B2B Payment Report

NACHA’s Council for Electronic Billing and Payment has published a white paper describing business-to- business electronic payments methods. The white paper, authored by the Council’s Business-to-Business Task Force, develops a framework that businesses can use to evaluate the comparative benefits of specific electronic payment mechanisms.

“The purpose of the white paper is to provide an objective, educational tool on business-to-business electronic payments,” said Pete Lambert, Chairman of the B2B Task Force and Vice President of Wachovia Bank. “The focus is on key issues that drive the selection of an appropriate payment tool.”

The white paper is the second in a series produced by the Council on electronic invoice presentment and payment (EIPP). It outlines the features of B2B electronic payment methods — Automated Clearing House (ACH), alternative electronic networks (MasterCard RPPS, Visa ePay), and credit card — as well as traditional payments (check and wire transfer). For each payment method, the paper presents an overview, process flows for buyer- and seller-initiated payments, functional differentiators, and an economic analysis.

The first paper, issued in January 2001, analyzed the three models of electronic invoice presentment that are emerging in the market — Buyer Direct, Seller Direct, and Consolidator. Both papers are available on the Council’s web site at http://cebp.nacha.org/publicdocs/publicdocs.html .

The two-part series on EIPP is designed to be of interest to billers, payers, financial institutions, technology providers, and other industry participants. Its purpose is to educate industry about EIPP, promote a common language and context for EIPP, and describe and review available EIPP options, including both presentment and payment alternatives.

“The Council for Electronic Billing and Payment believes that widescale adoption and product innovation will occur only when the executives in the B2B space have a broader understanding of electronic invoice presentment processes and related payment options,” said Jane Wallace, acting Chair of the Council and CEO of the Consumer and Payments Division at Princeton eCom. “This white paper plays an important educational role by providing a comprehensive overview of the electronic invoice presentment and payment arena.”

EIPP is the business-to-business version of electronic bill presentment and payment (EBPP) by which bills are presented and paid on the Internet. While both Business-to-Consumer (B2C) and B2B transactions have similar processes, the B2B environment is typically more complex, involving multiple internal participants, detailed analytic requirements, and intricate value chains. In addition, a more complex set of payment alternatives are typically available for B2B purposes.

“Because EIPP is a promising tool, TowerGroup projects a rapid increase in business usage to 8 percent of B2B bill volume by 2005,” said Beth Robertson, Senior Analyst at TowerGroup and a member of both the Council and the B2B Task Force. “The many benefits for businesses migrating to EIPP include improved cash management, enhanced analytic and data access tools, improved productivity, and lower direct costs.”

The mission of the B2B Task Force is to facilitate education and adoption of business-to-business, Internet-based electronic invoice presentment and payment (EIPP). The task force has 111 members representing 63 organizations.

The Council for Electronic Billing and Payment was formed in 1993 to act as a forum to facilitate, educate, and promote the use of electronic billing and payment programs and services to all interested stakeholders in the payments industry. The Council currently has 98 member organizations. The Council’s next meeting is October 22-23 in San Diego, CA. Guests are welcome to attend. More information is available at .

About NACHA – The Electronic Payments Association

NACHA is the leading organization in developing electronic solutions to improve the payments system. NACHA represents more than 12,000 financial institutions through direct memberships and a network of regional payments associations, and 650 organizations through its industry councils. NACHA develops operating rules and business practices for the Automated Clearing House (ACH) Network and for electronic payments in the areas of Internet commerce, electronic bill and invoice presentment and payment (EBPP, EIPP), financial electronic data interchange (EDI), international payments, electronic checks, and electronic benefits transfer (EBT). Visit NACHA on the Internet at .

[Part One – Presentment Models (PDF Format)][1]

[Part Two – Payment Options (PDF Format)][2]

[1]: /cardflash/secure/oldstatic/2001/august/2g-1.pdf
[2]: /cardflash/secure/oldstatic/2001/august/2g-2.pdf

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Wireless E-Port

USA Technologies has expanded its ‘e-Port’ product line to include proprietary wireless technology. The ‘e-Port’ technology allows clusters of vending machines, POS terminals, and other cashless transaction devices to be connected to networks via wireless technology, whether the devices are located on different floors of a building, or outside the building. The terminals then share existing data connections such as a telephone line or other existing data connection thus providing low cost, high reliability connectivity. The Company has also designed e-Port Wireless in part to speed up authorization, activation and delivery of the product or service provided by the vending machine or POS terminal.

