LML PATENTS

LML Payment Systems’ indirect subsidiary LML Patent Corp. has again
filed
suit for patent infringement in the U.S. District Court for the Eastern
District of Texas. The suit names National Bank
of Daingerfield, PlainsCapital Bank, Southside Bank, First Bank, The
American National Bank of Texas and American Bank of Texas alleging that
the defendants have infringed LML’s U.S. Patent No. RE40220 which
relates to electronic check processing methods and systems. In November,
LML filed suit in the U.S. District Court for the Eastern
District of Texas seeking damages, injunctive and other relief for the
alleged infringement of their patents against JP Morgan Chase, Wells
Fargo, Wachovia, Citigroup, Bank of New York Mellon, HSBC,
Capital One, ABN AMRO, Northern Trust, Regions Financial, National City,
Fifth Third Bank, Citizens Financial,, M&T Bank, UnionBanCal, First
National of Nebraska, Deutsche Bank Trust Company Americas and PayPal.

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Check Into Cash to Integrate CheckFreePay

Check Into Cash consumer financial services has deployed the the
convenient Fiserv “CheckFreePay” walk-in bill payment service. Allowing
customers to pay their bills in person with cash, “CheckFreePay” service
will be made available through the financial service Organization’s more
than 900 locations in 30 states for the acceptance of payment for such
items as utility, cellular, auto, insurance and credit card bills. The
Fiserv solution will be easily integrated into existing Check Into Cash
POS terminals to avoid extensive training on new platforms thanks to the
use of its existing hardware. “CheckFreePay” allows consumers to pay a
total of more than 2,500 types bills at 16,000 various retail agent
sites through supermarkets, drugstores, convenience stores and
independent retailers. Fiserv information management and electronic
commerce systems was established 25 years ago while TN-based Check Into
Cash employs 3,200 and runs 1,100 stores.

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CUSTOMERS ATMS

Ensuring committed arrangements until 2013 on improved terms, ATM
provider Customers has extended its Bendigo & Adelaide Bank and BP
Australia
bank contracts. Bendigo and Adelaide Bank will extend its ATM network by
up to 500 ATMs, each branded with the respective logo and
supplied/operated by Customers under a 5-year contract. The ATM supplier
anticipates the new contract will ensure greater national brand
recognition and increased revenue streams. Meanwhile, BP Australia,
Customers’ largest client, is slated to extend its current ATM services
contract for over 200 ATM installations across its network of stores
throughout Australia.

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DUAL GNS CARDS

American Express’s Global Network Services has embarked on a new
strategy outside the U.S. to deal with card acceptance issues. Under the
“Dual Card” program, cardholders receive two cards from a GNS issuer: an
American Express and a Visa or MasterCard network-branded card. The
latest monthly report from First Annapolis found that under such
programs cardholders using the AmEx card receive significantly more
rewards than those using the Visa or MasterCard. Thus, the cardholder is
incentivized to use the AmEx card as the primary card and the Visa or
MasterCard as a back up card where AmEx is not accepted. GNS issuers
such as Lloyds TSB offer 80% less points on the V/MC card; Westpac
offers as much as 67% less; Nedbank offers 44% less; and Credit Suisse
offers 20% less points on V/MC than AmEx. Under the “Dual card” program,
both cards are linked to a single account, statement, credit line and
monthly payment.

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AmEx and Omni Launch a Summer Promotion

American Express is offering summer family value packages for stays with
Omni Hotels. The exclusive summer weekend family package offers parents a
25% discount off regular rates and children receive an
“Omni Sensational Kids” activity bag upon arrival and milk and cookies
delivered to their guest room on the first night. The offer is available
on weekends from June 4th to September 6th and prices
range from approximately $119 to $259 per night, valid only when the
purchase is made with an American Express Card.

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PAYMENTS COUNCIL

Addressing difficulty some users experience when making payments using
non-standard account numbers, as promised in its “National Payments
Plan”, the Payments Council held consultation with stakeholders to
establish certain guidelines. These guidelines address the necessity to
reduce the impact of non-standardized account numbers on users and are
recommended for all financial institutions. They include adopting the
standard format when they upgrade their systems and masking non-standard
numbers so customers can use new account numbers for non-standard format
recognition. When these cannot be applied, the Payments Council
recommends banks create a standard format account number from a
customer’s internal reference number to form a 6 digit sort code and 8
digit account number; ensure non-standard account numbers can be checked
using a modulus checker; and to allocate a reference number for
delinquent accounts while providing the sort code and account number.
The complete guidelines are available to download from
www.paymentscouncil.org.uk.

