Consumer Confidence Plummets This Month

Consumer confidence took a big hit this month due to a softening job market, rising gas prices and an unstable stock market. As a result, a monthly index fell to it lowest level in 16 months. The “RBC CASH Index” plummeted to 71.1 for September, well below last month’s 89.3 level. Expectations about job loss grew gloomier as only 49% of consumers reported that it is unlikely they or someone they know will lose their job in the next six months, down from 56% last month. Forty-five per cent of Americans reported feeling less confident about their job security, up five points from last month. Consumers’ comfort level for making household purchases fell to 35% in September from 37% last month, and ratings of current personal finances also declined, with 27% of Americans rating their current financial situation as weak, compared to 23% in August. The “RBC Investment Index” declined almost 10 points to 88.3 this month, compared to 97.9 in August. The “Index” is composed of four sub-indices: “RBC Current Conditions Index;” “RBC Expectations Index;” “RBC Investment Index;” and “RBC Jobs Index.”

RBC INDEX HISTORICAL
Sep 06: 93.7
Oct 06: 83.1
Nov 06: 92.4
Dec 06: 86.9
Jan 07: 95.3
Feb 07: 103.0
Mar 07: 92.3
Apr 07: 85.4
May 07: 87.1
Jun 07: 81.4
Jul 07: 76.1
Aug 07: 89.3
Sep 07: 71.1
Source: RBC Financial Group

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YEEPAY & EACHNET

YeePay has partnered with EachNet to relaunch its consumer-to-consumer
marketplace, for which YeePay will be the sole payment and identity
verification provider. EachNet is a collaboration between eBay and TOM
Online to provide consumers with an escrow service, called “An Fu Tong”,
that integrates with YeePay to hold payments. This integration allows
purchases and money transfers to be made with bank cards over a secure
network, after user identification. YeePay is an e-payment service provider
of e-payment solutions and financial services. The site has been awarded
“Best Payment Platform” by the China eCommerce Association and one
of the “China Internet 100 Companies/Top 50 Innovators” by the China
Internet Society.

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Reunion.com Selects Vindicia’s ChargeGuard

Los Angeles based social networking site Reunion.com has selected Vindicia for its ChargeGuard chargeback management services Chargebacks occur when credit card holders contact their bank to dispute a charge. Chargebacks especially impact Card-Not-Present (CNP) e-commerce merchants and can have a costly effect on a merchant’s business. The CyberSource 2007 Annual Online Fraud Report estimates that $3 billion in online revenues were lost to online fraud, that chargebacks accounted for approximately half of the fraud losses, and that the time spent handling chargebacks ranged from 30 minutes to 1.8 hours per chargeback. Vindicia provides payment management services to ecommerce merchants through a recurring/automatic billing platform, outsourced chargeback management, and consulting services.

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BELL ID

Netherlands-based smart card software company Bell ID will be
opening a U.S. office in the Washington D.C. area. Although already
having penetrated the U.S. market with “ANDiS” products as a
(GSA)-approved company, this development will mark the first Bell
ID U.S. local office. Focusing on identity security, the company’s
solution complies with U.S. government regulation, providing solutions
for the Transport Services Administration (TSA) with such partners as
the Boeing Company and the Department of Defence (NL). Other
clients include banks, various government agencies and smart card
providers for corporate ID, mobile, government ID and contactless
banking business.

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Titan Prepaid Cards Coming in October

Titan Global Holdings has announced that planned launch of its “Guardian” brand of prepaid calling card products to be on retail shelves by October 2007. The Guardian prepaid calling card products are Card Services’ first branded products. In fiscal 2008, Card Services has been projected to generate revenues of $45 million as its management executes on its opportunities for revenue and earnings acceleration. The Guardian Instant Money Transfer product is a simple three step process. First the customer purchases the product. Second, the customer calls customer service to register and provide basic information. Third, the customer is provided with the ability to contact the receiving party via live transfer or using the INTL LD PIN provided with the product. To protect its proprietary technology, Titan recently retained a leading Washington D.C.-based intellectual property firm and also filed a patent application that is currently pending. Titan Global Holdings is a diversified holding company with a dynamic portfolio of companies engaged in emerging telecommunications markets, advanced technologies and energy. Titan generated in excess of $109 million in revenues on a consolidated basis.

