New Report Calls for Paperless Banking

A new report from Aite Group focuses on the advantages of a paperless banking channel.
U.S. banks have been heavily focused on removing paper checks from
branches over the past few years. While check imaging is a step in the
right direction, paper processes are still being used throughout the
branch channel. The benefits of going paperless include
mitigating fraud, assisting with compliance, preparing banks for the
audit process, achieving cost reductions, cutting down or eliminating
misplaced and lost data and files, and increased internal efficiencies.
Ample opportunities exist for banks seeking to realize the benefits of
electronic processes, such as deploying additional processes like
automated workflow, electronic document audit trails, and electronic
tracking of internal processes.

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VISA A/P Q2

Visa reported Asia Pacific was its only region that posted positive growth in gross dollar volume for the second quarter, on both a nominal and constant U.S. dollar basis. The U.S. and Canada regions both showed overall negative growth driven by a severe drop-off in credit card volume. (Visa, Inc. does not include Visa Europe, a separate entity which will report it results in late November.) In the A/P region GDV was up 10.3% on a constant dollar basis and up 3.7% on a nominal dollar basis. Total GDV was $259 billion, compared to $229 billion for the second quarter and $250 billion for 2Q/08. A/P purchase dollar volume was 2% and cash dollar volume rose 7% for the second quarter. Visa has 512 million payment cards in circulation in the region and 424 million accounts as of September 30, 2009. Visa reports performance data on a one quarter delay. For complete details on Visa’s latest performance visit CardData (www.carddata.com).

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ACCEL/Exchange Offers Online PIN Debit

Fiserv financial services technology solutions announced its
“ACCEL/Exchange Network” will begin processing and offering secure
Internet PIN debit transactions in November 2009. The result of a
partnership with Acculynk PIN debit software-only service,
“ACCEL/Exchange” payments network delivers anytime, anywhere funds and
payments access to its 2,500-plus members and their cardholders. Having
recently completed a joint pilot program with Acculynk and its PaySecure
product, which began in March 2009 to conclude over 50% of consumers
will use Internet PIN debit when presented as a payment option, the new
solution is validated for accurate processing of secure Internet PIN
debit transaction activity.

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Triton Dynamic Language Coming in Jan

MS-based ATM provider Triton Systems will be releasing Triton Dynamic
Language in January 2010. “TDL” will supersede the “Triton Standard Communications Protocol and
Message Format” that is used by the majority of ATM manufacturers and processors to operate
off-premise ATMs. TDL is more flexible, gives processors more control
over the ATM and can be used to easily create custom applications.
TDL is a superset of Triton Standard with additional functionality. TDL is
backwards compatible with Triton Standard version 5.41 so that
processors that currently support Triton Standard will be able to support TDL-equipped
ATMs. However, to support the flexible new interface and many new features
included in TDL, processors will need to make extensions to their device handlers.
Similarly, Triton ATMs in the field can continue to run their existing software or
they can be updated with new software to take advantage of the additional features
provided by the organization.

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Low & Moderate-Income Families Not Recovering

While the recent rise in the gross domestic product indicates that
economic recovery may be on the horizon, that recovery may be slow in
coming as low- to moderate-income consumers are still in recession mode,
closely watching what they spend on goods and services and spending more
on groceries versus on dining out. Year-over-year spending trends saw
the largest gains in the Groceries (+8.39%), Personal and Professional
Services (+5.81%) and Travel/Entertainment (+3.01%) categories,
demonstrating people are eating at home more often instead of dining
out, further reinforced with 3.03% decrease in the dining out category.
The largest declines were seen in Auto/Gas/Transportation (-5.32%) and
Food. This, according to the NetSpend “National Spending & Savings
Index,” also indicates an average balance of NetSpend savings accounts
rose from an average of $25.71 in September 2008 to $27.30 in September
to demonstrate people are still worried about their finances and are
looking for ways to save more and earn interest on their money.

SEPT SPEND
Auto/Transportation: -5.32%
Finance: -2.01%
Food: -3.03%
Utilities -0.35%
Home: -0.85%
Travel: +3.01%
Professional Services:+5.81%
Groceries +8.39%
Source: NetSpend

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Billing Revolution and PayPal Partner

Mobile payment provider Billing Revolution has become a “Mobile Commerce Partner” with
PayPal. Under the agreement, Billing Revolution will become a reseller of the PayPal Payflow Pro gateway service, while
PayPal may promote the Billing Revolution service to their merchant base.This partnership enables PayPal merchants to immediately begin conducting mobile credit card
transactions using their existing PayPal Payflow Pro gateway accounts.
PayPal has roughly 45,000 merchants that process transactions via their
Payflow gateway, and these merchants now have the ability to sell digital and
physical goods to any consumer on a mobile phone.

