Pre-Delinquency Management Software Tested

New software that predicts potential credit card delinquency has produced a 15% reduction in the default value during a recent U.K. trial. Portrait Software has introduced “Pre-Delinquency Management” to identify ‘at risk’ customers at an early stage, selecting and monitor appropriate treatment strategies. Using its analytics software the study identified a group of 100,000 customers likely to have difficulty meeting their credit card payments in the next three to six months. Identification criteria included increased credit limits, balances reaching the credit limit and changes in spending patterns. In the three-month analysis, Portrait demonstrated a 2% reduction in the number of defaults, a 2.5% reduction in default rates and a 15% reduction in the default value. Among Portrait clients: Lloyds Banking, U.S. Bank. Nationwide Building Society, Bank of Ireland and Bank of Tokyo.

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CARD FEES

A research firm predicts that U.K. issuers will soon aggressively market fee-based cards to customers. While credit card companies will continue to offer no-fee cards, the rewards aspect of these cards will be greatly reduced or removed altogether. Auriemma Consulting Group says that rewards cards, including cards with premium services or benefits, will certainly feature a fee in the near future. Credit card issuers that currently offer cards with annual fees will most likely increase those fees. Additionally, card issuers will develop new card offerings, with tiered rewards and benefits. Auriemma found that the percentage of consumers carrying balances on their credit cards has decreased 40% in the past year. Additionally, since the end of 2008, the percentage of credit card accounts written off by lenders has exceeded 10%. These two factors have resulted in card issuers being forced to seek out alternate commercial models and income streams.

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DEBIT CARDS

Merchant sales paid for by debit card are increasing dramatically across
Australia with 28.9% of merchant sales conducted using the method. This
marks an 18.6% increase since December of 2008 thanks to the means
consumers have to substitute credit cards for debit cards in most
situations and is consistent with the April 2009 findings showing a
moderation in credit card transaction volumes with a strong growth in
Scheme Debit payments. The research, based on interviews with 2,277
Australian merchants during June of 2009 and made available from East &
Partners’ six-monthly Merchant Acquiring and Cards Markets research
program, also shows 60% of merchants are from the retail sector. East &
Partners’ Australian Merchant Acquiring and Cards Markets program is an
ongoing six-monthly research service which delivers accurate market
intelligence on Australia’s merchant acquiring and cards markets.

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Ben Stein to Pitch for FreeScore.com

Ben Stein economist and financial writer is the new spokesperson for
FreeScore.com online credit service offered by FreeScore. Stein is
featured in FreeScore.com’s 60-second television commercial, created by
R2C Group, which also features Filbert the animated squirrel as Ben’s
Assistant. Filbert, who sports a bow tie and glasses similar to that of
Stein’s signature attire, offers additional information about the
FreeScore.com service disclosed on his sign, reflecting the three
sources of credit reports that FreeScore.com delivers: TransUnion,
Equifax and Experian. Filbert closes the commercial by saying, “Life
costs more without FreeScore” and the new spot can be seen at
www.FreeScore.tv. FreeScore is a consumer credit reporting and
monitoring company.

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NSF Fees to Produce $38B for U.S. Banks

A new survey from Moebs Services has discovered that the average overdraft fee has risen 10% this year to $27.50 and will generate $38 billion in revenue for U.S. banks. A 2008 study from Bankrate.com showed an increase of 2.5% in bounced check fees from the year before, up to nearly $30. A 2008 study from the FDIC found that insufficient funds and overdraft fees account for 74%t of consumer bank service charges. A December survey by The Center for Economic and Entrepreneurial Literacy found that half of respondents have over-drafted their checking account at one time, while a third of respondents have paid a bill late in the past year. Interestingly, 75% did not know that when in need of short-term emergency cash, bouncing a check costs more than wire transfers, credit card advances, and short-term payday loans.

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INFINITIUM & TRIPWIRE

Malaysian-based Infinitium electronic payment systems is deploying
Tripwire configuration control solutions, adopting the Tripwire
Enterprise for system security and automation and maintenance compliance
with PCI-DSS. The Infinitium e-payment systems support multiple payment
modes for credit cards, debit cards, purchasing cards and account
debiting, as well as supporting various payment channels for internet
transactions, phone, interactive voice response, kiosk, customer service
channel and IP terminals. Infinitium offers its services in Brunei,
China, India, Indonesia, Malaysia, Singapore and Vietnam while OR-based
Tripwire Enterprise automates the audit processing by continually
monitoring change, assessing configurations and helping remediate issues
that could place systems at risk for over 6,500 enterprises worldwide.

