Sub-Prime Meltdown is Good for Credit Cards

A new report forecasts that even as consumers moderate their spending in the coming months, the number of consumer loan delinquencies will continue to rise. TowerGroup says that while the sub-prime mortgage credit collapse has tightened credit availability in both consumer and commercial markets, banks appear to be anticipating the need to slacken credit standards for specific products like credit cards in an effort to accommodate credit needs and increase balances. TowerGroup believes this lowering of approval standards signals that credit card lenders are preparing to attract and grow balances previously lost to home equity lines of credit, which now are unavailable to many consumers. The report titled “Subprime Mortgage Meltdown: Upside for the Credit Card Business?” examines economic factors and consumer purchase behavior as well as trends in the credit card industry.

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ORCC Launches Virtual Collection Agent

Online Resources Corporation has launched a new version of “Virtual Collection Agent Advantage” for small to mid-sized lenders, billers and receivables management companies. Advantage complements existing collections technologies used by creditors and billers. It is particularly well-suited for community banks, credit unions, and small- to mid-sized lenders and billers, including those in the healthcare, utility, telecommunications, insurance and receivables management industries. Advantage features include shared-software hosting that enables rapid implementation and greater flexibility to scale debt recovery efforts in response to business and market needs; self-management tools and consumer analytics that provide clients complete control over their collections strategies, including how they are applied to the segments of their portfolios. Online Resources powers financial technology services for thousands of financial institutions, billers and credit service providers.

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Geddes Joins InComm’s Vanilla VISA Gift Cards

Atlanta-based prepaid leader InComm has signed an exclusive agreement to use images and artwork from photographer Anne Geddes for a signature series of “Vanilla VISA Gift Cards.” Geddes is known for her photographs of babies. The Anne Geddes series of “Vanilla VISA Gift Cards” will be available for sale at InComm’s retail partners and will be offered in denominations of $25, $50 and $100. The “Vanilla VISA Gift Cards” are issued by U.S. Bank’s Elan Financial Services. InComm has more than 145,000 retail locations worldwide.

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Discover Outstandings and Volume Rise 4% Y/Y

Discover Financial Services reported this morning pre-tax profits of $202 million for 3Q/07, a 16% decline over the year ago quarter. However, managed loans rose 4% year-on-year to $51.9 billion. Credit card sales volume also rose 4% to a record $26.8 billion. The managed credit card net charge-off rate declined to 3.95%, 28 basis points lower than the second quarter. But, the managed credit card 30+ day delinquency rate was 3.30%, up 18 basis points from last quarter’s record low level. The firm also reported that transaction volume across the Discover and PULSE Networks rose 17% over last year. For its U.S. cards, pretax income was $387 million, unchanged from 3Q/06 and driven by an increase in interest income related to higher average receivables and an increase in interest yield, partially offset by higher interest expense resulting from increased funding costs and increased borrowings due in part to Discover’s spin-off from Morgan Stanley; a decrease in other income due, in part, to lower new securitization activity and an unfavorable revaluation of the interest-only strip receivable; and higher marketing and business development expenses, as well as spin-off related costs of $5 million in the third quarter, partially offset by lower other expenses. For complete details on Discover’s third quarter performance, visit CardData ([www.carddata.com][1]).

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

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Hyperion Security Offers HyperSecur for PCI

VA-based Hyperion Security has release “HyperSecur” to provide PCI compliance services. “HyperSecur PCI Compliance”, is a flexible approach that exceeds general business and PCI compliance requirements. Depending on their needs, clients can receive complete assessments, self-assessment guidance, analysis, remediation action plans and training for their PCI compliance requirements. Upon completion of the assessments, Hyperion Security helps clients implement measures and prove compliance. The company’s security team also walks clients through preparing for, managing and better responding to information security threats — necessary competencies for any organization working to meet PCI DSS rules. Hyperion Security offers a range of risk management, security assessment, enterprise security program development and compliance services.

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GE Money Inks Lord & Taylor Card Extension

GE Money has announced a multi-year agreement with Lord & Taylor to offer the “Lord & Taylor Credit Card” through the company’s 47 stores and on its Web site. The newly designed Lord & Taylor Credit Card will be issued by GE Money Bank to the store’s existing 1.5 million cardholders, as well as marketed to new customers. The no-annual-fee card, with its exclusive cardholder benefits, is another instance of the store’s commitment to raising its level of service. It will enable new cardholders to receive 15 percent off their entire first-day purchases made with the card, as well as offering advanced notice of events, valuable savings and on-line account services. Lord & Taylor has launched a $10 million rebranding campaign aimed at modernizing the store’s image while celebrating its 181-year-old heritage. A rewards program is expected to be introduced in 2008.

