The Smart Card Forum added to two industry leaders to its Board of Directors yesterday. The new Board members, both of whom will serve three-year terms, are: Jerry Smith, Opportunity Manager, IBM Global Smart Card Solutions Randy Vanderhoof, Director of Product Marketing, Schlumberger DANYL. Vanderhoof has been involved with smart cards for nearly a decade. Smith spearheaded the implementation of the American Express corporate travel smart card program involving Hilton Hotels and Continental Airlines.Details
OR-based Card Capture Services announced Wednesday it has acquired LA-based North American Cash Systems, the country’s sixth largest independent ATM provider. The purchase is the largest completed by CCS over the past year, and brings the company’s total number of installed ATMs to 5,770. Under terms of the agreement, NACS will operate as a regional office for CCS. For the time being, NACS ATMs will continue to operate under the NACS brand. NACS has a portfolio of 800 ATMs located primarily in the southeastern U.S.. CCS also recently purchased 196 deployed ATMs from two smaller independents in CA and MD.Details
MBNA Canada Bank announced Wednesday that the University of Ottawa has signed an affinity card agreement with MBNA to offer a credit card to its students and alumni. The MBNA University of Ottawa credit card program, which is available as a ‘Preferred’ and ‘Gold MasterCard’, will be offered to the university’s supporters, including 23,000 students and 106,000 alumni. MBNA Canada Bank currently has more than 100 affinity programs in Canada and employs about 300 people at its headquarters in Ottawa and a business development office in Montreal.Details
In a move to further leverage its huge payments business and expand its leadership position in the rapidly growing electronic commerce marketplace, Bank of America announced Wednesday that Group Executive Vice President Chris Callero has been named to form and head a new group focused on Strategic Technology and Integrated Payments Services.
Callero and the new group will be responsible for leading Bank of America’s payments strategy across organizational lines — working to deploy strategic technology and develop business partnerships to best align the bank to serve its 32 million customers worldwide. The new group will work to provide customers with emerging access channels and capabilities, including electronic commerce, electronic bill presentment, and financial services aggregation through cable, telecommunications and other Internet providers.
In his new assignment, Callero will report to Ken Lewis, president of Consumer & Commercial Banking and Jim Dixon, president of Technology & Operations.
“Bank of America recognizes the evolution of the whole payments business, and we are moving aggressively to create this new group. Our customers are driving this evolution by increasingly using many convenient methods of payment, including debit cards and online banking, while also showing interest in even more capabilities and access channels, such as electronic bill presentment and Internet commerce. Chris’ extensive experience, leadership and execution capabilities, make him particularly well suited to lead our new Strategic Technology and Integrated Payments Services group,” said Lewis.
“Bank of America is already a major provider of payments services to both businesses and consumers,” said Dixon. “We hold a leadership position in all parts of the payments business — from check clearing, money transfers, and Automated Clearing House payments to credit and debit cards, online banking bill payments, and merchant services. This new group will build on our expertise and leverage Bank of America’s unsurpassed scale to benefit our consumer and business customers globally.”
The Strategic Technology and Integrated Payments Services group will be responsible for supporting existing lines of business such as Card Services, Cash Management, Direct Banking and Transaction Services in the evolution of payments. The group also will work closely with Channel Strategies and Development, leading and sponsoring strategic technology investments that enhance the bank’s development, distribution and processing of payments-related products and services.
Callero began his career with Bank of America in 1971 as a mailroom clerk on the swing shift. He rapidly advanced through a variety of operations management responsibilities and in 1983 was named to form and lead the Item Processing Operation for Southern California in Los Angeles.
In 1992, Callero was named Executive Vice President and head of the Consumer Lending Division, and two years later he formed and led the National Consumer Assets Group — responsible for the financing of homes, home equity, and automobiles for customers through branches, loan-by-phone, direct marketing and automobile dealerships. He was appointed Group Executive Vice President in 1994, and three years later was given expanded national responsibilities as the Group Head for Deposit and Payment Services, including Interactive Banking, ATMs/Debit Cards, Deposit Products, Investment Services, Insurance Services, Small Business and Liability Risk Management.
Since the announcement of the merger of Bank of America and NationsBank, Callero has spearheaded the transition for Consumer & Commercial Banking.
Bank of America is a leader in all aspects of the payments business. Advanced technology and accuracy standards help ensure the smooth processing of 37 million checks each day for customers. More than 1 million of the bank’s customers bank online via the Internet, America Online, or personal financial management software. The bank has more than 22 million credit card and nearly 11 million debit card accounts. Two out of three large U.S. corporations use Bank of America cash management services.