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CDNOW VBV

CDNOW, the leading online music destination, and Visa U.S.A., the world’s largest consumer payment system, announced CDNOW is one of the first e-Merchants to make online payments more secure with Visa’s Payer Authentication service, “Verified by Visa.” Verified by Visa, based on Visa’s 3-D Secure Interoperability Standard, gives CDNOW customers a safer online shopping experience by adding a layer of security that helps to reduce fraudulent use of Visa card numbers on the Internet, ultimately building consumer confidence for online shopping while reducing customer disputes and fraud losses for CDNOW.

Beginning Fall 2001, Visa cardholders can register for Verified by Visa through their card-issuing bank, giving them the ability to make authenticated online purchases with their Visa card. Registered Visa cardholders will then be asked to enter a password every time they buy merchandise at CDNOW, thus authenticating their identity similar to the way a signature verifies a cardholder in the physical world. Registration for the program is easy for consumers and the process of entering a password during an online purchase will take only a matter of seconds. CDNOW anticipates that installation of the Verified by Visa software will be complete in October 2001.

“CDNOW is proud to take a leading role in the implementation of Verified by Visa,” said Samantha Liss, CDNOW Vice President of Marketing and Promotion. “In a business where we rely so heavily on bank card sales, it is essential to provide the most secure shopping experience possible for our customers.”

“Visa Payer Authentication provides the first line of defense for cardholders,” Jim McCarthy, Senior Vice President, e-Visa, a division of Visa U.S.A. “CDNOW’s implementation of this service will help prevent fraud and drive online transaction volume, further strengthening the mass-market online payment channel.”

About Visa U.S.A.

Visa is the world’s leading payment brand and largest consumer payment system, enabling banks to provide their consumer and merchant customers with the best way to pay and be paid. More than 14,000 U.S. financial institutions rely on Visa’s processing system, VisaNet, to facilitate over $810 billion in annual transaction volume — including more than half of all Internet payments — with virtually 100 percent reliability. U.S. consumers carry more than 353 million Visa-branded smart, credit, commercial, stored value and check cards, accepted at approximately 22 million locations worldwide. Visa has long led the industry in developing payment security standards, and has been named the most trusted payment brand online. Visa’s people, partnerships, brand and payment technology are helping to create universal commerce — the ability to safely conduct transactions anytime, anywhere and by any device. Please visit for additional information.

About CDNOW-Never miss a beat. (TM)

CDNOW, Inc. is part of the world’s #1 global music service company, BeMusic, a division of the Bertelsmann eCommerce Group (BeCG). As the ultimate connection to the world of music, CDNOW has 4.8 million customers and sells over 500,000 items including CDs, movies and digital downloads. Music fans can access exclusive artist video interviews, album reviews, expert recommendations, and daily music news from allstar News. CDNOW helps people discover and enjoy music in a personalized environment.

About BeMusic

BeMusic serves over 12 million subscribers, part of 23 million customers online and offline, and operates the world’s largest music club, BMG Music Service, industry-leading technology and Digital Rights Management companies, myplay, Inc., the pioneering digital music locker service, and CDNOW. BeCG properties include BMG Direct, Digital World Services, barnesandnoble.com, myplay, Inc., and its strategic alliance with Napster.

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OPC IRS

Official Payments Corp. announced Wednesday that the Internal Revenue Service will soon accept credit card payments for current year delinquent tax payments and installment government tax payments. The IRS already uses OPC’s credit card payment service to collect balance-due, estimated and extension tax payments by credit card over the Internet and by telephone. This past tax season, Official Payments captured 87% market share of the $711 million in credit card tax payments collected on behalf of the IRS during tax season. In 1999, the IRS collected over $29.2 billion in delinquent taxes including current year return balances and installment agreement payments. Beginning January 11, 2002, individual taxpayers who have installment agreements with the IRS for the current tax year and for tax years 1998, 1999 and 2000, will be able to make their installment payments by credit card over the Internet or by telephone. (CF Library 7/26/01; 7/30/01)

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Speedpass Expansion

ExxonMobil’ said yesterday that its ‘Speedpass’ wireless payment system is now being accepted at nearly 1,600 Exxon service stations nationwide with another 900 Exxon stations expected to join by the end of this year. The expansion comes on the heels of a Chicago-area pilot using ‘Speedpass’ transponders for payments at more than 400 McDonald’s restaurants. The deployment of ‘Speedpass’ in Exxon stations will allow consumers to make wireless payments at more than 6,800 Exxon and Mobil service stations and convenience stores from coast to coast. ExxonMobil has indicated it may expand the McDonald’s program nationwide. ‘Speedpass’ is a radio frequency transponder device that fits on a key chain. It will automatically bill purchases against a pre-determined credit card. The technology for the payment system was developed for Mobil by the TIRIS Division of Texas Instruments. The system was launched in the USA in May 1997 following a six-month test in St. Louis. The program has signed up more than four million users. The ‘Speedpass’ program has also been introduced in markets outside the USA including Singapore and Canada. (CF Library 2/20/97; 1/22/99; 4/14/99; 8/17/00; 5/8/01; 5/30/01)

