VISA Incents Merchants for PCI DSS Compliance

VISA USA is offering up to $20 million in financial incentives to create new sanctions in an effort to further merchant compliance with the “PCI DSS.” The new “VISA PCI Compliance Acceleration Program” is the first of its kind to provide positive reinforcement to the industry’s traditional, fine-only approach and represents one component of VISA’s comprehensive strategy to address payment card fraud. The program targets the acquirers responsible for the largest 1,200 merchants – known as “Level 1” and “Level 2” merchants – that each process more than one million VISA transactions a year and combined account for approximately two-thirds of VISA’s U.S. transaction volume. The initiative’s goal is to eradicate the storage of full-track data, “CVV2” and “PIN” data, and grow PCI compliance among this group of merchants. VISA reports current “PCI” compliance among “Level 1” merchants at 36% and 15% among “Level 2” merchants, with the majority in both levels actively working toward compliance. To qualify for an incentive payment, acquirers of “Level 1” and “Level 2” merchants who have validated full compliance with the PCI DSS by March 31st will be eligible to receive a one-time payment for each qualifying merchant. Acquirers whose “Level 1” and “Level 2” merchants validate compliance after March 31st and prior to August 31st, will be eligible to receive a reduced one-time payment for each qualifying merchant.

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Little Caesars Scraps Paper Certs for Gift Cards

Detroit-based Little Caesars has rolled-out new a new set of gift cards to replace traditional paper gift certificates. Consumers can purchase the gift cards in any increment at participating Little Caesars stores. The unused balance will remain on the card, and there is no expiration date. In addition, there are no service fees. Little Caesars Pizza founders Michael and Marian Ilitch opened their first restaurant in Garden City, Michigan in 1959.

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Pennsylvania Settles Chase/Trilegiant Lawsuit

Pennsylvania Attorney General Tom Corbett announced multi-state settlements totaling $14.5 million with Chase Bank USA, Chase Home Finance and Trilegiant resolving allegations that the companies deceived consumers into paying for membership programs that claimed to offer discounts on automotive service, home repair, shopping and other consumer services. Corbett said that Chase Bank and Trilegiant were accused of offering “free” or “no obligation” trial memberships to various discount programs without adequately informing consumers that they would automatically be charged various membership fees if they did not cancel within a certain period of time. Corbett said that between January 2003 and October 2005, 319,532 Pennsylvania consumers cashed checks that were included in offers sent by Trilegiant. Some consumers may have unknowingly enrolled in memberships for multiple clubs.

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InfiCorp Holdings Inks a Card Deal with SunTrust

Atlanta-based SunTrust Banks has signed an agreement with InfiCorp Holdings for issuing consumer credit cards. Under terms of the agreement, InfiCorp will market, originate and service SunTrust-branded cards starting in the first quarter of 2007, focusing on SunTrust clients. SunTrust will be engaged in the underwriting process for the new cards, and have the option to purchase card assets for its own loan portfolio. SunTrust Banks, Inc., headquartered in Atlanta, is one of the nation’s largest banking organizations, serving a broad range of consumer, commercial, corporate and institutional clients. InfiCorp Holdings, Inc. is a wholly owned subsidiary of First National of Nebraska, a financial services holding company located in Omaha, Nebraska.

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Charge-Offs Show Upward Momentum in November

Charge-offs for managed outstandings edged up again in November by 10 basis points after a rocky year following the implementation of new bankruptcy rules last fall. The charge-off ratio has oscillated much of this year but seems to be on an upward trend as delinquency points north. According to CardData ([www.carddata.com][1]), charge-offs for November rose to 4.19% of managed outstandings, versus 4.09% in October and 7.03% one-year ago. According to FitchRatings, “prime” charge-offs for October were 3.78%, 10 basis points lower than the prior month but up 59 basis points since May. The “prime” 60-plus day delinquency index for October was 2.40%, compared to 2.33% in September.

CHARGE-OFFS 2006
Jan 06: 6.05%
Feb 06: 4.73%
Mar 06: 3.75%
Apr 06: 3.95%
May 06: 4.24%
Jun 06: 4.19%
Jul 06: 3.99%
Aug 06: 3.95%
Sep 06: 4.15%
Oct 06: 4.09%
Nov 06: 4.19%
Source: CardData (www.carddata.com)

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

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Comerica Bank Pilots Voice-Guided ATMs

Detroit-based Comerica Bank is piloting voice-guidance ATMs for the visually impaired. With the voice-guidance ATMs, customers simply plug a standard set of headphones into the ATM’s headphone jack to hear instructions in English or Spanish. Comerica worked with representatives from Leader Dogs for the Blind to make the new ATMs as “user friendly” as possible for the visually impaired. Instructions will be provided for any ATM transaction being conducted, such as a deposit, withdrawal, balance inquiry or payment. Comerica Bank has 240 banking centers and 379 ATMs in metropolitan Detroit, Ann Arbor, Battle Creek, Grand Rapids, Jackson, Kalamazoo, Lansing, Midland and Muskegon.