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Credit Card ABS Delinquency Down a Skosh in April

While average charge-offs among credit card-backed securities approach
double-digits for the first time, the 60-day delinquency ratio eased a
bit in April. However, excluding the effect of the bankruptcy spike in
2005, the three month average excess spread dropped to its lowest level
since early 2001. According to the latest “Credit Card Index” results
from Fitch Ratings, delinquency declined seven basis points to 4.37% in
April, but is up 40% over the year ago period.
Charge-offs climbed 77 bps to reach 9.66%, the third consecutive record
result and 51% above year earlier levels. Monthly payments rates have
exhibited some fairly typical seasonal volatility early this year, but
are now hovering around 17%. Over the last 24 months, the prime rate has
dropped 500 bps to 3.25%, while gross yield has declined by only 122
bps. Fitch says this resiliency is partially attributable to the
significance of fee income relative to interest income in recent years,
however, it also reflects the effectiveness of the pricing actions that
many card issuers have taken in advance of regulatory and legislative
changes. But, the incremental yield generation, while robust, is not
substantial enough to completely offset the increase in charge-offs.

CREDIT CARD ABS PERFORMANCE
YIELD MPR
Apr 08: 18.50% 18.61%
May 08: 17.27% 18.65%
Jun 08: 17.42% 19.54%
Jul 08: 17.05% 19.54%
Aug 08: 17.40% 19.21%
Sep 08: 17.13% 18.57%
Oct 08: 17.05% 18.42%
Nov 08: 17.01% 15.96%
Dec 08: 17.21% 17.27%
Jan 09: 16.00% 17.15%
Feb 09: 16.83% 15.78%
Mar 09: 17.66% 16.48%
Apr 09: 18.01% 16.98%
Source: Fitch Ratings

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Interchange Fee Legislation is Re-Introduced

House Judiciary Committee Chairman John Conyers, (D-MI), has
introduced “H.R. 2695,” the “Credit Card Fair Fee Act of 2009.” The
measure is similar to the version of the bill that was approved by the
committee in July 2008 and would require Visa and MasterCard banks to
negotiate with merchants on interchange fees. U.S. Rep. John Conyers and
Rep Chris Cannon introduced the “Credit Card Fair Fee Act of 2008” or
“H.R. 5546” in March 2008. The National Retail Federation, which
welcomed the proposed legislation, says between the momentum built up
since this bill passed the Judiciary Committee last year, the intense
scrutiny of the financial services industry seen during the current
economic crisis and the credit card reform law signed last month, the
NRF thinks the perfect storm exists for Congress to do something about
these unjustified hidden fees. Meanwhile, the American Bankers
Association strongly opposes the interchange legislation introduced by
Rep. John Conyers. The ABA says the new bill represents an effort by the
merchant community to have the government interfere with the payment
system so that they can reduce their cost of doing business. It’s clear
that giant retailers want to pocket interchange revenue and continue to
receive the added convenience and protection payment cards provide.

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LML Files More E-Check Patent Lawsuits

LML Payment Systems’ indirect subsidiary LML Patent Corp. has again filed
suit for patent infringement in the U.S. District Court for the Eastern
District of Texas. The suit names National Bank
of Daingerfield, PlainsCapital Bank, Southside Bank, First Bank, The
American National Bank of Texas and American Bank of Texas alleging that
the defendants have infringed LML’s U.S. Patent No. RE40220 which
relates to electronic check processing methods and systems. In November,
LML filed suit in the U.S. District Court for the Eastern
District of Texas seeking damages, injunctive and other relief for the
alleged infringement of their patents against JP Morgan Chase, Wells
Fargo, Wachovia, Citigroup, Bank of New York Mellon, HSBC,
Capital One, ABN AMRO, Northern Trust, Regions Financial, National City,
Fifth Third Bank, Citizens Financial,, M&T Bank, UnionBanCal, First
National of Nebraska, Deutsche Bank Trust Company Americas and PayPal.

Details

Latin America M-Payments Webinar Planned

Kabira Technologies memory-based transactional computing is sponsoring a
webinar entitled “Emerging Opportunities for Mobile Services in Latin
America: The Consumer Push for the Here and Now”. Hosted by Bill
Sequeira, Ph.D, discussed will be the evolving Latin American mobile
landscape, the infrastructure required, the expectations of consumers in
the future, social media and how mobile payment providers have grown the
industry to facilitate this change. Dr. Sequeira is a digital media
expert with 20 years of experience, having worked with such companies as
Sony, AT&T Bell Laboratories and Verizon, and is expressly well versed
in mobility issues such as micro-payments and mobile transactions.
Meanwhile, Kabira Technologies offers “extreme transaction processing”
software, installed at over 100 customers in more than 40 countries over
the past 10 years.

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Merchant Warehouse Explodes in April

Processing solution provider Merchant Warehouse reports a record April for
sales. Highlights include: April 2009 was most successful in company
history for new customer acquisition; Agent and VAR Channel saw growth of
100 percent over previous six-months and customer retention rates
currently 100% longer than industry average. Other successes include
technology advances for “BINsmart” embedded in point
of sale (POS) systems and exclusive IP or dial-up terminals, the
development and release of MerchantWARE Mobile, a point-of-sale
application that provides merchants with the ability to run credit card
transactions in real-time on their iPhone, iTouch or Blackberry and
accolades from peers and industry groups.

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