Bank of America has taken the affinity credit card model, largely pioneered by MBNA, to a new level with the introduction affinity banking. BofA, which acquired MBNA 10 months ago, says it intends to build a new consumer credit and deposit continuum and further fuel customer preference and loyalty. BofA says the expanded affinity model will further support the organizations for which customers are most passionate through their lines of credit and everyday checking and debit card transactions. The new deposit products will be marketed to participating organization members and supporters online beginning November 20th. The first batch of organizations to join the program represent 10 million members. Among the first to join BofA’s affinity banking program are: New York State Bar Association, National Wildlife Federation, American Quarter Horse Association, Habitat for Humanity International, Brown Alumni Association, and nine other associations.Details
Metavante announced a reciprocal agreement with Yodlee, that integrates Metavante electronic bill payment with Yodlee’s proprietary credit and debit card payment functionality, and integrates Yodlee solutions with Metavante’s electronic bill payment processing capabilities. Benefits of the agreement include enabling end users of Metavante online bill pay to make payments with their credit and debit cards. Leading financial institutions trust Yodlee to power critical online banking applications that increase profitability and drive more value from the online channel. Metavante Corporation delivers banking and payments technologies to financial services firms and businesses worldwide.Details
Transaction Systems Architects reported that revenue for the quarter ended September 30th rose 12% year-on-year to $88.5 million. However, net income for the quarter was $2.3 million, a decrease of 75% from one-year ago. The quarter was impacted by special charges for investment and globalization and by the settlement of a class-action lawsuit. During the quarter, TSAI added nine new customers, sold 33 new applications to existing customers,and 23 customers licensed capacity upgrades. Backlog for the next 12 months was $291.5 million as of September 30th, as compared to $258.2 million for the quarter ended June 30th. The Company revised its guidance for fiscal 2007 to be in the range of $430 million to $442 million. For complete details on Transaction Systems Architects’ latest results visit CardData ([www.carddata.com]).
Gemalto has signed a deal with Leigh Mardon Group to acquire Leigh Mardon Taiwan. Melbourne-based Leigh Mardon is an established supplier of secure transaction products and services. Leigh
Mardon is security accredited by VISA, MasterCard, Europay, Bankcard,
Diners Club and American Express and holds International Quality
Standards Organisation (ISO) “9002” series certification.Taiwan is currently in an EMV migration with most cards to be converted by 2008. The transaction is expected to close on November 30th.
Chase has signed a long-term deal with FL-based SeaMiles to issue a “Seamiles Reward Card” early next year. The new card will enable consumers to earn for everyday spend while redeeming on the cruise line of their choice through SeaMiles’ redemption platform. Cardholders wil earn bonus points by booking the cruise line of their choice on the card as well as earning points for purchases made onboard cruise ships. SeaMiles program is also launching a preferred partner network of travel agent retailers. About 13 million North Americans cruised in 2005, a steady increase of 8.73% over the previous year. SeaMiles began in December 2004.Details
Omaha-based First National Merchant Solutions announced an extension of its 14-year credit card processing relationship with NE-based The Buckle and its 350 locations in 38 states. First National Merchant Solutions provides a variety of payment processing solutions to meet the unique needs of merchants. These solutions include credit and debit card processing, secure Internet commerce processing, Electronic Benefit Transfer processing and check guarantee, authorization and collection. First National Merchant Solutions is a top 10 payment processor with more than 50 years of experience providing first-rate service and solutions to businesses across the nation.Details
VA-based Online Resources has launched “CardHQ,” an online gift card store that synthesizes two primary consumer payment platforms, the checking and card account. The first available service of its kind, Card HQ synthesizes two primary consumer payment platforms, the checking and card account, to create a virtual transaction account for the purchase and re-loading of stored value gift cards, which are provided in either physical or virtual form. Online Resources powers web-based financial services for 2600 financial institutions, billers and credit service providers.Details
