USA Technologies Adds Another Patent

Pennsylvania-based USA Technologies, a specialist in wireless non-cash transactions, has been granted a patent for certain technology within its new versions of “VendingMiser” and “CoolerMiser. Both are devices that conserve electricity when installed in vending machines and refrigerated coolers. USA Technologies provides networking of distributed assets, wireless non-cash transactions, associated financial/network services and energy management.

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Mexicana Airlines VISA Promotion Kicked-Off

Bank of America and Mexicana Airlines have kicked-off a promotion for the “Mexicana Airlines VISA Platinum,” offering a free companion ticket after a first purchase and a $99 companion ticket coupon annually afterwards. This is the first airline card to offer this type of reward and the first Mexicana Airlines card in the US. Bank of America serves 33 million consumer relationships and serves clients in 150 countries. Mexicana Airlines is Mexico’s airline and flies to more than 50 destinations in North, Central and South America and the Caribbean.

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CO-OP Network Gets a New Board Chairman

David Maus, the President/CEO of Colorado’s Public Service CU, has been elected CO-OP Network Chairman of the Board. Maus is the past Chairman of the Credit Union National Association (1999-2001) and past Chairman of the Governmental Affairs Committee. He received a gubernatorial appointment in 1993 to serve on the Division of Financial Services Board (the regulatory agency in Colorado overseeing state chartered credit unions and savings and loans) and he’s the current Chairman of CU Direct Connect, the Colorado Credit Union Indirect Lending Association. CO-OP Network is wholly-owned by its credit union shareholders with more than 1,770 credit union members and 20 million cardholders.

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Colorado the Next Market to Get Blinked

Chase confirmed that Colorado is next metro area slated for its new contactless credit card called “blink.” Chase has started delivery of the new cards with “blink” to more than 500,000 Colorado cardholders. There are more than 400 merchant locations in 63 cities across Colorado, including Arby’s, 7-Eleven, Regal Cinema’s and Walgreen’s that will honor “blink.” Colorado will be the first state west of the Mississippi to receive the new blink technology. To support the effort, Chase will launch an integrated statewide marketing campaign, including print, broadcast and billboard advertising.

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49MM Wealthy Gen Xers in the U.S. Market

A new American Express survey has found that there are now 49 million wealthy members of “Gen X”, compared to 78 million wealthy members of “Baby Boomers.” Overall, the wealthy members of “Gen X” have an average income of $213,000 and spend 18% more than the “Boomers” on luxury goods annually. AmEx says the difference is made more significant by the fact that the average income of wealthy “Baby Boomers,” $222,900, is similar to “Gen X.” However, “Gen X” spending far exceeds the “Baby Boomers” in beauty products, fashion accessories, clothing, and liquor.

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Encore Capital Acquires Jefferson Capital

Encore Capital Group has acquired the assets from Jefferson Capital, a subsidiary of CompuCredit for $142.8 million in cash. The deal includes a portfolio of charged-off consumer credit card debt with a face value of approximately $2.9 billion and an agreement to purchase an additional $3.25 billion in face value of fresh, credit card charge-offs from Jefferson Capital over the next five years at a fixed price. Encore also picks up a new collection site in St. Cloud, Minnesota with approximately 120 employees. To facilitate the transaction, Encore inked a new three-year, $150 million revolving credit facility with JPMorgan Chase.

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Revolving Debt Does its April Dip Again

Revolving consumer credit slipped a bit in April, dropping a tad below $796 billion. Americans shaved off $500 million in revolving credit during April compared to $2.6 billion one-year ago. Monthly payment rates continue to dampen growth in credit card debt. The higher payment rates are a combination of low interest rates for mortgages/home equity, improved consumer credit score knowledge and rising debit card usage. According to the Federal Reserve, Americans owed $795.9 billion in revolving credit at the end of April, compared to $796.9 billion for January. One-year ago revolving credit stood at approximately $740.9 billion. The annual growth rate is now a negative 0.6%, compared to a negative 0.9% in the previous month and -5.3% one-year ago. Bank credit card debt (excluding store and gas credit cards) at the end of the first quarter was about $659 billion, or roughly 83% of total revolving credit, according to CardData ([www.carddata.com][1]). At the end of April, Americans were $2130.5 billion in debt, excluding home mortgages.

