GE Capital’s Monogram Credit Card Bank of Georgia and American Eagle Outfitters Inc. jointly rolled out the ‘AE Clear Card’ yesterday. The see-through private label credit card offers a 10% discount with the first AE purchase, discount coupons, special previews of upcoming fashion collections and advanced notice of special sales and in-store events. GE is charging an APR of prime +10.71%, except in IA and ME, where the card will carry a 21% APR. Joining the current late fee trend, GE is charging a $15 late fee with no-grace-period for late payments, except for IA and WI. Cardholders in IA will have a 30 day late payment grace period and WI cardholders will have a five day late payment grace period. American Outfitters has 335 mall locations in 40 states.Details
VISA revealed for the first time how far it has come in the business card market yesterday. VISA reported its corporate customer base rose 36.3% last year to 4.3 million accounts. Cardholders of ‘VISA Corporate’, ‘VISA Business’ and ‘VISA Purchasing’ cards accounted for $21.9 billion in volume compared to $15.2 billion for 1996. Business card transactions for 1997 hit 128.7 million compared to 98.8 million for 1996. In a private on- the-record interview with RAM Research president Robert McKinley last June in Maui, Carl Pascarella, VISA USA president, said he had no idea how well VISA’s business card market was doing but said data would be forthcoming. One year later the business card figures are impressive, clearly rivaling American Express’ stronghold on the corporate card market. In September 1993 Pascarella told McKinley, two days after he returned from Japan and assumed the U.S. leadership of VISA USA, he would lead the charge to develop the business card market in America. Clearly he has delivered on the promise.
VISA also reported yesterday its share of PCE (personal consumption expenditure) increased last year to 9.6% compared to 8.7% for 1996. VISA also claimed its overall market share increased to 52.3%, based on data compiled by CA-based HSN Consultants Inc.Details
First USA said Thursday it will market credit cards for four additional ‘Major League Baseball’ teams this year. The new teams include the Colorado Rockies, Los Angeles Dodgers, Minnesota Twins and the Arizona Diamondbacks. The Diamondbacks were previously signed by Bank One. First USA has assumed responsibility for the marketing of all Bank One credit cards. Last year First USA signed the Florida Marlins, Oakland Athletics, Philadelphia Phillies and the Seattle Mariners to bank credit card deals.Details
Integrion Financial Network and Home Financial Network (HFN) announced Thursday that HFN’s Home ATM software has been awarded a Certificate of Validation and is now fully compliant with Integrion’s Gold Message Standard (Gold). In reaching this important milestone, Home ATM now becomes the first home banking software solution to achieve Gold-certification.
At the same time, HFN announced an initiative to introduce fully bank branded, Gold-compliant versions of Home ATM software designed to every Integrion bank. By so doing, HFN streamlines the integration process and reinforces the brand for each Integrion bank that decides to offer Home ATM to its mass/middle market customers. GOLD Certification of Home ATM HFN’s Home ATM software has successfully completed a comprehensive battery of functionality tests to confirm compliance with the Gold Message Standard. “Integrion required the most thorough certification process we have faced to date,” said Bart Barker, HFN’s vice president of research and development. “Our customers have the satisfaction of knowing no stone was left unturned in an effort to deliver superior software that’s problem-free.”
The Gold Message Standard is the open, cross-platform standard messaging interface employed by Integrion for retail banking transactions within the Interactive Financial Services (IFS) platform. The Gold Standard and its associated programming framework provide financial institutions and their allied application developers with the capability to utilize functionality, flexibility, and quick implementation of network-based applications. Gold supports the interactive nature of on-line services as well as the batch protocol needed for personal financial management software, while providing a mechanism for easy customization and management of transaction message content with a complete set of tools.
“It has been a priority of Integrion to work with high quality technology providers such as HFN to develop Gold-compliant, bank branded solutions,” said William M. Fenimore, Jr., CEO and managing director of Integrion. “HFN has worked diligently to complete our Gold certification process and become the first software provider to pass the required tests. We are pleased that they have made this strategic commitment to serve the Integrion banks, which represent the majority of North American households.”
Commenting on HFN’s achievement, Daniel M. Schley, HFN’s chairman and CEO said, “We are extremely pleased to announce that we are ready for business with the Integrion banks, and that we accomplished this milestone months ahead of our original development schedule.” Added Schley, “HFN and Integrion share the same objective – that is, helping banks provide low-cost PC and Internet home banking solutions that their customers will actually activate and use. GOLD-certified Home ATM provides precisely that solution, enabling each Integrion bank to reinforce its brand and to retain control of its customer relationships and its technology future.”
