iVerify

Brooklyn, NY-based iVerify announced this morning a new service for Internet merchants to confirm that a customer truly can be reached at the telephone number he or she has supplied. ‘iV-Caller’ inserts an additional user verification and security step prior to approval of an online credit card transaction. An automated call to the telephone number furnished by the buyer requires him or her to punch in a six-digit code he or she selected at the site. Upon doing so, the order is verified and confirmed. If the buyer is using that phone line to connect to the Internet, or the phone is busy for some other reason, ‘iV-Caller’ keeps trying the number to complete the verification procedure. For merchants who prefer that the phone number supplied be a landline phone, the verification process can include a step that requests someone who provided a cellular or pager number to give a regular phone number instead. ‘iV-Caller’ covers all buyers in the USA and Canada, and costs $29.95 a month plus 9 cents per verification.

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Wireless MasterCard

Citigroup’s e-Citi unit announced Friday it will join MasterCard’s ‘Global Mobile Commerce Forum’. The forum, which now has more than 200 participants, was established last November to foster knowledge exchange between MasterCard’s and Europay International’s member financial institutions, network operators and mobile technology companies. The last ‘Mobile Commerce Forum’ meeting was co-hosted by Europay International, and was held in March in Genval, Belgium and attracted more than 150 participants from around the world. A variety of mobile commerce solutions were discussed, ranging from “dual slot” approaches with a separate bank payment chip (either on a plastic card or as another SIM card) to remote wallet solutions. The group estimates that by 2001, 50 million consumers will own a commerce-capable wireless phone.

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CIBC Funds SLMsoft

SLMsoft.com announced that it has entered into a strategic banking relationship with the Canadian Imperial Bank of Commerce, one of Canada’s largest banks. CIBC is providing $22 million of operating line, term loan and mezzanine financing.

“We are enthusiastic about our partnership with SLMsoft.com and have great confidence in the company’s ability to achieve its goal to become one of the top three e-commerce suppliers to the financial services market,” said Mauro Spagnolo, Vice President of CIBC’s Knowledge-Based Business. “Prior to entering this relationship, we conducted an extensive study of SLMsoft.com — its strategic direction, management, products and technology, market positioning and financial performance. Our conclusion was that a banking relationship with SLMsoft.com would evolve quickly into a strategic customer- supplier partnership that will benefit both organizations.”

SLMsoft.com intends to use the proceeds to consolidate banking relationships, to provide additional working capital to fund its ongoing transition to an e-commerce application service provider (ASP), to finance additional research and development expenditures and to increase resources on the sales and marketing team. As part of the financing agreement, SLMsoft.com provided CIBC with 250,000 warrants at $8.00 to enable their equity participation in the success of the relationship.

“SLMsoft.com invested a significant amount of time assessing banks on both sides of the border. We were most impressed with CIBC’s commitment to the knowledge-based industry sector, and their innovative approach to assembling a comprehensive financing package while also validating our technology strategy and product architecture,” said Govin Misir, Chairman and CEO of SLMsoft.com. “We’re delighted to have CIBC as SLMsoft.com’s banking partner, and look forward to a long and mutually rewarding relationship. This partnership is especially exciting because of our shared goals for growth and profitability, and our synergistic visions for the future of electronic and wireless Internet banking.”

About CIBC

CIBC is a leading North American financial institution offering more than 8 million personal banking and business customers a full range of products and services through its comprehensive electronic banking network, branches and offices across Canada, in the U.S. and around the world.

About SLMsoft.com, Inc.

SLMsoft.com is a leading provider of end-to-end open system e-commerce solutions to financial institutions, governments and healthcare organizations. Founded in 1986, SLMsoft.com delivers the world’s broadest array of electronic transaction management solutions to customers in 53 countries around the globe. SLMsoft.com provides all the software, services and infrastructure businesses need in order to offer complete B2B and B2C e-commerce services to their customers. The Company is a single-source provider of in-house and outsourced solutions through its EC-street(TM) network of e-commerce products and services. The EC-street network includes Internet banking, ATM and kiosk networks and services, core banking systems, check imaging, telephone banking, electronic bill presentment and bill payment, point-of-sale and point-of- service management, debit and credit card solutions, web site design and hosting, and e-financial portal development. EC-street’s real-time connectivity is facilitated through SLMsoft.com’s ESP-Link(TM) middleware. The Company has over 650 employees in 22 offices worldwide.

