Six of Ten Business Women Hold a Biz Card

MasterCard and Ipsos-Insight released a “Women’s Small Business” study that shows 56% hold a business credit card, 28% hold a business debit card, and 40% use a business credit or business debit card to pay for the majority of their business purchases. The survey offers a look at the reasons why women are starting their own businesses, how they pay for business-related expenses and the challenges women face in trying to establish and run successful businesses. While businesses owned by women have made great strides in achieving financing and leveraging commercial credit, they still tend to rely predominantly on business earnings (35%) and personal savings (30%) as their primary funding source for business expenses. Two out of three (63%) female respondents also used personal savings to finance the start-up of their companies. All the survey respondents were owners of U.S. small businesses with 100 or fewer employees.

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Mid-Sized Issuers Up Nearly 9% in Q3

Mid-level bank credit card issuers posted an 8.6% gain in third quarter outstandings. Among issuers with outstandings between $100 million and $250 million, SunTrust led the peer group with a 39% gain. The Pennsylvania State Employees Credit Union also posted a solid gain of 12%. However, the North Carolina State Employees Credit Union slid more than 2% and AR-based Simmons, a low-rate issuer, contracted by more than 9%. OH-based FirstMerit was flat according to CardData (www. carddata.com).

ISSUER 3Q/05 OUTSTANDINGS Y/Y CHNG
Columbus Bank & Trust $250.3 million + 8.7%
Penna State Employ CU $239.8 million +12.1%
SunTrust $227.1 million +39.3%
NC State Employ CU $151.2 million – 2.3%
FirstMerit $142.8 million NC
Simmons $137.1 million – 9.7%
TOTAL $1148.3 million +8.6%
Source: CardData (www.carddata.com)

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Weekend Bankruptcy Filings May Top 100K

More than 200,000 Americans may have filed bankruptcy petitions in the final ten days prior to the full implementation of the “Bankruptcy Abuse Prevention and Consumer Protection Act of 2005,” which takes place today. Lundquist Consulting says a record 102,863 Americans filed for personal bankruptcy last week and another 100,000 were expected to do so over the weekend. Personal bankruptcy petitions in August soared by nearly 24% from last year and were up about 15% from the prior month. It is expected that filings for September will exceed 175,000, a new monthly record. In the first eight months of this year, there have been 1,119,522 personal bankruptcy filings. This number is now expected to top 1.4 million. The ABA said Friday that under the new law, wealthy filers will no longer be able to use the system as a financial planning tool. The ability to escape debts – such as monetary judgments in a civil court case – by socking away millions in a Florida mansion will be limited. And serial filers will be limited to one filing per eight years instead of one every six years.

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MasterCard Launches Second OneSMART Club

MasterCard International has launched its second “OneSMART Club” in
Northern Europe to bring together MasterCard customers and industry
suppliers in the Baltic States of Estonia, Latvia and Lithuania to foster
and support the deployment of added value chip-based business solutions.
The NE “OneSMART Club” will initially focus on five propositions:
“OneSMART MasterCard Authentication”, “MasterCard Web”, “MasterCard
Pre-Authorised”, “OneSMART MasterCard Retail” and “OneSMART MasterCard
PayPass”. MasterCard provides a range of resources to support Club
members inclduing technical support services and expertise to help
infrastructure set-up, preferred pricing arrangements with vendors,
including privileged support services, support to manage and administrate
the Club and facilitate information sharing, comprehensive marketing
support material for banks and assistance in developing
cardholder communications, and project management support and technical
assistance for pilot launches by individual members.

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M&A ARM Activity Sets a New Quarterly Record

The latest Kaulkin Ginsberg bulletin on M&A activity in the “Accounts Receivable Management” industry shows that third quarter transactions hit $1.14 billion in total deal value, the largest amount of deal value ever recorded in a quarter. High transaction values and competitive deal structures can be attributed to an economic “sweet spot” in the ARM industry. Declining unemployment, rising inflation, and increasing interest rates all create favorable conditions for the ARM industry. With low capital gains taxes, access to relatively cheap debt, and an excess of cash reserves in corporate balance sheets and investment funds, optimal conditions exist for buyers to continue their robust deal activity in this and other industries. Kaulkin Ginsberg provide solutions to accounts receivable management and other business services industries.

