HMV Issues One Million Gift Cards

HMV, the largest retailer of music, DVD and games in the UK has launched a gift card via TSYS and the Royal Bank of Scotland. Launched in October, the card has passed the one million gift card milestone. The
non-denominated, re-loadable cards are now available in HMV’s 200 stores
throughout the UK, and can be activated in amounts ranging from GBP1 to GBP500. The parent company, HMV Group plc, also owns 189 Waterstone’s specialist book stores in the UK and Ireland, and plans to offer a Waterstone’s gift card in 2005.

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Patent Sought for a Bill Pay via a STV Card

Payment Data Systems filed the final application for patent protection for the technology that will enable the industry’s first bill payment capability using the stored-value Secure Cash Network debit card. It does not require linkage to a traditional checking or savings account. Payment Data Systems, Inc. is an integrated payments solution provider for billers and retailers.

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MTV MASTERCARD

MTV Network Asia and GE Consumer Finance have teamed to launch a new MasterCard aimed at recent college graduates. The “MTV MasterCard” will offer discounts to certain merchants as well as access to the “MTV Music Awards” and “MTV Summer Summit Concerts” in the Asia-Pacific region. To qualify for the card, applicants must earn at least Rp 26 million per year (US$2776) and be at least 21 years old. MTV also has a partnership with United Overseas Bank Limited for a co-branded MasterCard in Singapore. Additionally, MTV partnered with Lippo Bank in Indonesia to offer a debit card to high school and college students.

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Bankruptcy Card Losses Top $90B Since 1999

The bank credit card industry has lost more than $122 billion to personal bankruptcies since the introduction of bankruptcy reform legislation in Congress eight years ago. Since 1996, charge-offs cumulatively total $282 billion, peaking at nearly $50 billion in 2002. Therefore, bankruptcy losses are significantly higher than $122 billion as charge-offs are discharged in subsequent years. In 1995, bankruptcy-related charge-offs were $4.6 billion, or 30% of gross charge-offs. In 2001, bankruptcy-related charge-offs doubled from year 2000, from $9.9 billion to $19.1 billion, comprising 48% of all charge-offs. Last year, bankruptcy losses edged down to $16.5 billion as the number of petitions declined.

BANK CREDIT CARD BANKRUPTCY LOSSES
($ billions)
YEAR RECV C-O C-O BR NET
1995: $358 4.31% $15.4 30% $ 4.6
1996: $412 4.85% $20.0 41% $ 8.2
1997: $444 5.63% $25.0 42% $10.5
1998: $454 5.49% $24.9 42% $10.5
1999: $490 4.98% $24.4 40% $ 9.8
2000: $569 4.58% $26.1 38% $ 9.9
2001: $608 6.55% $39.8 48% $19.1
2002: $661 7.51% $49.6 47% $23.3
2003: $677 7.22% $48.9 46% $22.5
2004: $698 6.22% $43.4 38% $16.5
RECV-year-end receivables; C-O: charge-offs; BR- percentage
of charge-offs in bankruptcy; NET: net losses due to bankruptcy.
Source: CardData (www.carddata.com)

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Cap One’s Feb Charge-Offs and Delinquency Dip

Capital One’s charge-off and delinquency ratios headed down in February. Charge-offs dropped 13 basis points from the prior month and delinquency decreased 19 basis points from January. Compared to one year ago, charge-offs are down 79 bps and delinquency is down 49 bps. The downtick was helped by a $2.6 billion increase in total loans. For February, Cap One reported that managed charge-offs decreased to 3.96% in February, compared to 4.19% in January, and 4.75% one-year ago. In June 2003, Cap One’s managed charge-off ratio stood at 6.20%. Delinquency decreased to 3.65% for February, compared to 3.84% in January, 3.92% for December, 3.87% for November, 3.94% in October, and 3.90% for September. Delinquency one year ago stood at 4.14%. At the end of February, Capital One had $81.9 billion in global outstandings. At the end of the fourth quarter, U.S. card outstandings of $48.6 billion were up 5%, compared to one year ago, and to the previous quarter. For complete details on Capital One’s monthly metrics and 4Q/04 performance, visit CardData ([www.carddata.com][1]).

Capital One 2004-2005
Month Charge-offs Delinquency
Feb 04 4.75% 4.14%
Mar 04 4.74% 3.80%
Apr 04 4.70% 3.69%
May 04 4.40% 3.73%
Jun 04 4.17% 3.76%
Jul 04 4.10% 3.77%
Aug 04 3.87% 3.80%
Sep 04 4.18% 3.90%
Oct 04 4.10% 3.94%
Nov 04 4.35% 3.87%
Dec 04 4.63% 3.92%
Jan 05 4.19% 3.84%
Feb 05 3.96% 3.65%
Source: CardData (www.carddata.com)

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

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Welcome Real-time Powers a Pakistan VISA

Pakistan’s United Bank Limited has launched its first VISA smart credit card. The new “UBL VISA” offers instant “Chip Rewards,” “RoadMiles,” and “Talk-Time.” The new card is powered by Welcome Real-time’s “XLS” software. UBL’s acquiring partner, RFM Loyalty, uses “XLS Server” to manage a network of payment terminals, which are equipped with a payment application developed using “XLS POS” software libraries. The “RoadMiles” feature offers free petrol every month based on spending. “Talk-Time” offers free phone minutes based on total spending, in addition to a free connection. UBL has more than 1,000 branches in Pakistan and a customer base of more than 3.5 million. RFM Loyalty is Pakistan’s only smart card solution provider. Welcome is a provider of payment software that utilizes the full capabilities of EMV standard chip credit and debit cards.

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Senate Vote on Bankruptcy Reform Delayed

The “Bankruptcy Abuse Prevention and Consumer Protection Act of 2005” is expected to take a final vote today in the U.S. Senate. The bill was delayed yesterday after Senators Paul Sarbanes, John Warner, and Patrick Leahy proposed an amendment to prohibit an investment bank that advises a company before it files for bankruptcy from continuing to advise it after the company is in bankruptcy. However, other amendments proposed yesterday were voted down. Senator Edward Kennedy’s amendment to cap the homestead exemption at $300,000 was rejected. Senator Chris Dodd’s amendment to permit larger education payments and to protect child support payments was also rejected.

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Oberthur Smart Card Sales Rise 16% in 04

Oberthur Card Systems reports that sales for last year reached 450.8 million euros, a 7% year-on-year increase before parity impact, and 4.8% at current rates. During this period, Oberthur delivered 148.3 million micro-processor cards, a 16% increase compared with last year, while the average selling price declined by 5.5% at constant exchange rates. The Company said there was an explosion of micro-processor payment cards, especially in the UK, which triggered an increase of +39.6% in shipments and +34.6% in sales. Also, continued and sustained increase of banking personalization services in Europe resulted in +18.2% growth. In the banking segment, Oberthur expects EMV deployments to accelerate over the next two years in Italy, Spain, Turkey, Thailand, China, Russia, Brazil and Mexico. For complete details on Oberthur’s latest results, visit CardData ([www.carddata.com][1]).

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

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