ADMS Picks up 8,000 Merchants at No Cost

Memphis-based American Merchant Data Service says the recent deal to add 8,000 merchants to its portfolio came at no cost since it involved an exchange of products and services. With the addition of approximately 8,000 merchants to its merchant portfolio, AMDS will add approximately 12 million transactions, which represent over $180 million of merchant volume annually.

Details

CTFS Options MasterCard Balances Up 24%

Canadian Tire Financial Services reported that its net managed credit card receivables increased 27% year-over-year to $2.5 billion, driven by a 24% increase in “Options MasterCard” average balances to $1,384. The “Canadian Tire Options MasterCard” currently makes up 96% of CTFS’ credit card portfolio. During the quarter, CTFS partnered with Bank of Montreal to launch the “Canadian Tire Commercial Link MasterCard” for business customers in the third quarter. The card will replace the existing commercial card that is held by more than 50,000 active Canadian Tire business customers. CTFS says estimates that its credit card portfolio will hit $2.8 billion by year end. For complete details on CTFS’ latest performance visit CardData (www.carddata.com).

Details

Credit Unions Grow After Unloading Card Portfolios

OR-based AssetExchange has released a study based on information filed with the National Credit Union Administration showing that credit unions that sold their credit card portfolios in 2001 or 2002 reported higher growth in both membership and loans-per-member than credit unions that did not sell their portfolios. According to the report average credit union membership grew about 8% from December 2000 to December 2003 among credit unions that sold their card portfolios, versus about 4.5% among credit unions that did not sell. Additionally, average dollars of credit union loans-per-member grew about 24% among sellers versus about 17% among non-sellers. Loans-per-member for sellers increased to about 30% if credit card loans on the outsourced credit card were included. The study analyzed approximately 2,400 credit unions that held credit card portfolios of over $1 million in 2000.

Details

VISA and Lucky Mag Launch a Wallet Weigh-In

VISA USA and Lucky Magazine have launched a national, month-long “Wallet Weigh-In” sweepstakes with a grand prize of a $2,000 VISA prepaid card, and ten $500 VISA prepaid card first prizes. With an increasing focus on “less is more” in today’s fashion trends, VISA USA and Lucky Magazine are encouraging people to share their personal stories and need for a wallet makeover.

Details

CyberSource Files a Lawsuit of ReD’s eBitGuard

CyberSource Corporation has filed a patent infringement lawsuit against Retail Decisions. CyberSource alleges that Retail Decisions’ “eBitGuard” product uses technology covered by its patent for “Method and System for Detecting Fraud in a Credit Card Transaction Over the Internet.” CyberSource says its application for the patent was filed in July 1997 and the patent was issued in February 2000. Retail Decisions says in the first seven months of this year “ebitGuard” accounted for approximately 3% of ReD’s group turnover and considerably less of its operating profit. ReD say it is investigating CyberSource’s claim, but says it is not aware of any patent infringement and believes the claim to be without foundation. If this proves to be the case upon further investigation, ReD says it will defend its position vigorously.

Details

Hudson’s Bay Selects the Rewards Network

Chicago-based Rewards Network has partnered with Hudson’s Bay Company to provide the “Hbc Rewards Dining & Hotels Program”. Members can now earn bonus points on purchases at participating restaurants and hotels. Bonus points can be redeemed for merchandise from the Hbc Rewards Cataloque and are in addition to already special low rates, competitive with leading online travel sites.

Details

MBNA Blasted for Promoting Credit Counseling Fee Caps

A national consumer advocacy group has called MBNA a hypocrite for publicly endorsing efforts by a number of state policymakers to place caps on the fees credit counseling agencies charge. Consumers for Responsible Credit Solutions says MBNA receives a sizeable portion of its own profits from high over-the-limit and late payment fees, which are far less reasonable, and in most cases, far more burdensome for consumers than credit counseling fees. CRCS says that in many cases, credit card fees are a significant share of the debt burden driving people to seek credit counseling in the first place. The group says that establishing such caps could backfire and hurt the very consumers they are intended to help. A recent CRCS report found that although fee caps are proposed as a pro-consumer measure, they really work to strengthen creditor control of the industry and work against the interests of consumers. Lawmakers in a number of states have proposed fee caps on credit counseling services, some as low as $20 for an initial set-up fee and no more than $20 per month to provide debt management services.

Details

VISA Signature Showcased During the Olympics

VISA has launched three new TV commercials for the “Olympics” touting the benefits of its “VISA Signature” card. The new ads feature the “Signature Song” of Frank Sinatra. Each of three spots highlights the advantages of “VISA Signature.” One ad promotes access to the hottest restaurants, while another promotes VIP treatment at “signature” resorts. The third spot highlights access to Pebble Beach golf. The new ads are part of a cross-media campaign (including Internet and print) spotlighting “VISA Signature” to the affluent cardholder. The campaign was launched in July at select airports and restaurants and followed this month with print, television and radio advertising. The six-year old “Signature” credit/charge card has produced approximately $80 billion in transaction volume. VISA says the “Signature” card program represents less than 3% of VISA cards in U.S. circulation, but accounts for 17% of VISA USA’s total credit volume. To view the new ads visit CardWatch® ([www.cardwatch.com][1]). (CF Library 7/12/04)

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

Details

Benny Card Producers Attract New Funding

CT-based Evolution Benefits, producers of the “Benny” benefits debit card, announced that Conning Capital Partners will co-led an $18.5 million investment in the firm. Evolution Benefit’s Benny Card allows employees to access flexible spending accounts, health reimbursement accounts, and new health savings accounts. Conning’s experience in the healthcare and financial services industries will serve as valuable expertise for Evolution Benefits as they continue to grow.

Details

Household’s V/MC C-Os Up; Private Label C-Os Fall

Household International reported that its net income rose 8.4% to $395 million during the second quarter. However, its VISA and MasterCard portfolio, which makes up 17% of the Company’s total managed receivables, has been contracting so far this year, after peaking at $21.1 billion in the fourth quarter of 2003. Household posted a sharp uptick in charge-offs for its bank credit cards during the second quarter, while delinquency edged down. VISA and MasterCard charge-offs hit 7.62% during 2Q/04, compared to 7.08% in the prior quarter, and 7.90% one-year ago. VISA and MasterCard delinquency, 60+ days, dropped to 4.21%, compared to 4.35% in the first quarter, and 4.19% for 2Q/03. Household, which issues the General Motors MasterCard, the Union Privilege cards, and the Orchard Bank sub-prime MasterCard, has experienced a 6% increase in bank credit card outstandings, from $19 billion one-year ago to $20.2 billion in the 2Q/04. Household also holds $17.5 billion in private label credit card outstandings. Private label delinquency (60+ days) declined to 4.81% in the second quarter, compared to 4.98% in the first quarter, and 5.16% for 2Q/03. Private label charge-offs also dipped to 4.92%, compared to 5.06% in the previous quarter, and 6.26% one-year ago. For complete details on Household’s second quarter performance, visit CardData (www.carddata.com).

HOUSEHOLD VISA/MC SNAPSHOT
Outstandings Delinquency* Charge-Offs
2Q/03 $19.0b 4.19% 7.90%
3Q/03 $19.8b 4.29% 7.12%
4Q/03 $21.1b 4.16% 7.03%
1Q/04 $20.3b 4.35% 7.08%
2Q/04 $20.2b 4.21% 7.62%
* 60+ days delinquency
Source: CardData (www.carddata.com)

Details