HFN Announces Initiative for Integrion Banks
HFN also announced the debut of a campaign to introduce the new Gold- certified Home ATM to Integrion banks. HFN will proactively create and deliver to each bank a fully bank-branded, code-complete version of HFN’s software for evaluation. This gives banks the opportunity to test and review actual software that is ready to be connected and rolled out to their customers. Those banks targeted include both owners and customers of Integrion.
“This campaign is designed to offer Integrion banks an opportunity to bypass the months of effort and hundreds of thousands of dollars ordinarily required for design and development of customized software,” said Eric T. Jacobsen, HFN’s president and COO. “Instead, we are offering them a fully branded, Gold-certified solution for their middle/mass market home banking initiatives that is ready to implement today.”
About Integrion ()
Owned by 17 banks, IBM and Visa USA, Integrion Financial Network provides interactive banking and electronic commerce services to financial institutions. Through the Interactive Financial Services (IFS) platform, Integrion offers financial institutions a network through which electronic transactions flow from multiple consumer access points to a bank’s host system and/or processor. Technology partnerships with IBM and CheckFree Corporation allow for the delivery of flexible, high utility applications to financial institutions for the benefit of end customers.
Integrion’s operating philosophy allows banks to determine the manner and format in which home banking and electronic commerce services are offered, ensuring consistency with the bank’s full range of services, effective branding by the bank and maximum customer benefit.
About Home Financial Network, Inc. ()
Home Financial Network of Westport, CT, is the premier developer of Internet banking software tailored to middle/mass market customers. HFN provides fully customized, bank-branded, PC-banking solutions to financial institutions, home banking outsourced service providers, and bill-payment processors. HFN has formal technology and marketing alliances with CheckFree, Security First and First Data Corporation, as well as leading home-banking platform vendors. The HFN management team are seasoned and successful home banking entrepreneurs. HFN offers technology leadership to banks through state-of-the-art transactional and marketing functions, sophisticated user interface features, economy and speed of implementation, and low technology support costs. HFN products are Y2K-compliant and conform to all major home banking protocols, including GOLD ADMS and OFX.
For more information, contact: Robert McGrath, The Weiser Group at 212-684-4440; Ann Marie Lochner, Lochner & Hawk at 908-852-3656; Tom Dittrich, Home Financial Network at 203-341-7403.Details
Millennium Solutions, an e-commerce solutions provider out of San Clemente (), was selected to develop on-line credit card verification software for American Merchant, Newport Beach, Calif. ().
American Merchant is the first credit card merchant service provider company to sell credit card services through the Internet. Small businesses can purchase packages with a merchant account, Web page, secure order form and real time on-line processing for $495. The on-line verification makes it easy for small businesses to place orders instead of the traditional method of using credit card terminal. The Web site allows businesses to market products or services to the Web.
Millennium Solutions was selected based on the experience they have with developing on-line verification, shopping cart technology and database integration. “We looked at several other companies and none were able or confident enough to provide us with the final product that Millennium Solutions did,” said Victor Olechno, American Merchant president and chief executive officer. The software that was developed can be used for single or multiple products and can easily be integrated into an existing Web site.
Consumer purchasing on the Web is increasing. Eighty-five percent of small business Web sites do not have any type of on-line purchasing available. Many development companies have made on-line processing unaffordable for the two to three product businesses on the Web. Increasing requests to sell products on the Internet pushed American Merchant to develop this new concept. Most credit card processing companies will not expect merchant applications if they are Internet businesses, because of the high risk involved. American Merchant is specializing in Internet accounts because of the direct relationship they have with several banks that are accepting Internet businesses.
For additional questions, demonstration or interview call Nicole Baker at 800/404-9926, or [firstname.lastname@example.org].
American Banknote Corporation today reported, before non-recurring charges, earnings of $0.6 million, or $0.03 per diluted share, on sales of $87.9 million for the quarter ended December 31, 1997, as compared to earnings of $2.9 million, or $0.14 per diluted share, on sales of $91.9 million for the same period in 1996.
The fourth-quarter 1997 results reflect an extraodinary loss resulting from the early extinguishment of debt of $0.27 per diluted share, or approximately $5.6 million net of tax benefit. Also reflected in 1997 earnings is a one-time charge of $0.07 per diluted share, or approximately $1.5 million after taxes, for a loss on a treasury rate lock agreement. Comparable 1996 results reflect earnings after a one-time non-cash charge of $0.08 per diluted share for a litigation reserve, or approximately $1.6 million after taxes.
Earnings for 1997 were $5.3 million, or $0.25 per diluted share, on sales of $336 million, as compared to earnings of $5.7 million, or $0.28 per diluted share, on sales of $309.5 million during 1996. Again, this comparison reflects earnings before non-recurring charges.
