Another Regional Exits

Admitting that it “no longer has the economies of scale to profitably grow its portfolio”, Comerica Bank is selling off its credit card portfolio to MBNA. Both firms made the announcement Wednesday. MBNA America will acquire Comerica’s check-accessed line of credit services as well as Comerica’s credit card portfolio. Both portfolios have combined assets of $500 million. Comerica’s credit card portfolio currently has approx. $325 million in card receivables, annual charge volume of $700 million and 265,000 accounts, according to CardData ([][1]). The deal is expected to close by March 30. Comerica will become an agent of MBNA. Comerica joins the steady stream of regional players who have exited the credit card business over the past two years.



First Omaha & Signio

First of Omaha Merchant Processing announced an agreement with Signio, Inc. to offer their clients on demand e-commerce solutions that enable them to accept secure online card processing payments. First of Omaha will resell Signio Payflow services to their online merchants through an integrated web-based merchant enrollment application.

“By incorporating Signio into our suite of e-commerce solutions, First of Omaha can offer efficient and scalable applications which will allow our clients to further grow their business and capitalize on the opportunities which exist in today’s burgeoning online world,” said Nick Baxter, President, First of Omaha Merchant Processing.

“Signio offers a highly reliable, easy to implement, fast and secure Internet payment solution. We are delighted that First of Omaha will be offering our Internet payment services to their online merchant customers,” said Philippe Courtot, Signio’s Chairman and CEO. “First of Omaha is recognized as the leading processor in the direct marketing industry and has established a strong reputation in the quality of their services.”

The Signio payment platform includes a robust e-commerce payment service for online merchants, merchant aggregators, auction sites and e-business buyer and seller communities. Signio’s platform offers integrated payment services for real time credit card authorization, debit card, purchasing cards — all for a flat monthly fee. Connected to a broad range of payment processors, the Signio service has been pre-integrated with most e-commerce applications solutions, making it easy to deploy. Signio’s TCP/IP based service provides fast response time and guarantees the completion of payments.

About First of Omaha Merchant Processing

First of Omaha Merchant Processing is a premier processor in the direct marketing industry, and also processes bank card transactions for large and small retailers, restaurants, lodging merchants, petroleum marketers, association/franchise groups and banks. Known for their superior customer service, First of Omaha specializes in providing clients the latest in card processing technologies. Through development of a diversified product line, First of Omaha has become a leader in the merchant processing industry, assisting clients in the reduction of chargebacks and fraud. First of Omaha is a wholly owned subsidiary of First National Bank of Omaha and is one of the few remaining in-house bank processors. First National Bank of Omaha, founded in 1863, is the 32nd oldest nationally chartered bank in existence. First of Omaha’s Internet address is [][1].

About Signio

Signio, Inc. delivers a highly scalable and reliable Internet payment platform to help businesses profit from the rapidly expanding e-commerce market. With its revolutionary flat-fee monthly pricing model and growing menu of services, Signio brings affordability and convenience to the process of selling online. Signio provides seamless connectivity across the Internet, from e-commerce applications to all major back-end payment processors and quickly enables companies to authorize, process, and manage multiple payment types (including credit cards and electronic checks), multi-currency options and different payment schemes. With solutions for merchants, financial institutions, ISOs, ISPs and developers, Signio has a growing list of notable customers, including CBS Sportsline, C/NET,, Network Solutions, Prime Sports Interactive,, and Web MD. Leading companies including Intuit, Bank of America and Wells Fargo have invested in Signio. Signio is headquartered in Redwood Shores, Calif. Signio announced on December 20, 1999, that it will be acquired by Verisign, Inc., the leading provider of Internet trust services.



NPC Hires Williams

T. Jack Williams has joined National Processing Company as SVP of Merchant Relations. National Processing Company, is the second largest provider of merchant credit card processing.

Williams also has extensive experience working with national retailers across the United States. Prior to joining NPC, Williams served as Senior Vice President for Stored Valued Systems, a leading provider of cash card programs across the United States. At Stored Value, Williams developed prepaid card programs for major merchants including, Kmart Corp. and Exxon Corp.

