CUNA e-gate

CUNA Network Services has become the first technology partner to offer the SchlumbergerSema ‘e-gate’ smart card to member credit unions. The alliance will target smart cards to 10,000 credit unions nationwide. The key component of the ‘e-gate’ smart card is a specially designed chip that incorporates the standard smart card ISO and USB interface. The ‘e-gate’ smart card plugs directly into the standard USB port on a PC, eliminating the need for a separate card reader, power supply and driver software. Used with an e-wallet, the ‘e-gate’ card enables credit unions to offer members a secure, convenient solution for conducting commerce online through a credit union portal.

[![][1]][2][![][3]][4][![][5]][6]
** **VIDEO CLIP** Choose your format to view a 30 sec clip of the e-gate’ smart card being demonstrated. **

[1]: http://www.cardweb.com/graphic/players/quicktime_sm200.gif
[2]: http://www.cardweb.com/cardwatch/movies/qt/egate_dc.mov
[3]: http://www.cardweb.com/graphic/players/windowsmedia_sm200.gif
[4]: http://www.cardweb.com/cardwatch/movies/wm/egate_dc.wmv
[5]: http://www.cardweb.com/graphic/players/real_sm200.gif
[6]: http://www.cardweb.com:8080/movies/cardflash/egate_dc.rm

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S1 and Corillian Suit

S1 Corporation and Corillian Corp announced that they have reached an agreement to settle the patent infringement lawsuit brought by S1 against Corillian in March 2000.

Under the terms of the settlement, Corillian will obtain a license from S1 to United States Patent No. 6,023,684 (“the ‘684 patent”), and the lawsuit will be dismissed. The ‘684 patent relates to a three-tier financial transaction system for supporting communications between financial institution customers and financial institution back end processing systems. The financial and license terms of the settlement are confidential.

About S1

S1 (Nasdaq: SONE) is a leading global provider to more than 2,600 banks, credit unions, insurance providers, and investment firms of enterprise software solutions that turn customer interactions into profits. S1’s Enterprise eFinance solutions deliver a transactionable, customer-centric view across all delivery channels, resulting in a more compelling experience for the customers and a more profitable relationship for the financial institution. S1 is the only eFinance provider with the proven experience, breadth of products, and financial strength to empower financial services companies’ Enterprise eFinance strategy. Additional information about S1 is available at .

About Corillian Corporation

Based in Oregon, and with international offices in Europe and Asia, Corillian Corporation is an award-winning provider of eFinance-enabling software for the financial services industry. Built on the Microsoft Windows 2000 platform, Corillian applications support Internet banking, bill delivery and payment, brokerage, customer relationship management, enhanced data aggregation, and small business transactions. Voyager can be deployed on-site at the financial firm or at a secure data center. Corillian technology also enables Open Financial Exchange (OFX) access by finance management software packages such as Quicken®, QuickBooks® and Microsoft® Money. For more information about Corillian Corporation, visit the company’s Web site at .

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Golf Card

The PGA TOUR has moved its credit card sponsorship to MBNA from Bank One/First USA. MBNA confirmed yesterday it has signed a long-term agreement to issue the ‘PGA TOUR MasterCard’ and ‘SENIOR PGA TOUR MasterCard’, effective January 1. MBNA has been involved in golf through its financial support of ‘The First Tee’, a World Golf Foundation initiative dedicated to introducing golf and its values to young people.The tax-exempt membership PGA TOUR organization will produce more than 125 events on three tours next year. First USA rolled out the first ‘PGA TOUR MasterCard’ and ‘Senior PGA TOUR MasterCard’ in early 1997. MasterCard is the “official card” of the ‘PGA TOUR’ and ‘SENIOR PGA TOUR’, making it the preferred method of payment at ‘PGA TOUR’ shops, Tournament Players Clubs and other locations. American Express launched its first golf card in 1996. The ‘American Express Golf Card’ offers a points reward program and advance tee time reservations at selected courses. In Canada, Bank of Montreal issues the ‘Canadian PGA MasterCard’ which offers discounts on greens fees and lessons. (CF Library 7/16/96; 1/31/97)

