CTG Says Fuel Costs will Dampen Spending

NJ-based consultancy Clear Thinking Group says its research shows that retail sales will increase by 4.0% to 4.5% over 2004, falling short of last year’s 5.3% gain. The research firm says fuel prices have fallen rapidly over the past six weeks but, even with the decrease consumers are still paying 30% more than they did last year. CTG also says the high cost of home heating fuel will continue to have an impact on disposable income. CTG says it believes gift cards will grow by nearly 10% to 12% compared to the 2004 holiday season and the average consumer is expected to receive three to four gift cards.

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NRF Says Holiday Retail Sales to Rise 6%

The National Retail Federation has for the first time revised its holiday sales forecast. The NRF now expects holiday retail sales (November and December) to increase 6.0% over last year to $439.53 billion. The change was due to strong October retail sales and falling gasoline prices. The previous forecast was a 5.0% sales gain, issued on September 21st. NRF represents more than 1.4 million U.S. retail establishments.

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Holiday Gift Card Sales to Rise 36%

While solid figures on holiday gift card sales are not available, the consensus is that Americans will purchase between $15 billion and $20 billion this holiday season. The estimated average gift card purchase has an even wider range, from $88 to $339, based on surveys conducted by various research firms. A survey conducted by BIGresearch for the National Retail Federation found that gift card sales will total $18.48 billion and that the average consumer will spend $88.03 on gift cards this holiday season. Stored Value Systems says its survey shows that Americans will spend an average of $248 on gift cards during the upcoming holiday season. American Express released a survey that shows 57% of Americans plan to purchase gift cards this year, spending on average $339. Deloitte says gift cards will remain the #1 gift purchase this year, with 67% of nationwide respondents indicating that they will purchase an average of 4.9 cards, compared to 64% and 4.7 cards last holiday season. A new poll by Chase for the “Disney Rewards VISA” determined that 68% of parents plan to purchase a store-branded gift card this year. Another Stored Value Systems survey found that four out of five parents say that they have purchased a gift card for their child or that their child has received a gift card with an average value of $29. First Data Prepaid Services’ ValueLink found that 59% of American adults, an estimated 131 million people, either purchased or received a gift card in the previous 12 months, up 23% from 2001.

HOLIDAY GIFT CARD SALES (ESTIMATED)
2001: $4 billion
2002: $6 billion
2003: $10 billion
2004: $14 billion
2005: $19 billion
Source: CardData (www.carddata.com)

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MobilePay Offers QuickBooks Merchant Services

e-Nabler has upgraded its “MobilePay” software, which runs on any “Pocket PC” phone or “Palm,” to provide credit card processing through QuickBooks Merchant Services. Current QuickBooks customers can easily add MobilePay to an existing QuickBooks Merchant Account and start accepting credit card payments via any Pocket PC Phone using wireless phone providers like Verizon, Nextel, Sprint, AT&T, Cingular, T-Mobile and many others. QuickBooks provides accounting software packages with more than 3 million small business customers and more than 250,000 accountants who use and support it. e-Nabler Corporation specializes in the development of packaged and customizable software for electronic wireless processes and the development of e-commerce and mobile tools.

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BNZ Market Share Rises to 22%

A new report has determined that Bank of New Zealand now accounts for 21.6% of the total number of accounts and 27.6% of balances
outstanding in the country, as of the third quarter. The “Plastic Cards in New Zealand 2005” report, offered by Research & Markets, also found that American Express has made an aggressive move into the credit card space. However, it remains a small player but it is now one equally reliant on credit and charge cards. The report says the “BNZ Limited Edition VISA Platinum Card” offers a compelling proposition since it charges a low rate of interest to cardholders who revolve a negative balance. At the same time by paying a relatively high rate of interest on positive balances BNZ appeals to consumers who always keep such a balance in their credit card account.

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BioPay Expands In CA and MO; Hits 2MM Users

VA-based BioPay has signed up 18 grocery stores across three brands in California and the Mid-Towne IGA in St. Charles, Missouri for its biometric payment solution. The BioPay system uses a person’s unique finger image and their chosen non-private BioPay number (usually a phone number) to authorize a secured debit direct from their checking account. The Company says its payment technology has been used to complete over seventeen million transactions worth $7 billion. Over 2 million customers are enrolled in BioPay. More than 1,500 merchants are using one or more of BioPay’s smart, secure methods for processing financial and other transactions requiring identification. BioPay charges merchants 15 cents on a $100 transaction.

