AmEx & Zeborg

Zeborg, Inc., the online procurement partner of Fortune 250 companies, announced that American Express has made a strategic investment in the company. Terms of the investment were not disclosed. The new agreement, effective immediately, extends the customer relationship that American Express began with Zeborg in September of 2000.

“Zeborg’s global procurement software offers companies comprehensive, cost-effective solutions for executing their purchasing strategies, re-engineering their procurement processes, and driving down their purchasing costs,” said Pierric Beckert, Senior Vice President, Investments and Business Development, American Express. “Our investment reflects our confidence in Zeborg’s business strategies, its products, and its commitment to generating measurable costs savings for its customers.”

“American Express brings financial strength, stability and a worldwide reputation that will help us accelerate the roll-out of Zeborg’s additional products,” said Arnab Gupta, chairman and co-chief executive officer of Zeborg, Inc. “As a customer for more than a year, American Express’ global procurement department has had first-hand experience in Zeborg’s capabilities as well as in our third generation solution that applies expertise to create savings. The company’s investment in Zeborg demonstrates valuable support of our business model.”

American Express employs Zeborg’s full software offering to support its global procurement strategies. Zeborg ExpenseMap(SM) is the first analytic software that offers an intelligent, cost-effective means to profile indirect spending and identify significant savings opportunities across an organization. Zeborg Advanced Sourcing(SM) is comprehensive sourcing software, with built-in intelligence and proven processes around each indirect spending area so companies can quickly negotiate new best-in-class contracts at significant savings. Zeborg MarketPort(SM) is day-to-day procurement software that delivers hard-dollar savings by enforcing supplier contracts and automating purchasing in the most complex indirect spending areas.

About Zeborg

Zeborg delivers permanent hard-dollar savings of over 20% in complex indirect spending areas such as print, distributed computing, labor, media and shipping. Zeborg maximizes savings and ROI by addressing the entire procurement cycle, providing customers with a strategic way to control and manage their purchasing. Zeborg’s software suite, Zeborg ExpenseMap, Zeborg Advanced Sourcing and Zeborg MarketPort, combines robust technology with 1,000 cumulative years of procurement expertise. To date, the technology and expertise that underlie Zeborg have saved the world’s leading corporations more than $5 billion on total purchases of $30 billion. Based in New York, with offices in Los Angeles and Boston, Zeborg’s investors include Willis Stein and Partners and American Express. For more information, please visit [http://www.zeborg.com][1]

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

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SMART CARD APPLETS

Datacard Group introduced an applet
development kit (ADK) for its Aptura Smart Card Operating System today at
Cartes 2001 in Paris. The kit includes all the software and hardware tools
needed to develop and debug Java Card applets intended to run on Aptura,
and is fully compliant with Java Card 2.1.1 and Open Platform 2.0.1′
standards.

According to Martin Kearsley, senior vice president and managing director of
Datacard’s software solutions division, the new ADK will allow smart card
developers and integrators to more accurately assess the quality and
performance of their smart card applications before they are released to
cardholders.

“The new Aptura ADK adds to the breadth of our smart card portfolio,” Kearsley
said.

“The Aptura ADK is a more advanced development kit adding an important
capability that smart card developers and integrators will not find in other
development kits currently on the market. It contains unique diagnostic
capabilities, which are essential for a successful smart card program.”
Kearsley added.

“The Aptura ADK provides developers with greater confidence in the applet
debugging process.” Kearsley said. “It includes development cards that have
the
same functionality as the Aptura operating system used in production cards, so
applets can be moved from development into production with confidence.”
The Aptura ADK contains four Aptura development smart cards, a smart card
reader, development software and complete user documentation. The software
offers a number of key features, including applet debugging, application
loading and management tools.

“In addition to the Aptura ADK, Datacard offers everything smart card issuers
need for a successful program.” Kearsley said. Offerings include the Aptura
smart card operating systems, server-based smart card personalization
managers,
a full range of card personalization systems, multi-application smart card
life
cycle management systems and a full range of consultative services, including
chip security evaluation and life cycle management.

