$8.1 Billion in VISA Holiday Volume, an 8.4% Increase

VISA expects Canadians to spend $1.7 billion in retail stores on December 23rd. Data collected by VISA since 1997 shows that, typically, the busiest
shopping day of the year falls two business days before December 25th. Interestingly, during this six-year time period, the busiest shopping day has
never been on the Saturday or Sunday immediately before Christmas. The data also shows that this will be the fifth year since 1997 that the busiest
shopping day falls on December 23rd. To date this holiday shopping season (November 28 – December 18), Canadians have already spent an estimated $8.1 billion on their VISA cards,representing an 8.4% increase over last year.

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Terra Payments Secures a $10 Million Private Placement

Montreal-based Terra Payments has signed an agency agreement for a $10 million private placement. The Company intends to utilize the net proceeds to accelerate the Corporation’s growth and diversification in international markets for its proprietary credit card and electronic cheque processing services. Growth will be generated through expansion of the Corporation’s sales effort, securing additional processing suppliers, as well as potentially through the acquisition of merchant processing portfolios.

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VISA Debit Share Rises & AmEx Credit Share Rises

While VISA USA has given up a sliver of market share on the credit card side over the past twelve months, it has picked up 30 basis points in the signature debit card market. Based on final third quarter figures from the four major U.S. card networks, American Express has emerged as the fastest growing credit card provider. American Express credit card volume is growing nearly 14% annually, and has added 11 basis points in share. VISA’s market share in the U.S. credit card market is 42.8%, compared to 42.9% one-year ago. MasterCard’s credit card share has declined from 34.5% to 34.0% and Discover’s credit card share also declined, from 6.7% to 6.3%. American Express has moved from a 15.9% share for 3Q/02 to 17.0% for 3Q/03. On the signature debit card side, VISA’s share has grown from 76.4% one-year ago to 79.4% this year.

According to CardData ([www.carddata.com][1]), overall third quarter credit card volume is up 7.3% from 3Q/02 while overall signature debit card volume is up 18.0%, compared to last year.

U.S. CREDIT CARD MARKET SHARE
(based on 3Q/03 gross dollar volume data)

NETWORK Q VOL ANN CHNG SHARE
VISA $167.7 + 6.9% 42.8%
MasterCard $133.1 + 5.6% 34.0%
AmEx $ 66.3 +13.9% 17.0%
Discover $ 24.8 + 2.1% 6.3%
*all $ figures in billions; annual change is 3Q/03 versus 3Q/02;
share figures may not total to 100% due to rounding
SOURCE: CardData (www.carddata.com)

U.S. DEBIT CARD MARKET SHARE
(based on 3Q/03 gross dollar volume data)

NETWORK Q VOL ANN CHNG SHARE
VISA $118.2 +22.6% 79.4%
MasterCard $ 30.4 + 2.4% 20.5%
*all $ figures in billions; annual change is 3Q/03 versus 3Q/02;
share figures may not total to 100% due to rounding
SOURCE: CardData (www.carddata.com)

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

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ProPay Transaction Volume Up 77% This Year

UT-based ProPay, which received a “Partnership Award” from the Direct Selling Association, says its transaction volume is up 50% in the four months since being recognized with the award. Projections for year end 2003 show total processing growth at 77 percent over 2002. ProPay’s award comes at a time when the domestic market for direct selling is approximately $30 billion, but many of the Americans who have established successful enterprises in the industry lack a cost-effective and secure means of handling their customers’ credit cards. ProPay provides payment services to individuals and corporations including merchant account capabilities, stored value cards, commission payment systems and other “payment intranet” solutions.

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No Takers for the LG Card Portfolio as LOI Deadline Passes

The sale of LG Card, which has a negative net worth of 3.24 trillion won, has no takers. Among LG Card’s eight creditor banks, no one filed a letter of intent. As a result the deadline has been extended till the end of this week. The government and the creditor banks are reportedly considering some significant changes in the deal. Earlier this week, Woori Bank, Kookmin Bank and the National Agricultural Cooperative Federation agreed to lend LG Card a total of 300 billion won to cover operating losses until the sale.

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GLOBALCash Card Inks ISP Marketing Deal

CA-based PayStar/GLOBALCash has inked a contract to market its prepaid ATM debit card to the credit-challenged subscribers of a major ISP. GLOBALCash’s product will be marketed to the ISP subscribers through banner ads, popups and marketing emails, immediately providing the viewer the opportunity to purchase the GLOBALCash prepaid ATM debit card online or by phone. PayStar Corporation ([www.paystar.com][1]) provides its distributors and clients with a suite of prepaid, stored value products. PayStar Corporation ([www.paystar.com][2]) provides its distributors and clients with a suite of prepaid, stored value products. PayStar’s GLOBALCash, Inc. ([www.globalcash.us][3]) distributes prepaid ATM debit and MasterCard cards that can be used just like regular credit cards.

