Teen Card Report

U.S. teens continue to represent a gold mine for retailers. The challenge for online retailers to tap into this opportunity is to offer an online payment option for the teenagers, who are not old enough to have their own credit card. According to IDC, the teen payment issue is a problem for online retailers and an opportunity for financial institutions. IDC’s back-to-school shopping research shows a new target market and an untapped opportunity for financial institutions.

Several companies, such as MasterCard, are offering prepaid credit cards. They work in much the same way as prepaid phone cards — with a finite amount of cash paid in advance. These prepaid credit cards are marketed to parents to give to their teens as an alternative to cash or gift certificates. However, IDC believes that MasterCard and other companies should target the 15.4 million working teenagers directly.

According to IDC, credit card companies should work with banks to offer stored value cards as part of their teen-focused banking packages.

“Banks and credit card companies working together is a winning situation for everybody,” said Keith Waryas, research manager, IDC Consumer eCommerce Core research program. “It will simplify putting more money on the card for teens. Banks will be adding extra value to their offering, making them more attractive to potential customers, and credit card companies get early exposure to possible lifelong customers.”

The biggest winners, however, will be online retailers who will get access to a large percentage of the population that was previously closed off to them.

IDC’s new bulletin Insider: Back-to-School Preview of the Upcoming Holiday Season (IDC #B22943) examines how much money will be spent online during the back-to-school shopping season and examines the ramifications for the upcoming holiday season. To purchase the report, contact Demetra Georgakopoulos at 1-800-343-4952 extension 4496 or demetra@idc.com.

About IDC

IDC delivers dependable, high-impact insights and advice on the future of ebusiness, the Internet, and technology to help organizations make sound business decisions. IDC forecasts worldwide markets and trends and analyzes business strategies, technologies, and vendors, using a combination of rigorous primary research and in-depth competitive analysis. IDC provides global research with local content through more than 600 analysts in 43 countries worldwide. IDC’s customers comprise the world’s leading IT suppliers, IT organizations, ebusiness companies, and the financial community. Additional information can be found at [http://www.idc.com][1].

IDC is a division of IDG, the world’s leading IT media, research and exposition company.

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


Smart e-Wallet

ACI Worldwide , a leading international provider of enterprise e-payment solutions, introduced a smart e-wallet designed to make Internet transactions both simpler and more secure. The Personal Online Data (POD) e-wallet was unveiled Thursday at a press show for the upcoming Cartes 2000 international forum on card technologies and security in Paris.

Features of the ACI POD e-wallet include:

— Multidevice functionality. The ACI POD e-wallet can be used with computers, mobile phones or digital televisions

— Password-protected secure space on the Internet during transactions, with digital certificates for credit card user IDs

— Automatic logoff if wallet is open but unused for a set period of time

— Personal information storage, eliminating the need to log in and fill out forms

— Instant hard copy receipt and delivery docket for order checking

“There’s no doubt people have had an element of mistrust regarding Internet payments. Now we can help to put those fears to rest,” said Graeme Ward, chief strategy officer for ACI Worldwide’s Commerce business unit. “Our best-in-class security measures greatly reduce any chance of online fraud, and we’ve taken great pains to make the POD e-wallet more convenient than any other payment method, including other e-wallets.”

POD e-wallets can be provided by anyone involved in trading on the Internet, whether a credit card company, bank or individual retailer.

About ACI Worldwide

ACI Worldwide (Nasdaq:TSAI) is helping customers change the way the world works with solutions designed to improve the way we live, work and shop. Every minute of every day, financial institutions, retailers and networking industries rely on ACI e-payment solutions to smoothly move money and information. As a leading international provider of e-commerce and e-payment solutions, ACI maintains operations in the Americas, Europe/Middle East/Africa and Asia/Pacific. More than 2,300 customers in 79 countries use ACI distributed solutions. Visit ACI Worldwide on the Internet at [www.aciworldwide.com][1].

