Ford Motor Company Selects Paymentech for Processing

Ford Motor Company has selected Paymentech for electronic payment processing at its nearly 5,000 dealerships across the country. Under the deal, Paymentech will provide access to debit, fleet and gift cards. Paymentech will also become the preferred processor for the company’s system-wide “FORDSTAR” charge and check services program. Paymentech supports the Certegy check guarantee system. The full transition to Paymentech processing is targeted for completion in the fourth quarter.

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Small Business VISA Usage Up 27%

VISA International reported this morning that small business nearly outpaced corporate and government usage of VISA products over the past year. Usage growth by small businesses is up 26.4% for the year ending June 30th, to more than $79.3 billion, which includes transactions using “VISA Business” credit and debit cards, as well as small business inventory payments using “VISA Distribution.” Transactions by medium-to-large business and government clients grew 21.3% to just under $79.5 billion per year, including volume on “VISA Corporate” and “VISA Purchasing” credit and debit cards. The commercial sector was up 11.8%. Annual growth rates in VISA’s commercial debit products are 27.6%, and volume amounted to more than $29 billion per year at the end of June.

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Metris Unloads Accounts to Improve Liquidity

Metris Companies has closed on the sale of a portfolio of approximately 160,000 credit card accounts and $590 million in receivables. Metris says it will take a third-quarter pre-tax charge of approximately $75 to $85 million due to the sale. The loss associated with the portfolio sale will be largely offset by a gain to be realized in the third quarter from the previously announced sale of the membership and warranty products and operations of Metris’ enhancement services business. Metris also announced that it replaced a $610 million asset-backed securitization maturing in early 2004 to improve its liquidity. The company had faced a September 30th deadline to obtain the new financing.

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American Express Introduces Expense Management Reports

American Express has launched a free, online tool, that provides American Express Business cardholders with access to detailed and customizable account information. The new “Expense Management Reports” also offers the option to download data into “Quickbooks” and other financial software and provides access to expense records dating back as far as two years. EMR also enables business cardholders to view spending data online five business days after the end of each billing period; organize data into detailed spend categories; sort charges for all cards by date date, card used, merchant, category or amount; and organize spending by month, quarter or year-to-date.

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Scheidt & Bachmann and OTI Target Automated Fare Collection

Mönchengladbach-based Scheidt & Bachmann GmbH has signed a deal to use Israel’s On Track Innovations Ltd’s contactless products for electronic payment solutions in its management systems for gasoline stations, mass transit ticketing, car parking and leisure centers and railway protection. The first joint effort is targeting automated fare collection programs. Scheidt & Bachmann will act as the system integrator, with OTI supplying readers and software for Scheidt & Bachmann’s front-end solutions. Applications developed by OTI include product solutions for micropayments, mass transit ticketing, parking, petroleum payment systems, loyalty programs, ID and secure campuses. OTI’s clients include MasterCard, BP, First Data Resources, Repsol, the Government of Israel and ICTS. Scheidt & Bachmann is a family-run company since its inception in 1872 and is currently managed by the founding family’s fifth generation.

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MBNA Charge-Offs Drop for the Fourth Consecutive Month

MBNA reported Monday that charge-offs for its credit card portfolio continued to decline for the fourth consecutive month, while delinquency edged up slightly in August. However, the delinquency rate increase to 4.38% is well below the levels posted in the first quarter. The nation’s second largest bank credit card issuer reported that charge-offs fell to 4.81% in August, compared to 4.95% in July, and 5.01% for June. Charge-offs started the year at 5.15%. Delinquency increased 3 bps from July’s 4.35%. MBNA also reported that managed credit card outstandings for the end of August were $96.8 billion. MBNA also holds more than $14.1 billion in other consumer loans.

MBNA 2003
Month Outstandings Charge-offs Delinquency
Jan 03 NA 5.15% 4.85%
Feb 03 NA 5.10% 4.91%
Mar 03 $92.9 b 5.05% 4.62%
Apr 03 $93.9 b 5.02% 4.49%
May 03 $95.3 b 5.04% 4.36%
Jun 03 $96.4 b 5.01% 4.34%
Jul 03 $96.5 b 4.95% 4.35%
Aug 03 $96.8 b 4.81% 4.38%
Source: CardData (www.carddata.com)

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Online Banking Usage Doubles Among Tiny Business

A new research study shows that online banking usage has doubled in the micro market and grows by 26% in the small business market. Micro market companies are defined as businesses with annual revenue between $50K and $1 million, while the small business market is defined as those with annual revenue between $1 million and $20 million. The study by Informa Research Services also found that 44% of companies in the small business market now use online banking. As recently as 12 months ago, only 12% of all businesses with less than $1 million in annual revenue used the online channel for routine banking. That figure is now 24%. Informa says what makes this trend even more significant is that adoption increased during a downturn in technology spending.

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