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Corillian Board

Corillian Corp. announced that its board of directors has approved the appointment of Eric C. W. Dunn as a new member of the board, effective immediately.

With this new appointment, the number of directors on the Corillian board expands to nine. Mr. Dunn has spent the past 15 years in the financial software and technology industry, serving in a number of senior executive capacities at Intuit Inc. from 1986 to 2000, most recently as Intuit’s Senior Vice President and Chief Technology Officer. Mr. Dunn’s other Intuit roles include: CEO of VFSC, an Intuit web finance joint venture which was purchased by Intuit in 2000; General Manager of Intuit’s personal finance group, where he was responsible for the Quicken(R) line of software products and related online banking activities; and CFO, where he played an integral role in Intuit’s IPO and successful merger with ChipSoft. Mr. Dunn serves on the boards of a number of private companies in the eFinance industry, including LiveCapital Inc., where he is Chairman. Mr. Dunn graduated with a degree in physics from Harvard College and graduated as a Baker Scholar from Harvard Business School.

“Eric’s vast knowledge and expertise in the eFinance software industry and background in developing innovative products will add tremendous value to our already strong board of directors,” said Ted Spooner, CEO of Corillian. “We have been fortunate to attract great talent in the industry and Eric is a prime example. With the addition of Eric to our board, his guidance and management will help us as we continue to develop and deliver great products to financial institutions worldwide.”

“I’ve been impressed with Corillian and its management team, many of whom I have known and worked with for many years,” said Mr. Dunn. “Corillian has made significant strides in becoming a leader in the online finance industry and I’m excited by the opportunity to work with their talented board of directors and executive team.”

About Corillian

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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MERCHANT ACQUIRING JV

First Data Merchant Services, a
subsidiary of First Data Corp., a leader in electronic commerce
and payment services, announced an agreement to launch a joint venture
with Deutsche Postbank, a subsidiary of Deutsche Post, Germany’s postal
service organization. Deutsche Postbank is one of the largest banks in
Germany and a controlling shareholder of the third largest debit network in
Germany. This alliance will offer merchant processing services for credit
card and other electronic payments. The business is expected to start in the
third quarter of this year following regulatory clearance from Germany and the
European Union.

“This joint venture represents another major step for First Data Merchant
Services in the growth of our international business,” said Pamela H. Patsley,
president and CEO of First Data Merchant Services and senior executive vice
president of First Data Corp. “Postbank and First Data are committed to
expanding merchant processing services and offerings in Germany. This
cooperative effort will be a catalyst for new electronic payment services and
stands ready to capture the marketplace demand.”

“With this joint venture, we can offer extensive payment processing
services to customers, accepting everything from cards to cashless payments.
Not only the handling of payments for all card types but also the entire care
including advice and installation of the card terminals,” said Wulf von
Schimmelmann, executive-chairperson of Postbank. “We will profit from the
worldwide experiences of First Data Merchant Services.”

“In Germany today nearly 500,000 businesses accept credit cards.
Electronic payment transactions offer tremendous growth potential. Next
year’s discontinuation of the Eurocheque guarantee will require many merchants
and service providers to view card and other cashless payments as a secure
replacement option for consumers. In e-business, a secure and simple payment
system remains a critical success factor,” said Patsley.

Combining the resources of the Deutsche Post World Net system and the
merchant acquiring joint venture, Deutsche Postbank can offer a true one-stop
solution. In addition to advanced payment technology, the joint venture can
provide a full suite of affiliated financial services. This distinguishes
Deutsche Postbank from other banks for merchant payment and logistical finance
solutions. The new company will service the existing merchant customers of
Deutsche Postbank. It will market to approximately 400,000 Postbank customers
through the Deutsche Post World Net’s distribution channels, as well as other
sales channels similar to those used in existing First Data Merchant Services
alliances.

