Edgar, Dunn Hires Card Expert Beth Costa

San Francisco-based Edgar, Dunn & Company has hired Beth Costa, who has held significant positions with Dove Consulting, Mellon Bank, and Transaction Processing, as a director in EDC’s financial services practice. Ms. Costa has been predicting market trends and building winning growth strategies for payments executives across the industry. She has particular strengths in ATM, debit, EBPP, and consumer payment preferences, including the development of national, syndicated consumer payments research studies. Edgar, Dunn & Company is a global strategy consulting firm specializing in payments and financial services.

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Online Card Design Studio Introduced by Oberthur

Oberthur Card Systems has introduced an online studio to enable card issuers to design their own debit and credit cards. The new “Variety Card Design Online Studio” contains hundreds of creative options including backgrounds, photos, logos and even embossing color, and allows banks to visualize the finished product before they place an order for manufacturing and printing. Oberthur is also offering an in-house creative team to assist issuers. Oberthur says the creative team will save issuers up to 50% of the cost to use external creative agencies. The card manufacturer says the online studio service reduces the time from design to manufacture by allowing Oberthur to provide a quote within hours. Oberthur is the manufacturer of the “Discover 2GO” and “AmEx Blue” designs. The company is also the number one supplier for VISA and MasterCard payment cards.

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MasterCard’s Motion to Enjoin VISA Exit Fee By-Law is Denied

U.S. District Court Judge Barbara Jones yesterday denied MasterCard’s motion to enjoin VISA from enforcing its “Settlement Service Fee” by-law, which penalizes larger debit card issuers for moving from VISA to MasterCard. Judge Jones ruled that the Court did not have jurisdiction at this time to issue the injunction that MasterCard seeks. However, if the Final Judgement in the government’s lawsuit against VISA and MasterCard is upheld on appeal, then MasterCard could return to the Court and move to enjoin VISA’s “By-Law 3.14.” VISA said yesterday that if MasterCard chooses to continue its challenge to the “Settlement Service Fee,” it will continue to vigorously defend its approach to meeting its settlement obligations as fair and equitable to all of VISA USA’s 14,000 member financial institutions. In September, MasterCard decided to take VISA to federal court after VISA declined to act on its “cease and desist” letter. The “Settlement Service Fee” by-law requires VISA top off-line debit card members, who switch to a competing off-line debit card, to pay a $20 million fine for each percentage point of lost VISA off-line debit volume. Following the recent settlement of the Wal-Mart litigation, VISA told its top 100 debit issuers that for the next 10 years, they would face significant fines, based on a share of VISA’s $2 billion settlement with the merchants, if they reduced their VISA debit volume from September 30, 2002 levels. In October VISA announced it will waive its new by-law for members switching to American Express or Discover. (CF Library 11/13/03; 11/26/03)

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BankOne/Avon VISA Rewards Cardholders and Representatives

Avon Products and Bank One have launched a co-branded card that rewards cardholders as well as Avon representatives. The new “Avon Platinum VISA” offers cardholders a full one percent back on card purchases and offers Avon representatives the opportunity to earn $25 for each approved account they generate after a new cardholder makes a purchase. After their first VISA purchase, cardholders also receive Avon’s “Anew RetroActive,” one of Avon’s most popular skincare products, worth $25. Every time cardholders accumulate 2,500 points, they will receive a $25 “AVON BEAUTY Rewards” certificate on their billing statement that can be redeemed for Avon products. Avon has 600,000 representatives in the USA.

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EASYPOINT 57I

The first ATM conceived and designed specifically for the Indian market has been introduced by NCR. The new “EasyPoint 57i” or “ASAN” is designed to offer cost-effective ATM convenience to untapped non-urban areas, as well as to open up opportunities in newer urban locations such as corporate offices and factories, newly emerging multiplexes and malls and branch extensions. “ASAN” supports wireless connectivity through GPRS and CDMA communication technologies for areas with poor conventional telecommunications connectivity. Its balanced pressure system and enhanced dust filtration mechanism facilitates deployment in non-air-conditioned environments. The new ATM also utilizes the NCR “Intelligent Power Management” system, with an integrated UPS, which ensures that in case of power failure the ATM completes the ongoing transaction before shutting down. NIPM can also help the ATM to be automatically switched off or on at pre-decided times every night and morning if located at sites that do not require 24-hour availability.

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Viads’s MoneyGram Transaction Volume Up 32% for 3Q/03

AZ-based Viad reported that third quarter revenues for its Payment Services’ business were essentially flat at $203.7 million, however, MoneyGram transaction volume grew 32% and revenues were up 19% in comparison to the prior year third quarter . For the nine months ended September 30, 2003, income from continuing operations was $0.99 per diluted share on revenue of $1.2 billion, segment operating income of $135.4 million and income from continuing operations of $86.2 million. Diluted earnings per share was $1.01 on net income of $87.7 million including $1.5 million of income from discontinued operations. Viad is a $1.6 billion revenue S&P MidCap 400 company. Major subsidiaries include Travelers Express/MoneyGram of Minneapolis, GES Exposition Services of Las Vegas and Exhibitgroup/Giltspur of Chicago. For more information, visit the company’s Web site at [www.viad.com][1].

