VISA Extras is Officially Launched

VISA USA officially launched a new payment card rewards program offering points on everyday expenditures. The new “VISA Extras” program also offers the ability to link cards to accrue points across both small business commercial cards and personal cards. The program enables issuers that currently do not have co-branded or affinity programs to offer a cost-effective loyalty initiative and to readily customize the program for their respective market segments. Cardholders earn points on all credit and debit card purchases, but not PIN transactions. Cardholders may redeem points for more than 100 rewards available from a wide range of 50 partners including: Amazon, Barnes & Noble, BP Amoco, GAP, Marriott, Ruth’s Chris Steakhouse, Staples and Starbucks. VISA says its research indicates that 76% of small business owners are interested in earning rewards when paying for their business expenses with a credit or debit card.

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Americans Say Debit or Forget It

A new survey shows that half of American consumers would consider walking out of a store without making a purchase if their debit cards were not accepted. Furthermore, nearly two-thirds of respondents said their feelings toward a store would be negatively impacted if a merchant stopped accepting debit cards. The findings come from a new Harris Interactive survey, sponsored by MasterCard, also found that 77% considered debit’s transaction speed and ability to save time at the checkout counter as extremely/very important. More than 80% of adults using debit cards noted convenience and safety to be extremely/very important attributes, as opposed to carrying cash. The survey was conducted in early December with a nationwide sample of 2,465 adults.

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CIBC Expands Aerogold Cards

CIBC will offer a new travel benefits package to its “Aerogold VISA” cardholders on February 1st. The “CIBC Club Privileges Travel” program, which carries a $199 annual fee, provides access to all Air Canada “Maple Leaf” lounges across Canada and in key international locations, Air Canada “Priority Check-in” privileges, one annual Air Canada companion ticket, and seven-day multi-trip family travel medical insurance. The program will be offered on the “CIBC Aerogold VISA Card” and the “CIBC Aerogold VISA Card for Business.” CIBC is also awarding a one-time Air Canada companion ticket to all “Aerogold VISA” cardholders as part of a special customer appreciation program. CIBC says more than 2,000 “CIBC Aerogold Card” customers redeem their “Aeroplan Miles” to fly for free every day of the year. Customers can sign up for the “CIBC Club Privileges Travel” program as of Jan. 13. The new travel package will be supported with an extensive national marketing campaign.

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NCR Lands Personas ATM Contract with Bank of China

Bank of China, has inked a US$36 million deal with NCR for “Personas” ATMs with enhanced security features to include the encrypting pin pad module. The ATMs provided to Bank of China are all produced in NCR’s joint-venture manufacturing facility in Beijing. A portion of the ATMs have specially designed cash-deposit functions. In November, NCR signed a $17 million agreement with China Construction Bank for security-enhanced ATM hardware and software solutions, including the encrypting pin pad module. Last year, NCR landed a $28 million ATM contract from CCB.

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Charge-Offs Eat Lion’s Share of Expenses

Charge-offs continued to dominate the issuer expense streams last year. Charge-offs may top $40 billion for 2003, making up 43% of gross expenses. Operating expenses eat up 38% of total expenses while the balance is consumed by cost-of-funds. According to R.K. Hammer Investment Bankers, the blended costs-of-funds for 2003 should come in at $17.6 billion. Operating expense is expected to be slightly more than $35 billion. Hammer previously estimated that total card income for 2003 at $123.2 billion, with $80.1 billion in interest income and $43.1 billion in fee income. Hammer projected the 2003 ROA for card issuers to be 4.40%.

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AEROGOLD TRAVEL PACKAGE

CIBC will offer a new travel benefits package to its “Aerogold VISA” cardholders on February 1st. The “CIBC Club Privileges Travel” program, which carries a $199 annual fee, provides access to
all Air Canada “Maple Leaf” lounges across Canada and in key international locations, Air Canada “Priority Check-in” privileges, one annual Air Canada companion ticket, and seven-day multi-trip family travel medical insurance. The program will be offered on the “CIBC Aerogold VISA Card” and the “CIBC Aerogold VISA Card for Business.” CIBC is also awarding a one-time Air Canada companion ticket to all “Aerogold VISA” cardholders as part of a special customer appreciation program. CIBC says more than 2,000 “CIBC Aerogold Card” customers redeem their “Aeroplan Miles” to fly for free every day of the year. Customers can sign
up for the “CIBC Club Privileges Travel” program as of Jan. 13. The new travel package will be supported with an extensive national marketing campaign.