Before joining Stored Value Systems, Williams served as the Director, of Blockbuster Entertainment. He was responsible for the launch of the Blockbuster Visa Card, Universal 50 million Membership Card and the Blockbuster Gift Card.

“I am thrilled to be a part of a company that is focused and committed to their national merchants. I feel strongly that NPC has the resources and dedication required to secure an extremely successful future in this industry,” said Jack Williams.

“With his bankcard, cash card and debit card background Williams will be an asset to our corporation. Through his contacts with large retailers his relationships will benefit NPC’s growth in National Sales,” said Mark Pyke, EVP of Merchant Services.

NPC is a leading provider for merchant credit card processing and corporate outsourcing services. NPC supports over 470,000 merchant locations, representing one out of every six Visa and MasterCard transactions processed nationally. Approximately 88 percent of the company is owned by National City Corporation (NYSE: NCC), a Cleveland based $87 billion bank holding company.


Mellon Multi Card

Mellon Global Cash Management yesterday introduced the ‘Mellon Multi Card’, a new corporate MasterCard program that allows companies and government agencies to consolidate individual credit card purchasing, travel, entertainment and fleet expenses into a single card solution. The new card program combines functions of separate credit card programs into a single, multi-purpose card that offers the same level of control, one monthly invoice and single reconciliation process.


PROCARD Acquired

Equifax announced an agreement to acquire PROCARD, Chile’s second largest credit card processor. Under the agreement, Equifax will acquire PROCARD, which had $6 million in revenues for 1999 and provides account maintenance, authorizations, data capture, transaction processing, bankcard and private-label card issuer posting services. PROCARD also provides application input, embossing, statement and collection letter printing and mailing, co-branding, reward administration and retailer acquirer services.


OPC Signs MN

Official Payments Corporation announced Wednesday the company has signed an agreement with the State of Minnesota to allow the state’s residents to pay their 1999 balance due, estimated payments, and penalty payments (delinquent) income tax payments by credit card over the Internet or telephone. Official Payments Corp. adds Minnesota to an existing list of clients including the United States Internal Revenue Service, the District of Columbia, and the states of California, Connecticut, Illinois, New Jersey and Oklahoma, for whom they have contracts to process credit card tax payments.

“Our service offers the people of Minnesota a proven, secure, reliable and convenient way to pay taxes, with added benefits from credit card reward programs,” said Thomas R. Evans, Chairman & CEO of Official Payments Corporation.

Minnesota taxpayers will be able to make their balance due, estimated and penalty payments by dialing 1-888-2PAY-TAX.(SM) or by visiting [][1] on the Internet. Information on the new payment options will be included in tax instructions, which are being mailed to consumers by the Minnesota Department of Revenue this month.

“Improvements to Minnesota’s tax system are a key component of Governor Jesse Ventura’s “Big Plan” for making government more user-friendly,” stated Minnesota Revenue Commissioner Matt Smith, “Our partnership with Official Payments Corp. is a great example of the “Service, Not Systems” initiative in Governor Ventura’s Big Plan. In making our tax system more modern, we’re making government simpler for our citizens by taking advantage of state-of-the-art technology which offers taxpayers another payment option. We are proud to be leading the way as one of the first states in the nation to offer this kind of service.”

Official Payments Corp. charges consumers a convenience fee for processing these credit card transactions. The fee schedule can be found at [][2]. For example, a taxpayer who owed the government $900.00 and charged their taxes would find a total of $927.00 on their credit card statement: $900.00 for the tax bill and $27.00 for the convenience fee. American Express, Discover Card and MasterCard are the credit cards accepted by the program. Taxpayers using credit cards with bonus rewards programs can, depending on their card’s program, earn rewards, points, and cash-back or airline frequent flyer miles for paying their taxes.

Last year, 462,000 taxpayers in Minnesota made balance due tax payments with an average payment of $1003.00 to the state treasury representing $464,000,000.00 in total balance due collected. 95,000 taxpayers in Minnesota made Quarterly Estimated tax payments with an average payment of $1400.00 to the state treasury representing $133,000,000.00 in total Estimated payments collected. Finally, the State, as of January 2000, is collecting $164,000,000.00 in past due personal tax payments and other State agency past due debts. There are 111,000 individuals in the State that owe, on average, $1477.00 on Delinquent Tax and Non-Tax items. Taxpayers can now make all of these payments by dialing 1-888-2PAY-TAX.(SM) or by visiting [][3] on the Internet.