Morris Weissman, Chairman and Chief Executive Officer, said, “As previously announced, the fourth quarter was disappointed due to the reduction of phone card volumes in Brazil, lower than expected sales in Australia and the weakening of the Australian dollar. We are, however, continuing to reposition the Company to take advantage of growth in transaction cards and systems, as well as the electronic commerce arena generally.”
Weissman concluded, “As we expand and reposition our business, improving our capital structure becomes essential. We are exploring a number of alternatives which, if successful, will permit us to accelerate our growth in this dynamic electronic media.”
Leigh-Mardon, American Banknote’s Australian-based subsidiary, was awarded its second major smartcard contract by the Victorian Taxi Directorate. The contract, expected to be worth approximately $1.5 million over three years, is the second major “non-pilot” commercial smartcard application in Australia, following the Telestra contract, awarded to the Company in September, 1997. Leigh-Mardon will supply smartcards to all taxi drivers and 170,000 members of a government-sponsored program that ensures the mobility of disabled people. The personalized reusable mircoprocessor cards will store taxi fare and trip details. Mr. Weissman commented, “This contract again demonstrates our advantage being the major local producer of smartcards in Australia. Furthermore, it is significant in that it is our first major smartcard contract for the transportation industry which we perceive to be a tremendous area for growth worldwide.”
American Banknote Corporation is a leading global full-service provider of secure transaction solutions in carefully selected markets along three major product groups: Transaction Cards & Systems, Printing Services & Document Management, and Security Printing Solutions. A combined strategy of operating along product lines and constant expansion of transaction activities worldwide reflects the rapidly changing field of electronic commerce. Additionally, American Banknote, via its Holographics subsidiary, is the world leader in security for financial transaction cards, including VISA, MasterCard, Discover, Diners Club International, and Europay.Details
ICM Electronic Banking Services introduced ‘BankTrack’ yesterday, a first-of-its-kind, outsourced solution for banks, enabling them to deliver global corporate cash management services via the Internet. Designed as a multi-bank, multi-currency solution, ‘BankTrack’ also offers corporate finance officers the opportunity to consolidate cash management information from many banks with a single interface. The new service is being hosted by NCR’s Electronic Commerce Solutions Center.Details
People’s Bank Credit Card Master Trust’s $343.0 million class A and $27.0 million class B floating-rate asset-backed certificates, series 1998-1, are expected to be rated ‘AAA’ and ‘A’, respectively, by Fitch IBCA. This is the eighth issuance out of the People’s Bank Credit Card Master Trust. The ratings are based on the quality of the VISA and MasterCard receivable pool, available credit enhancement, People’s Bank’s underwriting and servicing capabilities, and the sound legal and cash flow structures.
Series 1998-1 class A benefits from credit enhancement totaling 14.25%, comprised of 6.75% subordination of class B and a 7.50% collateral interest amount (CIA). Class B, in turn, is protected by the 7.50% CIA.
Investors are further protected from prolonged exposure to deterioration in credit card performance and/or servicer default by early amortization events, which would trigger a rapid payout of principal. In addition, series 1998-1 benefits from the sharing of principal and finance charges with other designated series in the master trust.
With the levels of credit enhancement available, series 1998-1 can withstand a decline of 40% in monthly payment rates while chargeoffs increase to a level of 30% and still make full interest and principal payments to class A investors. The class B enhancement covers simultaneous decline of 30% in monthly payment rate while chargeoffs rise to a level of 21%.
The risk of increase in coupon rate to the master trust is capped at 9% at all times. However, class A and class B investors will receive additional interest above the stated cap level from the cap provider, Lehman Brothers Financial Products, Inc., which Fitch IBCA rates ‘AAA’. Upon the expiration of the cap agreement at the expected maturity of the series 1998-1, additional coupon expense on the remaining class A and class B invested amount that is above the 9% capped-rate will be paid from the available excess finance charges.
People’s Bank is a successful low cost provider of Visa and MasterCard credit cards nationwide, servicing roughly 2.3 million accounts with $3.2 billion in credit card receivables balance.Details
Three biometric companies joined forces yesterday at the International Security Conference in Las Vegas to showcase a stand-alone fingerprint access control product. SAC Technologies, Keyware Technologies and Miros demonstrated their combined biometrics access control product ‘SAC-Remote’. The system integrates with ATM/credit card transactions and vending applications.Details
SCM Microsystems and Gemplus signed agreements Wednesday for the development and manufacturing smart card readers. The agreement contains firm, non-cancelable orders of approximately $1 million to SCM Microsystems in 1998, and contains volume forecasts which could result in SCM providing in excess of $20 million of smart card readers to Gemplus over the next three years. The product development part of the agreement covers a USB-based, PC/SC compliant smart card reader and development of a B1/CT API compatible transparent serial smart card reader. The manufacturing supply agreement requires Gemplus to utilize SCM Microsystems’ cost-effective manufacturing capabilities to produce certain Gemplus reader products including the PCMCIA Type II reader targeted at the mobile PC market.Details
VeriFone, Inc and Ariba Technologies announced yesterday plans to integrate VeriFone’s vPOS merchant Internet payment software with Ariba ORMS.
