Euronet Worldwide has signed a deal to resell eClassic’s “ATM Manager Pro” software solution worldwide. ATM Manager Pro is a leading ATM channel management software solution currently supporting more than 150,000 ATMs and provides a fully integrated suite of software modules that address all aspects of ATM channel management. Euronet Worldwide is an industry leader in processing secure electronic financial transactions. e-ClassicSystems, Inc., a wholly owned subsidiary of Jack Henry & Associates, Inc. (Nasdaq: JKHY), (www.jackhenry.com), provides a suite of integrated software systems that enable banks, credit unions and independent sales organizations (ISOs) to proactively manage their ATM networks in a fully automated, centralized environment.Details
San Francisco-based Pay By Touch has teamed with CA-based MTXEPS to jointly sell, market, and support an integrated solution of “WinEPS” and “Pay by Touch”. As a result of the MTXEPS alliance, solution providers such as Retalix USA and StoreNext will begin offering Pay By Touch to customers. Retalix USA has received an increase in customer requests for a more efficient age verification system — one of the key offerings in the Pay By Touch product suite. Pay By Touch is a payment service that allows shoppers to pay for purchases or cash checks using a finger scan linked to their personal identification information, financial accounts and loyalty programs.Details
Barclays reported that 2004 profits from its Barclaycard division rose 5.3% from 2003. Since 1998, Barclaycard profits have more than doubled from $707 million to $1.513 million and assets grew 13.1% last year to $43.49 billion. The issuer noted that the modest profit increase was due to higher volumes that more than offset margin pressure and the impact of considerable investment in both the U.K. and the international card businesses. In the U.K., Barclaycard manages the Barclaycard branded credit cards, Barclays branded consumer loans (mostly Barclayloan) and also comprises FirstPlus, Clydesdale Financial Services and Monument credit cards. Outside the U.K., Barclaycard International is in the United States, Germany, Spain, Greece, Italy, Portugal, Republic of Ireland and across Africa. The acquisition of the U.S. credit card issuer Juniper Financial Corporation was completed on December 1st. Juniper provides a platform for the expansion of Barclaycard into the U.S. credit card market and specializes in partnership card issuance programs. For complete details on Barclaycard’s fourth quarter performance, visit CardData ([www.carddata.com]).
Shell Oil Products reported that its gasoline station network doubled sales of “Shell Gift Cards” last year to nearly $150 million. More than a third of 2004 sales came in December alone. The number of retail locations selling Shell Gift cards increased over 260% during 2004. Last year, “Shell Gift Card” sales were up 62% overall, which includes sales to other businesses, Shell’s Retail network, and retail sales through Safeway and Walgreens stores. Participation in the “Shell Gift Card” program is voluntary in the company’s network of approximately 13,000 independently managed Shell-branded U.S. sites. In 2003, the “Shell Gift Card” program generated more than $70 million in sales. Approximately 85% of those sales were categorized as “incremental volume.” (CF Library 4/20/04)Details
The number of Starbucks activated prepaid cards nearly doubled last year from 25 million to 48 million. Last week, Starbucks announced its first-ever collectible card bearing the image of Seattle Mariner superstar Ichiro Suzuki. Starbucks launched its stored value card in November, 2001 and signed up 2.3 million cardholders within the first two months. In October 2003, Starbucks and Bank One issued the “Starbucks Card Duetto VISA”, a card that combines a re-loadable stored value card with a general purpose credit card. The new Ichiro Suzuki card will generate funds for the Make-A-Wish Foundation in Japan and the Starlight Starbright Children’s Foundation in the U.S. The new collectible Starbucks Card will be available at Starbucks stores in Japan, Washington State and Oregon beginning April 4th. (CF Library 2/27/04)
PREPAID CARDS ACTIVATED
2001: 2.3 million
2002: 10.8 million
2003: 24.7 million
2004: 48.1 million
Source: CardData (www.carddata.com)
Canadian Tire Financial Services reported that its net managed credit card receivables, for the fourth quarter, increased 15% year-over-year to $2.79 billion. The average credit card balance in the fourth quarter hit $1525, up 31% from one-year ago, largely driven by its “Options MasterCard” product. For 2004, the average credit card balance came in at $1436. Fourth quarter pre-tax earnings for CTFS were up 7% to $46.5 million. Net credit losses for the quarter ended January 1st, were $39.5 million, compared to $32.0 million one-year ago. The Company said credit card write-offs for the fourth quarter and the total year were similar to prior year levels and remain within the targeted rate of 5% to 6% of managed receivables. This year CTFS is expanding its personal loans program, which was successfully test-marketed in 2004.