About Official Payments Corp.

Official Payments Corp. is a leading provider of electronic payment options to government entities. The company enables consumers to pay government fees and taxes via telephone or the Internet, using their credit cards. The company has partnered with the United States Internal Revenue Service, several state governments, including California, Connecticut, District of Columbia, Illinois, New Jersey and Oklahoma, Minnesota and over 450 municipal and county entities, in which it collects property taxes, real estate taxes, parking fines and other government fees by credit card over the telephone and the Internet. The company is publicly traded on Nasdaq under the symbol OPAY. Official Payments Corp. is committed to making payments to the government go fast, smart and safe.




CardVerify announced availability of CardVerifyOne – an enhanced e-commerce credit card transaction and security service.

Recent news of theft of numerous credit card numbers from e-commerce sites confirms the need for CardVerify’s e-commerce approach: Consumers do not store their credit cards on individual e-commerce sites or provide a username/password combination for shopping, but rather use their credit card number every time they perform a purchase online. CardVerifyOne facilitates this process by allowing consumers to associate their cards with shipping information consisting of name and address. Consumers enter only their card details, while CardVerify provides full shipping information to the registered merchant.

Security is provided through CardVerify’s unique transaction model. Data collected by CardVerify is used only to identify the card, associate shipping information, and capture user preferences like adult content blocking. CardVerify stores only “fingerprints” of sensitive data – such as credit card numbers – on its servers; so even CardVerify does not have access to the actual card numbers. Merchants create the card fingerprint before sending it across the Internet, then obtain authorization and shipping information to complete the purchase, but do not need to store credit card information.

“Card numbers should not be stored on any e-commerce server,” said Peter Kostka, CEO of CardVerify. “Nowadays entering and transmitting card information is more secure due to ubiquitous SSL support, but storage will always bear some risks, as we have seen in recent days. Many online retailers, including and eToys, store credit card information to enable ‘one-click’ or ‘express’ shopping. CardVerifyOne allows use of the credit card number for one-stop shopping without usernames and passwords. You have to ask, would you leave your credit card details with every restaurant you go to and use a username/password for future visits?”

With e-commerce increasing, consumers will not be able to choose a favorite username and password combination, requiring consumers to to remember numerous usernames and to associate them with the right retailer. Changing e-mail addresses also prohibit their use as usernames. Credit cards are a natural tool for identification purposes in any online shopping situation.

CardVerify, Inc. develops e-commerce security applications in the area of credit cards.


Card Stats Stable

Bank credit card charge-offs and delinquency continued their stable course during December among credit card-backed securities. Loss rates of 5.5%, 5.7%, and 5.7%, for the three consecutive months of October, November, and December, represent the lowest back-to-back month reported charge-offs since the early 1990s. According to Standard & Poor’s Credit Card Quality Indexes, the delinquency trend is positive as well. December’s delinquencies dropped 22 bps, to 4.6% from 4.8%. Compared with last year’s numbers, delinquencies improved by 40 bps. S&P also reported yesterday that among the major trusts, there was a significant increase only in the Discover Card Master Trust. Losses for Discover increased by 80 bps during December, to 6.8% from 6.0%. At the other end of the spectrum, Universal Card Services Master Trust and Citibank Master Credit Card Trust had the largest decline in losses. Both trusts reported a drop of 50 bps in losses for the month.


Performance month Dec 97 Dec 98 Oct 99 Nov 99 Dec 99
Outstandings $248.7b 275.5 300.0 303.8 307.5
Yield 19.6% 19.7 20.0 19.5 19.7
Charge-offs 6.9% 5.9 5.5 5.7 5.7
Weighted base rate 8.1% 7.7 7.7 7.6 8.3
Excess spread 4.6% 6.1 6.8 6.2 5.7
Delinquencies 5.6% 5.0 4.8 4.8 4.6
Payment rate 15.0% 15.9 16.2 16.0 16.8

SOURCE Standard & Poor’s CreditWire



Introductory interest rates have invaded the UK. However Co-operative Bank says with most card offers in the UK: “the sting-in-the-tail is the much higher standard rate once the introductory period is over”. Co-operative Bank announced it is introducing this week its lowest ever ‘Advantage VISA’ credit card interest rate of 4.9%, fixed until July 2000. The go-to interest rate for both the ‘Advantage VISA’ or ‘Advantage Gold VISA’ is 14.7%. Both cards have no annual fee. The gold card has a minimum credit limit of £3,000.