Bank of America, with $595 billion in total assets, is the largest bank in the United States, with full-service consumer and commercial operations in 22 states and the District of Columbia. Bank of America provides financial products and services to 30 million households and 2 million businesses, as well as international corporate financial services for business transactions in 190 countries. Bank of America stock is listed on the New York, Pacific and London stock exchanges and certain shares are listed on the Tokyo Stock Exchange. For more information, please visit [www.bankamerica.com] and [www.nationsbank.com].
The board of directors of PULSE EFT Association has announced the election of Robert Vontur of San Antonio as vice chairman of the board.
Vontur, senior vice president of Frost National Bank, has been involved with PULSE for almost 16 years, 13 of those as a member of the board and its executive committee. Currently a member of PULSE’s Audit Committee, he also has served on its Operations Committee and its Point-of-Sale (POS) Product Development Subcommittee.
A veteran of 28 years with Frost, Vontur currently serves as the bank’s manager of electronic banking systems. He is a graduate of Southwest Texas State University in San Marcos, Texas, where he received his B.S. in mathematics.
“Over the years, PULSE has benefitted enormously from the knowledge and participation of very active directors such as Robert Vontur,” said Stan Paur, president and CEO of PULSE. “With his extensive experience both in the industry and with PULSE, Robert will be an even greater asset to our organization in his new role.”
PULSE is a not-for-profit, shared electronic funds transfer network comprising nearly 2,000 banks, credit unions and savings and loans in Alabama, Arkansas, Colorado, Louisiana, Mississippi, New Mexico, Oklahoma, Tennessee and Texas. The network includes more than 30,000 ATMs, 156,000 PULSE PAY point-of-sale terminals and more than 20,000,000 cardholders. For more information, visit the PULSE Web site at [www.pulse-eft.com].
The Ohio Tuition Trust has the perfect solution for children on your holiday shopping list: prepaid college tuition. It doesn’t need to be assembled, it doesn’t require batteries and it won’t break a week later. And it is a truly meaningful lasting gift for your special child.
The Ohio Prepaid Tuition Program offers an amazingly affordable gift option. During the holidays and until the end of January, families can open an account in the Ohio Prepaid Tuition Program for only a $30 enrollment fee — a $20 savings off the standard $50 enrollment fee. Families enrolling a newborn child can enroll at anytime of the year at a discounted enrollment fee of $25. Prepaid tuition units can be purchased for only $45.50, or less, depending on the purchase option chosen.
Grandparents can save $10 off the enrollment fee in the Ohio Prepaid Tuition Program with their Golden Buckeye card. To receive the Golden Buckeye card discount, card members must attach a photocopy of their card to their prepaid tuition contract form.
To give the gift of prepaid tuition to a child not currently enrolled in the program, family and friends can call 1-800-AFFORD-IT (233-6734) to request an enrollment packet for the Ohio Prepaid Tuition Program. Families and friends can also request and download the enrollment packet at .
“The enrollment packet provides all the information a family needs to immediately open a prepaid tuition account. We recommend presenting the enrollment packet with a check or money order for the enrollment fee to the family of the child. The child’s parents can then complete the prepaid tuition contract form needed to start the account. Prepaid tuition makes a unique and thoughtful gift for a child, especially when combined with a small traditional gift of a toy or book that the child can enjoy more immediately. It’s true that this gift may not be appreciated today as much as the latest toy, but it will provide the child life-long value when he or she enrolls in college,” said Barbara Jennings, executive director for the Tuition Trust.
The 1998-99-enrollment campaign offers Ohio prepaid tuition units at the affordable price of $45.50 or at the autopayment price of $43.50 per unit. In 1998-99, the average Ohio public university tuition already costs more than $4,300. Each unit purchased represents 1 percent of future weighted average annual tuition at Ohio public universities. Families currently enrolled in the prepaid program, and all new families who enroll during this 1998-99 enrollment period, are able to lock in this 1998-99 cost of college throughout this pricing year which lasts until September 30, 1999. Even further discounting of tuition unit pricing is available depending on the age of the child enrolled and the number of units being purchased at one time.
Although prepaid tuition is valued at the rate of Ohio public university tuitions, tuition units can ultimately be used at any accredited public or private college in the country. Ohio’s prepaid tuition can also be used for graduate school and room and board costs, offering even greater flexibility of use in the future.
