Johnson Financial Expands STAR Network Access

Wisconsin-based Johnson Bank has expanded its STAR Network access to include both Arizona and Wisconsin, plus Wind River Financial, which is the merchant service provider for Johnson Bank, now provides STAR Network access for thousands of merchants. First Data’s STAR Network is a coast-to-coast electronic payments network and provider of secure, real-time electronic transactions. Johnson Financial Group is a $3.7 billion financial services company. Wind River Financial is a provider of electronic payment services, including credit/debit card processing, check conversion/guarantee, gift and loyalty cards, point of sale solutions and security compliance services.

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Majority of Consumers Limit Online Shopping

A new survey found that 69% of those shopping online will limit their purchasing because of fears associated with misuse of personal information. The TNS/TRUSTe survey revealed that the top five factors that shoppers say might limit or prevent them from buying online this holiday season are, in order, identity theft (49%), spam resulting from online purchases (39%), credit card theft (39%), spyware (38%) and preference for the “touch and feel” of shopping in bricks-and-mortar stores (35%). Among those willing to use e-commerce, nearly 42% prefer using the large, well-known online brands they believe will keep them safer from privacy-related threats.

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Card Personalization Turf Battle is Brewing

A battle may be brewing over front-of-card personalization services. A U.K. company announced today that it intends to enforce its international intellectual patent rights for the technology that allows cardholders to design their own payment card and enables issuers and manufacturers to use digital card images on the fly for just-in-time card manufacturing. London-based Serverside Group, founded in early 2003, says it has become aware of new front-of-card personalization programs entering the market and may take legal action internationally to protect its patents, copyright, trade secret, trademark and database rights. The company has strategic alliances with VISA, Datacard Group and Getty Images. To-date, SSG has seven issuers offering its card personalization to cardholders including Abbey National, America First Credit Union, Capital One, First National Bank of Omaha and Taishin Bank in Taiwan. The Company says it also has signed contracts with additional top 10 regional issuers and has several other deals in the pipeline. Cardholder personalization services have gained popularity in the USA this year. Wal-Mart has added the option to its gift card program and MasterCard recently announced a similar service for its members. MasterCard introduced its proprietary “MasterCard Card Customization Services” two weeks ago that allows issuers to offer consumer and small business cardholders the ability to create their own unique credit, debit or prepaid cards. Wal-Mart Stores introduced its personalized gift card program in early November, charging an $0.88 fee. (CF Library 11/14/05 and 11/21/05)

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Cyber Monday Americans Charge Nearly $1B

Upwards of 60 million Americans went online Monday to shop for the holidays, charging nearly $1 billion on payment cards. Early statistics show that “Cyber Monday” spending was up 26% as traffic rose more than 30% for most retailers. VISA USA’s “SpendTrak” reports consumers charged about $505 million on the Internet using its cards, a 26% jump over the same day in 2004. VISA says between November 1st and 28th, consumers charged over $9.9 billion online using VISA, with an average ticket of $87.85. VISA also noted that the previous high for the 2005 holiday season was on November 15th when consumers spent approximately $461 million. eBay’s Shopping.com reported a 37% increase in year-over-year traffic on “Cyber Monday.” More than 3.4 million unique shoppers visited the site Monday. Among the hottest products for this year: Apple iPod Nano and Panasonic 42 inch HDTV Plasma TV. The NRF’s Shop.org said it estimated that 58.9 million consumers shopped online Monday.

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The CO-OP Network Hires Work from GenPass

The CO-OP Network has hired Leah Work, formerly with GenPass as National Relationship Manager. Work joins CO-OP Network after spending four years at GenPass, where she managed marketing implementation projects and developed strategic business plans and procedures to establish an ISO client relations department. During her time at GenPass, Work also managed technical sales for financial institutions and ISO client nationally. CO-OP Network is wholly-owned by its credit union shareholders and provides volume discounts on products and services that include risk management as well as debit and deposit access.