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OYSTER ONE-PULSE VISA

Barclaycard and Transport for London, in partnership with TranSys, has
launched a new 3-in-1 payment card that combines the “Oyster” mass
transit card with a contactless VISA credit card. The new “OnePulse
VISA” will target 10 million “Oyster” cardholders. The new card will
have three functions: “Oyster Card,” “Chip and PIN,” and contactless.
HSBC, HBOS, Lloyds TSB, and Barclays all indicated they will launch
contactless payments by year’s end. VISA is currently introducing
contactless facilities at retailers in Canary Wharf, Liverpool Street,
Moorgate, Fenchurch Street, London Bridge, Charing Cross and Waterloo
Stations. Over 1,000 London retailers have agreed to implement
Barclaycard’s cashless payment technology.

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ABS MPR Holds to its Historical Levels

Monthly payment rates, the amount that cardholders pay on their credit card debt, rose for the third month in July. Among credit card-backed securities, the MPR hit 20.46% in July after dipping to 19.58% in May. The MPR has remained fairly stable in the first and second quarters and remains consistent with historical levels. According to FitchRatings, the gross yield decreased to 18.46% in July from 18.94% in June and was up 83 basis points above year-ago levels. Fitch says that despite the decline in yield this month, gross yield for 2007 has been significantly higher and the difference in year-over-year levels is increasing; the difference in first-quarter average gross yield in 2006 and 2007 was just 25 bps, compared with the 2006 and 2007 second-quarter average of a 183-bp difference.

ABS METRICS
YIELD MPR
Jul 06: 17.63% 20.71%
Aug 06: 17.86% 20.24%
Sep 06: 17.96% 21.06%
Oct 06: 17.58% 19.30%
Nov 06: 17.96% 19.82%
Dec 06: 17.78% 19.32%
Jan 07: 18.28% 19.27%
Feb 07: 17.70% 20.80%
Mar 07: 18.21% 18.76%
Apr 07: 19.23% 21.09%
May 07: 18.23% 19.58%
Jun 07: 18.94% 20.17%
Jul 07: 18.46% 20.46%
Source: FitchRatings

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HALYK BANK & CR2

Halyk Bank of Kazakhstan has implemented CR2’s multichannel, self-
service solution, “BankWorld”, for the bank’s ATM, Internet, kiosk, and
mobile phone customer service channels. “BankWorld” Internet sites have
increased by over 100% since last year and for Halyk Bank, the CR2
solution will allow customers to personalize their self service products
and services. Subsequently, this is projected to create an increase in
cross
selling and customer satisfaction. This development comes at the end of a
successful, CR2 fiscal year reflecting a license sales increase of 40% on
the previous year with new customers from around the globe.

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Gander Mountain PC Theft Compromises Data

MN-based outdoor gear specialist Gander Mountain this week confirmed a possible theft of a Pennsylvania store computer. The Company reported that a computer from its Greensburg, PA may have been breached. The stored transaction information may have included 112,000 credit card numbers with expiration date but without any other associated information. Approximately 10,000 transaction records may have included the credit card number, expiration date and customer name. For the approximately 5,100 credit card customers who returned merchandise or did a lay-away purchase at the store during this period, the information also may have included an address. For the approximately 650 customers who purchased by check and returned merchandise without a receipt or put merchandise on lay-away by check payment, the information may have contained a name, address, driver’s license number and date of birth. The company has sent letters to the approximately 5,750 customers for whom address information is available informing them of this incident.

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EVERTEC & FAC

First Atlantic Commerce (FAC) has certified EVERTEC’s e-commerce
processing platform for Puerto Rican customers, which allows FAC to
process transactions with all banks on the platform. This development will
also allow acquiring banks in the Latin American Caribbean Region to
implement FAC e-commerce card payment solutions. Through EVERTEC
and its e-commerce processing platform, FAC is provided an application to
connect payment gateways and merchants with Credit and Debit Card
Associations. This also allows FAC to provide online payment and risk
management solutions. EVERTEC solutions are applied in 15 different
countries
across many different industries, executes over 920 million transactions
yearly
on a network of over 4,300 ATMs and over 85,000 POS terminals, and has
over 1,700 employees working in 7 countries. FAC merchant platforms include
Microsoft, UNIX, and LINUX.

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Minnesota Casinos Pick GPN’s VIP LightSpeed

Global Payments has signed an agreement to provide its “VIP LightSpeed” suite of cash access products to Mystic Lake Casino Hotel and Little Six Casino in Minneapolis/St. Paul, Minnesota. “VIP LightSpeed” is a high speed, Internet-accessible, PC-based platform that provides cash access services. The casinos will also utilize Global Payments’ PlayerCash @dvantage credit and debit card cash advance services to provide cash access from all major payment card networks, 24 hours a day, seven days a week. Global Payments is a provider of electronic transaction processing services.

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