With business-to-business transactions outnumbering those between businesses and consumers, the combined VeriFone and Ariba solution represents a major step in enabling widespread secure electronic network payment among businesses over the Internet.
The Ariba ORM solution uses corporate Intranets and the Internet to automate the entire process of acquiring operating resources, from requisition creation, through approval, payment, and receiving. By integrating VeriFone’s vPOS Internet payment software based on the Secure Socket Layer (SSL) and SET Secure Electronic Transaction(TM) protocols to this process:
— purchasing organizations can make secure online payment easily, cost effectively and in an organized manner – significantly reducing accounts payable costs;
— suppliers can also dramatically reduce costs and payment cycles – significantly improving cash flow.
“Today, most business-to-business payment is accomplished through paper invoicing, purchase orders and checks — an expensive, tedious and labor-intensive process,” said Bobby Lent, vice president strategic alliances, Ariba Technologies, Inc. “Issuing a check may cost a purchasing organization as much as $65, and collection of a payment may cost the supplier as much as $35. Through online payment, this can be reduced to pennies for purchasing organizations and a few dollars for the supplier.”
In the ORM solution model, vPOS software resides with suppliers. Purchasing organizations pay the supplier using online purchase cards — credit cards designed to serve the business-to-business market. The suppliers with vPOS software receive payment through vGATE-enabled financial institutions. The vPOS product is the merchant component of VeriFone’s complete Internet payment solution based on SSL and SET, which also includes vGATE gateway software for financial institutions and vWALLET software for consumers.
“The Ariba ORM system using VeriFone vPOS creates an opportunity to use purchase cards to extend business-to-business on-line payment to corporations and suppliers that cannot cost-justify EDI,” said George Hoyem, vice president and general manager, Internet Commerce Division, VeriFone, Inc. “The purchasing card model provides smaller suppliers access to the considerable reporting and infrastructure support of the credit card industry.”
“The use of the Visa purchasing card can open on-line business-to-business payment to a much broader set of businesses,” said Thomas Proctor, vice president Electronic Commerce, Visa International. “Through the established credit card infrastructure, businesses of all sizes can take advantage of on-line payment. VeriFone’s delivery of vPOS to suppliers is a significant step in enabling this new means of business-to-business electronic commerce.”
Ariba ORMS combined with VeriFone’s vPOS software is designed to accelerate the use of business-to-business electronic systems by large and small suppliers alike. While 95 percent of the Fortune 1,000 companies are using electronic data interchange (EDI), according to Forrester Research, only 2 percent of the 6 million businesses in the U.S. use such technology. The low transaction costs and standardized communication protocols of Internet should encourage the adoption of business-to-business electronic commerce by even the smallest of businesses.
Operating Resources are items that support a company’s day-to-day operations, such as office supplies or capital equipment. They account for a third or more of the expenditures made by a typical Fortune 1000 company. More importantly, nearly 95 percent of all operating resources are acquired and managed using paper-based processes. According to Killen & Associates, a 5 percent savings in these purchasing costs will commonly result in a 28 percent increase in a company’s profits.
The integrated vPOS and ORM network payment solution will be discussed in detail as part of the ORM Supplier Summit, March 24 in Santa Clara, Calif. The Summit is co-sponsored by Ariba, VeriFone, Visa and Federal Express and is intended to help suppliers learn to support buying organizations in the ORM model. For more information regarding the ORM Supplier Summit call 1-800/355-5808.
Ariba Technologies, Inc. is the leader in Operating Resource Management (ORM) solutions for Global 2000 corporations. The company’s products deliver a high Return on Investment through reduced ORM transaction costs and improved management of the acquisition of the goods and services required to operate a company. The products leverage the Internet and Intranets to connect buyers to suppliers and thin-client network computing to make deployment to every desktop possible. The Ariba Internet address is .
VeriFone, Inc. (), a wholly owned subsidiary of Hewlett-Packard Company, is the leading global provider of secure electronic payment solutions for financial institutions, merchants and consumers. VeriFone has shipped more than six million electronic payment systems, which are used in over 100 countries.Details