Delinquency in the U.K. Hits a New Record

Delinquency among credit card-backed securities hit an all-time high in January. However, charge-offs pulled-back from an all-time high set in December. The Fitch “Charge-off Index” decreased in January by 40 basis points to 6.8%. In January, the Fitch 60 to 180 days “Delinquency Index” increased for the fifth month in a row, moving to 4.5% from 4.3% in December. Fitch also reports that its “Monthly Payment Rate Index” was 16.4% in January, an increase of 20 basis points from December. The Fitch “Yield Index” fell 110 basis points to 19.5% in January. Having increased for each quarter of 2008, the outstanding amount of credit card debt held by U.K. borrowers rose to GBP 53.0 billion in January from GBP 52.8 billion in December.

U.K. CREDIT CARD ABS
Delinquency Charge-Offs
Jan 08: 3.4% 6.2%
Feb 08: 3.5% 5.6%
Mar 08: 3.6% 6.6%
Apr 08: 3.6% 6.5%
May 08: 3.7% 6.4%
Jun 08: 3.7% 6.9%
Jul 08: 3.7% 6.5%
Aug 08: 3.7% 6.3%
Sep 08: 3.8% 6.6%
Oct 08: 3.9% 6.6%
Nov 08: 4.1% 6.4%
Dec 08: 4.3% 7.2%
Jan 09: 4.5% 6.8%
Source: FitchRatings

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ICONGO 8.0

E-commerce solution provider iCongo has introduced “iCongo 8.0, an enhanced retail e-commerce and cross-channel system.
Version 8.0 enhancements and features include:Dynamic Catalog Creation, Life Cycle Work Flow and Audit;
Enhanced Dynamic Merchandising and Personalization Tools;
Improved Shopping Experience, Web 2.0, Social Media, and
Integration Adapters to 3rd Party Servicers; Superior Promotions Engine;
Vendor Management and Drop-Ship;
Cross Channel In-Store Upgrades; New E-Mail Marketing Features and
Third Party Retail Sales Channel, Marketing Channels and Shopping
Portals.
iCongo is recognized by Forrester
Research as a Strong Performer in their evaluation of the top 10
enterprise class B2C e–commerce platform vendors in the world.

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NXP & GEMALTO

Digital security provider Gemalto has entered into an agreement with NXP
to transfer NXP mobile services to Gemalto. The related unit based in
Sophia Antipolis, France will continue to develop and market software
and service solutions compliant with the” MIFARE4Mobile” interface
specifications which manage MIFARE-based applications in Near Field
Communication (NFC) mobile devices. MIFARE is the leading contactless
technology globally, predominantly used within transportation networks,
ticketing and access management applications. This strategic move by the
two industry leaders aims to accelerate the global adoption of NFC
technology in existing contactless infrastructures and further promotes
the deployment of MIFARE. Adding this MIFARE4Mobile software further
strengthens Gemalto’s Trusted Service Manager (TSM) platform offer
linking transport operators, banks and mobile phone operators enabling
the mobile phone to be used with existing payment and contactless
ticketing infrastructure. The TSM notably makes the entire process of
downloading tickets and subscriptions onto the cell phone more efficient
and secure.

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PHT’s A-Claim Deploys Visa’s AuthorizeFirst

Preferred Health Technology and Visa have teamed to make Visa the preferred payment brand for PHT’s “A-Claim” medical payment solution. A key component of “A-Claim’s” system is Visa’s “AuthorizeFirst” payment process, which allows patients and providers to agree to pre-authorize a payment with a Visa card at the time of service, based on an estimated amount of the patient’s responsibility.
The “A-Claim” technology system enables health care providers to simply and securely verify insurance eligibility, adjudicate claims, and accept credit, debit or prepaid cards for payment at the time of service, or at a later date once the amount of the patient’s responsibility
has been determined by his insurer. “A-Claim” supports Medicare, Medicaid, TRICARE, the Federal Employee Program and Medicare Advantage health plans, as well as other private health plans.