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First Horizon Merchant Services Acquires DirectNET

First Horizon Merchant Services has purchased all rights to the “DirectNET” loyalty and gift card system from MA-based POS/ware Inc. The DirectNET system integrates a transaction processing gateway with a full-featured gift and loyalty card application. The system supports many retail and lodging POS system interfaces to allow flexible card-based programs throughout a heterogeneous POS environment. First Horizon Merchant Services is one of the most successful processors of credit card payments for the travel and entertainment industry. First Horizon Merchant Services is a leading provider of transaction processing and bankcard acquiring services.

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Hagenuk Smart Card Solutions and Art of Security Complete Their Merger

Hagenuk Smart Card Solutions and Art of Security have merged into a new operation under the name: AOS-Hagenuk. The new company plans to launch a whole new, extended line of products for security, financial, retail and healthcare markets. Mladen Filipan, CEO and founder of Art of Security, will serve as the CEO of the newly formed company. Hagenuk Smart Card Solutions is an international orientated organization with a focus to the Dutch market. In the Netherlands the firm offers the secure smart card reader, “PocketID.” Art of Security is a recent spin-off from SCM Microsystems, founded by former
Executive VP and General Manager of SCM’s PC- Security Division Mladen Filipan.

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Air2Web Card Alerts Signs a Major CU

Premier America Credit Union is now offering automatic alerts on credit card accounts to its customers using Digital Insight and Air2Web’s SMS service. With over $800 million in assets and more than 70,000 members nationwide, Premier America Credit Union is offering their members a Wireless Internet Banking solution, provided by Digital Insight and powered by Air2Web. Premier America members can also call the Air2Web “On Demand” phone number to request their balance or history on all their accounts at any time, and the information is delivered as a text message within minutes. Air2Web has deployed over 80 real-world applications with blue-chip clients. These deployments account for over 325,000 mobile subscribers generating over 10 million application accesses and 2.5 million SMS messages per month.

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GZS and easycash Process Germany’s First EMV Chip Transaction

GZS and easycash processed Germany’s first EMV chip transaction this week. The transaction was made from an EMV-enabled terminal at the Holiday Inn in Frankfurt-Sachsenhausen. easycash is Germany’s first network operator to offer EMV-enabled terminals. GZS Gesellschaft für Zahlungssysteme provided the technical infrastructure for this transaction. The new chip technology was built into the “MultiCardManager” flexible plus terminals supplied by THALES. The next phase will involve acquirer ConCardis. The entire Holiday Inn chain is to be equipped with the new terminals over the coming weeks and months and serve as a pilot for GZS’s processing.

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IBM POS Systems to Add Pay By Touch

San Francisco-based Pay By Touch has signed an agreement with IBM to integrate its finger scan technology into IBM POS systems. IBM and Pay By Touch will work together to offer this technology to retailers across the world. Several major retailers are expected to launch Pay By Touch pilots using IBM’s POS systems in early 2004. The Pay By Touch finger scanning technology does not store actual fingerprints; instead it creates a set of geometric points that allows for a secure identity match at retail point of sale. Pay By Touch is a free consumer payment service that allows shoppers to pay for purchases using a finger scan to access their financial accounts and loyalty programs. IBM has been providing dependable POS solutions to the retail industry for over 30 years.

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Six Out of Ten Americans Received Gift Card

A survey conducted this month has found that 59% of all consumers received a gift card or certificate this holiday season, and that by January 5th, 50% of gift card recipients had already redeemed some or all of their cards. According to the survey, on average, consumers received 2.5 gift cards that had a combined value of $106. The average value of the redeemed card was $47.50, and the average that was spent in the store on that day was $47.20. Other key findings of Deloitte’s “Post-Holiday” survey showed that 81% received at least one gift certificate to a store or mall; 36% received at least one to a restaurant/fast food establishment; 10% received at least one that could be used at a variety of stores/establishments; and, 9% received at least one for a personal service. The Deloitte survey found that 55% of consumers said they will buy gift cards for others during the remainder of 2004 with average of $151. The 45-54 and 55-64 age groups will be spending the most — $162 and $193, respectively. Higher income households plan to spend the most on gift cards. Those making $100,000, or more, plan to give gift cards worth $217, on average. Gift cards will also be used by some consumers for their own use. More than one in ten said they had bought a prepaid gift card for their own use in 2003.

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