Chinese ATM Deal

Beijing-based Bank of China has signed a US$20 million deal with NCR Corporation for ATMs. Under the agreement, NCR will provide Bank of China with Personas 86, Personas 84, Personas 74 and Personas 75 ATMs with enhanced self-service functions. BOC already has over 6,000 ATMs, and the intention is to add multiple units to its 13,000 points of service. NCR helped Bank of China install China’s very first online ATM in 1988 at the bank’s Shenzhen branch. Last month, China Construction Bank inked a US$14.4 million hardware and software deal with NCR. CCB will deploy NCR’s “Personas 84” and “Personas 86” ATMs across China. CCB currently has 8,000 ATMs deployed across China. NCR and CCB have a 12 year relationship. There are 50,000 ATMs total in China, according to The RAM Report ([www.ramreport.com][1])

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

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EDY CARDS

Sony’s new e-money smart card system, “Edy,” will be adopted by seven major consumer finance companies in Japan. The seven firms project they will issue between two and three million credit cards with “Edy” functionality by the end of next year. The credit card companies involved include: DC Card Co., Sumitomo Mitsui Card Co., UFJ Card Co., Life Co., Daiei OMC Inc., Kokunai Shinpan Co., and Sony Finance International Inc. “Edy” money was developed by bitWallet Inc., which was established in January 2001 by the Sony group and other firms, including Toyota Motor and NTT DoCoMo Inc.. According to the Nihon Keizai Shimbun, “Edy” smart cards are already being used at some retailers, such as convenience stores. bitWallet says by the end of next year, there will be more than 8 million ‘Edy” cards in use, with 30% integrated into credit cards.
bitWallet also says it expects to increase the number of “Edy” merchants to 23,000 by the end of 2003.

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INTERCHANGE FEES

The Reserve Bank of Australia’s final proposal for credit and debit card reform is currently being reviewed by The Payments System Board with its report expected next week. The Australian Financial Review says it is likely that the PSB will recommend a 30% reduction in interchange fees on transactions, the abolishment of restrictions on retailers surcharging for card payments and easy access to the card business for new competitors. The RBA credit card proposal involves changes to what are known as four-party payment systems such as MasterCard, Bankcard and VISA. Three-party payment systems such as American Express and Diner’s Club, which typically carry higher fees than four-party systems, are excluded from the proposal. Under the terms of the proposals unveiled on December 14, 2001, the RBA would regulate three key areas of four-party credit card systems: the setting of interchange fees, surcharging, and who can join the system. VISA and MasterCard say the proposal would significantly reduce interchange fees with the result that credit card issuers would be forced either to raise fees or reduce services to cardholders.

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E-SIGNATURE

Sydney-based Sentry Project Management says smart card e-signature application, “protectID,” is now available on the MULTOS and Java smart card platforms promoted by VISA and MasterCard.
A payment application, an e-signature authentication application and a loyalty application are the typical applications that are now being requested by card issuers. The ability of the Sentry system to provide a uniform card interface with their “protectID” e-signature application simplifies card personalization and the rest of the card lifecycle. Telstra’s “iTrust” project currently uses “protectID” on the MULTOS platform to satisfy security regulations in Australia.

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MasterCard 2Q/02

MasterCard International reported this morning that gross dollar volume in the USA is growing at an annual rate of 16.8%. During the first six months of this year, MasterCard-branded cards were used in over 3.2 billion transactions, generating $283.7 billion in volume. MasterCard says purchase volume is growing 15.2% and cash volume is up 21.2%. Outstandings stood at $258.8 billion at June 30th, an increase of almost 16% over one year ago. The number of MasterCard cards issued in the USA increased 15.1% to almost 295 million at mid-year. During the first half of this year, MasterCard completed its integration with Europay International and its conversion to a shareholder-owned global payments company. Globally, MasterCard-branded cards, excluding on-line debit cards, produced more than 6.3 billion transactions in the first six months of this year, generating gross dollar volume of $534.7 billion. As of June 30th, MasterCard’s 15,000 member financial institutions around the world had issued nearly 559 million MasterCard-branded cards, a 16.7 % increase over June 30, 2001. MasterCard’s acceptance locations hit 28.4 million at mid-year, a 26.4% increase over June 30, 2001. Gross dollar volume for worldwide MasterCard credit programs grew 14.6% to $444.3 billion, and GDV for MasterCard off-line debit programs rose 21.6% to $90.4 billion, in each case compared to the first six months of 2001.

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TNS SMART NETWORK

Toronto-based TNS Smart Network said it now has 4,000 ATMs nationwide and has grown 56% since the start of this year. TNS is Canada’s largest privately-owned company specializing in shared cash and POS transaction processing. TNS offers both an in-house processing solution and sales of their proprietary “Smart Processing Suite” software. TNS says it has sustained profitability with no debt for 5 years.

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TransFort Deal

Paymentech and Arcot Systems have teamed to provide the full suite of Arcot “TransFort” merchant solutions to businesses selling goods and services online. Together the two companies have raised the bar in providing a global end-to-end service for secure e-commerce payment processing using Verified by Visa. E-commerce merchants can now get unprecedented fraud and chargeback protection, while increasing the confidence of online shoppers.

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Equitex 2Q/02

Equitex, Inc., the former marketer of the now-defunct “Net 1st MasterCard,” said last week it has received notification from the Nasdaq that it will be delisted from the Nasdaq SmallCap market. The company which runs Key Financial Systems, Nova Financial Systems, and Chex Services, reported 2Q/02 revenues of $5,766,861 as compared to $3,431,445 for Key and Nova for the three months ended June 30, 2001. Total expenses were $5,781,318 on a consolidated basis for the second quarter of 2002 versus $2,872,196 for Key and Nova for the second quarter of 2001. Net loss for the quarter ended June 30, 2002, was $32,457 as compared to net income of $441,749 for Key and Nova for the second quarter of 2001. The Equitex companies market and service credit card products and also provide cash access services to casinos and other gaming facilities. For complete details on Equitex’s 2Q/02 performance visit CardData ([www.carddata.com][1]).

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

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