Checkpoint Systems Expands RFID at the POP

NJ-based Checkpoint Systems has made a minority investment in GOLIATH Solutions, a start-up developer of RFID based technology for point-of-purchase advertising. Annually, consumer packaged goods companies spend some $17 billion in trade development dollars to produce, distribute and monitor their promotional displays and signage to increase sales. However, about 50% of the time, their displays are not deployed in a timely and consistent manner. GOLIATH Solutions designs and delivers RFID solutions that track and report the presence/value of advertising and displays in retail stores. Checkpoint Systems, Inc. is a multinational manufacturer and leading provider of product identification and shrink management solutions for the consumer packaged goods and retail industries.

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U.K. Banks Eyeing U.S. Card Market

Less than one week after the Royal Bank of Scotland announced its planned acquisition of CT-based People’s Bank entire credit card business, there is renewed speculation that Barclays and Lloyds TSB are making a run at San Francisco-based Providian’s credit card business. Interestingly, both U.S. banks were previously active in the U.K. credit card business. In April 2002, Barclaycard completed its acquisition of Providian Financial’s U.K. card business. The deal represented $543 million in receivables and approximately 500,000 accounts. Barclaycard took ownership of Providian facilities in London and in Crawley which employed 600 people. In April 2001 People’s Bank sold its U.K. credit card portfolio to Citigroup International PLC for approximately $526 million. Last week, the Royal Bank of Scotland confirmed plans to purchase People’s $2.3 billion credit card business for a 15.5% premium. Providian currently has $16.9 billion in U.S. credit card outstandings and 10.5 million accounts.

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OPC Enters Franklin County, Ohio

Official Payments Corp. has signed a deal to enable property owners in Franklin County, OH to pay their real estate taxes via a credit card. Official Payments provides credit card payment services for the Internal Revenue Service, 22 states, the District of Columbia, and more than 1,400 local government clients nationwide. Official Payments’ principal business is collecting credit card payments on behalf of government entities. Tier is a provider of transaction and online payment processing and packaged software and systems implementation services primarily for federal, state and local government clients.

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Corillian 4Q/03 Revenues Up 21%

Corillian reported fourth quarter revenues of $12.2 million, compared to $10.1 million for 4Q/02, a 21% increase. Net income was $2.1 million, compared to a net loss of $1.5 million in 4Q/02. The online banking solutions provider achieved profitability last year. During 2003, end user adoption for Corillian customers grew more than 50% to 14.0 million users at the end of 2003. Corillian “Voyager 3.0” had 14 customers migrating to its platform last year. During 2003, Corillian signed strategic partnership agreements with NCR, CashEdge, Centerpost and Hipbone. Corillian anticipates that first quarter 2004 revenues will be in the range of $11.0 to $12.0 million. For more details on Corillian’s latest performance visit CardData ([www.carddata.com][1]).

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

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Top 10 Grew 6.5% Last Year; Hold 77% of the Market

In terms of organic growth, Bank of America, Capital One, and American Express led the U.S. credit card industry with double digit gains in receivables and profits last year. The nation’s top ten bank credit card issuers grew an average of 6.5% during 2003, holding aggregate card loans of $538.9 billion, approximately 77% of the total U.S. market. Citigroup, the nation’s #1 ranked issuer would have slipped to second place had it not been for the acquisition of the Sears MasterCard portfolio in November. Citigroup card loans increased $7.4 billion during 2003 as it added $13 billion in Sears MasterCard card loans during the fourth quarter. Indeed, Citigroup’s organic growth was negative in every quarter of 2003. Bank of America led the top issuers with a 24% gain in outstandings. BofA also led with a 25% in card profits, according to CardData ([www.carddata.com][1]). Discover was the only issuer to post a portfolio contraction. However, Discover data does not reflect the impact of the December holiday season. (CF Library 2/4/04)

Top 10 U.S. Issuers by Card Loans
RANK/ISSUER 4Q/03 4Q/02 Y/Y
1. Citigroup $119.8b $112.4b + 6.6%
2. MBNA $ 85.8b $ 79.5b + 7.9%
3. Bank One $ 76.3b $ 74.0b + 3.1%
4. JPM Chase $ 52.3b $ 51.1b + 2.3%
5. Discover* $ 48.4b $ 51.1b – 5.3%
6. Capital One $ 46.3b $ 40.9b +13.2%
7. AmEx $ 38.5b $ 34.3b +12.2%
8. BofA $ 36.6b $ 29.5b +24.1%
9. Household $ 17.9b $ 17.0b + 5.3%
10. Fleet $ 17.0b $ 16.2b + 4.9%
TOTAL $ 538.9b $506.0b + 6.5%
*Discover data as of 11/30/03, all others as of 12/31/03.
Source: CardData (www.carddata.com)

