Fitch Rates Partners First

Partners First Credit Card Master Trust’s $538 million class A floating-rate credit card certificates, are expected to be rated ‘AAA’ by Fitch IBCA.  The corresponding $113 million class B floating-rate certificates from both series are expected to be rated ‘A’.  This is the second and third issuance from the PFCCMT since the establishment of Partners First through a joint venture between BankBoston (NH), N.A., Bank of Montreal and First Annapolis Corporation to establish a credit card business.

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Nation’s Cash Register

More than one in ten Americans have begun to use electronic commerce to purchase goods and services, according to a new poll commissioned by the Information Technology Association of America and conducted by Wirthlin Worldwide. Fifteen percent of those polled say they have made an online purchase. The study also found that five times more respondents cited credit cards than computers as the missing ingredient to shopping online. Other findings: People over 55 are three times less likely to have made a purchase electronically than their younger counterparts; those making more than $60K per year are twice as likely to have made an electronic purchase than those in the $40K-$60K category and over three times more likely than those earning $15K-$30K; almost 50% of those who have not made an electronic purchase cannot because they do not have a computer;  13% of those with a computer do not buy online because they do not have an Internet connection; 15% of respondents said their primary reason for not buying over the net is a lack of trust of electronic merchants; and 7% expressed fear of computer hackers.

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I-Commerce Building Blocks

The Global Internet Project introduced a ‘Policy Architecture’ Tuesday composed of the six critical building blocks fundamental to managing Internet growth. In the first of a series of white papers, the group revealed an umbrella architecture which provides a framework for industry, educational institutions, governments, and other organizations to address key Internet-related issues. The framework includes: Level 1 Infrastructure; Level 2: Governance; Level 3: Security; Level 4; Level 5; Content and Level 6: Commerce.

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XOOM Card

The leading provider of on-line Web clips signed with First USA yesterday to offer a co-branded card and a suite of highly targeted cards. San Francisco-based XOOM, Inc., is a free membership service offering server space, chat rooms, message boards, HTML email, Web page builders, full-length streaming movies and the largest collection of Web clips on the Internet. The co-branded ‘First USA/XOOM Platinum VISA’ card will offer exclusive XOOM promotions such as a free copy of XOOM’s Web Clip Empire, which sells online for $49.95. Other First USA/XOOM offerings will be cards customized to specific XOOM communities including a sports enthusiasts card, computer professional card, professional women cards, music card, and science fiction cards.  As of this morning XOOM has 1,789,298 members and is expanding its membership base by 22,000 per day. First USA is employing its current, fixed 9.99% APR , no-annual-fee pricing for the XOOM card products.

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ICVERIFY Upgraded

CyberCash, Inc. announced the release of ICVERIFY for Windows, version 2.2 yesterday. The latest release adds new features for the thousands of banks, processors, developers and other resellers who provide ICVERIFY software to merchants worldwide. It also includes enhancements for mail order/telephone order merchants.  The software also allows merchants to pass Level II purchasing data for Visa and Mastercard purchase card transactions on a number of card processing networks.

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AmEx Privacy Brochure

American Express rolled out a new consumer brochure yesterday to provide consumers with information and tips concerning online privacy and security. ‘CyberSmarts: Tips for Protecting Yourself When Shopping Online’ was developed by AmEx in conjunction with The FTC, the Consumer Information Center, the DMA and Call For Action. The brochure is available via AmEx’s Web site and by mail.

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Wireless Tool Distributors

After extensive evaluation, U.S. Wireless Data finally signed up Matco Tools for USWDA’s ‘POS-50’, ‘POS-500’ and ‘TRANZ’ enabler solutions for more than 1200 Matco outlets throughout the U.S. Matco is a large, national distributor of hardware and tools sold directly from trucks. Formal roll-out of this program will begin over the next 2-3 weeks. Currently, if a distributor accepts credit cards as payment means for tools that they sell, the distributor is forced to call for transaction authorization from their shop, cellular or home phones. An added expense is suffered because with phone-in authorizations, the distributor is subject to pay a surcharge for the transaction because the transaction and the funds are not electronically captured. USWDA says these surcharges can have a dramatic impact upon the economics of an industry that sells directly from their trucks or vehicles.

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E-Commerce Bottlenecks

The Global Internet Project said Tuesday there are four bottlenecks in key technology sectors that will impede the continued rapid growth of the Internet. While optimistic about overcoming these bottlenecks, the group is calling for a high-level summit later this year involving the 13 major companies in key sectors of the Internet industry to discuss appropriate actions. GIP says the bottlenecks are: end-user hardware and software; high-speed Internet access; backbone networks and server capabilities.

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Sinking Fraud

While fraud among VISA, MasterCard, Discover and American Express will top $1 billion again this year, overall fraud, as a percentage of total volume, is about half of what it was five years ago. According to updated figures released yesterday by CardData, credit card fraud among the four major general purpose cards has dropped from 23 basis points in 1992 to 12 basis points in 1997. Bankcard Barometer reported in its May issue that fraud has been averaging 9 basis points this year if American Express charge card volume is excluded.

GENERAL  PURPOSE  CREDIT  CARD  FRAUD
(VISA, Mastercard, Discover & American Express)

Total  % of Total Volume
1990: $439.8 million 13 basis points
1991: $702.6 million 20 basis points
1992: $909.6 million 23 basis points
1993: $897.9 million 19 basis points
1994: $973.0 million 17 basis points
1995: $937.8 million 14 basis points
1996: $991.5 million 13 basis points
1997: $1042.2 million 12 basis points
Source: CardWeb Inc.’s CardData

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VISA’s E-Purse

VISA and two international firms announced Monday they will create the first truly international electronic purse standard.  VISA,  ZKA in Germany and SERMEPA in Spain, said yesterday that common global specifications for the electronic purse (or stored value) will be published later this year, paving the way for world-wide interoperability of electronic purse schemes. The agreement between ZKA (Zentraler Kredit Ausschuss, which represents the German banking industry and operates the Geldkarte program), SERMEPA (the technology subsidiary of Visa Espana, which represents over 150 financial organizations and operates the world’s largest Visa Cash program), and Visa International, will mean that the 50 million electronic purse cards issued by the various members of the three associations will become interoperable. Commitments to adopt the new common specifications, once they are published, have also been received from the Italian electronic purse operator, SSB, and the national payment organization in Sweden.

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