Brazil Smart Cards

South American Business Information reported this morning that VISA International will introduce smart cards into the Brazilian market this week. There are currently 20 million VISA credit cards in Brazil. The Bradesco bank will reportedly replace 15 million credit cards with the new smart cards. VISA indicated that nearly 12,000 ATMs in Brazil are ready to accept smart cards. VISA International president Malcolm Williamson is traveling in the region. Last week Williamson said in a Mexico City news conference that the number of VISA cards worldwide reached 850 million at mid-year, a 30% increase. He also reported that VISA now holds a 72% marketshare in Latin America compared to 68% one year ago.


Nestor 2Q/99

Nestor, Inc. reported Friday consolidated revenues of $2,747,000 and a net loss of $121,000 ($.01 per share) for the six months ended June 30, 1999, as compared to revenues of $1,482,000 and a net loss after taxes of $1,901,000 ($.16 per share) reported for the six months ended June 30, 1998.

For the second quarter, the Company reported consolidated revenues of $1,306,000, an increase of 137% from $551,000 reported during the same quarter last year. A net loss of $138,000 ($.01 per share) was also reported for the second quarter, an 88% improvement over the net loss of $1,162,000 ($.07 per share) reported in the corresponding quarter of 1998.

Improved results reflect an increase in new licensing revenues realized by the Company’s Financial Solutions Division and its risk-management product line, PRISM(R). Financial Solutions revenues totaled $2,618,000 in the first half of 1999, as compared to $1,205,000 in 1998, and the division reported a net profit from operations of $576,000 for the six months ended June 30, 1999 as compared with a net loss of $382,000 in the same period last year. Revenues for the second quarter included initial license fees from deliveries to four new customers, including the first PRISM licenses in the United Kingdom and South America and the first license of CampaignOne(TM), a customer relationship management solution.

Nestor Traffic Systems, Inc., the Company’s 62.5% owned subsidiary, reported revenues of $101,000 and a net loss before minority interest of $1,079,000 for the six months ended June 30, 1999 as compared to revenues of $208,000 and a net loss of $779,000 in the comparable prior year period. The minority interest in the Company’s traffic systems subsidiary resulted in a reduction of $217,000 in the consolidated loss of the subsidiary for the second quarter and a reduction of $405,000 in the consolidated loss for the six months ended June 30, 1999.

“We are continuing to build upon our direct sales efforts and have realized the benefits of our strong partner relationships. ACI and CSK Corporation have helped us to realize substantial revenue growth and we remain optimistic that the current trend will continue,” said David Fox, Nestor President and CEO. “Our Nestor Traffic Systems subsidiary has also made great strides with its CrossingGuard(R) automated red light enforcement solution. The initial, fully functional installation in Vienna, Virginia is an industry first – using full video to detect, record and issue citations to red light running violators. CrossingGuard brings communities increased red light enforcement and unique collision avoidance features to enhance intersection safety.”

About Nestor

Founded in 1983 and headquartered in Providence, RI, Nestor, Inc. is a leading provider of intelligent decision-support solutions for the financial services industry. Nestor’s client/server products incorporate innovative pattern-recognition technologies ideally suited for data-intensive, mission-critical decision applications in real-time environments. The Company’s products for financial institutions support fraud detection and case management for credit, debit, retail and commercial card fraud, as well as Internet and merchant fraud; bankruptcy prediction; and customer relationship management. Nestor products are sold direct and by selected partners worldwide. Through its subsidiary, Nestor Traffic Systems, Inc., the Company also applies its technologies to a suite of video-based intelligent transportation systems that promote enhanced traffic management and improved safety.


Lower Cost Transactions

Seattle-based eCHARGE Corp. predicted this morning that the use of VISA and MasterCard online will become obsolete because of the associations’ old technology, high-cost infrastructure and lack of agility, clash with the philosophy of the Internet. The company says its new ‘eCHARGE’ solution will save online merchants up to 100 basis points on transaction fees over traditional credit card fees. The online payments firm announced this morning plans to deliver ‘eCHARGE’, the first Internet purchasing account with online credit and prepayments, in the fourth quarter. ‘eCHARGE’ will give Internet users the ability to sign up for their account online, get real-time account approval and buy immediately. ‘eCHARGE’ will also offer families and businesses the ability to set up sub-accounts with individual spending limits, and the ability to pre-select sites at which members can buy. In addition, ‘eCHARGE’ offers online settlement, reporting and accounting and can process micropayments for purchases as small as one cent.


