MasterCard Urges Congress to Consider Consequences of Durbin Amendment

MasterCard is urging House and Senate conferees to reject the Dick Durbin amendment to the recently passed Financial Regulatory Reform Bill. The amendment, says Mastercard, will hurt the people and businesses it is supposed to protect. Consumers, community banks and credit unions will all be forced to pay more as a result of merchants attempting to increase their profitability if the Durbin amendment becomes law. According to Mastercard, the legislation is no more than a means of getting American consumers to pay big-box merchants’ fair share for the benefits these merchants get from electronic payments. The company looks to the Australian market as a direct example, where consumers saw their annual fees rise significantly, rewards shrink, and no evidence merchants lowered prices to reflect the cut in fees after the government put artificial controls on interchange fees.

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Visa To Fund Litigation Escrow Account

Visa will deposit $500 million into the litigation escrow account previously
established under the Company’s retrospective responsibility plan.
Under the terms of the Plan, when the Company funds the
litigation escrow, its U.S. financial institutions and their affiliates
and successors, the sole holders of Class B shares, bear a corresponding
financial impact via a reduction in their as-converted share count. As a
result, the deposit of Loss Funds has the effect of a repurchase by the
Company of $500 million of Class A common stock on an as-converted
basis.

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Credit and Debit Card PDV Gap $5b in 4Q/09

The gap between debit card and credit usage continues to widen in the USA. In 4Q/09, purchase dollar volume for credit cards was down $36 billion while PDV for debit cards was up $12 billion compared to the year ago period. According to CardData, purchase dollar volume for Visa and MasterCard credit cards for the fourth quarter was $300 billion, compared to $290 billion in 3Q/09 and $336 billion one-year ago. Debit card PDV came in at $295 billion for 4Q/08 versus $280 billion in the third quarter and $283 billion for 4Q/08. For the full year Visa and MasterCard debit card gross dollar volume rose to $1158 billion. Meanwhile, credit card volume totaled $1191 billion. For complete details on Visa and MasterCard performance visit CardData (www.carddata.com).

U.S. PURCHASE DOLLAR VOLUME
($ billions)
Credit Debit
4Q/07: $365 $266
1Q/08: $326 $268
2Q/08: $355 $289
3Q/08: $354 $286
4Q/08: $336 $283
1Q/09: $289 $281
2Q/09: $312 $302
3Q/09: $290 $280
4Q/09: $300 $295
Source: CardData (www.carddata.com)

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IFX Forum Welcomes Citigroup and Tata Consultancy to Board

The Interactive Financial eXchange Forum member companies’ representatives
have re-elected Victor Dossey, Microsoft Corporation, and Ewan McGuire, NCR,
to the Forum’s Board of Directors for terms expiring in 2013. The group’s 2010
Annual Meeting took place in Irving, Texas, hosted by CSC. Richard Feight of
Citigroup was elected to fill an open
three-year seat, and Murray Heldon of Tata Consultancy Services (TCS)
was elected to a one-year term. The newly constituted Board then re-appointed President Richard P. Urban
and re-elected Chairman Richard DuVall of ACI Worldwide, Treasurer Lee
Hou of FIS, and Secretary Mark Tiggas of Wells Fargo. The IFX Forum
not-for-profit industry association develops IFX and promotes its adoption as an open,
interoperable standard for financial data exchange. The IFX Forum was distinguished by a
three-hour “Introduction to IFX” tutorial session presented by Mr. Urban
on the event’s first day, which focused on the new features of IFX
Version 2. Forum membership is open to organizations interested in contributing to
the development of open financial standards. Forum members include
financial institutions, hardware, software and service firms, and
related non-profit groups.

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TrustCash Initiates m-Commerce Development

With the worldwide market for mobile payments to grow to $633.4 billion by 2014, up from $68.7 billion in 2009, through the help of Alligato Trustcash has doubled the size of its technology infrastructure. Also, with mobile payment users to grow 600% to 490 million in 2014 from 81.3 million in 2009, The Company has deployed its core technology infrastructure within a strategic development lab. This consists of enterprise level Hewlett Packard hardware and enterprise versions of JAVA technologies. The design of the platform is to be operating system agnostic currently set up within a Linux/Unix environment. The Company sees this as a means to embark on the fledgling m-payments market.

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MasterCard to Participate in the UBS Services Conference

On Thursday, June 10, Ajay Banga, president and chief operating officer for MasterCard, will participate in the UBS Global Technology and Services Conference in New York, NY. The discussion will begin at 8:00 a.m. Eastern Time and last for approximately 1 hour. A listen-only live audio webcast will be accessible through the Investor Relations section of the MasterCard website at www.mastercard.com. An audio replay of the session will also be available for 90 days at the same website location.