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Kabira Boosts its High Availability Platform

CA-based Kabira Technologies announced the second generation of the “Kabira High Availability Platform” for disaster-tolerant real-time applications. Kabira HA has been enhanced to achieve higher throughput and increased speed, reducing the amount of network traffic between highly available nodes by almost 50 percent and achieving approximately 75 percent increase in throughput. In addition, the solution now supports multiple network connections between highly available nodes to enable network redundancy. Kabira provides high performance transaction processing software for global enterprises to manage high volumes at a substantially lower cost.

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Chase/Marriott Rewards VISA Heads North

Chase and Marriott have launched the “Marriott Rewards Platinum VISA” in Canada. Cardholders can use their card for their daily purchases and earn three “Marriott Rewards” points for every Canadian dollar spent at Marriott locations worldwide and earn one point per Canadian dollar for all other daily card purchases. In addition to earning “Marriott Rewards” points by using the card, cardholders receive 5,000 bonus points after their first card purchase. Cardholders will also be automatically upgraded to “Silver Elite” membership in the Marriott Rewards program. Cardholders can redeem points for more than 250 rewards options including free stays at more than 2,600 Marriott hotels worldwide, theme parks, cruises, airline miles, electronics and more.

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I4 Commerce Picks Up a Major Credit Line

MD-based I4 Commerce has secured $640 million in a corporate debt financing from Citigroup’s Corporate and Investment Banking division. Since its introduction three years ago, I4 Commerce has become the leading provider of alternative payment solutions for multichannel retailers. Almost two million consumers have used I4 Commerce’s Bill Me Later to shop at more than 425 retailers, including Walmart.com, Apple, US Airways, OfficeMax, Brookstone and PETCO. Citigroup Corporate and Investment Banking is the most complete financial partner to corporations, financial institutions, institutional investors and governments in the world. I4 Commerce is a rapidly growing technology company helping to connect leading retailers with high value customers by improving the purchase experience.

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First Equity Joins Mall Networks for Biz Cards

PA-based First Equity has selected Mall Networks to build and manage a customized online shopping mall for its business credit card holders. First Equity card holders will be able to shop easily and securely at hundreds of their favorite name-brand merchants while earning points for everyday purchases. In addition to funding the points for shopping through the mall, merchants will also offer special offers and promotions. First Equity Card Corporation, located in Blue Bell, Pa., specializes in the provision of business credit solutions, including a highly innovative credit card program designed around the needs of small businesses. Mall Networks offers custom online malls for card issuers, loyalty programs, clubs, professional organizations and non-profit organizations to increase revenue and keep members engaged.

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Online Purchasing to Peak This Afternoon

Online purchasing activity is predicted to peak today for major retailers between 2:00PM and 3:00PM EST. Retail Decisions says it is expecting to identify and stop greater volumes of attempted fraud this year. On a like for like basis, ReD saw volumes increase by 109% on “Black Friday” for its U.S. clients. The top categories of products purchased fraudulently this year were gift cards, electronics, tools, jewelry and apparel. ReD says attempted fraudulent transactions for one online mass merchant in November included 930 tool sets (valued at total $32,836), 738 gift cards (valued at total $26,895), 70 home theatres (valued at total $22,986) and 58 LCD widescreens at $59,983 total value. 89% of attempted fraudulent purchases were below $1000. ReD’s clients include, Federated Department Stores, Walmart.com, Travelocity, and The Finish Line.

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Feds Likely to Pause Again This Week on Rates

The Federal Reserve will likely tomorrow takes its fourth straight pause this year. LendingTree says with the cross-currents of core inflation on the one hand and the housing and auto sectors in a downdraft on the other, they will likely want to collect more data points before making a move in either direction. The Federal Reserve raised interest rates 17 straight times from June 2004 to June 2006. Meetings from August to October 2006 have resulted in a halt in rate moves, allowing previous hikes to work into the system and take affect. The current prime rate is 8.25%.

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