Target Card 3Q Profits Up 23%, Slows from 2Q

Target reported this morning that its credit card operations produced 34% of its total pre-tax profit of $481 million for the third quarter ending November 1st. The retailer’s “smart VISA” portfolio posted 3Q/03 outstandings of $3.81 billion, a 23% increase over 3Q/02. Meanwhile, Target’s private label “Guest Card” credit card posted another drop as it migrates its best customers to the “smart VISA” program. At the end of the third quarter, Target’s private label outstandings were $721 million, compared to $733 million for the second quarter, and $779 million one year ago. Target’s net charge-off rate for its VISA program was 9.7%, compared to 9.3% in the second quarter, and, compared to 6.9% one year ago. Net write-offs for its store credit card program were flat at 8.0% for the third and second quarter, compared to 7.9% for 3Q/02. The 90-day+ delinquency rate for “smart VISA” was 3.8% for 3Q/03, compared to 3.5% for the second quarter, and, 3.0% for 3Q/02. For its “Guest Card” program the figure was also flat at 5.2% for 3Q/03 and 2Q/03, and down from 5.6% one-year ago. Target’s pre-tax profits from its credit card operations were $162 million, compared $160 million for the second quarter, and well above the $138 million recorded one year ago. For complete details on Target’s 3Q/03 performance visit CardData (www.carddata.com).

Details

PreCash Card Nails 7-Eleven Deal

7-Eleven has signed an agreement to offer the “PreCash Card” to enable customers to fund their monthly wireless service via Sprint PCS. 7-Eleven stores provide more convenience to millions of Sprint PCS customers who use the PreCash card to pay for their monthly wireless service for a small convenience fee. Instead of a traditional prepaid program, in which a disposable prepaid phone card with a specified number of minutes is purchased and loaded onto a wireless phone, PreCash offers Sprint PCS consumers an electronic payment service using the PreCash card. 7-Eleven Inc. is the premier name and largest chain in the convenience retailing industry. PreCash offers a payment system that allows customers to quickly and easily transform cash into electronic payments at more than 22,000 convenient retail locations nationwide, such as RadioShack and Wal-Mart.

Details

MasterCard SecureCode Signs 2,500 Issuers

MasterCard’s “SecureCode” program has signed up 2,511 card issuers and 123 acquirers worldwide to-date. More than 9,000 merchants worldwide are now participating in the program. Additionally, MasterCard has signed “SecureCode” agreements with 115 technology vendors to license the specification for integration with pre-existing security solutions or for standalone applications. MasterCard has also deployed the MasterCard SecureCode Hosted Service as a fully customizable “on behalf of” service. The service is ideal for those issuers who choose not to implement an authentication solution of their own. MasterCard introduced “SecureCode” in September 2002 to tackle fraudulent Internet transactions. “SecureCode” uses MasterCard’s “UCAF” to provide an enhanced payment guarantee to online merchants by presenting, collecting and passing cardholder authentication information. Using hidden fields and a merchant plug-in application that is integrated with merchant Web pages, along with authentication information generated by issuing financial institutions, the new service provides explicit evidence of the cardholder’s involvement in a transaction.

Details

Merchant Debit Card Advisory Planned for 2004

NYC-based Constantine & Partners announced Wednesday it is releasing an advisory to merchants with information to help them decide whether they want to accept or reject VISA and/or MasterCard signature debit transactions while continuing to accept the associations’ credit cards next year. The advisory also contains information on the procedures and forms merchants can use if they choose to exercise rights obtained in the settlements. These include obtaining new merchant signage, obtaining debit card BINs and blocking or steering away from unwanted VISA and MasterCard signature debit transactions. As of January 1st, merchants will be free to accept credit cards without being forced to also accept the debit cards. Merchants will also be allowed to reject credit cards and accept debit cards.

Details

EASY-FUEL DEPLOYMENT

T@nque Lleno has teamed with On Track Innovations to install the “EasyFuel” wireless petroleum payment solution in Mexico. The first commercial implementation is planned for 57
CORPOGAS gas stations in 5 states in the center and south of Mexico, with the majority of stations in Mexico City. The system is expected to expand to the commercial fleets in the retail and government markets. T@nque Lleno is a Mexican company that provides intelligent administration systems to commercial fleets in Mexico. The “EasyFuel” wireless solution represents the next generation of OTI’s gasoline management system geared toward the North American and European markets. The system, developed over the past four years is based on OTI’s patented technology that allows RFID smart tags to work in both short and long-range situations. Several major oil companies, such as BP and Repsol, as well as commercial fleet companies, have adopted OTI’s solution for petroleum payment and fleet management in Africa, South America, and Europe.

