Installment Card

Move over revolving credit, installment credit is moving onto payment cards. MasterCard this morning announced the launch of its “MasterCard Installment Card”, a new program to help member financial institutions’ customers pay for larger purchases. The new installment program is subject to a U.S. patent. Under the new program, members set the overall credit limit, installment terms and interest rate, and have the ability to offer cardholders two card options: “The Stand-Alone Installment Card Option” and the “Add-On Installment Card Option.” With the stand-alone version, cardholders open a new installment card designated exclusively for larger purchases. A single credit line is determined by the member financial institution. The add-on version enables members to instantly expand their MasterCard functionality. Purchases are handled through a combination of revolving and fixed payment options. Fixed payment transactions, for example, would be automatically triggered for all purchases over a preset amount. All installment transactions would have a fixed payment schedule. Both the revolving and the fixed payment options would be set by the issuing financial institution and detailed in an account agreement and on the account statement.

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VISA ASIA-PACIFIC

VISA Asia Pacific reported its retail sales volume reached US$175 billion
for the first nine months of this year, a growth of 26% in constant dollars
over the same period a year ago. Total transactions across the region for
the nine-month period hit 2.7 billion, up 24%, and the total value of
transactions on VISA cards (card sales volume) reached US$472 billion, up
35% over the same nine-month period. For the quarter ended 30 September,
VISA reported that retail sales volume reached US$61 billion, up 18% from
the same quarter a year earlier but down from 30% growth reported at
mid-year. VISA has a greater market share than all other payment card
brands in the Asia-Pacific region, combined with 59% of all card purchases
at the point of sale being made using VISA cards. There are currently more
than 365 million VISA-branded cards in the region.

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Fiserv & SEDONA

Fiserv Customer Contact Solutions announced this morning it is acquiring SEDONA’s existing customer base. Fiserv says the deal will enhance its ability to provide CRM solutions by tapping into a solid customer base. SEDONA says the agreement will allow the company to focus on its multiple channel strategy as well as expand into new vertical markets. Fiserv Customer Contact Solutions is registered with the British Standards Institute as an ISO 9001 certified company.

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GLOBALPLATFORM BOARD

GlobalPlatform has named its new Chair, Vice Chair and
Secretary/Treasurer. Jerry Johnson, President and CEO of Datacard Group and
existing Board Member of GlobalPlatform has been named as the new Chair of
GlobalPlatform while Jim Lee, SVP/Emerging Technologies at VISA
International retains his position as Vice Chair for a second term. Gilles
Michel, President, Financial and Security Services at Gemplus takes on the
role of Secretary/Treasurer. Three of the six seats went to incumbents:
Toshiaki Kuzuki of JCB, Shoichi Senda of NTT and Jim Lee of VISA
International. GlobalPlatform also welcomed three new members to its Board;
Christian Jûttner of Giesecke & Devrient, Carmen Carnero-Silvo of SERMEPA
S.A. and Verina Horsnell of Sun Microsystems.

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NACHA Board

NACHA members have elected Leonard Heckwolf, SVP of Bank One, as the next Chairman of its Board of Directors. Heckwolf will begin a two-year term effective January 1, 2003. Also elected as officers of NACHA were John Kline, EVP/COO of Union Savings Bank, as Vice Chairman, and Francis Lee, President and CEO of Southwest Corporate Federal Credit Union, as Secretary/Treasurer. NACHA’s members also elected the following representatives from regional payments associations to the Board: Ann-Marie Bartels, AAP, Mid-America Payments Exchange; Charles Bretz, Compass Bank; Brady Cole, Navy Federal Credit Union; Ward Gailey, Jr., SunTrust Bank; Jerry Meyer, The Provident Bank; Keith Theisen, AAP, Wells Fargo; George Thomas, AAP, Electronic Payments Network; and Dennis Toda, AAP, WesCorp Federal Credit Union.

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CO-OP ATMs

American Airlines Federal Credit Union has been awarded a five-year ATM contract for Los Angeles International Airport, Ontario International Airport and Van Nuys Transportation Terminal. The credit union has also reached an agreement on a joint operating, branding and marketing effort for these ATMs with Western Federal Credit Union and CO-OP Network. The ATMs will be surcharge-free to the 11 million credit union members carrying ATM cards with the CO-OP Network logo. Initially, the AAFCU/WFCU/CO-OP partnership will deploy 26 ATMs at LAX, five at Ontario and one at Van Nuys beginning January 1st. The CO-OP Network offers access to nearly 15,000 surcharge-free ATMs across the country. Ft. Worth, TX-based American Airlines FCU has more than $3.8 billion in assets and is the seventh largest credit union in the USA. Western FCU is based in Los Angeles with 57,000 members and $465 million assets.

