Monetary Authority Releases Survey Findings

The Hong Kong Monetary Authority (HKMA)has announced its findings
on credit card lending for 1Q07. Total card receivables decreased by
6.3% in the
quarter after rising by 11.8% in 4Q06, the transfer of nearly HK$126
million outside the credit card portfolio contributed to the decline in
total
receivables, the number of credit card accounts rose by 1.1% and
borrowing increased by HK$.1 billion. In addition, the charge off total
increased by 0.79% from HK$0.54 billion in 4Q06, charge-off ratio rose
.04% from 3.13%, The delinquent amount decreased to HK$262 million
by 7 million from 4Q06, however, this ratio increased to 0.39% from
0.37%. The HKMA surveyed authorized institutions (AIs) and some
subsidiaries of AIs that are engaged in credit card business for this data.

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Kiwibank Guilty Of Hiding Fees

Kiwibank has been found guilty of breaching the Fair Trading Act by not
disclosing the 2.6% of total transaction fees for currency conversion to
its Mastercard customers. The fifth major bank to be charged, the
institution has been fined $134,000 in the Auckland District Court, will
pay $172,051 in compensation to customers, and $10,000 to the
Commission in costs. The penalties incurred were smaller in scale due to
the minimal window of time and customers affected in comparison to
other banks. Consumers affected are to be compensated by August
2007. With no disclosure of the fees, there is less encouragement for
customers to shop for better deals, thus, less incentive for banks to lower
the fees. The total paid out in fines by the 5 institutions is over $22
million.

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Consumers Excited About New PFM Tools

A new study has found that next-generation personal financial management tools may offer significant customer acquisition opportunities. The survey by Aite Group for Yodlee found that nearly half of all consumer respondents would be very or extremely interested in using the “Yodlee MoneyCenter” functionality if it was available at their bank. Of the consumers who said they were likely or extremely likely to use the products, 63% currently never or rarely use PFM software. The whitepaper also shows that 72% say that the ability to choose payment timing of their bills is important to have available on an online banking Web site; 59% believe that the ability to automatically organize expenses into categories is important; 55% say that the ability to pay bills by debit cards at the bank site is a very to extremely important feature of online banking; and 73% note e-mail and SMS fraud alerts as extremely important features. The “Yodlee MoneyCenter” includes “Yodlee PersonalFinance,” “Yodlee BillPay,” and “Yodlee FundsTransfer.” The ability to pay bills by debit cards at the bank site is unique to Yodlee solutions.

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HBOS Provides Free ATMs

In lower income areas, HBOS has announced it will be providing free ATMs
with no surcharge. Recently, 50 of these Halifax and Bank of Scotland ATMs
have become live and operational in Scotland and Northern England and
are to
be followed by 50 more in regions, such as these, by the end of 2007. These
ATMs will be marked with color coding indicating that no fees will be
levied.
HBOS provides more than half of all social banking accounts in the UK with
around 3.6 million basic bank accounts.

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Esprit Signs Agreement with Jiangxi for EM2 Services

Esprit Financial Group announced that it has signed an Agreement
in Principle with International Express Payment (Jiangxi) Corp
to provide advanced electronic funds management services (EM2) to
Jiangxi’s current customer base and its network of over 20 Chinese-based
banks. Jiangxi operates a proprietary Chinese based “closed loop
payment system” which works similar to a Paypal type online payment
service. This current closed loop payment system provides
services restricted to member banks and merchants whose customers
subscribe to Jiangxi system and are limited to electronic funds transfer
within this closed loop system. With this new Agreement, Esprit will
expand Jiangxi’s service capability from a ‘closed loop’ to an ‘open
loop’ system that can access a much larger pool of international banks
and financial institutions. Jiangxi is the leading online payment
platform in China. Esprit Financial Group is a public company engaged
in a diversified number of online financial services.

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Southwest Corporate to use VSoft

Southwest Corporate, an $11.5 billion asset corporate credit union serving 1,300 credit unions in 42 states, has chosen to offer VSoft’s “Merchant Capture” and “ATM Image Capture solutions” to its credit unions. The Merchant Capture solution allows credit unions to provide their business members the ability to remotely capture and electronically send deposits. Business members use a low speed scanner to capture the check images and transfer the data through a secure transmission. Businesses can consolidate their deposits into a single preferred financial institution, averting any geographic dependency. VSoft’s ATM Image Capture interfaces with image-based ATMs that deposit checks directly into an account. Once the image is captured at the ATM, the software sends it to the central check-processing site. Each check is positively matched against the ATM records, and a complete audit trail is maintained for clearing purposes. Southwest Corporate Federal Credit Union is a $11.5 billion institution that serves the financial needs of more than 1,300 member credit unions. VSoft Corporation is a global provider of financial technology solutions.