Details

Staples Signs Long-Term Renewal with Citi Cards

Boston-based Staples has signed a long-term renewal agreement with Citi Cards to provide processing services for all of Staples’ private label credit card programs. In conjunction with Citi Cards, Staples offers three private label credit programs: “The Staples Business Credit Account with Revolving Terms,” “The Staples Business Account with Net Pay Terms,” and “The Staples Personal Credit Account.” Both companies also have designed, developed, and implemented a new, instant credit process. Staples has 1,500 office superstores and annual sales of more than $12 billion.

Details

NCCC Signs Five-Year Extension to its Contract with EDS

The National Credit Card Center of Taiwan has signed a five-year renewal to its contract with EDS. Under terms of the agreement, EDS will help manage NCCC credit card system with technology support and applications development services. NCCC’s EDS-designed credit card system is an end-to-end card processing solution that includes cardholders/merchant management, online authorization, settlement management, a front-end switching solution, and report processing. NCCC was formed in 1983 by the Ministry of Finance and is the country’s largest card processing center.

Details

GPN Introduces Retail/Tip @dvantage Freedom II

Atlanta-based Global Payments has released a wireless terminal application designed for retail markets providing credit and debit card processing for mobile businesses. The “Retail/Tip @dvantage Freedom II” provides real-time processing anywhere that Cingular Wireless coverage is available. The application uses the “MIST Freedom II” portable, hand-held device that includes a mag-stripe reader, integrated PIN pad and a thermal printer. Global Payments says the “In-line Tip,” and “Store-and-Forward” capabilities, in combination with the host-based features of Global’s “Central Platform” add robustness not available in other wireless solutions currently on the market.

Details

Bell ID Launches EMV Migration Software

Rotterdam-based Bell ID is launching next week a turnkey software solution enabling card issuers to pursue a phased approach for EMV migration. The new “ANDiS4EMV” solution features data preparation, card issuance, (multi-application) smart card management, key management and, optionally, post-issuance personalisation, facilitating a gradual migration path from the current magnetic stripe-based systems to the EMV smart card-based infrastructure. “ANDiS4EMV” also provides support for EMV cryptographic processes, templates and risk parameters. “ANDiS4EMV” runs on both Microsoft Windows based operating systems as well as on several UNIX based ones. Bell ID B.V. is a subsidiary of London-based Bell Group.

Details

Bohannon Leaves Certegy Board

Certegy confirmed that Robert Bohannon, chairman, president and CEO of Viad, has resigned from its board, to enable Viad’s Travelers Express and Certegy to explore business opportunities in the future, among other reasons. Certegy and Mr. Bohannon decided that it would be in the best interests of their respective shareholders that he resign from Certegy’s Board to enable Travelers Express and Certegy to explore business opportunities in the future. Certegy provides credit and debit processing, check risk management and check cashing services, and merchant processing and e-banking to over 6,000 financial institutions, 117,000 retailers and 100 million consumers worldwide.

Details

JCB & VISANET

Lima-based Visanet del Peru S.A. has inked a deal with JCB International wherein the Peruvian company will represent the JCB brand in the acquiring and processing business in Peru. This is the first acquiring agreement for JCB in Peru. Visanet Peru will also introduce the JCB card into the credit card market of Peru for the first time. Visanet del Peru provides acquiring services to 15,500 merchants, which covers almost all of credit card retailers in Peru. JCB’s merchant network includes 11 million merchants. JCB cards are now issued in 18 countries and territories, with 48.4 million cardholders.

Details

Hypercom Launches Multi-Function Card Payment Software

Hypercom has launched the “HyperWare 08A” software that makes it possible for one card payment terminal to handle up to 16 different merchant accounts simultaneously, split dial up to eight different application hosts such as stored value, gift and loyalty with 16 supported card types, all at transmission speeds of up to 56 kbps. Making another industry first, Hypercom’s new HyperWare software enables smart, fast and easy dial connectivity to more hosts than any other card payment terminal software on the market. Hypercom is a leading global provider of electronic payment solutions that add value at the point-of-sale for consumers, merchants and acquirers, and yield increased profitability for its customers.

Details