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MAY LEI

The Conference Board Leading Economic Index (LEI) for Spain decreased
.1%, following a 6 month rate of decline total of 2.3%, while The
Conference Board Coincident Economic Index (CEI) decreased .5% in May.
With the .1% decrease in April, The Conference Board LEI for Spain now
stands at 105.8 (2004=100), which decreased 0.6% in March and increased
.2% in April, while the CEI now stands at 101.6 (2004=100), which
decreased 0.8% in March and decreased 0.5% in April. LEI results for the
month were attributed to order books survey, the Spanish equity price
index, the Spanish contribution to Euro M2, capital equipment component
of industrial production and the inverted long-term government bond
yield. Job placings remained unchanged.

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Global Payments Lands a $300MM Loan

GA-based transaction processor Global Payments has secured a $300
million, three-year, unsecured term loan.
Global intends to use the proceeds to pay down its existing $350 million
revolving credit facility which was used to pay for the $307.7 million
acquisition of the remaining 49% ownership in the U.K. joint venture
with HSBC. The company structured the loan as a $230 million U.S.
dollar tranche and a $70 million equivalent
British Pounds Sterling tranche (44 million in local currency) to better
leverage cash flow generated by its operations in the United Kingdom.
The term loan has a variable interest rate based on LIBOR plus
applicable margin that varies with the company’s leverage position and
expires in July 2012.

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MPLS/PCI Compliance Webinar is Slated

Communication service provider MegaPath will offer the “Future Proof
Your Network with MPLS and PCI Compliance”
webinar on July 14th. The webinar will cover optimizing retail
applications and future-proofing networks to be
both efficient and flexible, reducing costs by connecting all store
applications over a single
high-speed, PCI compliant network; removing WAN PCI compliance hurdles
through use of MegaPath MPLS VPN;
utilizing Managed Security Services to promote PCI compliance; building
scalability and flexibility into a network to
accommodate changing bandwidth and connectivity and enhancing
operational efficiency through prioritization to ensure
bandwidth is available as needed for mission critical applications via
use of MPLS to achieve Quality of Service (QoS).

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PDM SOFTWARE

New software that predicts potential credit card delinquency has
produced a 15% reduction in the default value during a recent U.K.
trial. Portrait Software has introduced “Pre-Delinquency Management” to
identify ‘at risk’ customers at an early stage, selecting and monitor
appropriate treatment strategies. Using its analytics software the study
identified a group of 100,000 customers likely to have difficulty
meeting their credit card payments in the next three to six months.
Identification criteria included increased credit limits, balances
reaching the credit limit and changes in spending patterns. In the
three-month analysis, Portrait demonstrated a 2% reduction in the number
of defaults, a 2.5% reduction in default rates and a 15% reduction in
the default value. Among Portrait clients: Lloyds Banking, U.S. Bank.
Nationwide Building Society, Bank of Ireland and Bank of Tokyo.

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ARTEMA MODULAR

Selected over other global payment providers, Hypercom Corporation has
deployed its “Artema Modular” for IBM’s self checkout system in five
test sales outlets throughout Bavaria. The first phase of deployment
comprises of 20 self checkout systems, after which the IBM/”Artema
Modular” solution will be rolled out to several larger stores in
Southern Bavaria. “Artema Modular” unattended card payment solution was
first introduced at the end of 2005 and can now be found in self-service
machines across Europe, the Middle East, Asia Pacific and North America
while Hypercom Corporation delivers high security, end-to-end electronic
payment products and services, allowing businesses in more than 100
countries to securely expand their revenues and profits.

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Affinion Offers Credit CARD Act Webinar

CT-based Affinion Group will host a webinar on July 21 that focuses on the “Credit CARD Act of 2009.”
The webinar will address changes to current business practices mandated by specific provisions
of the Act; timeline and process for implementation, including the role various
legislative and regulatory parties will play in oversight of the Act and other implications of the Act. Affinion provides
programs in subscription-based lifestyle services, insurance and other areas to
help generate increased customer loyalty and significant incremental
revenue formore than 5,500 affinity partners worldwide.

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