First Data Debit Services has signed an agreement with Interactive Financial Services Group to provide a school and charity rewards feature as a component of First Data’s Debit Rewards program. This new service will be in addition to the travel, merchandise and cash rebate programs that are currently available to financial institutions for which First Data Debit Services provides processing services. First Data Corp. (NYSE: FDC) is a leading provider of electronic commerce and payment solutions for businesses worldwide. IFSG is a Washington State financial services corporation based in Bellevue, WA. It designs and develops innovative web-based products for financial institutions primarily in the education sector.Details
A new study has concluded that the OFT’s decision to limit default charges at GBP12 is already affecting credit card margins. The research the new rule could cost lenders GBP one billion a year, or about $35 per year per cardholder. The PricewaterhouseCoopers found that credit card margins have hit new lows. After allowing for bad debts, net
yield on balances fell from 6.5% to just under 5% in the year to June
2006. Although APRs have risen by about 1 percentage point on average,
margins have fallen as bad debt has risen faster, from just 4% in
December 2004 to 7% by June 2006. The research also revealed that U.K. consumers have overtaken the U.S. in terms of debt penetration. The total debt of the UK population (secured and unsecured) now represents 104% of gross domestic product (GDP) compared to 92% in the US. At the same time, outstanding levels of consumer credit hit 18% of GDP in the UK, compared with 17% in the US.
MasterCard has launched a program to expand rewards beyond payment card products to the entire banking relationship including retail banking, insurance and investment products. The core of this new framework is MasterCard’s data processing platform and technology which gives banks the ability to customize their programs to meet specific customer interests and lifecycle events while seamlessly scoring, tracking and fulfilling rewards-based activities. The new program can also help cross-sell retail bank and credit products more effectively. Rewards can be earned on deposit or investment balances, the number of products held, transactional elements such as card purchases, online bill payment, direct deposit, as well as one-time promotional events such as a mortgage or HELOC application/approval. Additionally, rewards from personal and small business products can be commingled. MasterCard will offer relationship rewards programs beginning in early next year.Details
Nashville-based iPayment reported that revenues increased 7% to $187.0 million for the third quarter. However, the Company posted a net loss of $0.7 million for the third quarter, compared to net income of $8.1 million for 3Q/05. The loss was attributable to interest costs associated with the buyout of iPayment by a group led by Greg Daily, iPayment’s Chairman and CEO, Carl Grimstad, iPayment’s President, which occurred in May. The group, Payment Holdings, paid $800 million for the purchase of the outstanding shares of iPayment’s common stock, $70 million to pay down the entire outstanding balance of iPayment’s previous revolving credit facility, and $20 million to pay transaction costs at closing. iPayment provides credit and debit card-based payment processing services to over 140,000 small merchants nationwide. For complete details on iPayments’s latest results visit CardData ([www.carddata.com]).
3Q/05: $175.2 million
4Q/05: $183.0 million
1Q/06: $170.9 million
2Q/06: $189.2 million
3Q/06: $187.0 million
Source: CardData (www.carddata.com)
MasterCard reports that global acceptance for its contactless “PayPass” program has topped 36,000 merchants, compared to 25,000 in February. Today, the nation’s second largest payment card network announced a “PayPass” expansion into taxicabs. MasterCard and VeriFone have teamed with the Philadelphia Parking Authority to deploy “Tap & Go” payments into all of its taxis. The “PayPass” roll-out is part of a PPA project contracted with VeriFone Transportation Systems, a joint venture of VeriFone and Taxitronic. To system uses a contactless reader attached to a VeriFone “Omni 7000” terminal located in the back seat of the taxi. The customer-facing payment system is networked to another VeriFone system, the “MX870,” a multimedia device located in the driver cab that provides routing, navigation and other information. When using “PayPass” on the VeriFone “Omni 7000” system, passengers also have the option to enter the tip amount, as well as sign electronically for transactions over $25.Details