael E. Marcus as Managing Director of Marketing for Household Credit Services’ U.S. bank credit card business last night.  Marcus will report to Bobby Mehta, Group Executive responsible for Household’s $17 billion MasterCard/VISA unit.  Before joining Household, Marcus was a partner in the Chicago office of The Boston Consulting Group.    For the past two years Marcus has overseen numerous projects for Household, focusing particularly on customer segmentation strategies, retention programs and loss management initiatives.

Details

IBS + CBIS

USCS International Inc. announced Tuesday that its International Billing Services (IBS) subsidiary, and CBIS will team to offer IBS’ Electronic Billing Solution to CBIS’s entire client base. Under the terms of a multi-year agreement between the two industry leaders, companies that use CBIS’s billing and customer support solutions can now offer consumers a wider range of options for receiving and paying their monthly statements. These options include electronic statements that can be viewed and paid online via the provider’s Internet web site, through electronic bill consolidators such as MSFDC, CheckFree and Intuit, and through invited push technology, in addition to the traditional paper format.

Details