DXStorm Launches a Card with Loyalty Credit Capability

Ontario-based DXStorm says it is creating a “loyalty credit” card. The new card enables cardholders to be rewarded for their
purchase history by allowing them to complete purchases that exceed the amount of funds available on their card. The loyalty credit capability will be compatible with magnetic stripe cards as well as RFID cards featuring smart card technology. DXStorm is an e-Business Applications Service Provider and Developer.

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Arthur Blank to Use Infineon RFID Chips

Boston-based Arthur Blank has signed a deal to integrate Infineon’s packaged RFID chips into its card production process. The entire range of advanced production processes, including high quality six-color presses, high-speed laminators, and punch presses are available to any size RFID card order. Arthur Blank & Co., Inc.specializes in custom printed plastic cards. Infineon Technologies AG, with sales of Euro 7.19 billion, offers semiconductor and system solutions for automotive, industrial and multi-market sectors worldwide.

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Juniper Bank to Deploy Acxiom’s CII

Barclays Group’s Juniper Bank has chosen Acxiom’s information management solutions to reduce processing time and increase speed-to-market for more effective target marketing. In addition, Juniper will leverage Acxiom’s grid-enabled CII architecture to enhance Junipe’s analytics capabilities and marketing support infrastructure to determine the business impact of marketing campaigns, promotions and customer preferences. Juniper Financial Corporation, a member of the Barclays Group, is a full-service credit card issuer and provides co-branded credit cards and credit card services. Acxiom Corporation is a solutions provider for Customer Data Integration (CDI) technology, data, database services, IT outsourcing, consulting and analytics and privacy leadership.

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Optimum T2100 to Assist EMV Migration

Hypercom’s “Optimum T2100” card payment terminal has joined the “Visa Smart Breakthrough Acceptance Device Program” to facilitate EMV migration in Europe, Latin America and Asia. The Optimum T2100 includes high-speed transactions based on a 32-bit RISC processor with 12 megabytes of memory, stringent security achieving EMV 4.0 certification with secure casing, Visa PED certified and Triple DES and RSA cryptographic support. Hypercom’s card payment terminal, network and server solutions enable the processing of electronic payments in more than 100 countries.

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TBI VISA

Baghdad-based Trade Bank of Iraq has issued its first VISA payments
cards. The state-owned bank plans to issue about 30,000 “VISA Classic”
and “VISA Electron” cards by the end of this year. The first batch of
cards were distributed this week to ministers, government officials and
financial professionals in a ceremony at the TBI headquarters. The TBI
also announced plans to install Iraq’s first network of ATMs which will
enable VISA cardholders to withdraw
Iraqi dinars or US dollars from their accounts. The bank will initially
deploy 10 ATMs in the greater Baghdad area. UK-based Card Tech Limited
is providing the TBI with card issuing and acquiring processing
services. In March, Iraq’s Central Bank announced the formation of the
National Company for Limited Financial Services. The Basra-based firm
will specialize in issuing the “Al-Fayhaa” credit card via a partnership
with another Middle East Bank. The TBI was founded in 2003 and
capitalized at $100 million. (CFI Library 3/4/05; 5/10/05)

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MasterCard STV Volume Up 34% YTD

MasterCard reports that gross dollar volume on its prepaid programs has increased 34% year-to-date, compared to one-year ago. Last year, MasterCard and its partners launched nearly 800 new prepaid programs in the USA. The card network says prepaid represents one of the fastest growing segments in the payments industry. MasterCard estimates that the prepaid opportunity in the USA will reach $2.5 trillion by 2008. MasterCard this morning opened its third annual “Stored Value Forum” attended by about 300 payment industry professionals.

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QSR Volume Rises 57% in Q1 to $6.6B

Consumers charged $6.6 billion in quick service restaurants during the first quarter, a 57% increase over the year-ago period. Based on the current growth rate, the amount of fast food put on plastic this year should easily top $30 billion, capturing at least a 20% share of the U.S. QSR market. Last year, Americans charged $22.5 billion to their credit and debit cards in quick service restaurants. This year, several major chains, such as Burger King and VISA, have launched promotions to encourage card use. Also, the introduction of contactless payments in the QSR market may also help to accelerate card usage in 2005. Last week, VISA reported that its QSR volume was up 59.3% to $3.5 billion during the first quarter. VISA’s “Small Ticket Payment Service” volume, which includes the quick service restaurant category, was $22.6 billion, a 19.7% gain over 1Q/04. The QSR market is estimated to produce $140 billion in annual sales.

QSR Q1 HISTORICAL
2001: $0.6 billion
2002: $1.0 billion
2003: $1.9 billion
2004: $4.2 billion
2005: $6.6 billion
Source: CardData (www.carddata.com)

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Affluent Market Tops 13MM Households

A new study shows that the number of U.S. households with a net worth of $1 million or more increased 21% last year. A net gain of 1.3 millionaires were added to the segment during 2004, bringing the total number to 7.5 million. The measure excludes the value of the primary residence. The research by the Chicago-based Spectrem Group also found that those with $5 million in net worth, also excluding primary residence, increased 38% in 2004 to a record 740,000, a net increase of 200,000. In terms of the overall affluent market, which comprises households with a net worth of $500,000 or more, excluding primary residence, 25% growth in 2004 brought the total to 13.1 million, from 10.5 million the year before.

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HBC Financial Services Q1 Revenues Decline 6.5%

Revenue for Hudson Bays’s Financial Services division declined 6.5% in the first quarter to $76.4 million due to a reduction in
service charge revenue from lower credit card receivables. Credit card receivables dropped 23.8% over the past year from $443.8 million for 1Q/04 to $337.8 million in 1Q/05. The decrease in credit card receivables reflected the impact of lower store sales and higher customer payments, offset partly by a higher credit blend. The average balance per active customer account was down 9% to $417 but, the average volume per active customer account increased 2.2% to $183. As of April 30th, there were 2.9 million active Hbc customer accounts (1.6 million Bay cardholders and 1.3 million Zellers cardholders). For complete details on HBC’s first quarter performance visit CardData (www.carddata.com).

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CO-OP and Instant Cash Open a Gateway

CO-OP Network and Wells Fargo’s Instant Cash ATM network have opened a gateway link enabling credit unions that use ICS as their EFT processor to join the CO-OP Network for surcharge-free nationwide ATM access. Instant Cash Services serves the credit union community with advanced payment processing solutions. CO-OP Network is wholly-owned by its credit union shareholders with more than 1,770 credit union members, 19,500 surcharge-free ATMs, 80 million plus monthly transactions and 20 million cardholders.

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VISA T&E Rises Despite Lower Tickets

VISA reports that travel and entertainment spending volume on its payment cards from January 1st through mid-May has increased by 15%, compared to the same period in 2004. During the first quarter, VISA racked up approximately $58.8 billion in US T&E spending, about 17% of the network’s overall volume. The VISA T&E gain comes amidst a general decline in the average ticket price in most categories. Dining volume on VISA payment cards increased 21% this year, but the average ticket price has dropped 10% to $24.36. Airline tickets on VISA cards is up 11% and car rental card volume is up 9%, however the average individual transaction for both airline tickets and car rentals declined 3% to 7% across the board. Unlike the other major T&E categories, the average lodging ticket has increased almost 4% this year to $195.76. VISA’s lodging volume is up 9% year-to-date. VISA predicts a strong gain in T&E volume during the summer.

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