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Blue Cross/Shield to Offer VISA Debit Cards

The Blue Cross and Blue Shield Association and VISA USA have signed a deal to offer “Blue”-branded VISA debit cards linked to CDHPs, FSAs, HRAs and HSAs enabling members to pay for healthcare related expenses. The Blue-branded Visa debit cards will be a central feature for members at participating Blue Cross and Blue Shield companies enrolled in consumer-directed health plans (CDHPs). Consumer-directed products offer the same overall benefit as other forms of health insurance, but they combine a higher deductible threshold with a personal savings account, giving consumers more control over spending. The Blue Cross and Blue Shield Association is made up of 39 independent, locally operated Blue Cross and Blue Shield companies that collectively provide healthcare coverage for more than 93 million.

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Battle Underway for Low-Value Transactions

A new report suggests that the under $10 transactions market has yet to be cracked for electronic payments but cash is losing some ground. Boston-based Aite Group says U.S. consumers make a total of 138 billion cash transactions annually. About 50% of those transactions are under $10. Approximately 95% of all such transactions are made in cash in the U.S. annually. Aite says its research shows the spread of contactless bankcards will likely boost U.S. issuers efforts to cannibalize cash. However, unless merchant acceptance costs are dramatically reduced, the high cost of bankcard processing will limit the issuer’s ability to drive away large volumes of cash transactions below $10. Aite concludes that competition will intensify between non-prepaid, bankcard-only approaches and prepaid approaches that leverage ACH, bankcard and closed-loop networks as the underlying funding mechanism.

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GO MASTERCARD

Harvey Norman and GE Money have officially launched their “GO
MasterCard” which offers no annual fee, 0% interest for the first six
months and a rewards program. The retailer is hoping the highly
competitive card will further stimulate holiday sales, which are running
7.6% higher than last year. The new card carries an on-going interest
rate of 17.5%. GE Money and Harvey Norman have a long-standing
relationship. There are more than 200 Harvey Norman, Domayne and Joyce
Mayne stores operating in Australia, New Zealand, Slovenia, Ireland,
Singapore and Malaysia. GE Money Australia and New Zealand offers
consumer finance products through 12,000 retailers, 700 dealers, 5,500
brokers and a network of more than 350 branches (including Wizard Home
Loans). GE Money, which includes the Australian Financial Investments
Group (including Wizard Home Loans) has assets greater than A$36billion
and more than 3 million customers.

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GCA Deploys Wincor ProCash 1500xe ATMs

Global Cash Access is now deploying 150 Wincor Nixdorf “ProCash 1500xe ATMs” in casinos throughout the U.S. and U.K. for GCA’s “Casino Cash Plus 3-in-1″ ATM system. The ProCash 1500xe is a compact indoor cash dispenser system designed for branch lobby or retail installations. The ProCash 1500xe has a very small footprint and includes up to four cassettes and a standard 12.1” LCD screen. ProView, Wincor Nixdorf’s ATM management tool, monitors the entire network and can repair certain problems remotely without sending an actual person on site to a Casino’s ATM. Global Cash Access, Inc. provides cash access products and related services to approximately 960 gaming properties and other clients in the United States, the United Kingdom, Canada and the Caribbean. Wincor Nixdorf is one of the world’s leading suppliers of IT solutions to banks and retailers.

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7-Eleven to Double its ATM Kiosk Program

7-Eleven has signed a five-year agreement with NCR to add 1,200 units to its advanced-function financial services kiosk program and replace other in-store ATMs in the U.S. NCR will also service the majority of 7-Eleven’ existing base of non-NCR ATMs. The 7-Eleven network currently has 1,050 kiosks which offer check cashing, Western Union money orders and transfers, bill payment and Verizon long distance services in addition to ATM services. The rollout under the new agreement begins this month. The deal also includes hardware and software maintenance services and incident management.

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Bank-Issued Gift Cards Gather Momentum

Bank-issued general purpose gift cards got a real boost this week as two major issuers launched new cards. Retailer-issued cards currently dominate the $75+ billion U.S. gift card market, however, bank-issued cards are quickly gaining ground as consumers opt for cards with maximum flexibility. Yesterday, Washington Mutual launched the “WaMu MasterCard Gift Card” and First National of Nebraska introduced the “smartOne VISA Gift Card.” WaMu is offering six cards in increments ranging from $25 to $500. The card has an issuance fee of $3.95 plus a $1 first-class shipping and handling charge which is waived through the end of the year. First National Bank is now offering customers the ability to personalize their gift cards online using their favorite photos. The issuer also continues to offers six categories of designed cards. The “smartOne VISA Gift Card” is available in any dollar amount from $25 to $750. First National is charging a a $5.95 service fee for standard designs and $8.95 for personalized cards.

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