CAL SECURE VBV

Cal, a member of VISA Europe, and the largest credit company issuing VISA cards in Israel, has launched “Verified by Visa” to it’s cardholders utilizing Cyota’s “SecureVbV.” “SecureVbV” is provided as a hosted service using Cyota’s regional facilities in the US, Europe and Japan, offering a risk-free approach that helps issuers launch “Verified by Visa” without any integration efforts or IT investment. “SecureVbV” is offered as an in-house solution as well. Cal provides monetary services to more than 13 banks, with approximately 1.2 million cardholders.

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Jean Coutu AIR MILES

The second largest pharmacy in Canada and eighth largest pharmacy in North America has signed a multi-year agreement to become a sponsor in Canada’s “AIR MILES Reward Program,” operated by Alliance Data Systems. The Jean Coutu Group will offer “AIR MILES” in its 248 stores throughout the province of Quebec. Jean Coutu’s Canadian network comprises 269 PJC outlets, 39 PJC Clinics and 2 PJC Sante Beaute, all franchised, in Quebec, New Brunswick and Ontario. The American Brooks Pharmacy network has 330 corporate pharmacies in seven states in the northeastern USA. More than 12.5 million Canadians actively collect “AIR MILES” reward miles at more than 100 brand-name sponsors representing over 12,000 retail and service locations across Canada.

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VISA FEES

Progressive Enterprises and Foodstuffs NZ are protesting new VISA fees
which go into effect June 1. The two large supermarket chains say they will
drop acceptance of VISA cards if the new fees go into effect. Foodstuffs
NZ says that 9% of its $5.7 billion worth of groceries sold last year were
made on VISA cards. VISA’s new fees for supermarkets will rise about 20% on
June 1st, to around 100 basis points. About one third of supermarket
spending is done on credit cards and VISA has about 50% of the New Zealand
market. MasterCard has not raised fees.

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MagTek CEO

MagTek has named Mimi Hart, who has been associated with the company for more than 28 years, to the position of Chairman, President and CEO. In addition to marketing and selling MagTek products her activities on behalf of MagTek included product development and participation in the early ANSI and ISO Committees, which formulated the standards for PIN and card usage.

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MASTERCARD 1Q/03

MasterCard reported that it took a $721 million pre-tax charge in the first quarter in connection with its signing of a “Memorandum of Understanding” for a settlement with plaintiffs in the “Wal-Mart” debit card lawsuit. For the first three months of this year, MasterCard posted a $425,391,000 net loss compared to a $53,596,000 profit one year ago. First quarter revenue was $512 million compared to $393 million for the three months ended March 31, 2002, an increase of 30%, of which $70 million was due to the acquisition of MasterCard Europe. The number of transactions processed increased to approximately 2.206 billion for the first quarter compared to approximately 1.946 billion for the year-ago quarter, an increase of approximately 13%. Operations fees were $315 million for 1Q/03, compared to $256 million for 1Q/02, an increase of 23%. Approximately $33 million of operations fees in the first quarter were due to the acquisition of MasterCard Europe. Operating expenses were $1.180 billion for the quarter, compared to $315 million for the three months ended March 31, 2002, an increase of $865 million or 275%, primarily due to the debit card settlement.

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Diebold Signs MS Bank

MS-based Richton Bank and Trust has selected Diebold Transaction Services to handle the processing for their ATM network and has begun issuing its first “MasterMoney” debit cards. Before converting to Diebold Transaction Services, employees at Richton Bank and Trust were forced to perform tedious daily reconciliation processes, but those manual entries are now automated by the daily settlement services initiated by Diebold.

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Home Improvement

A new survey shows that more than half of home improvers say that credit or charge-based rewards programs shape their home improvement purchasing and shopping habits. The “2003 American Express Home Improvement Index” also found that June is the most popular month for consumers to start fix-up projects. On average, the “Index” suggests that home improvement budgets will rise to $3,796 this year, up 31% from $2,888 in 2000, and 42% from $2,660 in 1997, the year the survey launched. Among other findings: 16% only use a charge or credit card that will earn points and rewards and 13% go out of their way to shop where a charge or credit card can be used to earn rewards or points.

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CardWorks & Spiegel

CardWorks has signed a successor servicer agreement with MBIA Insurance Corporation to service the Spiegel private-label credit card portfolio contained in the “Spiegel Credit Card Master Note Trust.” The “Master Trust” contains four million total accounts, approximately $2 billion in receivables, and includes Spiegel, Eddie Bauer, and Newport News private-label cards. As a result of a “Payout Event,” which was triggered earlier this year, the Spiegel “Master Trust” is now in early amortization. CMS will take over servicing of the accounts from Spiegel’s First Consumers National Bank on June 30th. CardWorks is the parent company of Cardholder Management Services. With the Spiegel private-label portfolio, CardWorks will provide servicing to more than 6 million total accounts.

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