Willumstad Goes Global

As part of a new management structure, Citigroup said yesterday that Bob Willumstad, President of Citigroup and Chairman and CEO, Global Consumer Group, will now have global product responsibility for credit cards; consumer finance; and consumer branch banking. Bob Willumstad will also oversee Citigroup’s operations in Mexico and Puerto Rico. In addition, Mr. Willumstad, as President, will continue to serve as a member of the Finance and Capital Committee, the Investment Committee, and the Risk Committee.

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POSTCARD

London-based Mosaic Software launched PostCard, a complete debit card management and issuer services system. PostCard integrates with the Postilion Realtime Framework to enable processors to service any number of issuers, each with potentially very different requirements. With PostCard, operators on card issuers’ premises can define new cards, update existing cards, and delete existing cards. The product also runs a card production staging process on a regular basis, allowing files to be built for the production of payment cards. The files can be used by the PostCard owner or by an independent card production company for the encoding of magnetic-stripe cards or personalization of EMV smart cards.

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Supreme Decision

The U.S. Supreme Court decided yesterday not to review the Second Circuit Court of Appeal’s decision upholding a grant of class certification in the antitrust lawsuit brought against VISA and MasterCard by a group of U.S. merchants. Although the Court made no comment on the case, the implications for VISA and MasterCard are significant since it may force the card associations to seek a settlement rather than risk a trial that could produce damages of more than $40 billion. MasterCard said yesterday that the U.S. Supreme Court missed an opportunity to clarify the confusing standards for class certification that exist among district and appellate courts and it may open the doors to increasing class action abuse. MasterCard noted that the Court’s decision does not relate to the merits of the case, which challenges its “Honor All Cards” rule. Noah Hanft, General Counsel for MasterCard yesterday said that MasterCard is confident that the attempt by retailers “to take away from consumers the ability to choose how to pay for their purchases will fail once the plaintiffs’ attorney is called on to present evidence, not rhetoric.” One year ago, VISA and MasterCard filed an appeal to the Second Circuit Court of Appeals seeking to reverse Federal District Court Judge John Gleeson’s decision granting class-action status. The Second Circuit Court of Appeals turned down the motion by a 2-to-1 decision. In the dissenting opinion, Judge Jacobs, the senior judge on the Second Circuit panel, argued that the Court was obligated to look at two fundamental issues: whether the case can be manageably tried as a class action and whether common issues predominate among the four million merchants now in the class. (CF Library 2/24/00; 6/8/00; 2/5/01; 4/4/02)

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DINERS AEROPLAN

Diners Club Canada has renewed its contract with Air Canada to offer Aeroplan Miles. Diners became the first card to offer Aeroplan Miles in 1989. Aeroplan is Canada’s leading frequent flyer program with more than 5 million Aeroplan members. The Diners/Aeroplan partnership also offers Diners Club Silver, Gold, and Maple Leaf Club cards. Maple Leaf Club cardholders have access to Air Canada’s Maple Leaf and affiliated airport lounges worldwide. Each year, Maple Leaf Club cardholders will receive a special two-for-one ticket offer on Air Canada.

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TransLink Expands

San Francisco’s smart card regional fare payment system expanded this week to include the entire Muni Metro system. The four-month-old TransLink pilot program has distributed smart transit cards to some 5,000 pilot program participants so far. Participants can load value onto their cards at self-serve Add Value Machines in transit stations and some 40 retail locations throughout the Bay Area, or by calling the TransLink Customer Service Center. Add Value Machines accept cash, debit cards, and VISA, MasterCard and Discover credit cards. TransLink users can also reload value automatically by subscribing to the TransLink Autoload Program. Each TransLink smart card distributed to pilot program volunteers is pre-loaded with $3 in TransLink e-cash. The TransLink program involves AC Transit, BART, Caltrain, Golden Gate Transit, Santa Clara Valley Transportation Authority and San Francisco Muni. MTC has contracted with Motorola and ERG Limited to implement and operate the TransLink fare-collection system. MTC expects to install TransLink equipment on all 21 Bay Area transit systems by mid-to-late-2003 , which together carry in excess of 1.6 million riders a day. (CF Library 1/31/02; 3/21/02)