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Delinquency Tops an Unprecedented 6% in Jan

Credit card delinquency continues its steady climb, posting a seventh consecutive monthly increase in January. Compared to the prior month, 30+ day delinquency rose 14 basis points and 60+ delinquency increased seven basis points. According to CardData, the 30+ day delinquency rate increased to 6.19% and the 60+ day delinquency rate hit 3.33% in January. According to “Moody’s Credit Card Index” delinquency among credit card-backed securities rose to 5.94% compared to 4.51% for January 2008. Capital One reported its January 30+ day delinquency ratio rose to 5.02% from 4.78% in December, and up 66 basis points from January 2008. For the fourth quarter Bank of America posted a managed 30+ day delinquency ratio of 6.68%, compared to 5.89% in the third quarter and 5.45% for 4Q/07. Chase reported its fourth quarter 30-day managed delinquency rate was 4.97%, up from 3.48% in the prior year and 3.91% in the prior quarter. Citi’s 90-day delinquency ratio for North American cards in the fourth quarter increased 51 basis points from the prior quarter to 2.62%, and as compared to 1.77% for 4Q/07.

30+ DELINQUENCY
Aug 08: 5.69%
Sep 08: 5.76%
Oct 08: 5.90%
Nov 08: 5.93%
Dec 08: 6.05%
Jan 09: 6.19%
Source: CardData (www.carddata.com)

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Former GE Money CEO to Advise IPSA Intl

Risk advisors IPSA International has tapped David Nissen, former CEO of
GE Money, to serve on the Board of Advisors.
Nissen retired as President and CEO of GE Money in February 2008.
During his 27-year tenure with General Electric (GE), he held several
key executive management roles including Senior Vice President of
General Electric and Director of General Electric Capital Services Inc.
Nissen’s accomplishments are numerous but perhaps his most
distinguished is his creation of GE Money. He began with a team of three
people in 1993 then grew the bank to over $200 Billion in Assets, with
60,000 employees in 52 countries. GE Money became the second largest
business unit within GE and one of the largest financial services
businesses in the world. In October 2003, Mr. Nissen was named one of
“Ten Retail Banking Heroes”
by Retail Banker International. The publication also cited Mr. Nissen as
one of ten individuals who helped shape the consumer banking industry
landscape during the period covering 1981-2003. IPSA International. is
an international risk advisory firm which
provides clients in the corporate, financial and legal communities with
high-end investigative consulting services.

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Charge-Offs May Hit Double Digits by 2010

As the unemployment rate surged above 8% in February it appears that credit card charge-offs will likely hit double digits by year-end. For January credit card charge-offs hit 6.95% industry-wide and 7.74% among credit card-backed securities. According to CardData (www.carddata.com), average charge-offs for the fourth quarter were 6.0% with an unemployment rate of 7.2%. According to “Moody’s Credit Card Index” charge-offs for January hit 7.74%, compared to 5.48% one-year ago. Issuers with a significant exposure to sub-prime credit cards and business cards are already dealing with charge-offs above 8.0%. Capital One reported a record January charge-off ratio of 7.82% for its U.S. Card business, although the sequential increase of 11 basis points was at a much slower pace than the prior four months. Business card specialist Advanta reported a managed net credit loss rate of 11.99% for 4Q/08, compared to 10.00% in the third quarter and 4.13% for 4Q/07. The average charge-off ratio for BofA, Chase, Citi and Cap One in the fourth quarter was 6.70%, compared to 4.45% one-year ago. However, BofA’s figure includes international cards, boosting the average about 60 basis points. Excluding BofA the Q4 average was 6.04%, according to CardData ([www.carddata.com](http://www.carddata.com)). (CF Library 1/15/09; 1/26/09; 1/29/09; 2/17/09)

Unemployment Charge-Offs
1Q/08: 5.1% 4.6%
2Q/08: 5.6% 5.3%
3Q/08: 6.2% 5.5%
4Q/08: 7.2% 6.0%
1Q/09: 7.9% 7.1%
2Q/09: 8.5% 7.7%
3Q/09: 9.1% 8.0%
4Q/09: 9.3% 8.1%
Source: CardData (www.carddata.com)

