Hot Site

One of the fastest growing transactional Web sites is not a commercial e-tailer, it is the United States Mint. Last April the U.S. Mint launched secure online sales. Since then sales have soared, racking up $26.5 million in fourth quarter sales. The Mint’s average online credit card transaction was nearly $90. Products related to the Mint’s 50 State Quarters program have been especially popular with online consumers, and have driven single daily sales past the $2 million mark during peak periods. The Mint says on Oct. 18 it sold all 7 million Connecticut state quarters in four-and half-hours. When the Mint launched the Massachusetts state quarter on Jan. 11, the Web site was hit by 20,000 simultaneous visitors the first hour. Online sales for the new Gold Dollar, which went on sale last week, have also been brisk.


Mobile MasterCard

MasterCard announced, at the Cannes GSM World Congress, that it has signed a joint development and marketing agreement with Finland’s Sonera SmartTrust to enable secure wireless technology for cards issued by MasterCard and Europay members. Sonera SmartTrust’s secure digital signature, 1024 bit RSA algorithm for encryption and ‘Public Key Infrastructure’ technology, will provide the high level of security that is critical for using mobile phones in a variety of payment applications such as purchasing goods and services, bill payment and ticketing over a mobile device. As the global penetration of mobile phones continues to grow even faster than the adoption of PCs or the Internet, MasterCard says the market is there and ready. MasterCard also said implementing a major payment brand in a mobile device is going to be the starting point for rapid growth of global wireless secure e-commerce.



Neural networks will be deployed to combat fraudulent online credit card transactions. RI-based Nestor, Inc. will announce this morning a new online fraud detection solution. ‘PRISM eFraud’ is an advanced, real-time solution for detecting fraudulent on-line transactions. ‘PRISM eFraud’ combines neural network risk models and parameter-driven, user-defined strategies to minimize denied purchases and fraud-related charge-backs. ‘PRISM eFraud’ also maintains statistical data on fraud savings and losses, queue status, and reviewer and model performance to provide valuable management information. The new solution is targeted at acquirers, e-retailers, application service providers and commerce service providers. Nestor will also introduce ‘eCLIPSE’, an enhanced online customer loyalty solution which employs personalized, one-to-one multi-channel communications.


OTI Acquires SoftChip

On Track Innovations Ltd. is acquiring SoftChip Israel Ltd. and SoftChip Technologies (3000) Ltd. SoftChip is a chip design house that has developed certain proprietary technology in the field of chip design, smart card’s microprocessor design, CPU simulators, development of Operating System for Smart Cards, power line modems, Internet security as well as capabilities in the design of architecture for semiconductor products. On Track Innovations Ltd. is a pioneer in microprocessor-based contactless smart card technology.


Card Ads

Credit related ads continue to dominate Web advertising. For the week ending Jan. 23,’s ‘Bill Problems’ ad was the second most viewed banner ad on the Internet according to Nielsen/NetRatings.’s ads rank #3 and #7. NextCard’s ‘Breakthrough Advantages’ ad was the #10 most viewed banner ad. Nielsen says 56.3 million people surfed the web last week and the average click rate for top banners was 0.32%. Meanwhile Bank of America, First USA, People’s Bank and NextCard have renewed consumer ad contracts with’s consumer channels for year 2000. First USA will enter its fifth year of consumer ads with Bank of America (and former NationsBank) and People’s Bank have advertised for four years. NextCard will enter its third year this spring.’s consumer channels connect with 3 to 4 million consumers per year and produce the highest response rates among personal finance focused web sites.



MBNA International Bank Limited has selected ACI products to process e-payments, including ATM and POS transactions. The products include ‘BASE24’ which forms the core of MBNA’s card processing operation, and enables the issuer to process transactions based on the Euro monetary standard and smart card transactions initiated in the APACS ICC message format. ‘BASE24’ operates on ‘Compaq NonStop Himalaya’ systems to provide MBNA with true fault-tolerant processing power that is scalable to handle ever-increasing transaction volumes. MBNA processes ATM and POS transactions for more than 2 million cardholders in the UK.


Pathways Leaders

The Pathways Group, Inc. last week announced two new appointments to its senior management team. The executives, Monte Strohl, 48, senior vice president sales and marketing, and Christopher R. Miller, 55, senior vice president business development, have joined Pathways to broaden the management team as it steps up marketing and implementation of the proprietary smart card technology.

Carey Daly, founder, president and CEO of Pathways said, “We are fortunate indeed to have two more strong players join our team. Both Monte Strohl and Chris Miller can hit the ground running because they already know this business and the other members of the team.

“Chris Miller previously served Pathways as outside general counsel. He will oversee business development and continue to be our chief negotiator. That we were able to entice him to leave his very successful law practice speaks volumes about his strong belief in Pathways’ future. Monte Strohl and I co-founded the original Pathways in 1987. Having launched his own successful technology business in 1994, he rejoins us to lead our sales and marketing effort at a time when businesses and consumers around the world are only just beginning to recognize how smart card technology can simplify their lives.

“Over the past 12 years, we have woven Pathways’ proprietary technology, object-oriented programming and transaction processing capabilities into a complete end-to-end solution. This has given us a tremendous time-to-market advantage over competing smart card systems. With a strong team now in place, it is time to translate all of this ingenuity into value for our shareholders.”