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OSAKA CITY CARD

JCB Co. is launching a smart loyalty card in conjunction with the City of Osaka, Japan’s third-largest city. The credit card giant says it plans to aggressively market the new service to other cities and towns throughout Japan, and has set a target of 10 contracts and one million cards in the first year. The Osaka City Card is a smart card with contactless chip that will keep track of points awarded for purchases at participating city shops, amusement facilities, and businesses, which customers can then exchange for rewards. JCB will issue the cards and provide POS terminals at merchant locations, building on the network of JCB credit card-enabled terminals already deployed. Point program operations will be subcontracted to the Japan Point Anex, a joint venture established in 2001 by JCB with a number of other credit
card companies and major retailers. JCB also offers service customers the option of cards with an advanced dual-interface IC chip, allowing both contact and contactless access to a single chip that means the card can be used in a wide variety of applications. For example, in the future, the Osaka City Card loyalty program could be combined with the KANSAI THRU PASS prepaid transport card, also contracted to JCB by the Osaka Municipal Transportation Bureau, as well as incorporating credit card payment functionality.

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Voyager & FuelQuest

U.S. Bank Voyager Fleet Systems and FuelQuest have sealed a deal to combine the functionality of the FuelQuest Fuel Management Online solution, with the Voyager fleet card. The partnership will enable companies to improve operational efficiencies as customers will no longer have to manage and manually manipulate two different data sources for each of their rolling assets and locations. By combining the functionality of the FuelQuest Fuel Management Online solution, with the Voyager fleet card and its transaction reporting capabilities, managers now have web access to consolidated data from which to analyze and monitor their complete organizational fuel spend.

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AQUACARD

A debit smart card for purchasing drinking water has been introduced in Ronda, in central Cebu. New Jersey-based WorldWater Corporation launched its AquaCard this week. The new debit card system from enables users to purchase clean drinking water by the liter. Cebu residents insert the cards into AquaMeters which then deliver the requested number of liters of clean drinking water from the solar pump nearby. The smart cards are recharged by the customer at a community bank. The user can purchase up to 1000 liters per charge. WorldWater maintains a 10% carrying charge net of the card gross for service charges during a 10-year contract.

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Student Advantage Card Expands

The University of Mississippi, Oxford, and William Paterson University have inked contracts with Student Advantage to launch an off-campus stored-value payment card program. Adding the SA Cash function to the school’s IDs will enable students, faculty, and staff to buy food, necessities, and entertainment at off-campus businesses. These two universities are the latest in a growing number of campuses that have adopted the SA Cash Program. Other schools that have added Student Advantage’s SA Cash function to their IDs include Dartmouth, Princeton, Johns Hopkins, Carnegie Mellon, and American University.

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SafeCHECK SignUps

Citadel Commerce Corp and SyTec, Inc have agreed to enhance their POS check verification and electronic check conversion services with SafeCHECK in early July. Both companies will be able to provide merchants with an instant verification that the customer’s account is open and there are sufficient funds to cover the check. SafeCHECK also enables processors to immediately debit those funds through existing ATM networks. Merchants utilizing this capability can return a cancelled check to the customer at the time of the transaction.

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Insurance Card

Standard Insurance Company launched its Standard SecureCard today in conjunction with individual disability insurance policies. Benefit payments are automatically credited to the stored value card, which can be used at ATMs nationwide or as a debit card for VISA POS purchases. The Standard SecureCard was first introduced in January 2001 for group disability policyholders. The card also may be used to transfer funds as needed to checking and savings accounts with a phone call. Balances and transactions are monitored through a personal Web site account.

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APTUS Financial Launched

David Grano, former president and CEO of Card Capture Services and Rick Holt, former VP of sales at E*TRADE Access, have teamed to form Portland, OR-based APTUS Financial which offers a payment platform that allows wireless carriers and online service providers to expand into the prepaid service market. APTUS is developing additional proprietary solutions to allow for alternative delivery by financial institutions and transaction processors via ATMs and point-of-sale terminals. Additional applications include in-branch check cashing terminals and traditional ATM programs in the United States and Canada.

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