The Aptura OS for production cards comes pre-installed on a chip ready to drop
into card plastic. Aptura is based on the Hitachi(R) AE45C smart card
microprocessor with 32k bytes EEPROM.

Datacard Group provides financial institutions, corporations, consumer
marketers, governments, schools, healthcare providers, service bureaus and
other enterprises with the software, systems and professional services they
need to build successful card programs. The company’s portfolio includes the
world’s best-selling smart card solutions and card issuance systems, as
well as
a complete line of digital identity systems. Consultative services include a
smart card security laboratory that serves the world’s leading smart card
issuers. DataCard Corporation, doing business as Datacard Group, is privately
held and based in Minnetonka, Minn. Datacard Group serves customers in more
than 200 countries. www.datacard.com

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ATM Card Payout

Customers who now use Western Union’s direct access platform have the option to receive payout in the form of a ‘Western Union ATM Card’. This card can be used at ATMs in the MAC and PLUS networks. The ATM Card payout option is currently available in select agent locations throughout the United States. By end of year, more than 1,500 Western Union agent locations are expected to offer ‘Western Union Direct Connect’ which enables the ATM Card payout option.

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Advanta Gets FUSA Execs

Two senior credit card industry veterans will join Advanta in the next two weeks. Rosemary B. Cauchon has been appointed President, Advanta Small Business Services. Ms. Cauchon comes to Advanta with 16 years experience in the credit card business with Citibank and First USA. Most recently at First USA, she served as Executive Vice President for small business credit card operations and partnership/third party marketing programs, managing a $30 billion portfolio and 1,900 partnership relationships. Ms. Cauchon will be responsible for marketing, including alliances, new products, and new business development, and the analytic areas. Conrad D. Vasquez joins Advanta with 22 years of broad and diverse operational experience, including experience with American Express and Household. Most recently, as Executive Vice President of the Customer Support Division at First USA, Mr. Vasquez managed collections for a credit card portfolio of $70 billion. At Advanta, he will head the Card operating areas, including collections, customer service, and processing. “The addition of these outstanding executives to our already strong business positions us exceptionally well for the future,” said Chairman and Chief Executive Officer Dennis Alter.

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MasterCard/Europay Milestone

MasterCard International and Europay International announced that they have reached a key milestone on the road to global smart card adoption. As of third quarter 2001, MasterCard and Europay’s member financial institutions have issued more than 100 million MasterCard-, Maestro-, Mondex-, and Clip-branded smart cards to their customers around the world. More than half of these cards carry value-added, non-payment applications, such as loyalty, digital identification, e-ticketing, e-coupons, or personal data storage.

The milestone reflects the combined total of all live MasterCard-, Maestro- Mondex- and Clip-branded cards with integrated circuit chips on them. Cards counted in this total run the gamut from EMV-compliant multiapplication cards carrying M/Chip and other value-added applications, to magnetic stripe debit cards carrying an electronic purse function on the chip.

This milestone reflects MasterCard’s focus on providing its members with a comprehensive level of technical support, in addition to marketing programs that provide members with the flexibility to differentiate their smart card programs in the marketplace. It also demonstrates Europay’s continued leadership in driving chip technology forward. “Global smart card adoption is now reaching critical mass,” said Art Kranzley, chief e-Business officer, MasterCard International. “This growth exemplifies the momentum that can be achieved when innovative technology and value-added services are introduced for the right reasons at the right time.”

Europe is the leading region in terms of current smart card issuance. In France today, all MasterCard(R)-branded cards are smart cards, and the United Kingdom is now converting all general purpose cards in that country to smart cards. In fact, Europe is now in the midst of a continent-wide migration to the global EMV standard, allowing financial institutions and their cardholders to benefit from globally interoperable cards and terminals.

In Europe, Europay International was the first payment system to develop and implement a comprehensive set of rules for smart cards and chip terminals. Europay also was the first payments association to introduce chip migration incentives (a liability shift policy which takes effect on January 1, 2005 governing counterfeit fraud, and a preferred interchange for acquirers investing in EMV-compliant chip terminals).