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ORCC Attracts Janssen on its Board

Online Resources has named Debra Janssen, former President of First Data Debit Services and former President and CEO of eFunds, to the Company’s Board of Directors. She also served for fourteen years with Metavante Corporation (formerly M&I Data), where she last served as its Chief Information Officer. Currently, she is a private investor, and serves as CEO of one of the private firms in which she has invested. Online Resources powers web-based financial services for 2600 financial institutions, billers and credit service providers.

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Utilities Get FDC Revenue Assurance

First Data has launched “First Data Revenue Assurance,” a Web-based service that analyzes data from a utility’s existing billing and metering systems to identify revenue recovery opportunities. Using First Data Revenue Assurance is a simple three-step process. Data is uploaded using a secure Web connection, advanced algorithms are applied to the data to identify and prioritize revenue recovery opportunities and the results are made available on a secure Web site. Because First Data Revenue Assurance is available as a Web-based service, utilities can begin effective revenue recovery activities as soon as their first sets of data are uploaded and processed. Lengthy system implementation is not required and the up-front cost is minimal. First Data Utilities develops utility billing software and provides outsourced utility billing and payment transaction services.

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Cards Drive Merchant Revenue Best

A recent survey found that 36% of merchants indicated cash, and a nearly identical 35% indicated credit card as the method of payment that has best helped them drive revenue or meet other business goals. Surprisingly, only 4% cited PIN debit cards and 1% cited store-issued or private label cards. The report by Javelin Strategy & Research found the merchants cited prompt payment, lower cash handling and exposure to shrinkage as the top reasons for naming credit cards as the best payment method. However, the research noted that specific practices on the part of networks and issuers may undermine that perceived value, and threaten to alter the balance in place since the inception of credit cards. Javelin says many merchants understand the costs and benefits of card acceptance by some limit their analysis to interchange as a line item cost of doing business with no benefits.

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QuikOrder Lands its Fifth Patent

Chicago-based QuikOrder has been awarded a patent for a rapid entry system for the placement of product and service orders via the Internet. “FAVORDER” is a one-click solution for ordering products and services at websites and via cellphones and PDAs. Initial ordering information including payment by credit card, PayPal or other payment mechanism, delivery or pickup information and product data is encapsulated in a coded URL. An icon representing the order can be inserted on the desktop, as a favorite browser setting or on the quick launch bar. After that, one click submits any repeat order. While optional settings can be specified to prompt for passwords or additional confirmation steps based on input from the firm providing the product or service, the system is designed to reduce the customer action to one single click. QuikOrder Inc. is an online ordering company serving the $30 billion pizza industry.

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Affinity Cards Get a Virtual Portfolio

The U.K.’s ServerSide Group has created a “Virtual Portfolio” to allow issuers to offer an infinite variety of stock and personally designed cards to an unlimited number of affinity groups. With this online system, all stakeholders in the card creation and management process can create, collaborate, review, approve and market cards without restrictive inventory issues such as forecasting how many cards are required, dealing with the problems of over- and under-printing, and storage costs. The speed to market new card products targeting subgroups has massively increased and can be launched and managed at very little cost. The “Virtual Portfolio” online interface allows issuers to rapidly launch card programs targeting any number of affinity partners, subgroups, co-brands, individual branches and even specific events such as concerts or sport matches.

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Global Survey Finds Commercial Card Trends

A survey conducted by Visa, titled “Global Commercial Payment
Cards: Cutting Costs and Boosting Control on a Global Stage,” examines
practices and strategies with the use of commercial payment programs,
specifically corporate cards and purchasing cards, for organizations in
four
major regions, including Asia Pacific, Europe, Latin America, and North
America. Annual spending on corporate cards for travel and entertainment
(T&E) expenses has increased among respondents worldwide by more than
20% from 2005 to 2006. Also, 66% of organizations indicate that mandating
the use of corporate cards is the top factor for driving growth of the card
programs. In Latin America and Europe, 56% of employees having a card
have increased travel budgets 60%, while spending on non-travel-related
categories have increased 53%. In Europe, 73% of companies plan to use
P-cards for temporary labor and 67% for IT services. For Latin American
companies, 83% surveyed plan to use P-cards for advertising and marketing
while cost reduction is of significant importance to 80% of
organizations in
Asia Pacific. Increasing the transaction volume and dollars is important to
65% of companies in North America. Both European and Asia Pacific regions
are nearing the program longevity of North American organizations since the
majority of companies in both of these areas have had P-card programs in
place from three to 10 years (63% and 51%, respectively).

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