Points International Inks With Alaska Airlines

Points International has announced a partnership agreement with Alaska
Airlines until the end of 2009. Points International operates through its
website, Points.com. At this website, consumers can swap, earn, buy,
gift, share and redeem miles and points from more than 25 of the world’s
leading reward programs. These programs include Alaska Airlines “Mileage
Plan”. Alaska Airlines serves 90 cities in North America.

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Capital One to Reshape U.S. Debit Cards

Capital One’s new co-branded decoupled debit MasterCard has the potential to reshape the card-issuing landscape. The patent-pending product enables both PIN and signature debit transactions from checking accounts at other institutions and offers a high-value rewards program. A new report from Boston-based Aite Group says the revolutionary Capital One product delivers reward value at least two times the amount delivered by traditional debit card reward programs. The study found that Capital One wants to become a top 10 debit card issuer and is willing to operate with narrower profit margins on the product by betting on scale. Cap One also bets on a proprietary processing and risk management infrastructure that allows it to operate with lower costs than traditional debit card issuers. Aite Group says PayPal, which is the fifth largest issuer of VISA small-business debit cards, has been the most successful non-bank debit card program. Other debit card-issuing initiatives from organizations that don’t control checking accounts include programs operated by Tempo Payments, First Data, and TSYS. Aite says the progress of those organizations has remained limited thus far.

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Citibank Launches Cash Back Card

Citigroup has introduced the “Cash Back Gold Card” offering
cash back as high as 3.88% and 24-7 “Gold-on-Call” customer
service. The card also gives customers cash on a monthly, credit card
spending based on a tiered rate every month. The “Citibank Cash Back
Gold” card offers 0.50% cash back if they have carried forward balance
of less than RM5,000; 2.00% for a carried forward balance between
RM5,001 – RM10,000; and 3.88% for amounts above RM10,000.
Also, the “Gold Travel Service”, allows cardholders to make
travel arrangements through Citibank’s travel hotline, and includes free
one-way airport transfer. Furthermore, customers will also have free
travel insurance of up to RM500,000 when the airline tickets are charged
to their card.

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$6600 is the Median Card Debt Per Household

There has been much debate about the definition and calculation of U.S. credit card debt. However, an online poll of 55,000 consumers conducted by CardTrak.com found that the median amount of credit card debt carried by Americans is about $6,600 per household while the mean (or average) credit card debt load is nearly $9,900 per household. Of cardholders carrying debt, over 64% had balances under $10,000. However, 13% of the same group said they carry total credit card balances in excess of $25,000. The response confirms industry figures. At the end of 2006, Americans owed $745 billion on general purpose credit cards and an estimated $105 billion on limited purpose cards or store/gas credit cards. Of the $850 billion in credit card debt, about 18% is paid-off each month without incurring interest charges and about 3% is revolving business credit card debt. Discounting interest-free and commercial debt, Americans are revolving about $672 billion on all credit cards. Of the nation’s 111 million households, about 7% have no credit cards and 21% do not have a general purpose or major credit card. Discounting those who have no credit cards and those who only have a low balance store or gas credit card, there are 88 million households using credit cards today. Therefore, average credit card debt is $9659 per household. If the universe is limited to households that carry balances forward each month, then the assumption could be made that 61% of the 111 million households, or 68 million, revolve their credit card debt monthly. In this calculation the average credit card debt is $9882 per household.

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First Data To Continue Dresdner Bank Processing

First Data has announced its renewal of the Dresdner Bank card
processing contract until 2012. First Data will process transactions for
the banks’ classic, gold and business cards as well as co-branding cards
with Allianz. The transaction processing company and Dresdner Bank
first signed agreements in 1999. First Data serves 5 million merchant
locations, 1,900 card issuers and their customers. Dresdner Bank is
subsidiary of Allianz Group and is represented with 902 branch offices
in Germany and 50 global branch offices.