About First Data Merchant Services

First Data Merchant Services enables merchants to accept any type of
electronic payment — credit, debit, electronic check, EBT, smart card —
anytime, anywhere. A subsidiary of First Data Corp., Merchant Services
annually processes and settles almost 9 billion transactions for more than
$450 billion in sales volume from 2.6 million merchant locations. Through
partnerships and relationships with leading financial institutions and
independent sales organizations, First Data Merchant Services delivers
industry leading electronic payment and e-commerce services and solutions.
First Data Corp. (NYSE: FDC), with global headquarters in Denver, powers the
world economy, serving over 1,400 card issuers and millions of consumers
worldwide. First Data makes it easier, faster and more secure for people and
businesses to buy with virtually any form of payment at the point-of-sale,
over the Internet or by money transfer.

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VISA Online Sweepstakes

Visa U.S.A., the world’s largest consumer payment system, is giving online shoppers the chance to win a $50,000 shopping spree during the month of August — just in time for the busy back-to-school shopping season. The “Visa Online Shopping Spree” has been designed to drive traffic to merchant Web sites and motivate consumers to use their Visa cards online. Over 20 leading online retailers and over 90 Visa Member banks are participating in the promotion.

Each time cardholders use their Visa card to make an online purchase at participating merchants between August 1 and August 31, 2001, they will be automatically entered to win a $50,000 Visa card. Visa will also give 250 first prize winners a $100 Visa card. Winners can use these Visa stored-value cards to go on a shopping spree anywhere Visa is accepted — at approximately 22 million locations worldwide. The more times cardholders use their Visa card at participating online merchants, the more times they will be automatically entered into the sweepstakes. No purchase or obligation necessary to enter or win. For more details, including Official Rules, visit www.visa.com/shoppingspree beginning August 1, 2001.

“During May 2001, Visa’s `Win What You Spend X 10′ promotion exceeded our expectations — the number of participating merchants and banks was higher than anticipated and we were very successful at generating awareness for the promotion,” said Gerry Sweeney, Vice President of e-Visa, Visa U.S.A.’s e-commerce division. “Visa is excited to launch our next online promotion, offering consumers an even bigger reward for shopping online.”

“Online promotions, like the `Visa Online Shopping Spree,’ can be used to help drive traffic to our site and ultimately increase sales. This new Visa promotion also provides incremental exposure for the Tickets.com brand,” said Chris Woodburn, Vice-President of Marketing, Tickets.com.

“NextCard is committed to giving cardholders an enjoyable and rewarding online shopping experience and the `Visa Online Shopping Spree’ gives us an easy, turnkey way to offer additional value to our cardholders,” said Christopher Tracy, Vice-President of eCommerce Marketing, NextCard.

The promotion will be supported through a comprehensive marketing program, including online advertising on popular shopping-related sites, e-mail and viral marketing campaigns, and online merchant point-of-sale signage. Additionally, over 90 Visa Member banks will be featuring the promotion on their websites.

You can learn more about the “Visa Online Shopping Spree” Promotion and participating merchants by visiting [www.visa.com/shoppingspree][1] beginning August 1, 2001.

About Visa U.S.A.

Visa is the world’s leading payment brand and largest consumer payment system, enabling banks to provide their consumer and merchant customers with the best way to pay and be paid. More than 14,000 U.S. financial institutions rely on Visa’s processing system, VisaNet, to facilitate over $810 billion in annual transaction volume — including more than half of all Internet payments — with virtually 100 percent reliability. U.S. consumers carry more than 353 million Visa-branded smart, credit, commercial, stored value and check cards, accepted at approximately 22 million locations worldwide. Visa has long led the industry in developing payment security standards, and has been named the most trusted payment brand online. Visa’s people, partnerships, brand and payment technology are helping to create universal commerce — the ability to safely conduct transactions anytime, anywhere and by any device. Please visit [www.visa.com][2] for additional information.

[1]: http://www.visa.com/shoppingspree
[2]: http://www.visa.com

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NYC Parking

New York City has purchased an additional 220 ‘DG Classic’ multi-space parking terminals for on-street parking from SchlumbergerSema. With the new purchase, a total of 665 SchlumbergerSema terminals now replace over 7,000 conventional single-space terminals for on- and off-street parking in NYC. The city is also using the terminals to prevent delivery trucks from blocking traffic in the Times Square area of midtown. For the first time ever, when commercial trucks are making deliveries in this heavily congested area, they must park at metered spaces while they are loading and unloading. The SchlumbergerSema terminals, which can monitor up to 15 parking spaces on-street and in excess of 100 parking spaces off-street, are designed with a special mounting that attaches to existing city light poles. The terminals accept flexible payment options, including private cards, credit cards, smart cards and coins.

