Capital One Delinquency Up as Charge-Offs Fall

Delinquency for Capital One’s U.S. credit cards rose for the second
month in August, moving above the 5% level for the first time since
April. However, charge-offs dropped to its lowest level in four months.
U.S. Card delinquency increased from 4.83% in July to 5.09% for August.
The charge-off ratio declined from 9.83% in July to 9.32% for August.
One-year ago delinquency stood at 4.07% and charge-offs at 5.96%. The
higher delinquency ratio points to rising charge-offs for the fourth
quarter, which is expected despite signs of a recovery. Managed loans at
the end of August decreased to $63.1 billion, or down $0.5 billion from
the prior month. Capital One previously reported a second quarter
managed delinquency rate (30+ days) for U.S. credit cards of 4.77% for
the second quarter, compared to 5.08% for 1Q/09 and 3.85% for the second
quarter of 2008. The net charge-off rate for U.S. credit cards rose to
9.23% for the second quarter, compared to 8.39% for the first quarter
and 6.26% one-year ago. For complete details on Capital One’s second
quarter and monthly performance, visit CardData (www.carddata.com).

CAPITAL ONE HISTORICAL
DELINQUENCY CHARGE-OFF
Aug 08: 4.07% 5.96%
Sep 08: 4.20% 6.34%
Oct 08: 4.48% 6.54%
Nov 08: 4.70% 6.98%
Dec 08: 4.78% 7.71%
Jan 09: 5.02% 7.82%
Feb 09: 5.10% 8.06%
Mar 09: 5.08% 9.33%
Apr 09: 5.04% 8.56%
May 09: 4.90% 9.41%
Jun 09: 4.77% 9.73%
Jul 09: 4.83% 9.83%
Aug 09: 5.09% 9.32%
Source: CardData.com

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MISYS PAYMENT MANAGER

Misys global application software and services company has launched its
packaged payment hub. A low risk and rapid way for banks to modernize
payments environment and protect existing investment in legacy systems,
Misys’ “Payment Manager” hub aims to help banks centralize and
streamline their payment processes. Powered by Misys Message Manager and
supported by the company’s portal technology, Misys “Payment Manager”
extends the visibility and control of any payment through its complete
lifecycle on a Java EE thin-client application built on Service Oriented
Architecture. It automates and standardises payment processes from
capture all the way through to settlement, cutting out manual processes
and significantly reducing the risk to the bank’s reputation from failed
payments. It also aims to help banks deliver higher levels of customer
service and new products, allowing them to replace complex payments
flows between existing core processing systems with a centralized
payment hub.

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SMEs Demand Global Integrated Payment Platform

A new survey finds that the “Small-Medium Enterprise” market is placing increased importance on cash management in an effort to reduce working capital and optimize the supply chain and service delivery.
Travelex Global Business Payments and TowerGroup found there’s a pressing need for integrated, global payment platforms, enhanced visibility and tightened security controls to improve payment efficiency. Also, there is a strong market demand for high touch customer service to support the SME customer; international payments services is rapidly expanding as SMEs search for a reliable platform to serve international payments needs, which many global banks lack the local footprint to support; many payment solutions are aimed at the large, multi-national companies but are not well suited for the SME market; and innovative payment solutions such as beneficiary management are not currently supported by any global or regional banks.

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U.S. Consumer Credit Risk Hits New High in Q2

The nation’s credit risk level climbed to its highest level in a decade
during the second quarter. However, the good news is the rate of
increase is slowing as the general lending environment remains stagnant.
The TransUnion “Credit Risk Index,” which measures the change in average
consumer credit risk within various geographies rose to 128.32 for the
second quarter, compared to 127.26 in the first quarter and 120.89 for
2Q/08. The rate of increase between the first and second quarters was
the lowest since 2006, when the nation experienced a 3.35% decline from
115.37 to 111.51. The states that experienced the largest quarterly
increases included Florida (2.67%), Oregon (2.65%) and Nevada (2.37%).
Of the states experiencing quarterly decreases, Delaware (-0.80%), New
Mexico (-0.62%) and Montana (-0.60%) led the way. On a year-over-year
basis, four states had double digit increases in the CRI, including
Nevada (13.20%), Arizona (12.49%), California (12.47%) and Florida
(12.40%).