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


VISA Winners

VISA International announced the 33 winners of the “VISA Olympics of the Imagination,” a 23-nation youth art competition that ran from late 1999 through June of this year. Each of these children and a parent will participate in the ‘2000 Sydney Olympic Games’ in Sydney, Australia, as guests of VISA. The VOI challenged school children, ages 9-13, to use their imaginations to create an original piece of art that represented what the Olympic motto of “Citius, Altius, Fortius” meant to them. The children’s winning art will be on display during the entire Olympic Games following a special opening ceremony on Sept. 15. VOI winners were selected from Australia, Bahamas, Barbados, Bonaire, Brazil, Canada, Cayman Islands, China, Czech Republic, Curacao, Finland, Germany, Hungary, India, Japan, Korea, New Zealand, Norway, Poland, Russia, South Africa, United States and Uruguay. VISA said it received more than 400,000 entries for the 2000 Olympic Games program.


CheckFree Update

CheckFree Corp. said Thursday that the recent TransPoint merger will add approximately $0.5 million in incremental revenue. Approximately 30 of the billers previously committed to using TransPoint’s electronic billing and payment system will be net new billers to CheckFree. These join CheckFree’s base of 157 billers, for a total of almost 190 billers committed to EBPP using CheckFree’s end-to-end integrated billing and payment services. The company also announced its intention to be able to deliver the majority of the average consumer’s recurring bills by the end of fiscal 2001, through a combination of CheckFree and TransPoint billers, as well as bills obtained or scraped from biller web sites. CheckFree’s subscriber count of 3.5 million will not be materially changed by the addition of TransPoint subscribers.


X-Rated Ripoff

The Federal Trade Commission announced Thursday it has won a $37.5 million verdict against a California-based adult Web site operation the FTC charged with operating an illegal credit card billing scam. The agency alleged the defendants repeatedly placed charges on consumers’ credit and debit cards for X-rated Internet visits they had not made and services they didn’t order. The FTC noted that thousands of those billed for visiting the Web sites did not own computers. According to the FTC, the defendants had purchased access to a database of three million credit card numbers provided by Charter Pacific Bank of Agoura Hills, CA. The FTC says the defendants illegally used the account numbers to place charges on the accounts and that 90.8% of the company’s $49 million a year in sales were actually unauthorized charges. At trial, the FTC showed that the defendants used at least five different merchant accounts and four fictitious business names. The court concluded that the defendants had processed bogus charges totaling more than $43 million. The $37.5 million damages verdict represents the illegal charges minus the amounts that consumers already received through chargebacks and credits. The FTC has identified in excess of $20 million in defendant’s assets. The defendants included Kenneth and Teresa Taves, and Dennis Rappaport and their businesses J.K. Publications, Inc., MJD Service Corp., Herbal Care, Inc., and Discreet Bill, Inc. Two other defendants in this case, Gary Mittman and Adult Banc, Inc., settled FTC charges in June 1999.


MBNA IT Funding

Prometric announced Thursday its Training Funds Program for 2000.

Prometric is partnering with MBNA America Bank, N.A., in this new venture. The Training Funds Program is offered through participating Authorized Prometric Testing Centers to provide funding for students seeking information technology certifications. Prometric provides certification testing for numerous companies, including Microsoft, Novell, Lotus, CompTIA, Cisco Systems, and Oracle.

The Training Funds Program can also be used to acquire pilot certifications through participating flight schools.

Prometric, which launched its initial program in 1996, was the first company to offer financing for IT training, and Prometric continues to lead the field in IT training and funding. The Training Funds Program was designed with IT professionals in mind and incorporates the features most desirable to an IT audience.

MBNA’s lending philosophy combines sophisticated technology with individualized credit review. The Training Funds Program will be delivered instantly to customers through the Prometric site and through the APTCs. The online, paperless application process provides an immediate credit decision and access to funds.

Annual percentage rates vary, depending on the creditworthiness of the applicant, and there are no origination fees associated with the new program.