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@pos & Federated

@pos announced the launch of an initiative to implement online debit capabilities at 34,000 point-of sale-locations within Federated Department Stores, Inc.

This comprehensive rollout calls for the installation of new and enhanced @pos’ debit-ready iPOS 3100 transaction devices for all of Federated’s 450 store locations. The iPOS 3100 already delivers signature capture functionality for Federated and this program will add a virtual pin pad to the device that will allow the addition of online debit functionality. Federated has successfully offered online debit capabilities in its Macy’s Puerto Rico store since October 2000. Rollout of iPOS 3100 devices for the Federated installed base is planned for completion prior to the beginning of the holiday season.

The addition of online debit functionality allows Federated to substantially lower its transaction processing costs for a significant percentage of its transactions — the result is a rapid return on their investment for the estimated $7 million project. Sales associates will increase their selling time by reducing transaction length and customers now have another convenient payment alternative. In addition, Federated benefits from @pos’ secure transaction technology and PIN security to provide a secure environment for its customers.

“The iPOS 3100 offers significant opportunities for retailers to reduce transaction processing expenses, meet customer needs by providing flexible payment options and support one-on-one customer interaction,” said Llavan Fernando, Chief Executive Officer for @pos. “Federated has consistently led the industry by implementing state of the art systems to serve its customers. Our long and successful relationship with this leading retailer has allowed @pos to identify customer requirements early and respond with the technology to meet those needs.”

The iPOS 3100 has been an industry standard in point-of-sale technology since 1998. Features contained in the device include signature capture, touch screen PIN entry, built-in magnetic stripe reader, and a fully programmable display for customized text and graphics. The terminal integrates with open platform-based transaction systems such as DOS, IBM Flex OS or Windows. RS-232 and RS-485 connectivity options offer maximum flexibility for host system configuration and interfacing to a cash register.

About @pos

@pos (OTC BB:EPOS) is a leader in secure, interactive electronic transaction technologies. The company delivers technologies that include signature capture pads, web-enabled platforms, smart card interfaces, and encryption engines supporting DES and Triple DES, in addition to offering an extensive suite of software tools. @pos currently markets its products to the retail, government and banking segments for applications that include electronic signature capture, debit and credit payments. For more information, see [www.atpos.com][1], email to info@atpos.com, or call 408/468-5400.

About Federated Department Stores, Inc.

Federated, with corporate offices in Cincinnati and New York, is one of the nation’s leading department store retailers, with annual sales of more than $18.4 billion. Federated currently operates more than 450 stores in 34 states, Guam and Puerto Rico under the names of Macy’s, Bloomingdale’s, The Bon Marche, Burdines, Goldsmith’s, Lazarus and Rich’s, as well as macys.com, bloomingdales.com and Bloomingdale’s By Mail. Federated also operates the Fingerhut catalog and e-commerce subsidiary. Additional information is available online at [www.federated-fds.com][2].

[1]: http://www.atpos.com
[2]: http://www.federated-fds.com

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Transmedia 2Q/01

Transmedia Network reported total operating revenues for the quarter ending June 30 of $14.0 million, an increase of 21% over the same quarter a year earlier. Gross dining sales increased 14%, aggregating $49.4 million for the quarter, compared with $43.3 million in the prior year period. For the quarter, the Company recorded a net profit of $826,000 compared with a net loss of $4.1 million in the same quarter last year. Transmedia Network presently offers its over 6 million members a variety of dining savings and rewards programs at more than 7,500 restaurants throughout the USA via means of a registered credit card. The savings are offered through the Company’s dining programs, either branded under the name ‘iDine’ or provided through private label partnerships, such as airline frequent flyer programs, club memberships or other affinity organizations. For complete details on Transmedia’s 2Q/01 performance visit CardData ([www.carddata.com][1]).

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

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Delay Insurance

In the wake of delayed travel and air rage, American Express unveiled a new service that will pay for hotel accommodations in the event of a disruption in schedule. ‘Travel Delay Protection’ coverage pays for lodging expenses of up to $200 a night for up to two nights in the event of a missed connection, delayed flight departure, flight cancellation or denied boarding. The cost for the service is $9.95 per ticket. The coverage applies to missed connections, delayed flight departures, flight cancellations and denied boarding when there is no onward transportation made available by 11 p.m. the same day. Once enrolled in ‘Travel Delay Protection’, the cardholder is billed automatically for each scheduled airline flight purchased on their American Express Card.

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