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New AmEx Spot

American Express and Tiger Woods pair up in a new television advertisement that launched this week on the NBA Finals.

The commercial shows Woods playing the toughest course in the world – the streets of Manhattan. The ad, shot on location in New York in late April, shows Woods wallop a golf ball from Park Avenue to Central Park to Wall Street and finally to the Brooklyn Bridge where he putts it into a traditional diner- style blue coffee cup as if he played this fictional Manhattan ‘golf course’ on a regular basis.

“Tiger is admired for his ability to do extraordinary things, on the golf course and off. He inspires all of us to create our own success,” said John Hayes, executive vice president of Global Advertising for American Express. “The ad reinforces the aspirations of our Cardmembers who dream big, take on challenges and get the job done no matter how big the task.”

The 60-second television commercial aired Wednesday, June 7 during the NBA finals.

Like the previous ads that are part of the “Moments of Truth” campaign, this Woods ad was directed by Joe Pytka and created by Ogilvy & Mather.

American Express’ relationship with Woods began in May 1997 when he was signed as a global spokesperson for the company. His first commercials were for American Express Financial Advisors, one of which included his father. His work with American Express includes print advertising and appearances for American Express at the World Golf Championship events.

American Express Company is a diversified worldwide travel and financial services company founded in 1850. It is a leader in charge and credit cards, Travelers Cheques, travel, financial planning, investment products, insurance and international and online banking. For more information on American Express, visit the website at http://www.americanexpress.com.

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Alloy PocketCard

Alloy Online, a popular teenage online destination has named ‘PocketCard’ its preferred form of payment for its teen customers. The co-branded VISA debit card comes embossed with the Alloy.com URL and the teen’s name. The adult-funded debit card gives parents’ the authority to instantly add funds via the Web or any phone. Spending can also be tracked through instant e-mail alerts. Under terms of yesterday’s agreement the ‘PocketCard VISA’ will become the default form of payment in the Alloy online shop, superceding the four major credit cards currently listed on the checkout page. ‘PocketCard’ launched in June 1999. Alloy has a database in excess of 3.5 million and reaches over 10 million teens per month.

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ANZ & HNC

Australia and New Zealand Banking Group Limited , one of Australia’s largest banking and financial services corporations, has taken a proactive step to protect itself from the potential increase in payment card fraud activity that may accompany the Sydney 2000 Olympic Games taking place this September. ANZ has selected Falcon, the world’s leading bank card fraud detection system from HNC Financial Solutions, a division of HNC Software Inc., to help protect its card portfolios from fraud. In addition to Falcon, ANZ has agreed to purchase HNC’s Eagle Merchant Risk Management System.

“With the possible increase in fraudulent card activity during the Olympic Games, we wanted a proven, end-to-end fraud detection solution that would help protect our cardholders and merchants from fraud,” said Brian Hartzer, ANZ Managing Director of Global Cards. “Falcon and Eagle are both world-class fraud detection solutions that come highly recommended to us by HNC Financial Solutions’ other international clients.”

Michael Chiappetta, Group Vice President of Risk Management Products for HNC Financial Solutions, said, “We’re confident ANZ will realize the immediate benefits and cost savings of Falcon and Eagle before and during the Olympics, and long into the future.”

Among the hundreds of thousands of visitors expected to come to Sydney later this year will be those who will seek to perpetrate payment card fraud and those who, unfortunately, will be their victims. These visitors, many of whom do not speak English, may be unfamiliar with Australian transaction systems and thus potentially vulnerable to deception. Conversely, Australian merchants will be faced with a wide variety of cards and may be hard-pressed to tell their legitimacy. As was often the case during previous Olympic games, some criminals visiting Australia this summer may try to perpetrate card fraud and leave the country under the cover of being an Olympic tourist.

