NXP SEMICONDUCTORS

NXP Semiconductors has announced the addition of MIFARE to its
portfolio. Available for pilot in Q408, the new development will provide
users with security enhancements, such as “Advanced Encryption
Standard” (AES) encryption, with existing MIFARE implementations
thanks to support from secure Random Identifiers (RIDs) and 7 Byte
Unique Identifiers (UIDs) for contactless smart card ICs. NXP
Semiconductor was founded by Philips over 50 years ago, provides
semiconductor solutions for a range of electronic devices, has 37,000
employees across more than 20 countries and 2007 sales of $6.3
billion.

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Consumer Confidence Plunges to a New Low

Besides jobs, consumers are losing confidence in the U.S. economy. The latest “RBC CASH Index” collapsed to 33.1 for March, compared to 48.5 one-month ago. RBC says that the U.S. consumer, who carried the economy for the past half-dozen years, is in full defensive mode, battered by falling housing values, spiking food and energy prices, tightening lending standards, the teetering stock market and hints of weakening in the labor market. Americans’ confidence in future economic conditions, as measured by the “RBC Expectations Index,” plummeted to -41.6 this month, down from the -7.0 reading in February. The “Index” is composed of four sub-indices: “RBC Current Conditions Index;” “RBC Expectations Index”; “RBC Investment Index”; and, “RBC Jobs Index”.

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Credit Card Fair Fee Act Introduced

U.S. Rep. John Conyers and Rep Chris Cannon have introduced the “Credit Card Fair Fee Act of 2008” or “H.R. 5546.” The proposed legislation is aimed at cutting merchant payment card fees. This morning, the American Bankers Association said it strongly opposes the interchange legislation introduced by creating an impractical federal bureaucracy. The ABA says the result will be less competition, fewer choices and ultimately higher prices for consumers, as is always the case when government tries to fix prices.

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The NRF Responds to H.R. 5546

The National Retail Federation welcomed the introduction of landmark antitrust legislation that it says would address hidden MasterCard and VISA fees that cost merchants and their customers more than $40 billion a year. The bill is the first attempt by Congress to address credit card interchange fees, and is the outcome of a hearing held in July. The Conyers bill would require credit card systems possessing “substantial market power” to negotiate with merchants to reach a voluntary agreement on credit card terms and conditions. If an agreement cannot be reached, both sides would be required to submit to binding arbitration by a three-judge panel appointed by the DOJ and FTC. The arbitration proceedings would take place with a limited 60-day discovery period and other statutory deadlines, and the judges would be required to apply a market standard reflecting a perfectly competitive system where neither side had market power. Terms and conditions set by the panel would be in effect for three years, at which time the process would repeat itself. Both sides would receive limited immunity from antitrust laws in order to participate in the process.

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Merchants Respond to H.R. 5546

The Merchants Payments Coalition says the “Credit Card Fair Fee Act”, for the first time, deals with the biggest credit card fee of all — the interchange fee. The bgroup says it welcomes the effort to stop the price-fixing practices of the credit card industry and create a transparent market-based process. The MPC also said that currently, credit card interchange rates are set in secret and hidden from view. Raising interchange fees is how VISA and MasterCard encourage banks to issue more credit and debit cards — as long as rising rates are kept top secret, consumers have no way of knowing the extra costs they are paying through higher prices.

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Cruz Bay Solutions Unveils iGift POD

MA-based Cruz Bay Solutions has partnered with Radiant Systems to produce the “iGift Print on Demand Gift Card Kiosk.” The “iGift POD” kiosk allows customers to choose from a large selection of card designs that can be personalized with colorful text messages in a variety of fonts. Customers can also import their own photos and edit them with options similar to a photo editing kiosk. Using the “iGift POD” kiosk, customers are able to choose from a much greater array of design options than can be found by purchasing gift cards in the traditional manner. Customers may also perform balance inquiries and reloads at the kiosk.

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EPC Says H.R. 5546 Will Hinder Innovation

The Electronic Payments Coalition says the electronic payments system is a premiere American example of the endless economic opportunities the free market brings to all parties involved. Innovation, technology, and economic growth for all parties involved are hallmarks of a highly efficient free market system. However well-intentioned, any government intervention could never match the ability of the free market to determine the most appropriate price for services. The EPC says it strongly opposes the price control legislation. The EPC says the new bill clearly states that the board will “set rates and terms” for access to the benefits of accepting electronic payments. This provision replaces the free marketplace with a price control scheme governed by three unelected “electronic payment judges” — under control of the federal government.

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MC EMV CARDS

MasterCard has passed the 300 million card milestone for EMV chip-based cards worldwide. While Europe continues to be at the heart of the EMV chip-based issuance and acceptance with significant numbers of POS and ATM terminals supporting the EMV card base. Much of the growth over the last twelve months has come from other regions
such as Asia-Pacific, Latin America, the Middle East and Africa.
Globally, approximately one in every five MasterCard-branded cards
now carry an EMV chip with nearly a quarter of all POS devices upgraded to accept these cards. In Asia-Pacific, the growth rate of EMV chip cards over the past two years has exceeded 70%. In South Africa,
POS terminal deployment has reached critical mass encouraging banks to commence EMV card issuance. In the United Arab Emirates, EMV card issuance increased tremendously last year.

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Chase Paymentech Supports Optimum T4210/T4220

Chase Paymentech has agreed to provide full merchant and ISO support for Hypercom’s new PCI PED approved, 32-bit multi-application “Optimum T4210” and “T4220” terminals. The action follows Chase Paymentech’s Class A certification of the two new devices. Hypercom’s “Optimum T4200” family consists of six 32-bit multi-application terminals with a consistent look and feel and 19-key keypad layout. The Chase Paymentech Class A certified terminals include models with dial only and Ethernet/SSL/dial backup connectivity. The new terminals join a full array of high-performance “Optimum” countertop, multi-lane, wireless and portable terminals that have been adopted by leading banks, retailers and independent sales organizations globally, since Hypercom introduced its first 32-bit “Optimum” product in 2004.

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MasterCard Tops 300 Million EMV Chip Cards

MasterCard has passed the 300 million card milestone for EMV chip-based cards worldwide. While Europe continues to be at the heart of the EMV chip-based issuance and acceptance with significant numbers of POS and ATM terminals supporting the EMV card base. Much of the growth over the last twelve months has come from other regions such as Asia-Pacific, Latin America, the Middle East and Africa. Globally, approximately one in every five MasterCard-branded cards now carry an EMV chip with nearly a quarter of all POS devices upgraded to accept these cards. In Asia-Pacific, the growth rate of EMV chip cards over the past two years has exceeded 70%. In South Africa, POS terminal deployment has reached critical mass encouraging banks to commence EMV card issuance. In the United Arab Emirates, EMV card issuance increased tremendously last year.

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On Track Innovations 4Q/07 Revenues Soften

NJ-based On Track Innovations reported that revenues for the fourth quarter reached $13.0 million, a decrease of 1% compared to $13.2 million in the same period last year. Gross margin for the fourth quarter was 43% compared to 48% in the fourth quarter of 2006. OTI says that during the year it experienced delays in multiple projects, but despite the delays it was able to grow revenues by 7% for the year and limit cash burn to $6.4 million dollars. OTI designs, develops and markets secure contactless microprocessor-based smart card technology to address the needs of a wide variety of markets. For more information visit carddata.com).

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