Alaska Air Platinum

Joining the fast moving trend of platinumizing airline co-branded credit cards is Bank of America’s ‘Alaska Airlines VISA’ program. Cardholders of the new ‘Alaska Airlines VISA Platinum’ card will receive 5,000 bonus miles after opening an account, 1,000 bonus miles each year after renewal and double miles for each Alaska Airlines/Horizon Air ticket or vacation purchase. Each year, cardholders will also receive one $50 round-trip companion certificate and two one-way First Class upgrade certificates. There is no limit on mileage earned and mileage does not expire. Other benefits include one mile per regular purchase dollar and four Alaska Airlines ‘Board Room’ passes. Alaska Airlines is the 10th largest U.S. carrier and serves more than 40 cities in Alaska, Mexico, Canada and five Western states. Two weeks ago America West’s co-branded credit card went platinum. American Express and Delta Airlines took their ‘SkyMiles’ credit card platinum in June. US Airways went platinum one year ago while American Airlines and United Airlines launched platinum versions of their credit card programs in early 1998, according to CardTrak ([][1]).



De La Rue Sale

Rumors of an impending sale by De La Rue of its smart card division gained credibility over the weekend. London’s Financial times reports this morning that De La Rue is four to six weeks away from unloading its smart cards division to BC Partners, a privately held concern. The cards division is expected to fetch as much as GBP 200 million. De La Rue’s cards division currently generates profits of GBP 4.7 million on revenues of GBP 161 million. The Times says its sources indicate that Francois-Charles Oberthur is a partner in BC. NM Rothschild is advising De La Rue on the deal and is reportedly in the midst of resolving pricing and management issues related to the sale. Rumors concerning the sale surfaced in early July. (CardFlash 7/6/99). The cards division also produces mag stripe and debit cards. According to CardData ([][1]) De La Rue holds an 8% share of the global smart card business compared to 25% for Gemplus; 19% for Schlumberger; 11% for Francois-Charles Oberthur.



NBS Latest Quarter

Toronto-based NBS Technologies Inc. reported Friday that sales for the third fiscal quarter ending June 30, were $23.3 million, compared to $27.2 million in the third quarter last year. Sales for the nine months ended June 30 declined 3% to $73.2 million from $75.5 million recorded in the same period a year ago. The decline primarily resulted from slower sales of card services and transaction systems, offset by an increase in the sale of card issuance systems. The decline in sales coupled with an increase in operating expenses led to a net loss, after discontinued operations, for the third quarter and nine month period ended June 30 of $756,000 and $601,000, respectively. During the quarter, NBS introduced a new high speed color printing module for the ‘Horizon’ card issuance system. The firm recently received an order from the Bank of Egypt who will be using this new feature to apply photographs of cardholders to ‘VISA’ credit cards. For more details on NBS latest quarterly earnings visit CardData ([][1]).




MBNA America Bank, N.A., announced Friday the extension of the American Society of Civil Engineers endorsement of MBNA’s credit card services for their members.

Founded in 1852, the American Society of Civil Engineers (ASCE) represents more than 120,000 civil engineers worldwide, and is America’s oldest national engineering society. With the extension of their endorsement, ASCE remains one of more than 1,300 professional organizations that currently endorse MBNA’s credit card services.

MBNA Corporation (NYSE: KRB), a bank holding company and parent of MBNA America, N.A., a national bank, has $64.5 billion in managed loans. MBNA, the largest independent credit card lender in the world, also provides retail deposit, consumer loan, and insurance products.


Bank One Consumer Lending GM

Bank One announced Friday the appointment of Anthony F. Vuoto as general manager of Bank One Consumer Lending. He will report to Richard W. Vague, chairman and chief executive officer of First USA, a Bank One company.

“Tony Vuoto brings an outstanding record of achievement and talent to this newly created position,” said Vague. “Consumer lending is an area of focus and growth for us, and under Tony’s leadership, we look forward to continued expansion of this line of business.”

Vuoto will oversee the company’s consumer lending businesses representing approximately $30 billion in consumer loan outstandings. A 15-year veteran of the financial services industry, he was most recently director of distribution and sales in Germany for a global banking organization. Vuoto received his bachelor’s degree in economics from Princeton University and master’s degree in business administration from the Wharton School of the University of Pennsylvania.

BANK ONE CORPORATION (NYSE: ONE), headquartered in Chicago, is the nation’s fifth largest bank holding company, with assets of more than $256 billion. BANK ONE offers a full range of financial services to commercial and business customers and consumers. It is the world’s largest Visa credit card issuer, the third largest bank lender to small businesses, one of the top 25 managers of mutual funds and a major national automotive lender. It operates more than 1,900 banking centers and a nationwide network of ATMs. It is a major commercial bank in the United States and in selected international markets. It can be found on the Internet at [][1].



Home Account Names VP of IT

Home Account, the leading provider of Internet-based financial services, named Blair Helsing as its new Vice President of Information Technology. Helsing, who has extensive experience in the e-commerce and financial services arenas, will manage Home Account’s corporate-wide information technology infrastructure and related support processes.