Falcon, a neural network-based predictive software system that examines transaction, cardholder, and merchant data to detect a wide range of credit card fraud, currently protects more than 300 million payment card accounts worldwide.

The Eagle Merchant Risk Management System employs client/server technology that incorporates both neural networks and a rules engine to identify risky merchants and minimize the risk of unpaid chargebacks for acquiring banks. The Eagle system can also significantly increase the operational efficiency of portfolio analysts by providing a complete information solution to perform merchant analysis on a PC-based workstation with a graphical user interface.

Headquartered in Melbourne, ANZ offers the full range of financial products and services in Australia and New Zealand, and has overseas representation predominantly in greater Asia. With total assets of AUD $167 billion (US $100 billion), ANZ is one of the largest Australian-based banks and is considered an industry leader in credit cards in the Australian market. For more information, visit www.anz.com.

Headquartered in San Diego, California, HNC Software Inc. is a leading provider of predictive software solutions for service industries, including financial, insurance, telecommunications, and e-commerce. HNC’s suite of predictive software solutions can provide real-time insight into customer relationships based on transaction-level data, helping business-to-consumer companies manage their relationships with individual customers. By accurately predicting customer behaviors, these companies can create initiatives to mitigate risk and attrition; improve customer service; develop marketing programs to enhance profitability; and detect fraudulent customer transactions. For more information, visit HNC’s web site at www.hnc.com.

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Shaping The Battle

Pre-trial motions were heard Thursday in U.S. District Court in the Government’s antitrust lawsuit against VISA and MasterCard. The card associations lost two motions. The first motion was to have the trial dropped and replaced with a summary judgement, The second motion was to have VISA International removed as a defendant. However the card associations did win the right to present evidence of the government’s role in creating duality, one of the core issues of the trial. Judge Barbara S. Jones spent the day listening to key arguments from both sides. The formal trial will begin next week in New York City.

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Sydney Smart Fares

Australia by CityRail of Sydney has awarded a $3.1 million contract to Cubic Transportation Systems. Under the contract, Cubic will convert 20 ticket vending machines at certain Sydney locations to touchscreen operation, upgrade the software on existing ticket vending machines to accept more advanced applications, and supply an additional 56 electronic gates to the Sydney rail network. Cubic, which is already supplying a number of touchscreen machines to the new Airport Link rail service to Sydney Airport, will upgrade 20 of the 320 large size ticket vending machines in the Sydney network with the touchscreen model. The new machines allow riders to purchase multiple tickets, and provide ticket selection in 13 languages. Separately, CityRail and Cubic have signed a multi-year and multi-million dollar maintenance contract covering total hardware and software maintenance on the Sydney ticketing system.

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Biz Credit via Cards

More small businesses are turning to plastic to meet their business credit needs, rather than traditional lines of credit. According to PSI Global’s annual study of U.S. small businesses, released this morning, the use of business credit cards to finance equipment or inventory increased 9% since 1999. In the same period, the number of small businesses using established lines of credit at their banks dropped 15% for unsecured lines and 21% for secured lines. PSI found that these companies, on average, have been in business for about two decades and typically have traditional lines of credit in place. According to the survey, 18% of small businesses use company cards for financing equipment or inventory.Four percent use personal credit cards for financing, up 2% from last year. While attractive interest rates are one reason for the increased card use, many small business owners like the convenience of the card, and some like to rack up personal frequent flyer miles with relatively large business purchases. Each year, PSI Global, an NFO Worldwide Company, surveys 876 businesses with yearly sales of $500,000 to $10 million.