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CARD Act Pushes Card Mail Down 7% from 2Q/09

The “CARD Act” regulations, which partially went in effect during the third quarter, has put downward pressure on the volume of direct mail credit card offers. In the third quarter the number of solicitations dropped 70% year-over-year and 7% sequentially. According Mintel Comperemedia the estimated number of credit card solicitations for the third quarter was 391 million, compared to 419 million for the second quarter and 1337 million for 3Q/08. The research group says of the mailings made in the third quarter most offered variable interest rates and shortened introductory rate periods. In the third quarter, 12.53% was the average rate promoted, up more than a full percentage point from 1Q/09. During the quarter, only 6% of offers disclosed a fixed rate, down from 27% one-year ago. Nearly 16% of offers disclosed a balance transfer fee of 4% or 5%, rates that were almost unseen in direct mail one year ago. For offers with an introductory purchase APR, the period for use is shrinking. In 3Q/08, half of direct mail offers gave new cardholders 13 months or more to use the introductory APR. In 3Q/09, just 5% did,
while 21% disclosed introductory periods of less than six months.

CREDIT CARD SOLICITATIONS
3Q/07: 1.856 billion
4Q/07: 1.780 billion
1Q/08: 1.658 billion
2Q/08: 1.534 billion
3Q/08: 1.337 billion
4Q/08: 0.891 billion
1Q/09: 0.458 billion
2Q/09: 0.419 billion
3Q/09: 0.391 billion
Source: Mintel Comperemedia

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Digital Insight Launches FinanceWorks

Intuit’s Digital Insight is now offering the “FinanceWorks ” online financial management solution to banks and credit
unions not currently using Digital Insight’s Internet banking platform. Financial institutions offering FinanceWorks have already found that
providing online financial management capabilities can deliver tangible
business benefits to banks and credit unions. Data on early FinanceWorks
users indicates they are up to four times more profitable than the average bank or
credit union customer. They have twice as many accounts, nearly 30% higher loan balances, and tend to have higher incomes.
Customers log in to online banking twice as often as active online banking
users, and are more active online bill payers and are so highly satisfied with the online financial management
experience that 78% would recommend their financial institution
based on the solution.

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Smart Card Alliance Elects New Leaders

The Smart Card Alliance has announced its 2009-2010 board and seven-member executive committee.
The committee includes the Chair, Neville Pattinson of Gemalto; Vice chair Bryan Ichikawa of Unisys; Treasurer Bob Merkert of CardLogix;
Secretary Wendy Humphrey of First Data Corporation; Assistant Treasurer Willy Dommen of Booz Allen Hamilton; Assistant Secretary John McKeon of IBM and
Technology Vice Chair Bob Gilson of the U.S. Department of Defense/Defense Manpower Data Center. Elections were
held during the 8th Annual Smart Cards in Government Conference, taking
place this week through October 30th at the Washington DC Convention Center.
The Smart Card Alliance is a not-for-profit, multi-industry association
working to stimulate the understanding, adoption, use and widespread
application of smart card technology.

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NCR Opens New Georgia ATM Plant

NCR Corporation has opened its new ATM manufacturing facility in Columbus, Ga. with the rollout of
“NCR SelfServ” ATMs. In less than five months after announcing plans to build
a domestic manufacturing facility, NCR was able to open the 350,000
square-foot facility and begin production of ATM machines for its North
American customers. Approximately 870 jobs will be created the new site over
the next three years. In addition, NCR’s campus-like ecosystem between its partners, suppliers
and Georgia’s academic institutions will help drive and improve
cross-functional collaboration, training and innovation — ensuring that
NCR’s manufacturing process is cutting edge.

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DAHABSHIIL ECASH

Dahabshiil international money transfer has debuted its “Dahabshiil
eCash” debit card service in Somalia to ease making and receiving
payments. “Dahabshiil eCash” is designed to allow users to pay for goods
and services at any official Dahabshiil merchant with a POSand is
available to those with a Dahabshiil account and debit card. These
merchants include shops, restaurants, hotels and petrol stations located
throughout the country and there are plans in the works to expand its
eCash service to utility providers and educational institutions to allow
students to pay for tuition fees. Although the debit card requires both
PIN and signature authorization like that of a traditional debit card
offering, transactions are made over the internet connection, which
means that the money is transferred from the card holder’s account to
the merchant’s account immediately.

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