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HouseCharge Server

Datacap Systems, Inc., a leading provider of integrated payment systems, announces availability of HouseCharge Server, a simple, complete charge system for merchants of all types and sizes. HouseCharge Server is easily implemented on a headquarters PC to handle payment authorization requests locally via direct connection and remotely via phone lines. Retailers, schools, hospitals, country clubs and other businesses can quickly implement their own credit authorization system, speeding up authorizations, eliminating credit service charges and improving customer service. After installation, all DataTran-ready system users can initiate use of HouseCharge Server simply by issuing private cards or account numbers to their repeat customers and setting credit parameters. Datacap payment solutions automatically handle all payment types by sending bank credit/debit cards and check requests to traditional payment authorization services, while identifying private card/acccount numbers and forwarding those requests to HouseCharge Server. Datacap integrated payment solutions are used by hundreds of system, register and POS providers at hundreds of thousands of paypoints. Users of those systems can send requests to HouseCharge Server immediately by simply downloading new parameters to their DataTran. Most DataTran-ready POS terminals require no changes to their software. A complete reporting package, including customer statements and aging reports, ensures control and accountability – with or without integration to other accounting systems. Private charge systems have become popular in schools, hospitals, country clubs and other “closed” sales environments. Now HouseCharge Server makes it easy and inexpensive for any merchant to implement a private charge system. Call or email for more information. The Company Datacap Systems has successfully designed, manufactured and marketed integrated credit/debit/check verification systems for over 18 years. Datacap’s payment verification interfaces allow virtually any system, regardless of operating system or hardware platform, to get easy access to payment processing networks for credit, debit, check, EBT, house charge, gift card and loyalty program processing. Datacap products are typically used in retail, mail/telephone order, hospitality, quick service, retail petroleum, parking, auto rental, convenience, medical and government applications.

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Chargeoffs Spiral

Further confirmation of a sharp rise in chargeoffs since the end of third quarter comes from the performance of receivables held in trusts of rated credit card-backed securities. According to the latest performance figures, the monthly charge-off rate rose 30 bps, to 6.8% in October from 6.5% in September. The increase represents a 135 bps increase in charge-off levels compared with a year ago. According to data collected by CardData and RAM Research’s ‘Bankcard Barometer’, chargeoff rates industry wide for October hit 6.33%, the highest level in nearly 11 years. According to Standard & Poor’s ‘Credit Card Quality Index’, the average increase in losses in October for “prime” issuers was relatively modest, less than 40 bps. The “subprime” section averaged an increase in defaults of 165 bps. S&P also reports delinquencies averaged 5.3% in October, a 20 bps increase from September and a 70 bps increase from a year ago. Seventy-five percent of the trusts tracked by the index reported an increase in 30-plus day delinquencies during October, and almost 80% of the trusts reported an uptick in delinquencies in the 90-plus days bucket. Other than delinquencies and charge-offs, performance trends for the other variables rebounded. The gains in yield and the lower cost of funds helped excess spread levels. Average excess spread levels ballooned significantly, increasing by 190 bps to 8.5%, the highest point since the S&P index was created.

STANDARD & POOR’S CREDIT CARD QUALITY INDEXES
Performance month Oct 99 Oct 00 Aug 01 Sept 01 Oct 01
Outstandings (Bil. $) 300.3 332.0 366.6 366.1 373.2
Yield (%) 20.0 20.3 20.0 18.9 20.0
Charge-offs (%) 5.5 5.4 6.5 6.5 6.8
Weighted base rate (%) 7.5 8.4 6.0 5.8 4.7
Excess spread (%) 6.9 6.5 7.5 6.7 8.5
Delinquencies (%) 4.8 4.6 5.1 5.1 5.3
Payment rate (%) 16.2 16.5 16.7 14.8 16.2
SOURCE Standard & Poor’s

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Privacy Guidelines

The staff of several federal agencies that supervise banks, thrifts, and credit unions issued guidance yesterday to help financial institutions comply with these agencies’ consumer privacy regulations. The staff guidance issued Wednesday is a series of “Frequently Asked Questions”, or ‘FAQs’, covering various aspects of the privacy rules. For example: “I own and operate several ATMs. Many consumers who use them are not my customers. I disclose to nonaffiliated third parties nonpublic personal information about those consumers other than as permitted by certain exceptions, so I must provide them with the required notices when they use my ATMs. But ATM screens are very small. Am I required to purchase machines with screens large enough to hold my privacy policy? Must I make consumers click through dozens of tiny screens of information?” The FAQ answers: “Neither new machines nor multiple screens are necessary. You must provide an opt out notice. This notice must state that you disclose nonpublic personal information about the consumer to nonaffiliated third parties, state that the consumer has a right to opt out of that disclosure, and provide a reasonable opportunity for the consumer to opt out (such as by requiring the consumer to decide whether to opt out as a necessary part of the transaction). In addition to the opt out notice, you must provide an initial privacy notice. For consumers who are not your customers, you may provide a short-form initial notice with an opt out notice. This short-form notice must state that your privacy policy is available upon request and it must describe a reasonable means for the consumer to get your privacy notice. As with any privacy notice, the opt out notice and the short-form initial notice must be clear, conspicuous, and accurate. These notices must be delivered in a manner so that the consumer can agree to receive the notices electronically, such as by acknowledging receipt of the notices as a necessary step to completing the transaction at the ATM. The complete FAQ is available on CardFlash Online’s navigation bar ([www.cardflash.com][1]).