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

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SCM Microsystems Ranks 51st on GrowthPlus’ Europe Top 500

Ismaning-based SCM Microsystems has been included in the list of Europe’s “Top 500” emerging companies. The European trade association GrowthPlus ranked SCM as 51st on the annual list. The ranking honors the 500 entrepreneurial companies that have created the most jobs over the last five years. SCM Microsystems develops and sells a range of standards-based hardware, software and silicon products to OEM customers worldwide. The company’s offerings include conditional access modules for secure decryption of digital pay-TV broadcasts; smart card reader technology for secure access to PCs, networks and facilities; and interface technology for transferring content to and from digital flash media.

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Consumers Say They’ll Use Cards Less During Holiday Season

While data for the first two weeks of the holiday shopping season show a 5% increase in retail sales and a 6% increase in credit card spending, a new survey by a MA-Cambridge Consumer Credit Counseling and its affiliated Debt Relief Clearinghouse, finds that more Americans plan to use credit cards less during this year’s holiday shopping season, than in 2002. According to the monthly survey, the “Cambridge Consumer Credit Index,” 38% of all consumers plan to use less credit to purchase holiday gifts this year, compared to 31% one-year ago. Twenty-nine percent plan to use the same amount of credit as they did last year, two percentage points lower than in 2002. Another 29% plan not to use any credit cards this season, down by 7 percentage points from 2002. The Cambridge Index also asked consumers who plan to use credit cards this season whether they expect to pay them off in full when the bills arrive in January. Sixty percent say they expect to pay off their balance in full, up from 58% a year ago and 55% in 2001. Thirty-six percent expect to carry a balance on their credit cards for more than a month before they pay them off, unchanged from 2002, and down from 39% in 2001. Only 4% plan to pay off some cards and carry balances on others, down by 2% from 2002 and 2001.

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Consumers Shift to Second Gear as Economy Rebounds

Further evidence of the recent economic recovery is the uptick in consumer revolving credit for September and October. During October, Americans added $2.2 billion to revolving credit at an annual growth rate of 3.6%, more than twice the rate of growth one-year ago. Revised figures, released Friday by the Federal Reserve, also show that September’s figures were better than previously reported. September’s revised growth rate is 6.5% compared to 3.0% for September 2002. For October, consumers owed $735.3 billion in revolving credit, mostly credit card debt. Bank credit card debt (excluding store and gas credit cards) at the end of the third quarter was $645.7 billion, or roughly 88% of total revolving credit, according to CardData ([www.carddata.com][1]). At the end of October, Americans were $1977.3 billion in debt, excluding home mortgages.

REVOLVING CREDIT HISTORICAL ($billions)
Oct03 Sept03 Aug03 Jul 03 Jun03 May03 Apr03
GRWTH: 3.6% 6.5 3.4 1.4 -2.4 7.7 3.4
$OWED: $735.3 733.1 729.1 726.8 725.9 727.9 722.8

Mar 03 Feb03 Jan03 Dec02 Nov02 Oct02 Sep02
GRWTH: 4.1% 5.9 5.2 -6.7 -1.4 1.6 3.0
$OWED: $720.7 718.6 715.5 712.4 716.8 717.9 721.3
Source: Federal Reserve; revised figures as of 12/05/03;
For complete historical data visit CardData (www.carddata.com).

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

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VISA Canada Releases Updated Owner’s Manual and Holiday Survey Results

VISA Canada released an updated version its publication that is designed to help consumers manage their credit card use responsibly. The booklet, “Credit Cards:
An Owner’s Manual,” was originally published in 1995, and has been distributed to more than 850,000 consumers across Canada. A French version of the updated publication will be available by year-end. VISA Canada also reported that a recent survey it conducted found that almost half of all Canadians plan to use credit cards for their holiday shopping needs, and that most of them will have their credit card balances paid off within two months.

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Mosaic Software Endorses e-ClassicSystems’ ATM Product

Mosaic Software has inked a deal to recommend e-ClassicSystems’ “ATM Manager Pro” solution to current and future customers to complement their “Postilion” products. The ATM Manager Pro suite of modules offers a complete back-office solution to manage and report on ATM channel operations and status, including ATM asset compliance, location and transaction reporting and trending, cost and revenue analysis per ATM, cash forecasting and management, project management and much more. ATM Manager Pro currently manages the daily operations of over 100,000 ATMs worldwide including 20% of the US market. Mosaic Software is a global EFT software company with offices in the United States, the United Kingdom, South Africa, and Australia.

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