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Mountain America Credit Union Implements Memento Security

Mountain America Credit Union (MACU) has implemented the Memento fraud management Security platform to combat deposit account fraud and improve compliance operations. The MACU Fraud Risk Management team has reduced false positive rates by as much as 90% while increasing fraud detection by using a powerful combination of advanced analytics, cross-channel monitoring, and sophisticated account profiling. The resulting alert accuracy and efficiency gains have greatly improved analyst reaction time, enabling stronger protection of member deposit accounts from a variety of threats including check, card and ATM fraud. Using Memento Security, MACU developed a rapid ATM transaction monitoring process that detects geographical, transactional, and situational anomalies of member card activity.

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Visa Expresses Disappointment Over Senate Passage of S. 3217

Visa is disappointed legislation intended to make the financial system safer and fairer for consumers because of the “irresponsible” and “anti-consumer” amendment offered by Senator Durbin. Adopted with no debate or review of facts, according to Visa, the amendment allows retailers’ to shift their cost for accepting debit cards onto the backs of consumers while they continue to receive the value of electronic payments – including faster check-outs, ticket lift and guaranteed payment. Visa also cites the amendment is written and backed by lobbyists representing the nation’s largest retailers, and could subsequently harm consumers. Visa is also warning this amendment could force banks to reduce or eliminate valuable debit and checking account services.

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Moody’s Issues No Ratings Impact on Discover

Moody’s has reviewed the issuance the Discover Card ABS Ratings
of Class A(2010-B) Notes and determined it will not reduce or
withdrawal ratings currently assigned to any class of outstanding
notes issued by Discover Card Execution Note Trust or
by Discover Card Master Trust I. Moody’s ratings address only the credit risks associated with the
transaction. Other non-credit risks have not been addressed, but may have
significant effect on yield and/or other payments to investors. The
affirmation of Moody’s ratings should not be taken to imply that there
will be no adverse consequence for investors since in some cases such
consequences will not impact the rating. Further information on the
nature of credit ratings and Moody’s rating methodologies can be found on
www.moodys.com.

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Paytronix Integrates with SpeedLine

SaaS loyalty solution provider Paytronix Systems
announced a new technology integration with POS software provider SpeedLine Solutions to
offer new loyalty solutions for pizza and delivery
restaurants—beginning with the 300-unit, New England-based Papa Gino’s
chain. The combined technology from SpeedLine and Paytronix captures specific
customer activities seamlessly at the point of sale. Using this data,
restaurant companies can easily identify their best customers, track
purchase and visit behavior, and design personalized promotions.
In addition, the new loyalty tools minimize operating costs; restaurant
operators redeem rewards directly into guest checks with the swipe of a
card. The integration also adds support for loyalty transactions through
online ordering providers in the SpeedLine Technology Network.

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MasterCard-Heartland Settlement to Provide Issuers $41.4m

MasterCard Worldwide has reached a settlement with Heartland Payment Systems (Heartland) to resolve claims by MasterCard and its issuers in connection with Heartland’s previously announced data security breach. The agreement calls for Heartland to fund up to $41.4 million of “alternative recovery offers” to be made to eligible MasterCard card issuers to settle their claims for operational costs and fraud losses alleged to have been incurred by them as a result of the breach. Under the terms of the settlement, MasterCard card issuers that filed timely claims for reimbursement of operational expenses or to recover fraud losses on certain accounts processed by Heartland during 2008 will be eligible to receive a specified dollar payment with receipt expected during the third calendar quarter of 2010, if they choose to accept their offers.

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Kensington Leasing to Acquire Allianex Prepaid Cards

Kensington Leasing has entered into an
agreement to acquire Allianex. Allianex is a development stage
company engaged in the business of producing, marketing and distributing
retail prepaid cards for the purchase of technology support
and security services for electronic devices. Allianex’s clients and
markets include top retail store aggregators, direct selling companies,
affinity groups, agents, and national associations. Developed under
agreements with the largest retail store prepaid and gift card
aggregators, the full range of Allianex support products and services
are available at merchandising displays at stores ranging from small
“mom and pop” shops to the nation’s largest “big box” stores.
Kensington, through a newly formed wholly owned subsidiary, has agreed
to purchase substantially all of the assets of Allianex for $75,000 in
cash, 575,000 shares of Kensington common stock and the assumption of
Allianex’s trade payables. In addition, Kensington agreed to pay
Allianex, in a combination of cash and Kensington common stock, 25% of
the EBITDA of the ongoing business for three years after the closing of
the transaction. The closing of the transaction is subject to a number
of conditions, and is anticipated to occur in late May or early June.

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