The Ohio Tuition Trust Authority was created by the Ohio General Assembly in 1989 to promote savings for higher education. Through the Ohio Prepaid Tuition Program, parents can start paying for college tuition and fees while their children are young by purchasing tuition units. The Ohio Prepaid Tuition Program offers a straight forward, simple, safe and affordable way for families to save for college. The program currently has more than 73,000 participants and more than $340 million in total assets. Ohio families can learn more about the Ohio Prepaid Tuition Program or receive an enrollment kit by calling 1-800-AFFORD-IT (233-6734) or by visiting our Web site at .Details
While Citigroup announced yesterday it is cutting more than 10,000 jobs worldwide with more than 3,500 positions to be eliminated in the U.S., the company will nonetheless beef-up its credit card telemarketing unit. Citibank says it will hire 700 telemarketers to fulfill its direct marketing initiatives which are showing significant potential. For example Travelers Property Casualty has sold approximately 3,000 auto and homeowners insurance policies through the call centers servicing Citibank’s card operations. The cross marketing has also spread to other areas. Primerica has opened some 1,000 new Citibank checking accounts through cross-marketing in Las Vegas and Atlanta. Citibank currently has approximately $64 billion in U.S. bank card receivables according to CardData ([www.carddata.com]).
De La Rue, Motorola and Logica’s end to end mobile commerce solution won the Financial Times 1998 Global Telecommunications Award for most innovative mobile product.
The award winning mobile commerce solution comprises of the world’s first dual slot GSM Cellular Phone from Motorola, De La Rue’s SIMphonIC Java powered SIM toolkit smart card and Logica’s m-Commerce(TM) server (1). The solution will revolutionize consumer ‘lifestyles’ enabling consumers to receive information services, make purchases and download e-cash securely, while on the move. These services are potentially available to consumers in any of the 100 countries around the world with a GSM mobile phone network.
“We are most honored to receive such a prestigious award,” says Kevin Duffey, group telecommunications director at Logica. “It reinforces Logica’s commitment to driving the future of mobile commerce and in our prediction that by December 2001, over 6.2 million Americans could be spending over $5.1bn per year via mobile commerce. The Logica m-Commerce(TM) server software will help make this forecast a reality by allowing any mobile phone to link to any bank or retailer’s information systems.”
“We are delighted that this mobile commerce solution has been recognized as the most innovative mobile product,” says Paul Goode, Business Development Manager, De La Rue Card Systems. “The award signifies a key milestone in the development of mobile commerce as a real business and consumer proposition where smart card phones will be a vital business and leisure tool for the Millennium.”
“The award positions De La Rue as the leading force in smart card innovation and with its heritage and expertise in both the banking and GSM markets, De La Rue is making mobile commerce a reality today, bringing greater opportunities, more freedom and greater lifestyle flexibility than ever before imagined.”
Joachim Hoffmann, Director, Mobile Commerce Business, Motorola Cellular Subscriber Group, EMEA, commented: “This award is recognition of the role that mobile commerce will play in the future of communications — and, once again, Motorola is leading the field. We believe that personal access to smart card services is the key that will ignite the market. We will continue to develop and deliver solutions, with our partners, to enable a smart future — one fuelled by electronic transactions and driven by user convenience.”
De La Rue, Motorola and Logica are all members of the Global Mobile Commerce Forum — a consortium of over 85 companies from 17 countries working together to deliver the benefits of mobile commerce to consumers worldwide.
Logica is a leading provider of business engineered, content-rich solutions primarily for the Energy & Utilities, Telecommunications, Financial Services and Automotive markets. The company’s expertise is in systems integration, consulting, products and core process out-tasking/applications management. In collaboration with its partners around the world, Logica helps its clients achieve sustainable, profitable growth, by maximizing the value of their core assets. Logica’s success is driven by its people, and is delivered through focused industry, process and application expertise enabled by technology. The company offers its products and services through innovative, flexible business partnerships and measures its success by the impact it has on its clients’ results.
With its North American headquarters in Lexington, MA, Logica has over 850 staff based in North America and offices in Atlanta, Dearborn, Denver, Fort Lauderdale, Houston, Pittsburgh, New Jersey, New York, Oakland, Orlando, San Francisco, St. Louis, Toronto, Washington D.C., and Williamsburg.
Logica plc was founded in London in 1969 and now has offices in 23 countries and over 7,000 employees worldwide. Today Logica is a leading international computer consultancy, systems integration and software company with clients across diverse markets including finance, telecommunications, energy and utilities, industry, government, defense, transport and space. For the fiscal year ended June 1998, Logica’s revenue was $790 million (473 million pounds sterling). Logica’s home page can be found at .