The Latin America/Caribbean region also continues to quickly embrace chip technology. As of third quarter 2001, some 330,000 MasterCard smart cards have been issued in Brazil. As that country proceeds with its nationwide migration, more than 850,000 MasterCard smart cards will be issued by year’s end 2001. Similar activity is now underway in Mexico and other countries in the region. A new, region-wide liability shift policy takes effect in Latin America on January 1, 2004. Currently, all new ATMs and POS terminals or devices introduced in the region must be chip capable.

In the Asia/Pacific region, more than one million MULTOS(R) multiapplication smart cards have been issued under MasterCard’s US$2.99 chip program. Kookmin Card Co. of Korea recently issued 300,000 MasterCard multiapplication smart cards incorporating Mondex(R), as part of the TradePass program in Korea. Taipei Bank in Taiwan is also issuing two new cards to government employees, one for corporate purchasing and one program for corporate T&E. In the Middle East/Africa region, members have committed to chip migration and projects are now underway. Effective immediately, all new ATMs and POS terminals deployed by members in the region must be chip-capable and fully compliant with MasterCard rules for EMV standards. On January 1, 2005, all new or renewed MasterCard cards issued must be fully compliant with MasterCard rules for EMV standards and a new, region-wide liability shift policy will take effect.

In the North America region, a number of U.S. based members are committed to issuing multiapplication smart cards in conjunction with MasterCard later this year and early 2002.

MasterCard is the only global payments association to actively support all major smart card environments, freeing our members to focus on business issues, rather than technology issues. Through its participation in various standards groups -including the MULTOS Consortium and GlobalPlatform – MasterCard is working to define global requirements and technology standards for multiapplication smart cards.

About MasterCard International

MasterCard International is a leader in global e-business. The association is focused on providing its member financial institutions with customized, meaningful global e-business solutions that connect them to customers in both the online and offline worlds. Through its investment in industry innovation, participation in standards development and business alliances, MasterCard is staying in the forefront of technology integration to enable anytime, anywhere payments across multiple channels and various devices. MasterCard’s global e-business solutions include Internet interactive services, security, smart cards, mobile commerce/wireless, e-wallets, business to business electronic commerce, and numerous emerging technologies.

MasterCard International has a comprehensive portfolio of well-known, widely accepted payment brands including MasterCard(R), Cirrus(R) and Maestro(R).

More than 1.7 billion MasterCard, Cirrus and Maestro logos are present on credit, charge and debit cards in circulation today. An association comprised of more than 20,000 member financial institutions, MasterCard serves consumers and businesses, both large and small, in 210 countries and territories. MasterCard is a leader in quality and innovation, offering a wide range of payment solutions in the virtual and traditional worlds. MasterCard’s award-winning Priceless(R) advertising campaign is now seen in 80 countries and in more than 36 languages, giving the MasterCard brand a truly global reach and scope. With more than 22 million acceptance locations, no card is accepted in more places and by more merchants than the MasterCard Card. At June 30, 2001, gross dollar volume exceeded US$458 billion. MasterCard can be reached through its World Wide Web site at [http://www.mastercard.com][1].

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

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AmEx 3Q/01

American Express Travel Related Services reported quarterly net income of $248 million, down 51% from the same quarter last year. Most of the reduced earnings are the result of restructuring charges, but $87 million worth is directly related to the events of September 11th. Even though AmEx is realizing higher fee income and interest income from credit cards, net revenues rose a mere two percent for the third quarter, due to a 3% decline in charge volume and a 28% fall in travel sales, mainly the result of terrorist attacks on the USA. On top of the 9/11 impact, AmEx is experiencing a 23% increase in delinquency and a 30% jump in net charge-offs. AmEx also noted that marketing and promotion expenses for card related products are 17% lower as TRS scaled back certain marketing efforts in light of the weaker business environment. AmEx spent $298 million in 3Q/01 for card and travel related marketing. For complete details on American Express current and past performance visit CardData ([www.carddata.com][1]).

