PCI Council to Certify UPTs and HSMs

The PCI Security Standards Council announced that “Unattended Payment Terminals” (UPTs) and hardware, a/k/a “Host Security Modules” (HSMs) can now undergo a rigorous testing and approval program to ensure they comply with industry standards for securing sensitive payment card data during any point in the transaction process. The Council also will maintain the list of approved UPTs and HSMs, provide documentation and training for labs evaluating these devices and be a single source of information for device vendors and their customers. Vendors have been manufacturing and having the “Encrypting PIN Pads” (EPPs) that go into UPTs evaluated by approved labs, and the payment card brands have been requiring the use of “PCI SSC” approved EPPs. HSMs are secure cryptographic devices that can be used for PIN translation, card personalization, electronic commerce or data protection and do not include any type of cardholder interface.

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Barclays Takes Over L.L. Bean Co-Brand

Barclays has taken over the L.L. Bean co-branded Visa credit card program from Bank of America. MBNA, acquired by BofA in 2005, introduced the “L.L. Bean Visa” in May 1996. The new Barclays program, which launches today, features free shipping, return shipping and monogramming, a choice of three card designs, plus “Visa Platinum” or “Visa Signature” benefits. Whenever cardholders earn 10 coupon dollars, a $10 L.L.Bean coupon will be sent to them automatically via their account statement. Cardholders also receive 10 “Bonus Coupon Dollars” after their first purchase, balance transfer, or use of a “Convenience Check” within the first 90 days after the account is opened. The no annual fee card offers interest rates ranging from prime +6.74% to prime +14.74%. In conjunction with the card launch Barclays has opened a customer service operation in Wilton, Maine to serve L.L.Bean cardholders as well as those from other partner programs. MBNA formerly serviced the card via its Camden, Maine center. (CF Library 5/7/96; 7/23/98; 5/21/08)

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GPD/STIP TEST PLAN

GlobalPlatform has published its upgraded “Test Plan 1.0” GDP/STIP v2.3
compliance tool for smart card products, designed to speed development
and deployment testing for faster time to market. As a result of its
early-stage compliance, “GPD/STIP v2.3 Test Plan v1.0” ensures lower
implementation and testing costs for merchants’ compliance with the
GlobalPlatform “GPD/STIP v2.3” specification for data security. As a
member driven association with cross-industry representation from around
the world, GlobalPlatform smart card infrastructure development is known
as the standard for smart card infrastructure.

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MAY DEBT

Credit card outstandings rose in May by GBP 556 million to a total of GBP 55.5 billion. Year-on-year credit card outstandings (not seasonally adjusted) were up slightly more than 3%. According to the The Bank of England, the increase in total net lending to individuals in May (GBP 5.4 billion) was below the increase in April and the previous six-month average. The twelve-month growth rate slowed to 8.0%, and the three-month annualized growth rate slowed by 1.2 percentage points to 5.9%. The increase in net consumer credit in May (GBP 1.4 billion) was above that in April and above the previous six-month average. Net other loans and advances increased by GBP 0.8 billion, lower than the March increase. The annual growth rate of consumer credit rose by 0.1 percentage points to 7.0%; the three-month annualized growth rate fell by 1.7 percentage points to 6.7%.

NOTE: Chart does not include about GBP10 billion from specialist
lenders, retailers, and insurance companies. SOURCE: Bank of England

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Consumer Card Fraud Concerns Rise Globally

A new global survey has found that identity theft and financial fraud are top global concerns for consumers. The “Unisys Security Index” declined three points to 134, representing a moderate level of overall concern about security issues worldwide. Consumer concern is highest in Asia, (specifically Hong Kong, Singapore, and Malaysia) – as well as Brazil. Germany is the only European country that registered a high concern about security issues. French consumers are least concerned worldwide, with fears at or near the lowest level of concern in all four areas included in the “Index”. Compared to August 2007, segments of the population in the U.S. and Hong Kong experienced more stress about meeting basic financial obligations, such as paying credit card bills and mortgage payments. The “Unisys Security Index” presents a social indicator that measures consumer concern in relation to four areas of security: national, financial, Internet and personal safety.

