Obama Factor Nudges Jan Spending Slightly

Economic confidence among consumers is slowly rebounding and has pushed
spending up slightly in January. However, the percentage of Americans
who plan to spend less in the following month, 29%, is greater than the
percentage that plan to spend more, 17%. The Discover “U.S. Spending
Monitor” rose 1.2 points in January to 77.8. The monthly survey found
that a near-record 55% of Americans were prepared to spend less on
discretionary categories like entertainment, dining out and movies next
month. About 52% are cutting back on household improvements and 51% are
cutting major personal purchases. A record high of 70% are either
holding the line or spending less for household expenses. Discover says
for the seven days ending January 28th, the “Monitor” dipped more than 3
points. Fueling the decline was a 4-point drop in economic confidence
and a 3-point plunge in the index measuring consumer spending
intentions. The fall coincided with a barrage of post-inauguration news
about job cuts.

U.S. Spending Monitor
Jan 08: 86.1
Feb 08: 86.4
Mar 08: 85.1
Apr 08: 85.4
May 08: 86.8
Jun 08: 85.9
Jul 08: 85.2
Aug 08: 87.8
Sep 08: 86.5
Oct 08: 80.4
Nov 08: 79.7
Dec 08: 76.6
Jan 09: 77.8
Source: Discover

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Payment Fraud Produces $4B of Online Losses

CyberSource’s Online Fraud Report – 2009 Edition is now available.

This year’s study found that online merchants estimate they lose 1.4% of their revenue to fraud or $4 Billion in annual sales. Read about this and over 25 other fraud management benchmarks, trends and practices.

The 2009 edition of CyberSource’s Online Fraud Report is based on an independent survey of hundreds of web merchants. This annual industry report is essential for finance, risk and eCommerce professionals.

To get the report visit: [http://forms.cybersource.com/forms/FraudReport2009NACYBSwww020309](http://forms.cybersource.com/forms/FraudReport2009NACYBSwww020309)

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Card Issuers Remain in Tightening Mode

The latest Federal Reserve survey reveals that 45% of banks have raised the minimum required credit scores on credit card accounts and about 45% have lowered credit limits for either new or existing credit card customers. Nearly 55% reported having reduced the extent to which both credit card accounts and other consumer loans were granted to customers who did not meet credit-scoring thresholds. However, the “January 2009 Senior Loan Officer Opinion Survey on Bank Lending Practices” also found that in its October survey 60% of banks were lowering credit limits for either new or existing credit card customers. Overall, the latest survey found that 53% of banks have “tightened somewhat” for new credit card applications while 6% say they have “tightened considerably.” About 30% tightened limits for business credit cards.

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DIRECT ENERGY & EPOST

Direct Energy is not offering bill payment service provider epost as an
option for its customers in Alberta. Alberta
residents who want to receive their Direct Energy bill online simply
register at canadapost.ca/epost and select Direct Energy as a mailer.
Customers can also select from an additional 100 mailers to receive some
250 different documents (e.g. monthly credit card statements, utility
bills, telephone bills, or notices) through their free epost mailbox. A
secure, online document delivery service, epost enables leading
Canadian companies to deliver critical documents, such as bills to their
customers and pay statements to employees, online. For consumers, epost
is a secure and convenient online approach to receiving, viewing and
storing (for up to seven years) financial statements. Since epost was
launched in 1999, more than five million Canadians have registered for
the service.

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Experian and PredictiveMetrics Team

Experian has teamed with NJ-based PredictiveMetrics to offer “Priority
Score for Collections.” It provides creditors, collection agencies and
debt buyers with the advantage of predicting two outcomes: dollars
to be collected and expected payers. By having the ability to predict
expected dollars to be paid in addition to the traditional payer score,
organizations can prioritize collection actions based on cost, effort
and impact optimizing collection yields. The algorithms that drive these
scores are derived from models segmented by account balances along with
the debt type and age of debt. Clients will be able to score and make
decisions on more accounts since the models leverage client data.
PredictiveMetrics is the leading
provider of predictive scoring and analytical decision solutions using
advanced statistical techniques. PMI’s custom analytics and
industry/finance decision technology spans many industries, types of
financing, and debt.

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Mail Monitor Shows Solicitations Off 27%

A credit card direct mail tracking service confirms the extent of the
reduction in card mail last year, as reported by CardWatch.com last
week. Synovate’s “Mail Monitor” service estimates that U.S. households
received 3.8 billion offers for new cards during 2008, a 27%
decrease, or 1.4 billion fewer offers mailed in 2008. CardWatch.com
reported a 30% decline to 3.8 billion pieces. Synovate found that out of
the top 25 mailers of card solicitations the only banks to increase
their mail volumes in 2008 were U.S. Bank (+29%) and Barclays
(+27%). U.S. Bank broke into the top 10 for the first time last year
replacing Credit One, a subprime issuer (Barclays is ranked 9th). The
card issuers that cut back solicitations the most in 2008 versus one
year ago were HSBC (-61%), Citibank (-44%), Chase (-32%) and Bank of
America (-30%).

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Small Business Optimism Up a Skosh

A January survey shows that 39% of small business owners were “very worried” about the economy and 48% are “somewhat worried.” This compares to 56% and 35%, respectively, in the October survey that was conducted just after the market crash. The uptick in optimism is despite nearly half indicating they are “not at all confident” that President Obama and Congress will pass a stimulus package that addresses the needs of small business owners. The PayCycle research also showed that 58% of respondents now believe the recovery will take another 12-18 months, compared to 50% in the earlier survey. The survey showed that both the extreme pessimists and extreme optimists are beginning to converge on predicting an economic recovery in the 12-18 month range. PayCycle is the leading online payroll service.

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NCR’s Board Adds a Xerox Executive

NCR has appointed Quincy L. Allen, president of Xerox Global Business,
to its board of directors. Allen is responsible for the worldwide
management of Xerox’s $5 billion
production and $8 billion office businesses, including P&L, product
marketing and launch and strategic planning. The production business
offers high end systems, software and services for the graphic
communication industry, including production publishing, transaction
printing and enterprise-wide printing. He oversees marketing of Xerox
technology, software and services for offices small to large. Allen
earned a bachelor’s degree in electrical engineering from
Northeastern University and a master’s degree in business administration
from the University of Rochester.

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Payment Data System Processing Up 25%

Payment Data System posted a 25% increase in processing for December
2008 from November and 5% more than December 2007. Transactions
processed increased 11% from the previous month and 13%
from December 2007. It should be noted that December’s dollar volume was
the highest for any month in 2008 and is the third highest in our
history. In dollars processed, volume increased 21% from the third
quarter. For transactions processed, volume grew 20% over the previous
quarter and 7% over Q4 2007.

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