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VISA Meetings

VISA International has confirmed that all six VISA regions and Visa International will hold their Board meetings in Beijing next June. The news follows VISA’s recent announcement of its renewal of Olympic sponsorship through to the 2012 Games. According to last week’s “The RAM Report” ([www.ramreport.com][1]), VISA is working closely with China UnionPay to accelerate the creation of an international standard payment infrastructure following World Trade Organization accession and ahead of the 2008 Beijing “Summer Olympic Games.” VISA International also reported this morning that retail sales volume in Asia-Pacific hit US$175 billion through the third quarter of this year, up 26%. For the third quarter, retail sales volume in Asia-Pacific reached US$61 billion, up 18% from the same quarter a year earlier but down from 30% from the second quarter. VISA also noted that approximately 5% of its transactions in Asia Pacific are now conducted online, up from 3% several months ago. (CF Library 11/12/02)

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

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St. Jude VISA

Bank One has teamed with St. Jude Children’s Research Hospital to launch the “St. Jude Children’s Research Hospital VISA” card. Like the typical affinity card program, Bank One will make a direct contribution to support the hospital based on cardholder transactions. The new card will carry a six-month 0% APR. The card will be available in mid-December and will offer a choice of card designs featuring either St. Jude patients or the hospital itself.

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EBPP Loyalty

Affluent consumers using electronic bill presentment & payment services are 50% less likely to leave their financial institution than non-EBPP users according to new consumer research report. Collective Dynamics, working closely with Charter Members CheckFree, U.S. Bank and Visa, says it also found that 65% of consumers get their service from a bank, and 30% use a portal. At the upper income level of $80,000 or more per year, EBPP users outnumber non-users two-to-one. The study also found that 76% of the EBPP users visit their financial institution’s Web site at least weekly while only 40% of the non-EBPP users visit the Web site as often.

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INFINET & MONERIS

Toronto-based Moneris Solutions and infiNET Solutions announced an
alliance agreement to begin providing Moneris credit card payment services
through the “QuikPAY” subscription service. “QuikPAY” provides colleges and
universities with the ability to aggregate all of their transactions
through a central billing and payment service. Services include eBill,
paper bill fulfillment, eCheck payments, credit and debit card services for
Internet, phone and in-person transactions, campus card refresh, cashiering
solutions and reconciliation reporting across the enterprise, along with
sophisticated content management and distributed administration, which
serves every departmental merchant within the institution. Used on over 50
campuses throughout the US, “QuikPAY” is the pre-eminent billing, payment
and commerce service for colleges and universities today.

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AMEX & AA

American Express and American Airlines announced they have agreed
to provide American Express
Corporate Travel customers in North America with access to all publicly
available American Airlines fares, including Web fares. This collaboration
will create a new distribution model that delivers lower airfares to American
Express’ corporate customers. It will also lower distribution costs for
American Airlines. The companies expect to launch the program in first quarter
2003. Through an enhancement to its proprietary technology, “TravelBahn”,
American Express has created a new business model to help American Airlines
reduce its distribution costs. American Express Corporate Travel customers
will automatically gain full access to all American Airlines public fares,
including those found on AA.com and other low-cost distribution channels.

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Oberthur & Thales

Thales and Oberthur Card Systems are joining forces to develop smart card-based technologies and solutions for financial services, identification/government, and physical/network security. The partnership will bring together Oberthur Card Systems’ expertise in smart card technologies, peripherals and mass personalization solutions with Thales’ global security offerings in the networking and communications, transaction and payment, and enterprise and ID markets. With its exclusive transaction security products, EMV payment terminals and associated products, Thales holds a unique global leadership position in the provision of the security cornerstones for EMV. Oberthur Card Systems is the number one supplier of banking cards and has a worldwide capability with industrial facilities and personalization centers. Combining these strengths, Thales and Oberthur will deliver a smooth migration to EMV, full interoperability and secure, end-to-end solutions for standard and value-added services.

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