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Credit Union 24 Joins Allpoint Network

FL-based Credit Union 24 signed a multi-year deal with with the Allpoint Network and will continue to offer the CU HERE Premium network and its nearly 50,000 surcharge-free ATMs to its credit union participants. The Allpoint ATMs are part of Credit Union 24’s CU HERE Premium program, which was introduced in December 2007 and is nearly three times the size of the largest bank-controlled ATM network. Credit Union 24 will continue to offset a portion of the cost for the program for its participants who choose to utilize non-surcharging ATMs as a tool to grow their membership. Credit Union 24’s CU HERE surcharge-free programs combine to create the largest surcharge-free ATM presence in the country. Credit Union 24 is a flexible, member-owned, full-service, deposit-taking ATM and POS network with multiple processor links with hundreds of thousands of POS locations.

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MicroBilt and PRBC Merge Databases

Risk management information provider MicroBilt Corporation and PRBC are teaming to help small-to-medium sized and financial institutions conduct business with an estimated 50-70 million American consumers with “thin” or no established credit histories. PRBC is a bill payment credit bureau that collects, stores, scores, and reports bill payment data in compliance with the Fair Credit Reporting Act (FCRA) and the Fair and Accurate Credit Transaction Act (FACTA). It is the first credit repository to give prospective borrowers the tools to demonstrate their creditworthiness without the need to go into debt. The two companies will merge payment data collected by MicroBilt and PRBC in PRBC’s data repository to help more consumers qualify for FICO® Expansion® scores used by lenders and financial institutions in underwriting new loans. As part of the agreement, MicroBilt will make an equity investment in PRBC.

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MATCIA Z20/Z20T & MS20

Matica has announced its provision and installation of its “Z20”
printer, “Z20T” printer and MS20 card sorting to Oberthur Card Systems,
collectively valued at over EUR400,000. Oberthur is deploying the mid
range card issuance systems- capable of producing 900 cards per hour- in
Hungary, Romania, Ukraine, the Philippines and South Africa. The “Z20T”
‘all in one’ solution allows Oberthur to encode, emboss, indent, print
logos and install chips on credit cards in a single system while MS20
card sorting and mailing system takes the card from production to the
end user. Oberthur provides cards and card-based solutions to a broad
range of sectors and had 2007 revenue of over EUR730 million while
Matica is an international supplier of card personalisation and card
mailing systems in approximately 100 countries.

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US Dataworks Q1 Revenues Drop by 30%

Houston-based US Dataworks reported revenues for the quarter ended March 31st of $1.6 million, compared with revenues of $2.3 million for the same period a year ago. The net loss for the quarter was $4.4 million, compared to a net loss of $1.3 million, for the corresponding period in the prior year. The Company says it is close to completing a major restructuring, which includes streamlining the staff. The Company is also set to release a new version of its proprietary software: “Clearingworks 3.0.” US Dataworks is a developer of payment processing solutions. For complete details on US Dataworks’ latest results visit CardData ([www.carddata.com][1]).

[1]: http://www.carddata.com

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RiskWatch for PCI Compliance is Unveiled

RiskWatch has released “RiskWatch for PCI Compliance” software which measures compliance directly against the recently updated Payment Card Industry Data Security Standard. The software consists of a simple web-based solution which allows an organization to log in to a secure web site and create compliance surveys that can be distributed throughout an organization and provides full audit trails, validating compliance with the new standard.

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Bank Credit Card Switching Grinds Down

While an on-going CardTrak.com survey shows that 43% of consumers want to switch cards and 19% want to cut-up all their cards this year, the number of consumers closing their credit card accounts has nose-dived. According to CardData, voluntary attrition for the month of May slipped to an all-time low of 6.80%, compared to 9.10% one-year ago and 8.88% five years ago. As credit card issuers tighten credit card approval standards, switching cards has become more difficult for consumers as new credit lines are less generous. Furthermore, as reported last week in CardFlash, direct mail credit card offers have dropped significantly this year. Additionally, a major online credit card marketing concern, creditcards.com, abandoned its planned IPO in the wake of tighter underwriting on consumer credit cards. Voluntary attrition is determined by dividing cardholder-initiated account closings by the gross number of accounts and then annualizing.

MAY ATTRITION
(Excludes Discover and AmEx)
2004: 8.88%
2005: 9.35%
2006: 8.99%
2007: 9.10%
2008: 6.80%
Source: CardData (www.carddata.com)

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