[1]: http://www.paystar.com
[2]: http://www.paystar.com
[3]: http://www.globalcash.us

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ICBA Buys a Banker’s Bank Card Portfolio

ICBA Bancard’s TCM Bank has purchased the $3.1 million consumer credit card portfolio of MO-based Midwest Independent Bank and its agent contracts. ICBA Bancard has provided more than 2,000 community banks with equitableaccess to payment system products and services. In addition to ATM, creditand debit cards, banks have access to merchant services, ATM driving, riskmanagement services, Internet banking and marketing services. Midwest Independent Bank is a bankers’ bank owned and directed byindependent financial institutions. MIB provides superior banking servicesand products at lower costs and with more personal service than othercorrespondent banks.

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Mini VISA Cards Top 10 Million

Standard Chartered Bank and ICICI Bank have introduced the first miniature credit cards in India, according to this week’s issue of CardFlash International (www.cardflashinternational.com). The roll-out of the “VISA Mini Card” follows recent introductions of the cards in Thailand, Singapore, Hong Kong, and Taiwan. The miniature VISA was first launched in the USA in October 2002. To-date there have been approximately 10 million “VISA Mini Cards” issued. Standard Chartered Bank says it is aiming the card at its 100,000 “Gen Y” cardholders. It will initially target about 30,000 young cardholders in Delhi, Mumbai, Kolkata, Chennai and Ahemdabad. The issuer has more than 1.4 million total credit cardholders. ICICI Bank is issuing the miniature VISA card in conjunction with its “Sterling VISA Gold” card program.

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APAK Group and Fincentric Sign a Partnership Deal

APAK Group, a UK-based systems integrator and implementation specialist of banking systems, has signed a partnership deal with Fincentric Corporation. Together, the two companies will offer
UK financial institutions a value proposition based on Fincentric’s software products and APAK’s extensive IT experience in the region. Also, Fincentric and APAK will work closely together in the localization and customization, implementation, and support of delivering Fincentric’s “Wealthview” software solution to specifically meet the unique business needs of UK financial institutions.

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Charge-Offs and Delinquency Head South in October

October’s credit card delinquency rate, among card backed-securities, declined for the third consecutive month. Charge-offs, among card ABS, also declined for a second straight month and are only up slightly over year-ago levels. The October delinquency rate was 5.16% compared to 5.47% one-year ago. The October charge-off rate was 6.53% compared to 6.38% one-year ago. The figures are based data gathered by Moody’s Investors Service. Yield (the income, primarily finance charges and fees, collected during the month as an annualized percent of the total loans) fell to 17.14% from last year’s rate of 18.15%. The yield has fallen on a year-over-year basis for 27 months, and hit a record low of 16.50% in April 2003. Moody’s says most of the drop in yield is attributable to the low interest rate environment as well as issuers’ aggressive balance transfer and teaser rate offers. In October, cardholders paid back their debts at a record-setting monthly rate of 16.09%, above the rate of 15.29% in October 2002. The last time the payment rate rose above 16% was in August 2000. Since then, the payment rate has been remarkably stable, even throughout the most recent economic downturn, and has generally remained within the historically high range of 14% – 16%.

Credit Card Asset-Backed Bonds
MONTH CHARGE-OFFS DELINQUENCIES
Oct02: 6.38% 5.47%
Apr03: 7.00% 5.25%
May03: 7.05% 5.20%
Jun03: 6.87% 5.12%
Jul03: 6.87% 5.19%
Aug03: 6.88% 5.18%
Sep03: 6.63% 5.17%
Oct03: 6.53% 5.16%
Source: Moody’s Investors Service

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WildCard Beefs Up Call Center and Infrastructure

FL-based prepaid card specialist, WildCard Systems, says it will expand its infrastructure and call center after receiving a $2.5 million line of credit from GE Technology Finance. WildCard Systems is the global solutions leader in turnkey host-based prepaid cards and custom stored-value products. These products serve a wide range of vertical markets in both consumer and commercial applications and are made available to end users through banks and commercial clients in the U.S. and abroad. GE Technology Finance, a unit of GE Structured Finance (GESF), serves the equipment and working capital financing needs of emerging growth technology companies backed by venture capitalists and other professional investors.

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