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Chip & PIN Drops U.K. Card Fraud by 40%

Counterfeit and lost/stolen fraud on U.K. payment cards dropped by nearly a third in the first half of this year due to the new “Chip and PIN” system. Card fraud involving counterfeit and lost/stolen cards was $158 million this year, compared to $222 million for the first six months of 2004. Last week, the “Chip and PIN Program” announced that effective February 14th “Chip and PIN” cardholders must use their PIN to be sure of being able to pay at the point-of-sale. APACS says the vast majority of people are already using PIN at the POS. For debit cards, 97% of transactions, and for credit cards, 89% of transactions, are already successfully verified by PIN. To encourage the PIN stragglers, the “Chip and PIN Program” launched the “I LOVE PIN” campaign. It will run for four months and will include a PR campaign, online information, a customer leaflet and POS material for shop staff to use.

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Citi Stagnates in Q3 as Card Profits Fall 6%

Citigroup reported that third quarter profits for its credit card business in North America slid 6% year-over-year, but were up 16% sequentially. The nation’s second largest bank credit card issuer blames net interest margin compression, higher payment rates, an increase in bankruptcy filings and Hurricane Katrina for the lackluster results. Credit card outstandings for North America of $139.8 billion were flat from the prior quarter and down 1% from one-year ago. The figure includes $25.7 billion in private label card outstandings. Bank credit card outstandings have declined for four consecutive quarters, according to CardData ([www.carddata.com][1]). Purchase and cash advance volume increased 10% year-on-year to $73.7 billion. Citi’s account base at the end of the third quarter declined by 3.2 million accounts from the prior quarter and was down 4% from one-year ago. At the end of 3Q/05, Citi had 123.9 million accounts in North America. Citi’s charge-offs decreased from 5.82% in the second quarter, to 5.58% for 3Q/05. Charge-offs for bank credit cards slipped to 5.49%, compared to 5.59% in the second quarter but above 5.34% one-year ago. Charge-offs for private label credit cards dropped from 6.28% in the second quarter to 6.01% for 3Q/05. Charge-offs for private label cards remain well below year-ago levels by 107 basis points. Delinquency (90+ days) increased slightly from 1.70% for 2Q/05 to 1.73% for the third quarter 2005. Delinquency for bank credit cards edged up by 2 basis points from the year-ago level. For complete details on Citigroup’s 3Q/05 performance, visit CardData ([www.carddata.com][2]).

CITIGROUP
North American Credit Card Net Revenues
3Q/04: $1067 million
4Q/04: $1190 million
1Q/05: $911 million
2Q/05: $861 million
3Q/05: $1003 million
Source: CardData (www.carddata.com

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

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UniCredit Adopts NCR Personas ATMs

UniCredit Banca of Milan has selected NCR Corporation to provide
151 new NCR “Personas M Series 86” automated teller machines with
NCR’s “No Envelope” deposit functionality. The image-based “No Envelope”
Deposit technology allows deposits to be accepted at the ATM without the
need of an envelope. The image of the deposited check is displayed on the
ATM screen and printed on the customer’s receipt, together with the totals
and breakdown by denomination of any cash deposited, providing UniCredit’s
customers with immediate proof of their deposit.

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AmEx Launches a San Diego Marketing Program

American Express has teamed with the San Diego Union-Tribune, the Gaslamp Quarter Association and local merchants to launch the “American Express San DieGO Downtown Marketing Program” website. The new marketing program is free of any administrative or promotional charge to the participating merchants if they agree to offer special incentives to American Express Cardmembers and honor those specials for consumers who have downloaded the appropriate offers and use their American Express Cards for redemption. Consumers who visit the page will be able to choose from among a wide variety of special incentives offered exclusively to American Express Cardmembers by dining, retail, entertainment, hotel, cultural, recreational and professional services enterprises.

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KIT Limited Selects Trintech’s ReconNET

KIT Limited Partnership has selected Trintech’s “ReconNET” to automate
the verification and reconciliation of its cash and credit cards and to
automatically assign, organize and prioritize its research incidents for
its chain of 481 restaurants. This will enable KIT to streamline
accounting processes and provide effective risk management and reporting
across its enterprise. KIT Limited Partnership owns and operates quick
service restaurants in seven provinces across Canada, serving 1.5
million customers a week. Trintech is a global provider of transaction
reconciliation and payment infrastructure solutions to retailers,
financial institutions, payment processors and network operators.

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Brits Oblivious to Card Spending Totals

Research by Egg Money, the UK’s first ever dedicated spending account, shows that British consumers are unaware of how much they spend each month on plastic, believing they spend over $600 a month less than they actually do. This lack of understanding means Britons spend over $350 billion a year on their cards of which they are unaware. One in two claim to be unsure how much they spend on cards, believing they spend just $733 a month. Actual industry figures show average amount much higher at $1359 a month or about $30 billion more. Consumers believe they spend $414 billion a year on plastic when real amount is actually $766 billion.

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