Ingenico Gets Vital Certification

Vital Processing Services has issued a Class B platform certification for Ingenico’s Elite 510 counter-top, Elite 712 “hand-over” counter-top, and the Elite 770 short-range wireless terminals. Vital certified the terminals with Certegy (Equifax) and Telecheck, including driver’s license and keyed MICR input support. Additionally, Vital simultaneously certified all three Elite terminals for debit and credit card acceptance in retail and restaurant establishments.

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SMART CARD DEALS

Sophia Antipolis-based, ASK S.A. has signed two new contracts for dual interface contactless smart cards, one from the “Centre” region of France and the city of Tours and a second from the city of Grenoble.
Under the first of the new contracts, ASK will supply 80,000 dual interface contacted/contactless smart cards to the “Centre” region of France and the city of Tours. The two cards supplied are the GTML and the CD97. The cards are for use in the Automated Fare Collection system on the 400 buses of the region as well as in the regional SNCF trains, and it will be fully operational in October 2002. In the second contract, ASK will provide the city of Grenoble with 90,000 dual interface GTML smart cards and 1,000 GEN310 contactless couplers, which are integrated into the fare readers and AFC system on the buses and trains. Deliveries will start in June 2002, and the system will be fully implemented in November 2002.

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Plastic Vacations

The Cambridge Consumer Credit Index, sponsored by The Debt Relief Clearinghouse and affiliated with credit counseling firms owned by John and Richard Puccio, said yesterday its latest survey showed that 23% of Americans will use credit cards to charge their vacations. However, older and higher-income Americans are using their credit cards far more to pay for their vacations. Of those age 65 or older, 40% are putting their holiday expenses on plastic, while 38% of those earning more than $75,000 are charging their getaways.

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CELL PAYMENTS

JCB, Sumitomo Mitsui Card Company, Nippon Shinpan, American Express, and about a dozen other credit card companies will sign contracts with the cell phone provider NTT DoCoMo next month. Under the program, which is set to begin in September, NTT DoCoMo users will be able to pay their monthly phone bills via credit card. Currently, NTT DoCoMo customers pay phone bills at banks, post offices and convenience stores or have the bills charged directly to their bank accounts. KDDI and J-Phone already allow customers of their cell phone services to pay by credit card. About 7% of the charges incurred by subscribers of KDDI’s service are paid by credit card, while 12% of J-Phone’s customers pay by credit card.

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Payment Habits

While the latest industry statistics show 40% of consumers pay off credit card balances each month, a poll taken during the last two weeks of June, indicates the number of convenience users may be shrinking. The informal June survey of more than 1,000 Americans showed that 37% pay off the total balance in full each month. Since the recession of 1990-91, the number of convenience users of credit cards grew from 29% to a high of 44% in early 2001. The trend reversal began in July 2001 and accelerated after 9/11. According to the informal poll conducted on CardWeb.com’s homepage, 51% of consumers say they pay more than the minimum each month. Slightly less than 12% say they make minimum payments only. At the end of the first quarter 40.30% of cardholders were paying-off account balances each month, according to CardData ([www.carddata.com][1]).

Bank Credit Card Convenience Usage
1990: 28.60% 1996: 38.50%
1991: 29.20% 1997: 40.20%
1992: 31.30% 1998: 42.00%
1993: 33.70% 1999: 43.40%
1994: 35.10% 2000: 44.40%
1995: 37.90% 2001: 42.10%

Source: CardData ([www.carddata.com][2])

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

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SMART MASTERCARD

Bank Islam Malaysia Berhad has begun issuing MasterCard M/CHIP smart cards using the MIST NBS Smart EMV Card Issuance Process with “Conquest” card issuance software and “Advantage” series card issuance machines. Bank Islam Malaysia Berhad is the first Islamic bank to issue EMV smart cards and has a network of 83 branches nationwide. MIST NBS says the installation of mid-volume NBS Advantage issuance equipment at Bank Islam provides the platform for the Bank to begin chip card migration. If higher volumes of smart card issuance are required, NBS Horizon equipment, which uses software with the same user interface, may be implemented.

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CyberSource R/3 Cassette

CyberSource is shipping its new payment cassette for SAP solutions which gives R/3 customers real-time credit card authorization and fraud-detection functionality accessible from a single application interface. CyberSource utilizes a highly secure Public Key Infrastructure-based cryptographic security model to authenticate and secure 100 percent of the transactions processed on behalf of its more than 3,000 customers worldwide. The CyberSource system utilizes a private key, known only by the merchant, with over 1,024 bits of data used to authenticate each transaction.

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InfoNow 2Q

Denver-based InfoNow Corporation, provider of VISA’s ATM locator service, reported preliminary financial results for the second quarter which show revenues of approximately $2.8 million and a net loss of approximately $211,000. InfoNow will host a conference call on Tuesday, July 9, 2002 at 9:00 a.m. MDT to review preliminary results of operations for the second quarter.

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Credit Uptick

Americans added $2.4 billion to revolving credit during May compared to $1.4 billion for May 2001, and the annual rate of increase was slightly off this year. The brisk expansion in revolving credit, mostly credit card debt, flies in the face of other recent economic barometers which point to a decline in consumer confidence, travel plans, and overall spending. The May recovery may reflect some pent-up demand from April when revolving credit grew at half the rate of one year ago. According to figures released Monday afternoon by the Federal Reserve, revolving consumer credit is growing at an annual rate of 4.1% compared to 4.5% for May 2001. Since the first of this year, Americans have added $19.8 billion to revolving credit, to hit a record $712.2 billion. At the end of May 2002, American consumers were $1.706 trillion in debt, exclusive of home mortgages.

REVOLVING CREDIT HISTORICAL
($billions)
May 02 Apr 02 Mar 02 Feb 02 Jan 02 Dec 01 Nov 01
GRWTH: 4.1% 7.5 4.8 2.2 1.8 -9.7 12.7
$OWED: $712.2 709.8b 705.4 705.0 702.4 692.4 698.0

Oct 01 Sep 01 Aug 01 Jul 01 Jun 01 May 01 Apr01
GRWTH: -7.1% 0.6 -2.2 -3.7 2.1 4.5 14.2
$OWED: $686.4 692.7 693.5b 698.1 700.3 699.0 697.6

Source: Federal Reserve; revised figures as of 07/08/02; For complete historical data visit CardData ([www.carddata.com][1]).

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

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