DATA Act Passes a U.S. House Committee

Another data security bill is making its way through Congress. This week, the House Energy and Commerce Committee unanimously approved the “Data Accountability and Trust Act, passed 41-0. The “DATA Act” requires that consumers be notified if their privacy may have been violated because of a security breach. Data brokers will be required to implement effective security safeguards. If there is a reasonable risk of identity theft to the individual to whom the personal information relates, fraud or other unlawful conduct, these data brokers must notify consumers. Additionally, data brokers will be prohibited from falsely representing themselves to obtain personal data. The legislation also directs the FTC to create rules setting rigorous national standards for data brokers to protect personal information. It also require entities to appoint and identify a person in the organization that is responsible for information security.

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Bridgeport to Launch a Parcxmart Card

Connecticut’s largest city expects to replace its entire downtown on-street meter inventory with a smart card payment system. Bridgeport will deploy a system from Parcxmart Technologies. When the “Bridgeport Parcxmart Card” program becomes fully operational, people coming to and living in Bridgeport will be able to load up to $100 onto the card and use it to pay for parking at participating parking lots and garages, and for retail purchases at participating local merchants. Bridgeport is the second city in Connecticut, following New Haven, to adopt the interoperable Parcxmart payment solution.

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Chase Paymentech Solutions Launches VeriFone Vx 510

Chase Paymentech Solutions has released the VeriFone “Vx
510”, designed to appeal to smaller Canadian retail and restaurant
merchants who require a compact and lightweight point-of-sale dial
terminal. This solution efficiently processes all major credit and
Interac debit payments, and supports Chase Paymentech’s electronic gift
card program, “FlexCache”. Chase Paymentech Solutions is a result of the
2005 integration of the former Paymentech and Chase Merchant Services. The integrated companies processed approximately 15.5 billion transactions in 2005, with more than $560 billion in annual bankcard and debit volume in both Canada and the United States.

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Rahaxi Processing Names a European Sales Director

FreeStar Technology announced that its Rahaxi Processing Oy.
subsidiary has named Paul Warren to be European Sales Director, a new
position. Warren will be responsible for marketing
Rahaxi Processing’s payment processing software to European banks and
merchants, such as retail chains, in the Benelux and Nordic countries as
well as Germany, the UK, France and Italy. Warren most recently held
senior positions in two companies in the electronic funds payments
industry, Albany Software, one of the UK’s leading
developers and suppliers of eTransaction enabling software solutions,
and eFunds, an industry leader in electronic payments and risk management.

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Axalto Intros a “Fee-Per-Card” EMV Migration Program

Axalto announced a turnkey smart card personalization offer
through the Visa Smart Breakthrough program, an initiative bringing
cost-effective solutions and innovative technologies to member financial
institutions, and facilitating the EMV migration process. Axalto will be offering a “fee-per-card” scheme that allows banks to migrate to the
advanced EMV standard without a large upfront investment. As part of the “Visa Smart Breakthrough” program, Axalto offers VISA member
banks its field-proven personalization package which includes data
preparation, personalization software suite for EMV cards, quality control software, as well as ongoing technical support.

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Korea’s LG Card Finally Goes on the Block

After much wrangling among creditors, LG Card is finally going on the selling block. Korea Development Bank, working with JP Morgan, says the bidding will start on April 12th and will end on April 19th. The creditors are looking to sell at least 51% of South Korea’s largest card issuer. The deal is expected to fetch at least $4 billion. Woori Financial, Hana Financial, HSBC and Citibank are rumored to be interested in the portfolio. LG Card has posted four consecutive quarters of solid profitability. In the third quarter of 2004, the issuer reported a $48.2 million loss. Since then, LG Card has earned $1.7 billion.

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Average Active Balances Decline 4% in 05

The average balance per active account among the top 10 issuers declined 4.2% last year to $2,256. Average balances have been relatively flat over the past three years, indicating usage of multiple accounts. The nation’s top issuer Chase had a 3% decline in average balances in 2005. Citi, the nation’s #2 issuer, experienced a 10% increase in average balances during 2005, according to CardData ([www.carddata.com][1]).

AVERAGE BALANCES AMONG TOP 10 ISSUERS
(per active account)
ISSUER 2004 2003
1. Chase $3411 $3457
2. Citi $1690 $1584
3. MBNA $2475 $2548
4. BofA $3118 $3057
5. Cap One $1854 $1801
6. Disc $2452 $2325
7. AmEx $2240 $2362
8. HSBC $1734 $1469
9. Prov $2439 $2288
10. Wells $2146 $1923
AVG $2356 $2281
SOURCE: CardData (www.carddata.com)

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

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UBS & AirPlus Launch a Corp Travel Payment Product

AirPlus International has entered into a strategic partnership with the
Swiss bank UBS to offer companies in Switzerland the “AirPlus
Information Manager”, a complete payment and cost analysis solution for
corporate travel and the “AirPlus Company Account” and “UBS VISA
Corporate Cards”. The collaboration with UBS will strengthen the
AirPlus’ position as a provider of global business travel payment
solutions.

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TransUnion Integrates with ID Score

TransUnion has integrated ID Analytics’ “ID Score” into its “Fraud and Identity Management Services.” Under the terms of the agreement, TransUnion becomes a contributing member of the ID Analytics ID Network. “ID Score” is a standardized, predictive risk metric that helps organizations focus their identity risk management efforts on individuals with the highest likelihood of fraud. The solution is in use by over half the credit card and wireless telecommunication markets in the U.S., as well as leading retailer, retail bank and online consumer finance companies.

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Fast Food Card Volume Rises 47% in 2005

Americans charged $33.2 billion worth of fast food to their credit and debit cards last year, compared to $22.5 billion one-year ago. The 47% increase was driven by merchant expansion and promotion of card usage during 2005. Last year, McDonald’s increased payment credit acceptance from 3,000 locations in 2004 to 13,000 in 2005. McDonald’s has also geared up for contactless payments. The average QSR credit card ticket, based on the most recent VISA data, is $10.75. Americans spend about $150 billion per year in quick service restaurants.

QSR ON PLASTIC HISTORICAL
2000: $ 1.7 billion
2001: $ 3.7 billion
2002: $ 6.1 billion
2003: $12.9 billion
2004: $22.5 billion
2005: $33.2 billion
Source: CardData (www.carddata.com)

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MoneyGram Purchases Money Express

MoneyGram announced the signing of an agreement to buy the business
of Money Express. The Rome-based Money Express has an active network of
about 800 independent retailers throughout Italy who provide MoneyGram’s
money transfer service. MoneyGram expects to continue to expand its
network in Italy through a newly created company named MoneyGram Payment
Systems Italy S.R.L. when the sale is completed sometime in late April.
The MoneyGram money transfer service is now available in more than 9,000 Poste Italiane locations and plans are underway to add the MoneyGram service in another 4,000 Poste Italiane locations across the country.

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