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UniteU Partners with International Checkout

CA-based on-demand commerce provider UniteU Technologies is now offering
merchant clients the opportunity to sell and ship globally through
integration with the “International Checkout”
solution. “International Checkout” guarantees the merchants against
fraud, ships worldwide, and provides multi-lingual customer service.
Currently, sixteen of UniteU’s ecommerce merchants are enjoying the
benefits of selling internationally without risk. Through a simple
integration performed by UniteU, consumers worldwide can shop directly
on the merchant’s site. With the click of an “International Checkout”
button, the contents of the shopping cart are transferred to a branded
checkout page, where the customer completes the checkout process. The
International Checkout purchasing team places orders on behalf of the
international customers directly on the merchant’s website, following
the normal domestic checkout procedures and paying via US credit card.
Upon arrival at the International Checkout facility, each order is
inspected, packed, and shipped to the customer’s doorstep, anywhere in
the world.

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Shoebuy.com Offers the Moneta Pay Option

Online retailer Shoebuy.com will offer GA-based Moneta as its newest
payment option. Consumers setup their free Moneta account conveniently through a single
enrollment process by setting a username, password and designating a bank account for online payments.
Financial analysts predict
that consumer credit use may decline by 40% within a year
accelerating debit-based payment acceptance, like Moneta, as consumers
pay down credit balances.

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PCI Council Launches Standards Training

The PCI Security Standards Council has launched “Standards Training” to help merchants improve preparation for on site assessment.
The “Standards Training” is targeted at security and IT personnel that are
responsible for their company’s PCI DSS activities. This new course
takes some curriculum content directly from current PCI SSC approved
Qualified Security Assessor training. It therefore provides merchants
with the opportunity to understand first hand how a QSA will be
examining their environment and some of the guiding principles they use
during assessments. The course is relevant to Recognizing that
achieving, and more crucially maintaining, compliance with PCI DSS is an
organization’s best defense against account data compromise, the course
will also put compliance into a broader security context discussing best
practices outside of PCI DSS that merchants may find useful for their
overall security programs.
The two-day training course will be held April 6 and 7, 2009 at the
University of Chicago Gleacher Center.

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Account Service Charge Draws a Lawsuit

The newly implemented “Account Service Charge” of $10 per month by Chase has attracted a class action lawsuit. San Francisco-based Green Welling has filed two class action lawsuits regarding promotional offers from Chase that promised a low interest rate for the life of the loan or until paid off. Chase credit card customers allege in the complaints that they were offered balance transfer loans or loans in the form of blank checks that were connected to but with different terms than the credit cards. The Plaintiffs also claim that the promotional rate loans offered by Chase had terms that were at low interest rates usually with APR’s or interest rates set at 2.99% or 3.99% “for the life of the loan” but were also charged transfer fees which raised the interest rates.
In November, Chase sent its customers a notice stating that the minimum monthly payments would go up by 150%, from 2% of the balance to 5% of the balance, according to the document. The notice of change in terms sent by Chase also added a new finance charge misleadingly described as an “Account Service Charge of $10 a month.” This lawsuit says the new $120 annual account finance charge effectively increased the interest rates.

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CardPartner Unveils a Blood Cancers Visa

The Leukemia & Lymphoma Society and CardPartner have teamed to offer a new affinity Visa card. The new “Leukemia & Lymphoma Society Visa Platinum” generates $50 for each activated card, plus a share of the monthly fees paid by merchants. The new credit card can also be personalized with a unique image, such as a patient’s face, the faces of those who support the patient, or nearly any image that has special meaning to the cardholder. To kick-off the program, the Gap will include LLS as one of six national charities that will receive up to 5% of the net sales on any purchase at Gap, Old Navy, or Banana Republic made between March 12th to 15th using a special LLS-coded 30% discount coupon that can be downloaded. The Leukemia & Lymphoma Society is the world’s largest voluntary health agency dedicated to blood cancer.
CardPartner affinity credit cards are issued by UMB Financial.

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