CREDIT RISK INDEX
2Q/08: 120.89
3Q/08: 117.74
4Q/08: 124.79
1Q/09: 127.26
2Q/09: 128.32
Source: TransUnion

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OGC & MASTERCARD

The Office of Government Commerce (OGC) has allowed public sector
agencies MasterCard electronic payment solutions for their procurement
activities under its new Framework Agreement. running from 2010-2014.
The agreement allows for MasterCard solutions, including the MasterCard
“Purchasing Card,” the “SmartData Online” and its “InControl,” made
available to the 3,300 national, regional and local public sector bodies
in the UK through financial institutions AirPlus, Barclays, J.P. Morgan
and RBS Group. The 44,000 disparate buying units across the UK public
sector will also be able to use MasterCard payment solutions as tools to
streamline and improve purchase-to-pay processes. The “inControl”
platform allows financial institutions to provide government agencies
enhanced authorisation controls to direct how, when and where payment
cards may be used while the “Purchasing Card” allows public sector
organizations to leverage data reporting, integration and management
tools through “SmartData Online”.

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Meta Payment Systems Launches Community PPCs

Meta Payment Systems has successfully completed the pilot for a new
“Community Gift” program to help local economies through the promotion
of Chamber and/or Downtown Association organizations’ retail members.
The Community Gift pilot program was conducted in Sioux Falls, SD and
Luverne, MN. Downtown Sioux Falls approached Meta Payment Systems with
the desire to replace and improve upon its existing program.
The Luverne Area Chamber of Commerce partnered with Exchange State
Bank of Luverne to offer Community Gift also with positive results.
Based on the successful results from the pilot programs
Meta Payment Systems is launching the program nationally.

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BLAZE ADVISOR

Absa Bank has deployed the FICO “Blaze Advisor” business rules
management system as its decision engine for all consumer credit
originations. The FICO solution will standardize its decision process
across mortgage, personal loans, auto loans, checking accounts and
credit cards for significantly greater agility and effectiveness. The
“Blaze Advisor” also gives Absa a single point of control to manage
multiple product offers and make customer-level decisions to improve
response time and decision consistency. Users can modify business rules
themselves, without having to rely on technical staff support, offering
greater flexibility and control over policies, reducing time required to
modify rules to minutes.

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EVO Merchant Services to Market Hypercom

NY-based credit card processor EVO Merchant Services has Class A certified and will market Hypercom’s “Optimum T4210”
and “T4220” terminals to its nearly 200,000 US retail and restaurant merchant customers.
Hypercom’s high security Optimum T4200 product family for North America
consists of four powerful 32-bit multi-application devices that share
the same platform, user interface and software toolkit to maximize
efficiency, application portability and offer customers a broad range of
options to serve any market need.

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GLOBALPAY.EUROOUT

Wachovia has introduced its “GlobalPay.EuroOut” at the 2009 SIBOS
conference, a euro payment solution to help financial institutions send
payments outside of Europe. The service was designed to allow European
banks to initiate and make euro payments to a beneficiary’s account,
without having to use a correspondent bank account to facilitate the
process. While most banks in the Eurozone have traditionally gone
through correspondent banks to make euro payments to beneficiaries
outside the Eurozone, “GlobalPay.EuroOut” eliminates this step. With
this, European banks can make payments using the same systems they use
to send payments inside of Europe, including Target2 or EBA Euro1.

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TUTUKA & SAFENET

South African-based Tutuka payment processor has implemented SafeNet’s
“DataSecure” platform and “ProtectHost (PH) EFT” hardware security
module. These Components of SafeNet’s Enterprise Data Protection (EDP)
Security Suite allow Tutuka to meet PCI DSS and EMV compliance. Tutuka
provides software-based solutions for gift vouchers, gift cards, prepaid
Mastercards, prepaid cash replacement and loyalty programs, catering to
customers typically avoiding traditional credit card options. These
payment methods can now be easily and securely issued, redeemed,
tracked, and reported on through multiple channels such as point of
sales, terminals, EFT switches, self-service kiosks, telephone, and the
Web. The “DataSecure” security solution was additionally appealing
thanks to its quick installation and flexibility with new compliance.

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RDS Launches New Payments Division

POS reseller Retail Data Systems will introduce a new payment services division.
RDS has appointed payments industry veteran, Richard Roscher, to head up
this division. Roscher has worked for such companies as Chase Paymentech
and RBS WorldPay, as well as launching his own consulting company and
ISO. RDS partners with leading POS technology
companies to provide customized point-of-sale solutions.

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AFI FORUM

The “2009 AFI Global Policy Forum” in Nairobi attracted nearly 100 central bankers and other financial policymakers. The Thailand-based Alliance for Financial Inclusion, which is partly funded by the Bill & Melinda Gates Foundation, endeavors to expand access to financial services to 2.5 billion unbanked consumers globally. AFI members, who represent more than 60 countries, have chosen to focus on six policy areas to increase financial inclusion for their respective countries: agent banking, diversification of financial products and providers, state bank reforms, financial identity, consumer protection and mobile phone banking. AFI is managed on behalf of its members by the German development organization Deutsche Gesellschaft fur Technische
Zusammenarbeit (GTZ) and supported with a $35 million grant from
the Bill & Melinda Gates Foundation.

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