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Merchants Largely in a Fog Over Card Fees

A new survey has found that many small and mid-sized business owners don’t understand credit/debit/prepaid card processing costs, the fees and surcharges they pay, and how these charges impact their bottom line. NJ-based Heartland Payment Systems, founding supporter of “The Merchant Bill of Rights,” said its recent survey found that 26% of participants believe they are being treated fairly by the debit/ credit/prepaid card processing industry; 32% understand unfair card processing practices and how they impact their business; 21% understand the rates, fees and surcharges they pay; and 15% believe they are charged the same as larger businesses. The centerpiece of “The Merchant Bill of Rights” is www.MerchantBillOfRights.com, an interactive website that serves as an information clearinghouse. There, business owners can learn about the mechanics of card processing, receive industry tips, ask questions and stay abreast of industry news.

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TransUnion Extends Operations To Croatia

TransUnion has extended credit reporting operations to Croatia, the fourth
international bureau the agency has opened in two years. With the
partnership of CRIF, an international group specialized in the design,
development and management of credit reporting, the bureau will operate
through the local banking association, HROK, and is the first bank-owned
credit bureau company in the country. The bureau was founded by 20
Croatian banks and will represent more than 90% of the retail banking
market in Croatia. TransUnion employs more than 4,000 employees in more
than 30 countries on six continents.

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Moneris Provides Card Processing To SBI

Moneris Solutions has announced that it will be providing
credit card processing for State Bank of India(SBI) under a
3-year agreement. The agreement stipulates that SBI will provide
POS technologies, wireless payment processing and electronic bill
payment to its business customers using the company’s transaction-
processing hardware and software. SBI claims the highest net
assets, deposits, branches and employees for commercial banks in
India. Moneris Solutions serves over 350,000 North American
merchant locations and has over 1,100 employees.

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HSBC Announces A Climate Partnership

HSBC has announced their “Climate Partnership” for the response to
Earth’s climate change. The partnership, with Climate Group, EarthWatch
Institute, Smithsonian Tropical Research Institute, and WWF, is under
contract for 5 years, and is worth $100 million. The partnership is
designed to help some of the world’s great cities respond to the climate change, create ‘climate champions’ worldwide who will undertake field research and bring back valuable knowledge and experience to their communities, conduct experiments to measure carbon and the effects of climate change, and to help protect world’s major rivers benefiting the 450 million people who rely on them. Since 2001, HSBC has helped save more than 12,000 plant species from extinction, trained 200 scientists, sent 2,000 HSBC employees on conservation research projects worldwide, and protected and better managed three of the world’s largest rivers.

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Credit Managers Say the Economy is Steady

A monthly survey of the business economy shows that conditions were only slightly improved from last month, but overall credit managers are currently reporting good business conditions. The seasonally adjusted “Credit Manager’s Index” edged up in May by ten basis points. The report showed mostly small changes in the 10 components of the “Index,” with the number of increases and decreases evenly split. The manufacturing sector fell 0.7%, while the service sector gained 0.9%. The National Association of Credit Management noted that overall, the data suggest that the economy continues to expand at a modest pace despite the drag of tightened monetary policy, high energy prices and a devastated housing market.

Credit Manager’s Index
May 06: 54.9
Jun 06: 57.2
Jul 06: 57.6
Aug 06: 57.3
Sep 06: 57.1
Oct 06: 55.3
Nov 06: 55.2
Dec 06: 54.7
Jan 07: 57.2
Feb 07: 56.6
Mar 07: 55.0
Apr 07: 56.6
May 07: 56.7
Source: National Association of Credit Management

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FundsTech Appoints a New Executive

FundsTech has announced the appointment of Victoria Vaksman as the
Executive Vice President of European, Middle Eastern and African
operations. She has been a member of the board for the previous six
months and has experience building International IT companies.
FundsTech provides prepaid debit card solutions for the unbanked
population worldwide and provides software solutions to financial
institutions.

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Phishing Attacks Remain Very Active

The Anti-Phishing Working Group reports that the number of phishing URLs deployed by electronic crime gangs rose to more than 55,000 in April, up 48% from the previous high in October 2006 and more than 166% higher than the number encountered in March. Although the financial services sector accounted for nearly 93% of all phishing attacks, April was marked by a diversification of attack sectors by electronic crime gangs, including branded social networking outfits, VoIP companies and numerous large web-based email providers. For the first time, the time live for phishing sites dipped below four days — to 3.8 days, reducing by more than 5% the duration in which consumers are exposed to phish sites that could deceive them into submitting their user credentials.

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