About De La Rue
De La Rue Card Systems — part of De La Rue the ‘cash to cards’ group whose 1998 annual turnover was 790.2M pounds — supplies almost 500 million magnetic stripe and microprocessor based smart cards each year. The world’s leading supplier of VISA and MasterCard products, it specializes in third party card integration and customer solutions for banking, telecoms, PayTV, retail, transport, health and identification markets. Offering total end-to-end solutions for electronic commerce applications, it also holds manufacturing licenses from Europay, Mondex, Diners Club, APACS (UK Banks), GIE Cartes Bancaires (French Banks), American Express and others. Its vision is that ‘by 2005, 10% of the world’s population will possess a De La Rue smart card.’
Motorola Cellular Subscriber Group is one of the world’s leading manufacturers of cellular telephones, producing a comprehensive range of cellular subscriber equipment for all the world’s leading cellular standards including NMT, TACS, ETACS, GSM, DCS 1800, TDMA, CDMA and AMPS. It supplies a complete range of wearable, pocket, mobile, handportable and transportable cellular telephones for analogue and digital cellular systems.
(1) The Logica m-Commerce server(TM) is built on Postilion from Mosaic Software.Details
In the largest agent bank program established in the credit card industry, Associates First Capital Corp. announced this morning it has been selected to launch and manage a credit card services program for Washington Mutual Bank, FA. Under a multi-year agreement, The Associates will market credit card products to approximately 4 million Washington Mutual customers with accounts in more than 800 branches in California, Florida and Texas. The Associates formerly had an agent relationship with Great Western which has since merged with Washington Mutual. Seattle-based Washington Mutual, with $159 billion in assets, operates retail banking networks in Washington, California, Oregon, Idaho, Montana, Texas, Utah and Florida and conducts mortgage lending operations in 29 states. The Associates has approximately 14 million active customers and $10 billion in managed credit card receivables in the U.S.. According to CardData ([www.carddata.com]), The Associates’ VISA/MasterCard portfolio, at the end of the 3Q/98, includes: $5,845,634,968 in receivables; 7,844,319 gross accounts, 3,386,272 active accounts and 11,825,776 cards-in-force.
The EBT Industry Council of the Electronic Funds Transfer Association Tuesday announced that its second annual conference on the future of electronic benefits transfer systems will be held on Nov. 7-9, 1999 in Washington, D.C.
More than 250 delegates attended the 1998 EBT conference, dubbed “EBT — The Next Generations,” said John Pfeuffer, vice president of Citicorp Services Inc., and chairman of the EBT Industry Council.
“This year’s conference was an outstanding success,” said H. Kurt Helwig, executive director of the Electronic Funds Transfer Association. “Our EBT Industry Council looks forward to taking EBT — The Next Generation to an even higher level in 1999.”
EBT — The Next Generation brings government and private industry together to analyze how the latest transaction technologies and applications can be used to deliver government serviced to citizens in the future.
“Surveys showed that our delegates were nearly unanimous in saying that the 1998 conference delivered the EBT information they were looking for,” said Pfeuffer, “and that the conference was worth continuing in 1999.”
Delegates praised the amount of information found in the conference’s 25 sessions, as well as the quality of the presentations, he added.
Delegates to the conference came from 30 states, as well as Puerto Rico, Guam, Quebec, the United Kingdom, and Italy, according to Helwig. Over one dozen companies provided corporate support for the conference.
About the Electronic Funds Transfer Association
The Electronic Funds Transfer Association is the nation’s leading inter-industry trade association dedicated to advanced payment systems and commerce. Now in its third decade, its members include Transaction Network Services Inc., NCR, and virtually all shared ATM networks in the U.S., including HONOR, PULSE EFT Association, and Electronic Payment Services Inc. It can be reached at its web site, [www.efta.org].
About the EBT Industry Council
The EBT Industry Council is the longest-standing trade group dealing with the business and policy issues of electronic benefits transfer systems.
Its broad base of membership include equipment manufacturers such as VeriFone Inc., and NCR; EBT transaction processors Buypass and Concord EFS; systems integrators Lockheed Martin and EDS; and consulting companies Benton International Inc., Burger, Carroll & Associates Inc., Chaddsford Planning Associates, and Maximus.
First USA Credit Card Master Trust’s $650 million class A 5.36% asset-backed certificates, series 1998-9, are expected to be rated ‘AAA’, and $44.83 million class B 5.66% asset-backed certificates, series 1998-9, are expected to be rated ‘A’ by Fitch IBCA.
Fitch IBCA’s expected ratings are based on the strength of the Visa and MasterCard collateral pool, available credit enhancement, excellent servicing capabilities of First USA Bank, and the solid legal and cash flow structures framing the transaction.