Helsing was most recently Vice President of Systems Operations for, where he built the company’s e-commerce operations infrastructure, including the data center, customer support, and internal MIS functions.

Formerly, Helsing was Vice President of Technology Operations for Preview travel, which builds and operates online travel services for Snap!, Lycos, Excite, USA Today, America Online and its own brand. While at Preview Travel, he managed the company’s operations growth from its online launch through its initial public offering, to the stage of serving six million customers.

Helsing also spent several years as a Managing Consultant at Oracle Corporation, where he led Oracle project teams on major multi-vendor systems integration projects. He also held management positions at the Electric Power Research Institute. Helsing’s career began at Bank of America, where he spent nearly 10 years managing automation projects for the largest bank in the U.S.

“Home Account is leading the industry by setting the standards and the pace for innovation. With an array of unique products that appeal to a wide variety of customers, Home Account is poised to move rapidly to meet the substantial opportunities afforded by the financial services revolution,” said Helsing. “I look forward to managing Home Account’s internal technology as the company continues on its current growth path.”

“Blair Helsing has been intimately involved with managing companies through high-growth periods. He also has been a pioneer throughout his career in implementing leading-edge technologies for increased operational efficiencies,” said Randy Kahn, Chief Operating Officer of Home Account. “His expertise will be a great asset to Home Account as our computing needs, and those of our clients, continue to evolve.”

Helsing assumes his new position on August 16.

About Home Account

Home Account delivers patent-protected home banking, financial management and electronic commerce solutions to banks, brokerages and other financial service organizations. Home Account’s products include: Canopy Server(tm), an OFX (Open Financial Exchange) financial services platform that allows distribution of services through multiple channels; Canopy Advisor(tm), a strategic financial planning system for use by individuals and financial professionals; Canopy First(tm), a family of outsourced, scalable and brandable Internet products and services for financial institutions, card issuers and brokerages; Canopy Card(tm), innovative Internet account access programs for card issuers; Canopy Business(tm), Internet-based cash management services for business customers; and Canopy Clients(tm), a series of financial management user interfaces.


EZ GmbH & BfS

Orion Technologies, Inc. announced Friday that its wholly owned subsidiary, EZ GmbH, has entered into an agreement with Bank fur Sozialwirtschaft AG (BfS Bank) of Cologne, Germany.

BfS Bank will serve as the clearing bank for the processing of all of the credit and debit card transactions for EZ GmbH’s customer base in Germany. The Bank was specifically chosen by EZ as it specializes in a high volume of transactions throughout Germany.

“This agreement between EZ and BfS Bank enables our subsidiary to most effectively provide both the equipment and services that our customers in Germany require. BfS Bank was chosen for its abilities to process high volumes of transactions on a daily basis,” said A. Frans Heideman, President of Orion.

Orion is concentrating on Internet and telecommunications based technologies and services for e-commerce and related business. It is currently engaged in electronic point of sale terminal rentals and the electronic processing of debit and credit card transactions over such terminals in Europe.

Electronic point of sale processing is the technology used by retailers to facilitate payment by credit or debit cards, bank customer cards (ATM), and chip cards (cash cards) with POS terminals. The use of these terminals, widely used by retailers in the United States and the United Kingdom, is growing very rapidly in Germany and other parts of Europe where Orion has operations.

The management of Orion is also pursuing related acquisitions.


Buy It Button

Internet search engine LookSmart and i-Escrow Inc. announced this morning ‘The Buy It! Button’ which will eliminate the financial risk to small-scale merchants of selling online. The new tool will enable users to accept credit card and non-credit card orders online with no up-front investment or flat rate service charges. Users are only charged fees for the service when transactions are completed. All transactions initiated with the ‘Buy It! Button’ will be completed using i-Escrow online escrow services. The proceeds of each sale are only released to the seller once the buyer has received the shipment and has had an opportunity to inspect the purchase. Both companies said this morning that this new process ensures that merchants get paid for a sale and that buyers receive the purchased item in satisfactory condition, thereby removing the risks of online transactions for both parties.


PubliCARD 2Q/99

CT-based smart card manufacturer PubliCARD, Inc. Friday reported consolidated sales of $6.3 million for the second quarter, an increase of 52% from $4.1 million in the prior year period. The company also reported a loss from continuing operations of $3.2 million in the second quarter, compared to a loss of $941,000 in 1998. During the second quarter PubliCARD introduced ‘SmartReward’, a smart card-based loyalty program designed for retailers who seek to improve customer retention and reward customer loyalty. Other recent smart card-based rollouts include: ‘PCDefender’ (computer security); ‘SmartGuardian’ (library web-filtering); ‘SmartPassky’ (Internet password management); and ‘DataFast D-101’ (hand-held remote data transfer tool). For more details on PubliCARD’s 2Q/99 visit CardData ([][1]).