REVOLVING CREDIT HISTORICAL ($billions)
Apr 05 Mar 05 Feb 05 Jan 05 Dec 04 Nov 04 Apr 04
GRWTH: -0.6% -0.9 1.9 6.3 3.8 0.9 -5.3
$OWED: $795.9 796.4 796.9 796.9 793.0 784.0 740.9
Source: Federal Reserve; revised figures as of 6/07/05;
For complete historical data, visit CardData (www.carddata.com)

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

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Merchant Debit Card Refunds Set to Start

NY-based Constantine Cannon, f/k/a Constantine & Partners, said yesterday that all appeals in the “VISA Check/MasterMoney Antitrust Litigation” to the Supreme Court have been denied or expired on May 31st. Therefore, the settlement of $3.383 billion in compensatory relief and an injunction valued by the court in the range of $25-$87 billion will begin distribution to U.S. merchants. Constantine Cannon says merchant advisories will follow in the coming weeks prior to the actual mailing of the claim forms to merchants concerning the process for making and paying monetary claims on the settlement fund. In December 2003, the U.S. District Court in Brooklyn, New York gave final approval of the settlement and of a plan to allocate and return monetary relief to merchants. Since then, there have been three appeals to the U.S. Court of Appeals for the Second Circuit. (CF Library 1/11/05)

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Decru and Network Appliance Unveil CardVault

California-based Decru and Network Appliance unveiled a joint solution to enable secure storage of credit card data and to support compliance with new mandatory “PCI” security standards. Requirement 3 of the PCI standards directs organizations to encrypt and make unreadable sensitive cardholder data anywhere it is stored. The CardVault solution secures stored data with a combination of AES-256 encryption, authentication, access controls, and tamper-evident logging. Decru develops storage security solutions to address a range of business needs. Network Appliance provides unified data storage solutions.

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Pepperdine University VISA Cards Launched

U.S. Bank has agreed to issue affinity cards for the Pepperdine Alumni Association. Alumni will have access to three credit card products offered through the partnership, including one that earns reward points that can be redeemed for gift certificates, merchandise and travel rewards and another that provides cash back on purchases. Based in Malibu, Calif., Pepperdine University is an independent, medium-sized university enrolling approximately 8,300 students in five colleges and schools. U.S. Bank is a subsidiary of U.S. Bancorp, the 6th largest financial holding company in the US with $198 billion in assets.

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InfiCorp to Issue PETA VISA Platinum Cards

Atlanta-based InfiCorp Holdings has teamed with the People for the Ethical Treatment of Animals to launch a suite of “PETA/VISA Platinum” cards. Every time a cardholder makes a purchase using their PETA card, a portion of that sale goes to fund educational programs designed to teach children and adults to respect and show compassion for all living beings. InfiCorp Holdings, Inc.is a specialty credit card company and marketer of client branded credit card products and services. Founded in 1980 and now up to 800,000 members and supporters internationally, PETA is dedicated to establishing and protecting the rights of all animals.

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HSBC Buys the Neiman Marcus Card Portfolio

HSBC-North America has agreed to purchase the private label credit card portfolio of Neiman Marcus for $640 million. The Neiman Marcus and Bergdorf Goodman portfolio comprises a total of approximately 3 million accounts. The purchase price includes approximately $527 million in net cash proceeds and the assumption or repayment of approximately $113 million of the Company’s securitization liabilities. In addition, the Company will receive on-going payments related to credit sales generated under the new agreement. The transaction is expected to close on July 31st.

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