American Express U.S. Card Portfolio Snapshot
3Q/01 2Q/01 1Q/01 4Q/00 3Q/00 Ann
Chng
Volume $54.4b $58.8b $55.6b $59.0b $56.2b -3.2%
Loans $31.3b $31.2b $30.2b $28.7b $27.1b +15.5%
Cards 34.7m 34.6m 34.2m 33.3m 32.9m + 5.5%
Delinq* 3.2% 2.9% 2.9% 2.8% 2.6% +23.1%
Losses 5.6% 5.7% 5.1% 4.4% 4.3% +30.2%
Yield** 8.8% 8.6% 8.3% 7.7% 7.8% +12.8%
* 30+ days past due; ** net interest yield
Source: CardData(www.carddata.com)

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

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Chameleon Enhancements

Tidel Technologies, Inc. will showcase new enhancements for its leading-edge Chameleon ATM at the NACS 2001 exposition, which opened yesterday in Las Vegas and will run through tomorrow. Among the enhancements available for preview are Chameleon’s new voice-guided package for the blind, a new flat panel display, and an improved check-scanning device.

The Chameleon, an internet-enabled PC-based ATM, will offer an audio port for the visually impaired that provides voice-guided instructions for all types of ATM transactions. The feature works with a standard headset, owned by many who are visually impaired, which may be plugged into the audio port to allow financial transactions to be conducted in complete privacy.

Michael Hudson, Executive Vice President, noted “Before voice-guided systems were invented, visually impaired customers typically needed assistance to conduct routine automated teller transactions. Our new audio-enabled Chameleon is designed to allow visually impaired customers to conduct every transaction available to sighted customers with total independence.”

The new Chamelon will also feature a 15″ flat panel touch-screen display option, designed to give advertising and media-intensive applications a boost with bright, high-resolution images, and a new SEAC check scanning device, representing the latest in check-scanning technology.

Hudson added, “We continue to further the development of the Chameleon and believe that we have created the best platform for delivering advanced functionality in the retail market. In 2002, we expect to deliver value-oriented solutions to the marketplace for such items as check cashing, money order issuance and lottery applications.”

The trade show, an annual event hosted by the National Association of Convenience Stores, is one of the largest trade shows in America and is important to Tidel since convenience stores represent one of the biggest markets for the company’s products.

Tidel Technologies, Inc. is a manufacturer of automated teller machines and cash security equipment designed for specialty retail marketers. To date, Tidel has sold more than 30,000 retail ATMs and 115,000 retail cash controllers in the U.S. and 36 other countries. More information about the company and its products may be found on the Internet at [www.tidel.com][1].

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

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Sub-Prime ABS

Following the stunning fall of Providian last week, the borrowing costs of sub-prime specialists such as Metris/Direct Merchants Bank are likely to rise even more. The asset-backed securities market has already sent signals that yield spreads will rise further. Earlier this month a triple-A rated tranche supported by sub-prime credit card receivables priced at LIBOR +35 bps compared to a similar sub-prime offering in August that was priced at LIBOR +23 bps. With last week’s revelations from Providian, yield spreads for sub-prime card bonds will likely increase at least 10 bps. Currently there are approximately $25 billion in sub-prime credit card asset-backed securities. Providian’s common stock is now trading at less than $5 per share compared to a January high of $64 per share.

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3 Million Voyager Users

Corillian Corp., a leading global provider of eFinance Solutions, announced that it has reached an industry milestone of more than three million consumers using the Corillian Voyager platform to perform online banking transactions at their financial institutions.

Corillian is the first eFinance vendor to reach three million end users on its retail Internet banking platform.

“This milestone shows the dominance and performance of the Corillian Voyager platform,” said Alex Hart, president of Corillian. “Fifteen of the top 100 U.S.

banks and 11 of the top 100 credit unions have licensed Corillian Voyager as their eFinance platform. As these large financial institutions increase their online customer base, our investments in the scalability, security and performance of the Voyager platform ensure that our clients have the most robust and reliable eFinance platform in the industry today.” This milestone demonstrates the scalability and reliability of the Corillian Voyager platform. During the third quarter there were more than 570,000 end users added to the platform, corresponding to a 20 percent sequential end user growth over the second quarter.