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20% of Students Turn Down Credit Card Offers

A new report has found that more than 20% of college students surveyed have decided to avoid potential credit card pitfalls by not obtaining even one credit card. More than 30% of students have just one card, according to the research by Atlanta-based NetBank. More than half of the students who have credit cards said they pay their credit card statement in full each month and don’t carry a balance. NetBank also says the survey showed that the first thing students look at when selecting a bank is the amount of fees charged for not maintaining a minimum balance. Their second biggest concern is belonging to a bank that provides easy access to fee-free ATMs.

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MasterCard Shareholders Approve 2006 IPO

MasterCard shareholders yesterday approved changes to the governing documents of MasterCard, the proposed initial public offering and a new long term incentive plan. More than 85% of MasterCard’s outstanding shares were voted at Monday’s special meeting, the highest quorum ever achieved by the company. Each of the proposals was approved by over 94% of the votes cast except for the incentive plan proposal, which was approved by over 91% of the votes cast. The new corporate governance and open ownership structure includes the appointment of a new Board of Directors comprised of a majority of independent directors, the transition to a publicly traded company and the establishment of a charitable foundation which will hold 10% of the company’s shares. In September, MasterCard announced it was planning to go public in early 2006 by selling 49% in an IPO, raising about $2.5 billion. The card association said it will use the IPO’s proceeds to redeem stock from its existing 1,400 financial institution shareholders and plans to retain $650 million for litigation and marketing expenses. (CF Library 9/1/05; 9/16/05)

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U.S. Contactless Market Drives OTI Growth

Rosh Pina-based On Track Innovations posted revenues for the third quarter of $12.1 million, a 120% jump over the same period of last year.
The Company says the increase in revenues represents the rapid
advancements in the contactless market around the world and in
particular the U.S. market, where it will deliver contactless solutions
for more than ten million payment cards in 2005. During the third
quarter, OTI completed a series of strategic acquisitions in China,
increasing manufacturing capacity to 1.5 million units per week by the
second half of 2006. The Company also completed a $22.2 million private
placement of new equity financing with institutional investors from the
US, Switzerland and England. For complete details on OTI’s third
quarter performance, visit CardData (www.carddata.com).

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Arby’s Launches a Dec. MasterCard Promotion

MasterCard and Arby’s have launched a December promotion for its 1,000 U.S. restaurants whereby customers using a MasterCard credit card are automatically entered for a chance to win $25,000 in MasterCard gift cards. There is no purchase necessary to win and participation is available in-restaurant or via mail. Arby’s Restaurant Group, Inc. is an Atlanta-based company that is the franchisor of the Arby’s restaurant system, which consists of nearly 3,500 restaurants worldwide.

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Pay By Touch Names an EVP of Biz Development

Pay By Touch has named Gus Spanos as EVP of business development after he recently led a $130 million fundraising effort. Spanos brings a wealth of experience in finance and operations. Prior to joining Pay By Touch, he was a partner at JH Partners where he helped raise the firm’s inaugural institutional private equity fund that consisted of the nation’s top five university endowments. In addition to his eight years in private equity, Spanos began his career at Goldman, Sachs & Co. and later spent seven years as an operating executive at several private equity sponsored companies. Spanos earned his MBA degree from The Stanford Graduate School of Business and his AB degree from Harvard College.

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AmEx Finanzmanagement Teams with update for CRM

Update software AG has established a Customer Relationship Management
partnership with Heidelberg-based American Express Finanzmanagement. The credit card company has added
personal advisory services in the areas of liquidity, provisioning and
asset management to the range of financial services it holds available
for cardmembers in Germany. By the end of 2005, some 100 financial
advisors at 16 branches of AmEx Finanzmanagement will work with update’s
CRM system. Via the Web-based user interface, they will be able to
access the centrally stored customer data from their respective
workplaces. The marketing department will use the CRM system primarily
for analytical tasks such as controlling or customer value calculations,
and the results will flow back directly into the operational process.
update software is one of Europe’s leading providers of CRM solutions
with revenues of EUR 15.3 million.

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