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AmEx Sponsors Women’s Leadership Exchange

For the fifth consecutive year, “OPEN from American Express” is the “Founding Sponsor” of the “Women’s Leadership Exchange” event to be held in Northern California this week. Guest speakers include Dawn Lepore, Chairman and CEO of Drugstore.com, who recently led the Internet-based company to record sales in excess of $100 million, and Carly Fiorina, former chair and CEO of Hewlett Packard and author of “Tough Choices.” The conference also features expert- led seminars focused on leadership and business development skills, the WLE powerful brand of Speed Coaching, QVC Product Evaluations, and more. Other speakers include Quinn Tran, founder and CEO of goQTT, and Edie Weiner, renowned futurist and co- author of “Future Think.” Built into the day are various facilitated interactions between sponsors, speakers and the attendees so that they can build relationships and become resources for each other. In addition to OPEN from American Express, WLE corporate partners include IKEA, Morgan Stanley, American Airlines, Bermuda Department of Tourism and Jones New York.

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Bandit Card Project Unveils ID Control Promo

The Novell-led open source “Bandit Project” has kicked off the “Control Your Identity” campaign to promote awareness and the use of information card technology. As part of the “Control Your Identity” campaign launch, Novell will conduct a live demonstration of the Bandit Project’s “DigitalMe” and Windows “CardSpace” information card selectors using Bandit Cards to perform identity transactions online at the Digital ID World Conference this week in San Francisco. Further promotion will take place at various IT industry events over the next six months culminating at Novell’s annual “BrainShare” user conference in March of 2008.

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Mocapay and Quest Retail Integrate POS

CO-based Mocapay announced integration with Quest Retail Technology’s POS solutions, allowing more than 20,000 Quest POS systems in North America to accept payment via mobile phone. The first implementation will allow fans at the University of Colorado’s 53,000-seat Folsom Field to purchase Centerplate concession items with their mobile phones and will serve as a test for future expansion into additional Quest-serviced sports and entertainment facilities. Quest Retail Technology is a supplier of Point-Of-Sale solutions to Stadiums and Arenas in North America. Mocapay is a mobile payment and marketing company that lets consumers use their mobile phones to pay for goods and services at the register and online.

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MasterCard Launches Easy Savings for Biz Cards

MasterCard has launched a new savings program for “MasterCard BusinessCard” credit and signature debit cardholders. The new “Easy Savings” program offers automatic savings on goods and services from airline, hotel, restaurant, travel and other business services categories. Participating merchants include: Adminstaff, Avis, Budget, DHL, HRTools.com, Maggiano’s Little Italy, Midwest Airlines, Mimeo.com, SurePayroll, Website Pros, and Wyndham Hotels and Resorts. Card issuers offering their small business debit and credit card customers the benefits of the “MasterCard Easy Savings” program include Bank of America, Bank of the West, KeyBank, Washington Mutual, and Wells Fargo. The launch of “Easy Savings” is being supported by an extensive, integrated marketing campaign under the “Priceless” umbrella. According to MasterCard research, 75% of small businesses surveyed that use cards to pay business expenses are strongly interested in savings programs.

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AOL Execs Redo GratisCard as Revolution Money

Former top AOL executives have banded together to launch a new payment platform to offer lower interchange fees for merchants and the first free online money transfer service for consumers. Revolution Money, formerly “GratisCard,” is being funded by Steve Case, and led by Ted Leonsis, former U.S. Treasury Secretary Larry Summers, former Charles Schwab CEO David Pottruck, and former MasterCard President and CEO Russell Hogg. It is also backed by Citi, Morgan Stanley and Deutsche Bank. Revolution Money this week introduced its first two flagship offerings “Revolution MoneyExchange,” the first free money transfer service and “RevolutionCard,” the industry’s first anonymous, PIN-protected credit card. “MoneyExchange” launched in invitation-only beta form and will be gradually expanded before being made available to all consumers later this year. The “RevolutionCard” offers merchants an average interchange rate of 1.9%.

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