Corillian Voyager is a high-performance platform that allows for the delivery of a wide range of financial services to customers via the Internet, including:

Internet banking, bill delivery and payment, customer relationship management, enhanced data aggregation, and small business transactions. Powered by Windows 2000 Server and Component Object Model (COM+), Voyager provides a direct link between a financial institution’s host system and its consumers, using Internet browsers, personal financial management software and internet-ready wireless devices. Voyager’s open architecture design allows an institution to quickly integrate emerging technologies, deploy the platform in-house or in a secure data center and provide a personalized portal to its customers.

About Corillian Corporation

Based in Oregon, and with international offices in Europe, Asia and Australia, 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 in the state-of-the-art Corillian Data Center. Corillian technology also enables Open Financial Exchange (OFX) access by finance management software packages such as Quicken(R), QuickBooks(R) and Microsoft(R) Money. For more information about Corillian Corporation, visit our Web site at [www.corillian.com][1].

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

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AMEX SNOWFLAKES

In the wake of the anthrax scare, Swedish card holders of American Express
cards were concerned after receiving plastic snowflakes in the mail last week.
AmEx sent out about 40,000 direct mail pieces to its Swedish customers as part
of a Christmas promotion. The mailing suggested “consumers spread the
snowflakes out”. The mailing prompted phone calls from angry customers. AmEx
said it has since issued letters of apology to all the recipients of the
mailing.

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Visible Gift Card

A revolutionary new gift card is hitting the US market this week which features an actual display of its monetary value directly on the front of the card. The new stored value gift card from Visible Results USA is built around the thermo-chromic technology developed for the company’s ‘GraphiCard’ loyalty card application. Once the card value has been depleted it may then be re-initialized through payment at the point of sale or returned to the retailer for recycling and re-issue to new customers. Visible Results USA is a subsidiary of the New Zealand-based Visible Results Group of Companies. The company established the USA unit following the February acquisition of GraphiCard Systems International of Overland Park, KS.

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ATM CASH HANDLING

NCR Corporation (NYSE: NCR) has further
enhanced its global leadership in financial self-service by expanding its cash
security technology, improving the security and reducing the cost of
protecting cash in transit and at the automated teller machine.

Keith Taylor, senior vice president of NCR’s Financial Solutions division,
said, “We recognize the importance of improving safety and reducing costs for
customers operating a self-service network. The addition of these exceptional
ATM security solutions will further enhance what is already the best and most
comprehensive solutions portfolio in the industry.”

With this new offering, cash is protected during delivery to the ATM, both
in the vehicle and across the pavement by a product called Genesis, as well as
during replenishment and in operation at the ATM by a product called Sentinel.
Both products use indelible ink to spoil cash inside the cash unit during a
physical attack, reducing losses as a result of criminal activity and the cost
of cash delivery.

At a European self-service security conference held in London today, the
company announced it has completed negotiations with Spinnaker International
and has acquired the Genesis and Sentinel solutions. The two companies have
previously worked together to develop these intelligent security solutions.

Genesis and Sentinel will be marketed by a new company called Fluiditi, a
wholly-owned subsidiary of NCR. Fluiditi will be based in the United Kingdom
and will have global reach through NCR’s international presence.

Ken Munro, currently vice president, life cycle and change management of
NCR’s Financial Solutions division, has been named managing director of the
new company.

About NCR Corporation

NCR Corporation (NYSE: NCR) is a leader in providing Relationship
Technology(TM) solutions to customers worldwide. NCR’s Relationship
Technology solutions include the Teradata(R) database and analytical
applications such as customer relationship management (CRM) and demand chain
management, store automation systems and automated teller machines (ATMs).
The company’s business solutions are built on the foundation of its
long-established industry knowledge and consulting expertise, value-adding
software, global customer support services, a complete line of consumable and
media products, and leading edge hardware technology. NCR employs 33,300 in
more than 100 countries, and is a component stock of the Standard & Poor’s 500
Index. More information about NCR and its solutions may be found at
http://www.ncr.com.

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