MBNA and AAA have teamed up to offer a suite of stored value cards. The new prepaid VISA cards include: ‘AAA Global Currency’, ‘AAA EveryDay Funds’, and the ‘AAA Gift Card’. The ‘EveryDay Funds’ and ‘Global Currency’ offer prepaid denominations from $5 up to $9,999 and can be accessed at 600,000 Interlink merchants in the U.S. and 625,000 ATMs worldwide. The ‘EveryDay Funds’ and ‘Gift Card’ also can be used at all VISA merchant locations. The ‘Gift Card’ can be purchased with any denominations from $25 up to $2,000. The ‘Global Currency’ card is available free at participating AAA club locations to AAA members with a minimum initial balance of $300 or more, or for $3 per card to non-members. The cards also can be obtained by paying a $2.95 shipping and handling fee via the Internet or by calling the toll-free order center. The new AAA stored value cards will be issued by MBNA and processed by WildCard Systems.


Positive Card Stats

More U.S. consumers are paying their credit card bills on time and fewer are defaulting than in any period since early 1996. Chargeoffs should hold in the sub-6% level through year-end as the favorable economic conditions persist and bankruptcies remain in check. The conclusions are based on the latest stats from credit card asset-backed securities tracked by Fitch IBCA. Fitch’s chargeoff index fell nine basis points to 5.11%. Seriously late payments on card portfolios also fell to their lowest level in four years, with Fitch’s delinquency index dropping to 2.79% from May’s 2.89%. Despite slight monthly declines, portfolio yields and monthly payment rates remain healthy on a historical basis. Fitch’s yield index, which tracks finance charge and fee income paid each month, fell to 19.05% from 19.40% last month. The MPR index for July fell nineteen bps to 16.46%, yet edged past their year-earlier mark of 16.44%.



MasterCard International and TradeCard yesterday announced an agreement to develop and pilot a new online payment system for B2B purchases. The new MasterCard-TradeCard payment solution will be the first ever to allow businesses to seamlessly complete B2B e-commerce transactions through a single mechanism. Using TradeCard’s compliance and transaction workflow technology, and MasterCard’s brand, purchasing card platform and global reach, the companies will offer an online payment solution that enables businesses to complete transactions whether large or small, domestic or cross-border, in multiple currencies. Businesses will be able to pay for spot transactions, or track larger, more complicated corporate purchase orders through their transaction cycle and then pay for them when the contract terms have been satisfied. Companies will be able to receive integrated payment information, including transaction-level detail via secure web access. Pilot transactions for the new payment solution are scheduled for the fourth quarter.



Schlumberger Test & Transactions, a business segment of Schlumberger Limited announced it has teamed with PCS Innovations, to jointly create a high-speed content distribution platform to be offered by Schlumberger as the OASYS solution. The solution is based upon the PCSI mobileMAGIC software platform and incorporates the features and security systems inherent in the Schlumberger Simera subscriber identity module (SIM) card. The OASYS solution enables operators to optimally deliver value-added services to Global System for Mobile Communication (GSM) and Time Division Multiple Access (TDMA) wireless customers.

‘The mobileMAGIC platform gives Simera card users the high-speed software platform and interface required to efficiently integrate our SIM card-based, value-added services with our clients’ wireless networks,’ said Ed Jacobsen, vice president, Mobile Communications, Schlumberger. ‘It is critical for our customers to deliver content at a high speed. The OASYS solution and Simera card enable us to provide them with that significant capability.’

‘Simera cards represent a very flexible, multiapplication architecture that can be tailored to meet specific market and security requirements,’ reports Martin Hebert, president of PCS Innovations. ‘With our mobileMAGIC platform, we are able to provide a high-speed gateway to Schlumberger that enables their clients to efficiently deliver value-added services to millions of subscribers.’

