GLOBAL E-VISA

Payment card transactions via the Internet will celebrate its tenth anniversary this month. VISA says its on track to top $150 billion in e-commerce sales for this year, a five-fold increase since 2001. VISA says its global Internet volume is up 56% over 2003. Online VISA sales originate in over 90 countries, purchased with VISA cards issued in over 150 countries. VISA notes that a secure foundation coupled with increased demand for specialized products not offered in local markets continues to drive cross-border transaction volume growth. Cross-border transactions now represent 16% of all VISA e-commerce transactions, up from 15.2% a year ago. Average e-commerce transaction value at $107 versus $70 in the physical card acceptance environment.

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Global Payments Renews its Canadian Funding

Atlanta-based Global Payments has renewed its US$146 million Canadian revolving credit facility agreement for its Canadian merchant settlement process. The term of the credit agreement is 364 days and can be extended for another 364 days if both parties are in agreement. Global Payments, Inc. is a chief provider of electronic processing services to consumers, merchants, Independent Sales Organizations (ISOs), financial institutions, government agencies, and multi- national corporations in the U.S., Canada, Latin America, and Europe.

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HSI Canada Micros and Radiant Launch Pay@Table

HSI Canada Micros and Radiant Communications has teamed with Ingenico to launch a new integrated hospitality solution. The new solution features Ingenico’s “i7700” terminal range, a new
generation of short-range wireless transaction terminals that are part of Ingenico’s new “Pay@Table” solutions. The Micros suite of hospitality
systems provides the customers data to this terminal, which enables the
check details to be printed out. The server simply accesses the table number and all that the table has ordered by the touch of a button on the “i7770.” The Micros system then sends the data to the terminal for printing. All payment activity can take place at the table, therefore reducing the amount of time a server uses to check-out a customer by as much as one-third or more.

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Cardholder Fees May Top $23 Billion for 2004

Cardholder fees have more than doubled since 1996 following a Supreme Court decision that gave national bank credit card issuers federal preemption of state regulations. Last year, revenues generated from late payment fees, over-limit fees, annual fees, balance transfer fees, cash advance fees, and, other user fees, grew 8.6% to $21.5 billion. Between 1996 and 1997, cardholders fees jumped 48%, according to CardData ([www.carddata.com][1]). R.K. Hammer Investment Bankers estimates that penalty fee revenues were $11.7 billion last year. Other 2003 fee revenues include cash advance fees of $5.6 billion, annual fees of $3.4 billion, and fees from enhancements of $860 million. (CF Library 1/12/04)

Bank Credit Card Annual Credit Card Cardholder Fees
(VISA, MasterCard, Discover, American Express)
($ billions)
YEAR TOTAL
1980 $2.6
1985 3.9
1990 6.2
1995 8.3
2000 20.6
2003 21.5
Source: CardData (www.carddata.com)

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

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50% of Americans Jittery About Online Shopping

According to a new survey, 58% of consumers say they may reduce their online shopping during the holiday season this year because of identity theft and other privacy concerns, compared t0 49% one-year ago. The second annual online shopping study conducted by TNS and TRUSTe indicates that 46% of Internet shoppers say they buy only from e-tailers that have a privacy statement or seal. The leading reasons cited by those reducing or halting online shopping include: identity theft concerns (52%); fear of credit card theft (44%); spyware potentially being downloaded onto one’s computer (44%); and, receiving spam after purchasing from a Web site (42%).

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Digital Duo Card Hits RadioShacks

Napster and Blockbuster have teamed to introduce the “Digital Duo Card” at 5,000 RadioShack stores, offering consumers one month of digital music and online DVD rentals for $20. The Digital Duo card enables consumers to enjoy unlimited access to Napster’s song library, two a la carte track downloads, and unlimited Blockbuster Online DVD rentals with up to three movies rented at a time along with two free in-store movie or game rentals for the duration of the card. DVDs rented online will be delivered to the customer’s mailbox and no late fees or return dates will be enforced. Two free in-store rental coupons per month for “gotta-have-it-now” rentals are also included in the service. Napster® is the world’s largest brand in digital music. Blockbuster, Inc. is a world-leading provider of in-home movies and game entertainment. The company has over 9,000 stores in the Americas, Europe, Asia, and Australia.

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Inspired Coins TV Ad Campaign Gets Underway

Coinstar launched its first TV advertising campaign yesterday with ads created by Publicis Seattle. The “Inspired Coins” campaign promotes Coinstar machines, which enable people to turn accumulated loose change into a “splurge.” In the commercial, coins are seen all over a house. They are then gathered up into the shape of a woman’s stylish, high-heeled shoe as a voice over asks viewers “What could your change be?” The campaign will air on cable TV for four weeks on networks such as MTV, TLC, USA, and Sci-Fi Channel. Coinstar, Inc. launched self-service coin counting to help consumers convert loose coins into cash. Publicis Seattle is a unit of Publicis USA and Publicis Worldwide, which represent part of the Publicis Groupe S.A., the 4th largest communications company, as well as one of the fastest-growing communications companies in the world.

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Jack Henry Acquires NC-based Optinfo

Jack Henry & Associates has purchased NC-based Optinfo, a provider of software products and services that help financial institutions mitigate the risks associated with their financial and operational data. Optinfo’s products and services are used by some of the No. 1 banks and brokerage firms around the world. Optinfo is used for reconciliation, exception processing, and management of data elements. According to Kevin D. Williams, CFO of Jack Henry, the acquisition is expected to generate $1.5 to $2 million in gross revenues for the rest of the current fiscal year. Jack Henry & Associates, Inc. provides integrated computer systems and processes ATM/debit card/ACH transactions for banks and credit unions.

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V/MC Purchase Transactions to Hit 24 Billion

Quarterly purchase transactions on VISA- and MasterCard-branded cards topped 6 billion for the first time during the third quarter. Based on the current 12% growth rate, purchase transactions on credit card and signature debit cards could approach 6.5 billion for the fourth quarter. There were 23.2 billion total purchase transactions during the past four quarters. The 2004 figure will likely approach 24 billion. The average VISA purchase transaction is now $59.19 compared to MasterCard’s $76.77. The lower VISA figure is due to its dominance in the signature or off-line debit card market wherein it holds a 79% market share. The average off-line debit purchase transaction is $39.78 while the average credit card purchase transaction is $84.63, according to CardData ([www.carddata.com][1]).

VISA and MasterCard Purchase Transactions
3Q/03: 5.43 billion
4Q/03: 5.79 billion
1Q/04: 5.42 billion
2Q/04: 5.90 billion
3Q/04: 6.08 billion
4Q/04: 6.48 billion
Source: CardData (www.carddata.com)

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

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