NextCard Commissions

NextCard announced yesterday that its affiliate program is a real win-win for the card issuer and for outside promoters. In the first nine months of the program, NextCard paid out more than $1.1 million in commissions to other web sites. NextCard says it currently has 30,000 members in the affiliates program. Under the program, the Internet VISA issuer pays a minimum $20 commission for each approved credit card account delivered by external web sites. Yesterday a Mississippi man said he earned enough commissions since last July to purchase a new Cadillac SUV.


AmEx Cards Grow

American Express acknowledged yesterday that during 1999 its consumer charge cards-in-force increased for the first time since 1990. Last year AmEx added 2.1 million net new accounts. The new ‘Blue’ card and the co-branded Costco cards contributed to the increase. Meanwhile, AmEx Travel Related Services reported a 15.1% increase in net income for 4Q/99 compared to 4Q/98. The strong earnings were driven in part by merchant fees and cardholder interest charges. Merchant fees for the fourth quarter were $1.9 billion compared to $1.6 billion one year ago. Finance charge revenue grew 22.3% for the 4Q/99 to $802 million compared to $655 million for 4Q/98. However interest expense rose more than 43% over the same period driving down the net growth in interest revenue to a 12.4% annual rate. The average AmEx cardholder charged $2,102 during the fourth quarter compared to $1,861 one year ago. The average merchant fee, excluding alliance partners and independent operators, for 4Q/99, was 2.71%. For complete current and historical statistics for American Express visit CardData ([][1]).

Card Loans: $23.4b $16.7b +39.8%
Charge Volume: $186.4b $165.6b +12.6%
Cards-in-Force: 29.9m 27.8m + 7.4%
Delinquency*: 2.6% 3.1% NA
Charge-offs: 4.5% 6.2% NA
Interest Yield: 8.6% 9.5% NA

* 30+ days Source: CardData (



VoIP Phone Cards

Cybertel Communications Corp. announced Monday that it has now added prepaid VoIP phone cards to its line of Internet Telephony-based products and services. Cybertel’s phone cards are priced very aggressively, between 40 and 50 percent less per minute than most phone cards available through traditional phone companies such as AT&T , Qwest , Sprint , IDT Corporation.

Cybertel’s VoIP prepaid phone cards will be made available through the company’s Web site at [][1] and will also be marketed to the members of organizations participating in Cybertel’s unique Affinity Partnership Program, including the Marine Corps Reserve Officers Association (MCROA) and the 10,000 member Tailhook Association. Cybertel is also researching the market potential for customized prepaid VoIP calling cards for its affinity customers, creating co-branded promotional cards as marketing and advertising incentives for those organizations.

“We are expecting a tremendous reception for our new prepaid VoIP phone cards. Prepaid calling card sales have exploded in the U.S. over the past 5 years to become a $1+ billion industry. Our prepaid VoIP cards route calls over the Internet, making it extremely inexpensive to deliver voice traffic to anywhere in the world. In addition to low rates per minute, our cards don’t have monthly fees or surcharges. Since we have no fees or surcharges, you can start saving money immediately,” says Richard Mangiarelli, president and CEO of Cybertel Communications.

Cybertel is a La Jolla, Calif.-based Voice Over the Internet Telephony (VoIP) company in the process of building a state-of-the-art Internet Telephony network throughout the United States. Cybertel has recently signed contracts with other major carriers like MCI/Worldcom (Nasdaq:WCOM), Bell Atlantic Corp. (NYSE:BEL) and Level 3 Communications, which have made it possible for Cybertel to offer 1+ long distance, 1-800 numbers, regular and pre-paid calling cards and Internet access at some of the most competitive rates on the market today. Cybertel is a fully reporting company, listed on the OTC Bulletin Board under the symbol OTCBB:CYTP. For more information, please visit .