The OASYS solution enhances wireless operator networks with its high-speed content delivery capability using Short Messaging Service (SMS) technology. Its robust features enable scalable capacity based upon individual customer requirements and business growth. The OASYS offering will be available in the fourth quarter of 2000 on Windows NT and in the first quarter of 2001 on Sun Solaris servers.

About Schlumberger Test & Transactions

Schlumberger Test & Transactions provides consulting, integration and products for testing and measurement of semiconductor devices, smart card-based transactions, IP (Internet protocol) network security and wireless services. With 1999 revenue of $1.2 billion and over 7000 employees in more than 40 countries, it is a business segment of Schlumberger Limited [NYSE: SLB], a global technology services company with 1999 revenue of $8.4 billion. More information is available at [www.slb.com][1].

About PCS Innovations

PCS Innovations (PCSI) is a pioneer in the development of wireless software technologies connecting the mobile Internet to the world. Through the company’s flagship product, mobileMAGIC, and professional services, PCS Innovations enables enterprises and service providers to rapidly develop, launch and manage their own wireless applications. Formed in 1996, PCS Innovations’ diverse group of industry-leading international clients includes Ericsson, National Bank of Canada, Nokia, and TD Waterhouse. PCS Innovations is a founding member of the newly created Wireless Advertising Association and a participating member in the Personal Communications Industry Association; the WAP Forum; the Canadian Wireless Telecommunications Association; the Global Mobile Commerce Forum; and the Internet Advertising Bureau. For more information, please visit [www.pcsinnovations.com][2].

[1]: http://www.slb.com/
[2]: http://www.pcsinnovations.com/


AmEx & Comerica

American Express announced it has entered into a strategic alliance with Comerica Securities. The two companies will build and distribute annuities through more than 300 Comerica bank branches.

As part of its Value Package, American Enterprise Life, a division of American Express, is providing all Comerica banks with annuity products, training for Comerica investment consultants, financial planning software, and marketing support and training.

“American Express is helping Comerica with what American Express Financial Advisors does best, and that’s financial planning,” said Jan Breyer, senior vice president, Third Party Distribution. “We are excited about this alliance. Establishing solid and productive relationships with respected third parties like Comerica is part of our goal at American Express.”

“Comerica Securities is pleased to link its services with the highly-regarded American Express brand,” said John Irwin, president, Comerica Securities. “In addition to adding the annuities issued by American Enterprise Life, this alliance includes valuable support services and comprehensive financial planning tools that our investment consultants can offer to customers.

Comerica Securities, Inc. is a full-service broker-dealer that offers stocks, bonds, mutual funds and annuities to individual investors, along with investment banking services. It is an investment services affiliate of Comerica Incorporated (NYSE: CMA), a multi-state financial services provider headquartered in Detroit, with banking subsidiaries in Michigan, California and Texas, banking operations in Florida, and businesses in several other states. Comerica also operates banking subsidiaries in Canada and Mexico.

American Enterprise Life Insurance Company is a subsidiary of IDS Life Insurance Company, which is one of the largest providers of individual annuities and variable life insurance in the United States, with more than $70 billion in assets under management.

AEL annuities are backed by the strength of IDS Life Insurance Company, a subsidiary of American Express Financial Corporation. IDS Life, the 14th largest life insurance company, is the second largest issuer of non-qualified fixed annuities in the country. For more complete information about this annuity including fees and expense, please call 1-800-333-3437 for a prospectus. Read it carefully before you invest or send money.

American Express Financial Advisors has been in operation in the U.S. for more than a century, with assets owned or managed exceeding $289 billion. The company’s products and services are distributed through a nationwide network of more than 10,000 advisors, third party relationships with major financial institutions, insurance agencies, broker/dealers, and an institutional business that provides 401(k) and defined benefit plans to companies.

American Express Financial Advisors Inc., the principal underwriter for the insurance and annuities member NASD. Insurance and annuities are made available through AEL, or in New York, through American Centurion Life Assurance Company. American Express company is separate from American Express Financial Advisors Inc. and is not a broker-dealer.