Most recently, Mr. Miller served as Pathways’ legal counsel while of counsel to Lanahan & Reilley, LLP, a California law firm. Prior to Lanahan & Reilley, Mr. Miller was managing partner (1991 through 1999) of Miller, Mailliard and Culver, LLP of Santa Rosa, CA, a firm he founded as a partner in 1982. During his nearly 17 years with the firm, his law practice focused on business litigation, corporate transactions, contract negotiation and drafting, and domestic and international IP licensing. He received his BA degree in Philosophy/ Psychology from Sonoma State University in 1971 and a JD from the University of San Francisco, School of Law in 1975.

Prior to joining Pathways, Mr. Strohl was president and CEO of MS Digital, a company he founded in 1994. MS Digital, which specializes primarily in corporate communication and cable broadcasting, provides hardware and software solutions to facilitate communications over cable systems or Intranets. MS Digital’s clients include universities, municipalities and Fortune 500 companies. Before founding MS Digital, Mr. Strohl was vice president of sales for OMNI International, which provided video production solutions internationally. Mr. Strohl is one of the original founders of Pathways International, Ltd., a corporate predecessor to today’s Pathways Group.

The Pathways Group, Inc., a world leader in smart card technology, provides clients with innovative, secure, individually tailored solutions for capturing and processing data and electronic transactions, with particular focus on Chip Card technology as it is applied to the Worldwide Web.

Founded in 1987, Pathways is today a leading developer of smart card applications offering clients custom software and hardware solutions for electronic banking, e-business and transaction processing. Pathways’ proprietary back office systems coupled with their long standing core competencies in electronic transaction processing, allow clients to efficiently capture and process data, and transfer funds via “ACH” protocol. This protocol is the De Facto standard for the Banking Industry, used for funds transfer in retail, medical and institutional environments.


Croatia Proton

Proton World and Croatia’s MBU signed agreements last week to make MBU a Proton licensee for Croatia. MBU is a consortium of 27 Croatian banks that manages and operates a network of ATMs and POS terminals. Under the agreement, MBU will start replacing existing POS terminals in February with new Java-based ‘C-ZAM/SMASH’ multi-application terminals from Banksys. MBU will begin to replace mag stripe cards with smart cards later this year.


Natl Air & LatinPass

In Miami, National Airlines announced that it has joined the LatinPass frequent flyer program providing both LatinPass members as well as its own National Comps frequent flyers with increased air rewards.

The announcement was made at a breakfast by National Airlines’ Chief Executive Officer Michael J. Conway as the carrier celebrated its inaugural service between Miami and its Las Vegas hub.

LatinPass members traveling on National Airlines can include their LatinPass account numbers in their reservations and receive mileage credit in their LatinPass accounts. By mid-February, members of National Airlines’ frequent flyer program, National Comps, will be able to redeem their account points for travel on any of the Latin American carriers belonging to LatinPass. In addition, LatinPass members may redeem their LatinPass mileage for travel on National Airlines.

“As Miami is one of the major U.S. gateways to Latin America, it is fitting to make this exciting announcement here,” Conway stated. “With literally tens of thousands of LatinPass members residing in the U.S., we believe this agreement will benefit not only National Airlines, LatinPass partners and our respective frequent flyers, but cities such as Miami where many international connections to Latin America are made.”

Conway noted that the original National Airlines was based in Miami, and said, “We are well aware of the stellar reputation for customer service that the original National Airlines created and we are making every effort to live up to the standard they set.” The CEO then presented Irma Baker-Lyons with a scale model of the Las Vegas-based airline’s Boeing 757 aircraft. Baker-Lyons is the widow of the original National Airlines founder George T. (Ted) Baker.

“The addition of National Airlines to the all-star LatinPass lineup of member airlines is a welcome one,” said Robert C. Booth, Chairman of AvMan, creators and administrators of the LatinPass program. “National will conveniently link its hub of Las Vegas, the world-renowned entertainment center of the U.S., with key U.S. gateways for Latin American travelers, and do it in style and with outstanding onboard and ground service. All of us at LatinPass are excited with the new benefits National brings to our members.”

The Latin American member-carriers of LatinPass include: ACES, Aeropostal, Avianca, Aviateca, COPA, LACSA, NICA, SAETA, TACA and TACA-Peru. More information about LatinPass is available through its Web site at [][1].

With the initiation of service between Miami and Las Vegas on January 27, National Airlines now offers daily nonstop service to its Las Vegas hub from Chicago Midway, Dallas/Ft. Worth, Los Angeles, Miami, New York JFK, Philadelphia and San Francisco. The carrier operates an all-Boeing fleet of 757 jet aircraft, each equipped with 175 seats including 22 in first class.



Smart Polish Cards

Poland’s Kredyt Bank is using IFS International’s ‘TPII’ system to support the issuance of VISA ‘Smart Debit Credit’. KB is one of the most advanced Polish banks with currently around 300,000 active cardholders, 500 ATMs and 1,000 EFT/POS devices. ‘TPII’ was originally installed at PBI in 1997, and since then the system has been significantly extended. Over the past 2 years since PBI’s merger with Kredyt Bank, the Bank embarked on a major customer-focused payment card strategy using ‘TPII’.