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

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Aradyme Integrates Vital’s Gateway into Database Software

UT-based Aradyme has fully integrated Vital Processing’s payment gateway into all its database software. All applications developed on the “Next Generation” database platform from Aradyme will be enabled to bypass third party gateway services by going directly to Vital Processing Systems, that processes one in every four electronic payment transactions in North America. This integrated functionality means companies running Aradyme applications can eliminate the third party processing service that costs as much as $.30 per transaction, plus 2.39% of the payment amount. Vital is a leader in technology-based commerce enabling services; Vital Processing Services(R) is the commerce connection between acquirers and merchants, processing one out of every four authorized payment transactions in North America.

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Bank One to Replace 550 Chicago ATMs

Bank One plans to replace 550 ATMs in Chicago this year, and add about 50 new off-site ATMs in the area over the next two years to bring the total number of Bank One ATMs in the Chicago market to 1,250. Most of the new branches will be storefront locations, which provide convenient bank access in areas with high levels of foot traffic. The 50 new off-site ATMs will be located inside Walgreens drug stores and in other venues, and the ATM replacements will include 200 machines inside Bank One branches and about 350 inside Walgreens. Bank One Corporation ( ) is the nation’s sixth-largest bank holding company, with assets of $326 billion.

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FDC’s Western Union Under a Civil Antitrust Probe

First Data confirmed this morning that its Western Union Financial Services subsidiary received a “Civil Investigative Demand” from the U.S. Department of Justice on Wednesday of this week. FDC says the CID is focused on its contractual relationships between the company and its money transfer agents. Western Union also has been informed that certain states are aware of this CID and may join in the investigation or conduct separate inquiries concerning competitive aspects of its money transfer business. First Data notes that during the 2000-2001 period, the Federal Trade Commission and one state conducted preliminary investigations of similar issues. First Data says its contractual practices reflect common industry norms and it does not expect this civil investigation of the money transfer business will impact its ability to complete its merger with Concord EFS. Earlier this week, First Data reported its fourth quarter results which showed that its Payment Services unit, comprised primarily of Western Union, produced quarterly operating profits of $323 million, a 13% increase compared with the fourth quarter of 2002. For the full year, Western Union and ValueLink, combined, handled more than one billion transactions, up 26%. (CF Library 2/3/04)

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Paymentech Signs The Container Store

Paymentech has signed a processing agreement with Dallas-based The Container Store, that will switch the 30 location firm from dial-up processing to frame relay, and will add a PIN-based debit option at the point of sale. In addition, Paymentech’s direct connection to debit networks played a key role in The Container Store’s decision. Paymentech utilizes an alternate and dynamic routing system that routes debit transactions through the least expensive network — which can save merchants thousands of dollars each year. Paymentech, L.P. processes more payment transactions than any other company in North America — and more than half of all Internet transactions — for retailers accepting U.S. and international payments via traditional point of sale, Internet, catalog and recurring payments.

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Rewards Network Names Aron to its Board

Chicago-based Rewards Network has named Adam Aron, CEO of Vail Resorts and former senior executive at United Airlines and Hyatt, to its Board of Directors. Prior to joining Vail Resorts, Mr. Aron served as President and Chief Executive Officer of Norwegian Cruise Line Ltd. He previously was the Senior Vice President of Marketing for United Airlines and prior to that he served as Senior Vice President of Marketing for the Hyatt Hotels Corporation. Rewards Network provides loyalty and rewards programs for restaurants and hotels via its registered credit card platform. Incentives are offered through the Rewards Network branded program, airline frequent flyer dining programs, club memberships and other affinity organizations.

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FSA/HRA Debit MasterCard Explodes in 2003

MA-based MBI says its “Flex Convenience MasterCard,” which provides access to employee flexible spending accounts and health reimbursement arrangements, has topped 800,000 cards. In the last 18 months the number of employers offering MBI debit cards has jumped over 400% from 1,600 to 8,900. Some participating employers include Staples, British Airways, Toshiba, Dow Jones, The PGA Tour, Krispy Kreme, eBay and the State of Texas. MBI says it will introduce major enhancements and new product offerings this year designed to simplify substantiation for MBI’s “Third Party Administrator” and health plan partners. The key features of the new system include: a health identification card that provides both health plan member information and debit card functionality onto one simple card; credit line features attached to the FSA and HRA accounts; HSA capabilities, including fund investment management; and, a new pharmacy authorization system that reliably substantiates both prescription and over-the-counter drug purchases.

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