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Sub-Prime Smart Cards

A Florida firm specializing in issuing debit cards for so-called payday advance loans yesterday announced it will introduce a smart card. Pinnacle Business Management, OTI America, and SmartNexus have teamed up to offer a smart ‘Pinnacle’ debit card. Under the program customers will receive an instant issue smart card, good for making purchases via all point-of-sale systems and other smart card applications. PCBM expects to issue 1 million of the cards in the first year of the program, with the first cards expected to be issued next month. PCBM owns Fast Pay Check Advance of Florida Inc.

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FICO® Demystified

Fair, Isaac has decided to make a “clear and comprehensive” list of the factors used in its ‘FICO®’ credit bureau risk scores to consumers. The company confirmed this morning it is developing a Web-based service that will explain individual FICO® scores. Each ‘FICO®’ score is delivered with up to four reason codes, which lenders use to help consumers who were denied credit understand how to improve their credit rating. However, this is the first time that a comprehensive, easy-to-understand list of all of the factors that go into ‘FICO®’ scores has been made widely available to the public. Fair, Isaac is also making available descriptions of the score factors and an explanation of how the FICO® score evaluates credit history. Fair, Isaac has publicly supported disclosure of credit bureau scores to consumers by mortgage lenders in the context of a lending decision. Fair, Isaac is currently in discussions with all three of the national credit reporting agencies in the U.S. about changing contract agreements that may prevent lenders from disclosing scores to borrowers.

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Go2pay.com

IFS International Holdings, Inc., a leading provider of software products for the electronic financial market, announced it has developed a strategic partnership with Go2pay.com, a provider of Internet infrastructure payment processing created by IFS’ co-founder, Frank Pascuito.

Mr. Pascuito has left the employment of IFS International to focus his efforts on Go2pay but remains on the IFS International Board of Directors. The Companies will jointly form a payment-processing center that will manage Internet based e-commerce transactions and will utilize IFS’ field-proven TPII product as its authorization engine. At the partnership’s inception, IFS will become a minority partner, owning 30 percent of Go2pay.com’s assets in exchange for a TPII license.

Go2pay.com plans to target and improve upon the following areas:

Creating a Web-based payment authorization center that processes Internet credit, debit, EBT and smart card payment transactions for web merchants.

Developing a payment authorization center to reload and process payment for smart cards over the Internet. (Go2pay will take advantage of recent announcements to standardize smart card processing.)

Frank Pascuito, one of the original founders of IFS International Inc., will lead the new company as Chairman and CEO and will primarily focus on creating innovative payment processing solutions for the Internet. Mr. Pascuito has previously and successfully raised startup capital and is well known in the local technology community. He plans to seek out local financing and technology partnerships immediately.

Mr. Pascuito stated, “TPII is currently installed in various environments that are providing authorization for millions of financial transactions per day. We will utilize TPII’ s field-proven technologies to successfully provide state of the art electronic payment processing.”

Dave Hodge, President of IFS International Holdings added, “The IFS investment in Go2pay represents an additional strategic opportunity for IFS to participate in the exploding Internet payment processing market. The combination of Frank Pascuito’s leadership, local funding and advisory support, and the superior technology of IFS will contribute to the success of Go2pay. IFS is proud to be an integral part of this exciting new business initiative.”

About IFS International Holdings, Inc.

IFS International, Inc. and Network Controls International, Inc. are subsidiaries of IFS International Holdings, Inc. which has headquarters in the USA and subsidiary offices in the USA, UK, Singapore, Australia and Germany.

IFS International, Inc. develops, markets and supports software products for the electronic financial market. IFS International’s TPII and TP-CMS products provide support for ATMs, Point of Sale devices, network switches, smart cards and card management. NCI, Inc. develops innovative retail delivery applications like NCI Business Centre(TM), which combines network centric and browser based technologies in “One Application” to automate all delivery channels such as branch teller, platform service, call center, internet banking and customer relationship management.

About Go2pay.com

Go2pay is a payment processing center specializing in providing internet infrastructure payment processing. The Company utilizes state of the art client/server and database technology to provide one of the most comprehensive payment processing services available today.

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