Credit enhancement supporting the class A certificates is derived from the subordination of the class B certificates and excess collateral equal to 13% of the total initial invested amount for each series. Class B investors are protected from losses by the 6% enhancement of the excess collateral. The excess collateral represents interests in the trust subordinate in payment rights to class A and class B certificates.
Several economic and credit stress scenarios were devised by Fitch IBCA to determine appropriate credit enhancement levels. The scenarios simultaneously stress yield, chargeoff, and monthly payment rate steady state assumptions. Under the available enhancement, class A withstands a 30% decrease in yield, a 40% decline in payment rates and chargeoffs increasing to 32% and still makes full and timely payments of investor principal and interest. Class B sustains a 20% decrease in yield, a 30% decline in payment rates and chargeoffs increasing to 22% without suffering a principal or interest loss.
Class A and class B investors for series 1998-9 will receive monthly interest on the 18th of each month throughout the revolving and accumulation periods and on the scheduled final payment date which is anticipated to be Jan. 20, 2004, provided an early payout event does not occur. Early amortization of the bonds may result from a deterioration in asset quality, transferor insolvency or servicer default.
Fitch IBCA also expects to affirm its outstanding ratings assigned to the existing master trust series indicating that the issuance of series 1998-9 will not result in a ratings reduction or withdrawal.Details
Racom Systems, Inc. announced that it is developing a new business strategy focused on licensing Racom’s radio frequency core technologies to the semiconductor and embedded systems markets.
Since its founding in 1991, Racom historically has focused on marketing its advanced ferroelectric memory (FRAM) and RF electromagnetic technologies to the contactless smart card market.
“With smart card industry revenues lagging behind expectations and adverse market conditions persisting, Racom has reviewed its business and concluded that its unique and patented technology offers great potential for the emerging embedded systems marketplace,” says Art Rancis, president and CEO for Racom Systems. “Our goal is to repackage the skills and intellectual property Racom excels in and become a leading licensor of wireless, RF-enabled technologies and services for embedded semiconductor-based applications.”
RACOM’S NEW FOCUS AND STRATEGY
Racom is now extending its generation of RF-based products, tools and services to enable embedded systems and microcontrollers to communicate, store and process data without the need for wire connections. Racom’s experience in developing proven solutions for a wide range of smart card applications positions the company as a technical leader within the RF field. With more than 3.9 billion embedded controllers produced in 1997, and an increased need for devices of all types to transmit and process data via the Internet through wireless technology, Racom has identified the semiconductor and OEM markets as its primary targets.
“Racom has successfully licensed its RF and FRAM technology to industry leaders Rohm, Fujitsu and Hitachi, and we intend to build upon that success during the coming year,” explains Racom’s Rancis. “We will continue to service our existing smart card customers and applications, and offer technical services to industry leaders and partners. Regardless, Racom will clearly focus its efforts on becoming a licensor of leading-edge technologies.”
Under Rancis’ direction during the last four months, Racom has been completely restructured and continues to generate revenues from its existing lines of business while preparing for its major re-launch and marketing introduction early in 1999. For instance, the company recently made smart card system sales to ITT Industries, Inc., Berlin, Germany, and Otis Incorporated, Cernusco, Italy. Racom also announced it has signed a manufacturing and marketing partnership with Iris Technologies, the first such agreement reflective of its new outsourcing and licensing strategy. The company’s staff has been reduced with engineering and R&D remaining the primary focus for the company.
“We eliminated staff to reduce overhead and provide the opportunity to re-build the company with experienced personnel to match our new focus,” said Rancis. “We plan to start re-staffing during 1999.”
RACOM ADDITIONAL FINANCING
To carry out its new business strategy, Racom has secured a $350,000 loan on its FRAM RF-ID licensing royalties from Ramtron International, one of its principal stockholders. Racom also is pursuing additional financing from the investment community and hopes to announce further funding during first quarter of 1999.
“We’re pleased to announce much-needed funding in the form of an advance on existing licensing royalties from Ramtron. This allows us to move forward with our re-structuring plan,” says Rancis.
About Racom Systems, Inc.
Racom Systems, Inc., headquartered in Denver, Colorado, develops and markets RF-based technologies that automate transactions for electronic commerce, information technology, physical and logical access control, and industrial automation. Racom solutions provide secure, convenient and personalized access to money, information, property and services. For further information about Racom, its technology and products, contact Racom Systems at its Web address, , by telephone at 303/771-2077, or by fax at 303/771-4708.Details