[1]: /cardflash/secure/oldstatic/2001/december/prifaq.html

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Horizon Platform

Cardservicer, a leading provider of credit card processing solutions, announced the launch of its revolutionary new technology platform with a promotional “cost-based” offer for qualifying U.S.-based MasterCard and Visa Card issuers. The promotion will run through March 2002.

Cardservicer’s credit card processing platform, called Horizon, is a web-based architecture that will provide credit card issuers increased scalability and flexibility and will reduce cost of operations over current mainframe based systems. It is operational in 17 credit card issuer banks outside the United States.

The Horizon platform evolves in part from Credit origination and Collections software developed by Cardservicer’s associate company Instant-Bank. Instant-Bank’s enterprise loan/leasing software is currently operational in 17 installations, and its clients includeGE Capital, National Westminster Bank, Bank One, The Associates, and Affiliated Computer Services, among other clients.

The Horizon technology platform is built on a series of modern technology components that have been highly integrated. The system has been developed over the past three years at an investment of more than $10 million and is delivered as a complete end-to-end enterprise-wide hosted solution.

“Credit card issuing banks across the United States can now more efficiently and cost effectively manage their credit card portfolios, with the benefits of easy to use functions, and work management features enhancing productivity” said Chris Sullivan, President of Cardservicer. “They will no longer be limited to mainframe inflexibility.”

The introductory promotional offer for the Horizon platform applies to credit card issuing institutions with a minimum of 25,000 accounts. The cost-based offer applies for the first five years, one-third of cost for periods thereafter, plus cost-based enhancements and implementation/conversion.

About Cardservicer

Cardservicer and its sister company Instant-Bank, is a privately held, New York-based company, that develops enterprise wide technology infrastructure platforms for loan and lease processing management. Cardservicer’s flagship product is the Horizon credit card processing software that helps credit card issuers more cost-effectively service their credit card portfolios. Horizon is a hosted Web-based solution that wholly replaces legacy mainframe systems. Horizon originates, services, collects, and accounts for credit cards using technology 30 years ahead of other systems. For more information, visit [www.Cardservicer.com][1].

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

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Advanced Deposits

NCR and Star Systems announced this morning an arrangement to bring advanced deposit technology to STAR participants throughout the US. This new deposit solution enables a customer to deposit cash or checks directly into an ATM without an envelope. The advanced deposit technology utilizes NCR’s ‘APTRA’ software suite and will be marketed jointly by NCR and STAR. The architecture enables the core application to run on ATMs, providing the capability of accepting and counting cash and checks. The deposit amount is verified on screen, displaying the check or cash amount visually. NCR’s patented ability to print check images on receipts will also be utilized.

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AmEx Cut Back

American Express Company announced this morning its is eliminating approximately 5,500 to 6,500 jobs and taking a fourth quarter pre-tax restructuring charge of approximately $240 to $280 million. The staff reductions announced today are in addition to the reductions of 7,700 positions announced earlier this year. The total number of jobs eliminated — 13,200 to 14,200 — represents approximately 15% of the workforce as of the beginning of 2001. The staff reductions are taking place primarily in the travel businesses and reflect the sharp slowdown in that sector since September 11. Approximately half of the staff affected by these reductions have already been notified. The remaining notifications will take place during 2002. At Travel Related Services, billed business volumes were down 14% in September, 10% in October and approximately six percent in November. The declines reflect continued weakness within the corporate travel and entertainment category. Travel sales for October declined approximately 46% from year-ago levels. In November, travel sales were down approximately 38%. The company also said it expects earnings to come in on low side of analyst projections. Approximately half of the staff reductions announced today are taking place in the travel businesses. American Express’ shares were down to $32.75 in pre-market trading from Tuesday’s close of $34.26.

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Mosaic CNP Solution

Mosaic Software has announced the general availability of Postilion Integrated Payments for eCommerce, a fast track solution to address the requirements of merchants and commerce service providers in the card-not-present market. Designed specifically to handle all the processing requirements for Internet eCommerce and Mail Order Telephone Order transactions, PIPE provides for real time authorization and secure transaction processing when the card and card holder are not physically present. Payments initiated by credit cards, debit cards or checks are supported.

Due to the greater opportunity for fraud, the card-not-present market has more stringent requirements for transaction processing than card present transactions. Because of these requirements, intended to protect all parties from fraud, Postilion PIPE implements security at the network level by providing secure channels for data transfer using Secure Socket Layers. In addition, at the EFT level, card authentication through the use of card verification values and address verification services is also provided.