For complete details on Canadian Tire Financial Services’ fourth quarter performance visit CardData (www.carddata.com).
Comdata’s Stored Value Systems has been greenlighted by the federal Food and Nutrition Service to proceed with its “Online WIC” EBT card-based transaction service. WIC, a federally funded supplemental nutrition program for Women, Infants and Children, is traditionally executed using a paper voucher system. SVS’ online version will eliminate paper and replace it with a plastic card making checkout at the register faster as well as cheaper for merchants to implement since, unlike smart cards, it does not require investment in special reader equipment. Comdata Corporation (www.comdata.com) is redefining the movement of money and information through technology for businesses, their customers and employees.Details
A new study has found that consumers are holding $9 billion in unredeemed value on gift cards received during the holidays. The research also found that gift cards generated about $18 billion in retail sales during December and January. According to the report by Deloitte & Touche, adults received 3.2 gift cards during the holiday season just ended, compared to 2.5 one-year ago. This year’s 3.2 cards had a total face value of $142.98. More than six out of ten gift cards received by adults had been fully or partially redeemed by the end of January. General purpose, or bank-issued gift cards, were the type most likely to have been used by the end of January. Nearly three-quarters of these cards have already been fully or partially redeemed. Deloitte & Touche said that if consumers continue to spend unredeemed cards in a similar fashion as they did in December and January — that is, some consumers purchase more than the face value of their cards — then the unredeemed gift cards of $9 billion could have the potential to add as much as $13 billion to retail sales.
GIFT CARD TYPE RECEIVED
General Purpose: 10%
Personal Service: 5%
Internet Site: 5%
Source: Deloitte & Touche
Electronic Clearing House reported that revenues for the fourth quarter increased 11.1% to $12.8 million. Bankcard and transaction processing revenue increased 4.9% to $9.2 million, compared to one-year ago. The increase was primarily due to the organic growth in bankcard processing volume from ECHO’s existing and new merchants. Gross margins from processing and transaction revenue was 35.4% for the quarter, as compared to 38.5% for the same period last year. Check-related revenue increased 31.0% to $3.6 million with continued success in the “Visa POS Check” program. For complete details on ECHO’s latest performance visit CardData ([www.carddata.com]).
TowerGroup is using the theme of “Road Map for Growth” for its upcoming “2005 Financial Services Business and Technology Conference” to be held in Boston in late May. TowerGroup is the leading advisory research and consulting firm focused on the global financial services industry.Details
Average charge-offs, net of recoveries, declined 25 basis points last year, for the top five issuers with aggregate managed U.S. credit card outstandings of $444 billion. Charge-offs peaked in the second quarter at 5.60%, dipped to 5.06% in the third quarter, before ending the year at 5.22%. Bank of America was the only top five issuer to post an uptick in charge-offs between 4Q/03 and 4Q/04. BofA’s charge-offs for fourth quarter of 2004 were 5.90%, compared to 5.14% one-year ago. The largest improvement was reported by Citibank where charge-offs fell 58 bps to 5.59%. MBNA and Chase posted a 54 bps and 52 bps improvement, respectively, during 2004, while Capital One knocked 30 bps off its average charge-offs. For complete details on delinquency and charge-offs by the top ten issuers visit CardData ([www.carddata.com]).
TOP FIVE CHARGE-OFF HISTORICAL
Source: CardData (www.carddata.com)
The growth in fees for exceeding the credit limit slowed down last year as the average crossed the $30 milestone. However, more top issuers, such as MBNA and Chase, are now charging fees for exceeding the credit limit at any time during the billing cycle instead of just the billing cycle closing data. During 2004, the average over-limit fee increased 3.8%, compared to 4.8% in 2003, and 32.3% in 1997. Between 1994 and 1999, over-limit fees grew 96%, from $12.75 to $24.96. During 2004, the most common over-limit fee among major issuers was $35, although some issuers charge $39 for accounts with higher balances.
OVER-LIMIT FEE HISTORICAL
Year Average Y/Y CNHG
1994: $12.75 +2.6%
1995: $13.20 +3.5%
1996: $13.94 +5.6%
1997: $18.44 +32.3%
1998: $21.14 +14.4%
1999: $24.96 +18.1%
2000: $25.99 + 4.1%
2001: $26.88 + 3.4%
2002: $27.89 + 3.8%
2003: $29.23 + 4.8%
2004: $30.35 + 3.8%
Source: CardData (www.carddata.com)