China Construction Bank Adds 800 More Diebold ATMs

Beijing-based China Construction Bank has inked a deal with Diebold to added 800 more ATMs this year. All of the terminals will be installed in CCB’s nationwide branches before the end of this year. Diebold handled an initial installation of ATMs to CCB in the first seven months of the year. This will be the second ATM contract for this year. CCB customers will have access to bill payment and electronic funds transfer between foreign currency and savings accounts, and will be able to review stock transactions, account balances, banking statements and advertisements via the ATM. Some provincial bank branches differentiate themselves from competitors by selling airline tickets at ATMs.

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International Paralympic Committee and VISA International Ink Deal

The International Paralympic Committee and VISA International have signed an exclusive partnership agreement for the “Paralympic Games,” including the “ATHENS 2004 Paralympic Games.” VISA will also sponsor the “International Paralympic Day 2003,” which takes place from 26 to 27 September in Bonn. Under terms of the agreement, VISA will become the official payments sponsor of the IPC until the end of December 2004 with exclusive marketing and promotional rights within the payment services category. VISA and its member banks will be able to develop promotions featuring the IPC, which, in return, will receive a financial contribution as well as marketing and media support through VISA
cardholder communications, promotions and advertising. VISA already sponsors the “Paralympics Games” as part of its agreement with
the International Olympic Committee to support both the “Olympic Games” and “Paralympic Games.” VISA has the exclusive global marketing rights and official status for the “Paralympic Games” through 2012. More than 4,000 athletes from approximately 140 countries will
be competing for medals in 19 sports, making the Paralympics the second-largest international sporting event of 2004.

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Switch/Maestro Foreign Transactions Soar

“Switch/Maestro” ATM debit card usage outside the UK is up 19% at mid-year, with 9.6 million transactions year-to-date, according to this week’s issue of CardFlash International. Last year, over 20 million “Switch/Maestro” transactions were made outside the UK, with ATM transactions accounting for over 18 million. There are currently 22 million UK “Switch/Maestro” cardholders who can use their debit card in over 890,000 cash machines and at over 7.8 million retailers worldwide. The “Maestro” logo has traditionally appeared on the back of “Switch” cards, but is starting to move to the front following the agreement between Switch and MasterCard to replace “Switch” with the “Maestro” global debit brand over the next few years. The “Maestro” brand mark now appears on 466 million cards worldwide and is accepted for purchases at over seven million merchant terminals in 93 countries and territories.

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Court Decision on Exclusionary Rule Upheld

A three-judge panel of the Second Circuit Court of Appeals yesterday affirmed the 2001 court decision which required VISA to drop its “bylaw ‘210(e)” and MasterCard to end its “Competitive Programs Policy.” Federal district court Judge Barbara Jones ruled on October 9, 2001 that the card association’s exclusionary rules, which prevented member banks from issuing American Express and Discover cards, were anti-competitive. The hearing before the appeals court took place on May 9th of this year. The U.S. District Court for the Southern District of New York granted a stay in its Jones ruling in February 2002. The status of the stay is unclear following Wednesday’s ruling. However, both VISA and MasterCard indicated last night they will seek further appellate review, including requesting a hearing en banc before the Second Circuit Court of Appeals. MasterCard said it believes that Judge Jones legal approach incorrectly led her to conclude that American Express must have access to every distributor of its choosing, even if its intent is to cherry-pick banks and to destabilize the MasterCard joint venture. MasterCard says it has strong legal grounds for a further appeal. Meanwhile, American Express said this morning it is pleased with the appellate court’s ruling and believes it will ultimately lead to more competition and a broader choice of innovative products. (CF Library 10/10/01; 2/8/02)

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GlobalPlatform’s Card Compliance Program and Test Kit is Completed

GlobalPlatform’s “Card Compliance Program and Test Kit” has been completed. The Kit consist of procedures and testing components which provide the processes and tools necessary to verify a smart card’s functional compliance to the “GlobalPlatform Card Specification v2.1.” GlobalPlatform’s Card Committee worked in conjunction with ICC Solutions to develop and implement the new Test Kit. The first version was released in April 2002, which tested only mandatory features of GlobalPlatform compliant cards. The updated version addresses all mandatory and optional features of the specification and allows verification of a card’s functional compliance for any card configuration and combination of optional features.

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Standard Federal Bank ATMs Dominate Michigan

MI-based Standard Federal Bank has increased the size of its ATM network to more than 1,260 machines, twice as many as its nearest competitor. SFB added 466 ATMs this week, including 182 ATMs in southeast Michigan CVS drugstores and 284 ATMs in Speedway gas stations located throughout Michigan. The network processes more than 40 million transactions annually. Standard Federal customers also have access to SFB’s sister bank, LaSalle Bank’s, with 500 ATMs in Chicagoland.

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E-Checks Save Card Issuers $800 Million

A new study shows that credit card issuers are the primary beneficiaries of new e-check payment methods. The research by NACHA’s “Business Case Validation Task Force” found that credit card issuers have been the leading adopters in using e-checks to collect payments from customers. The Task Force estimates an annualized cost savings of $70-120 million to VISA and MasterCard issuers from faster funds availability, lower operational and clearing costs, and loss reductions. In addition, convenience fees collected from last-minute telephone payments generate an estimated $738 million in annualized fee revenue for VISA and MasterCard issuers, for a total annualized benefit to VISA and MasterCard issuers of $808-858 million.

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Visa Debit Volume Up 15% in the Second Quarter

Debit volume for the second quarter hit $353 billion, a 15.0% increase over the same quarter in 2002. Debit growth was particularly strong in VISA Asia-Pacific and VISA Central Europe, Middle East, and Africa, which experienced increases of 23.4% and 37.6%, respectively. During the second quarter, VISA Canada announced that it would join the global migration to chip. It is expected that within seven years, almost every VISA card in Canada will feature chip technology. Also VISA EU was awarded a five-year contract for corporate and purchasing cards for the Office of Government Commerce of the UK Government.

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