“The Postilion Integrated Payments for eCommerce solution is the most scalable solution today in the MOTO credit card market, and can handle up to 720,000 transactions per hour. Merchants and CSP’s, both small and large, will be pleased with the competitive nature of our investment structure. In addition, our new solution is based on the highly reliable Microsoft Windows 2000 based Postilion platform so it is much easier to support and more flexible when adding additional payment processing capabilities, than existing products available on the market today” stated Kevin Pannebecker, Senior Vice President, e-Commerce Business Development, Mosaic Software.

An added benefit of the Postilion Integrated Payments for eCommerce solution is that it integrates fully with emerging technologies (including WAP-enabled mobile phones, the Internet and digital TV), providing a true multi-channel payment solution.

About Mosaic Software

Mosaic Software is a leading edge provider of electronic funds transfer (EFT) software for consumer-generated electronic transactions, and is the market leader for web-enabled ATM and prepay software solutions. The company is held by strategic partners GE Equity and Comparex Holdings, and Mosaic management. With offices in the USA, a European office in the UK, South Africa and Australia, Mosaic has a strong global presence. The company is firmly established in the financial services industry and its EFT solutions drive operations in a large number of multinational companies and industry leaders around the globe. Clients include financial institutions, retailers, Internet service providers, card issuers, telcos, data processing service providers and some of the foremost players in the emerging online industry, in the USA, Latin America and the Caribbean, Europe, Australia, the Middle East, Africa and the Asia-Pacific region.

Mosaic’s family of products, named Postilion, is a comprehensive software solution designed to effectively handle the transaction delivery and authorization requirements of every aspect of the EFT arena. Worldwide, Postilion is used for ATM Processing/Monitoring, EFT Switching and Routing, Point-of-Sale (POS), Credit/Debit Card Processing, Internet/Call Center Payment Authorizations, Prepayment, Internet/Home Banking and Mobile Commerce applications. Operating as the first fully-fledged EFT switch running on Windows NT/Windows 2000, Postilion is live in more than 500 installations worldwide.

Mosaic Software clients include 7-Eleven (US), American Express (US), E*Trade Access (US), Retail Decisions (UK), Calypso (Canada), Columbus Data Systems (US), Transaction Network Services (UK), Woodforest National Bank (US), Sky Financial Group (US) Echo (US), Pick ‘n Pay (SA), ABSA Bank (SA), Saambou Bank (SA), NBS (SA), Vodacom (SA) and MTN (SA).

An overview of the company and product may be found at: [www.mosaicsoftware.com][1]

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

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Barbeque Gift Card

Gift Check Solutions announced it has been selected by Spring Creek Barbeque, to provide the Texas-based restaurant chain known for its “down-home cook’n” with electronic gift card services.

Spring Creek Barbeque has 14 restaurants in the Dallas and Fort Worth, Texas area.

As part of the agreement, Gift Check Solutions’ Gift Card Solutions will manage the gift card fulfillment, processing, and security of the gift cards for Spring Creek Barbeque. The electronic gift cards are customized to meet the look and feel of the restaurant. The electronic gift cards may be purchased at any of the Spring Creek Barbeque restaurants.

“We decided to move to the electronic gift cards because they were more convenient, durable and easy to market to our customers,” said Greg Lozier, controller for Spring Creek Barbeque. “Gift Check Solutions provided a better price and rate on the transactions than any of their competitors, and it has a positive reputation in the restaurant industry.”

Gift Check Solutions’ Gift Card Solutions electronic gift card program utilizes magnetic swipe card technology, allowing all gift card transactions to be processed in real-time through a highly secure network. Gift Card Solutions are designed to utilize compatible location-established point-of-sale (POS) equipment or a Gift Check Solutions dedicated gift card terminal. “We are pleased to have Spring Creek Barbeque as a new client and hope to help them grow their business through our Gift Card Solutions,” said John Bechard, president of Gift Check Solutions.

About Spring Creek Barbeque

Spring Creek Barbeque has been serving “down-home cook’n” in Dallas and Fort Worth since 1980. The company now has 14 restaurants located throughout Texas.

About Gift Check Solutions

Based in Salt Lake City, Gift Check Solutions provides paper- and electronic-based gift products and services. The company manages the creation, processing, printing and fulfillment of gift certificates and gift cards. Electronic gift cards utilize magnetic swipe card technology, allowing gift card transactions to be processed real-time via a secure network. Gift Check Solutions also offers hosted e-commerce services for online gift certificate and ordering and customized point-of-purchase materials to drive gift certificate and gift card sales throughout the year. For more information, visit [http://www.giftchecksolutions.com][1] or call 888/739-9971.

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

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