The United States is now a few steps closer to hosting 21st century payment systems. The Clearing House, a payment company that operates the nation’s only private sector automated clearing house (ACH) network, just named two partners in an ambitious plan to create a real-time system that accommodates both consumer and business payments. VodaLink Ltd. is a dominant player in the U.K. payments space, and Fidelity National Information Services (FIS), a technology firm that provides payment and other back-end services to about 3,000 U.S. banks and credit unions, are now working with TCH to build a real-time payment system.

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During a mid-October Strategic Leadership Forum hosted by the Electronic Transactions Association in Phoenix, executives from The Strawhecker Group, Verifone, Samsung Pay, LoopPay, and Vantiv gathered for a panel discussion titled Mobile Payments: From Buzzword to Business. In an interview with The Green Sheet, SLF mobile panelist Jared Drieling, Business Intelligence Manager for The Strawhecker Group revealed key takeaways from the event and his own perspectives as a payments expert.

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Payments executive Michael Alan Grossman passed away Thurs., Oct. 22, 2015. He will be remembered for his contributions to the industry’s POS equipment, merchant acquiring and alternative lending sectors. He served with distinction in senior positions at Lipman USA, Cynergy Data LLC, Dejavoo Systems LLC and Bizfi (formerly Merchant Cash and Capital LLC). Mony Zenou, Chief Executive Officer of Dejavoo, hired Grossman in 1993 to manage business development for Lipman USA, an Israeli terminal manufacturer. As he reflected on their 23-year history, Zenou described Grossman as a partner, brother and friend. He acknowledged that they came from different worlds but said their relationship was like their terminals: built to last.

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Retailer losses to fraud this year will amount to 1.32 percent of revenues, a whopping 94 percent increase over 2014 losses, according to the latest LexisNexis True Cost of Fraud Study. The biggest losers will be mobile and international merchants, according to the study. In a separate study, the Ponemon Institute, which tracks online crimes, reported that the average cost to an organization in the United States that gets attacked by cyber-criminals is $15 million. That represents a 20 percent increase over 2014 costs and an 82 percent increase over the course of six years.

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The NFC Forum released a new set of specifications for near field communication (NFC) technology on Oct. 14, 2015. The new guidelines are subject to review and approval by the forum and include one approved specification and three candidate specifications. NFC Forum Chairman Koichi Tagawa thanked committee and working group members for writing the specs and for their continuing efforts to improve NFC communication protocols, architecture and device capabilities. "The expansion [to tag operation format NFC-V] means that NFC technology can reach a broader market and support even more use cases," he said.

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The week of Oct. 12 to 16, 2015, was a historic one for payments industry IPOs, with Worldpay Group plc going public Oct. 13 on the London Stock Exchange and two days later First Data Corp. on the New York Stock Exchange. Before the week was over, two more companies had filed registration statements with the U.S. Securities and Exchange Commission for proposed IPOs, Square Inc. on Oct 14 and TransFirst LLC on Oct. 16.

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Reports by both government and private-sector sources indicate emerging technologies are unseating incumbent legacy payment systems. One such example is paper check usage, which has steadily declined since the mid-1990s, according to a Jan. 2015, study by the Federal Reserve System. The fed's Strategies for Improving the U.S. Payment System found high costs of paper check usage and ease-of-use of various digital alternatives to be the primary reasons for declining use among consumers, while business-to-business (B2B) usage was reportedly more resilient. "Based on data from the latest Fed Payments Study, 85 percent of noncash general-purpose payments were made electronically in 2012," the report stated. "Yet billions of checks are still written each year across a variety of use cases. Business-to-business check writing remains entrenched, especially among smaller businesses."

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San Francisco-based Coinflip Inc., doing business as Derivabit, reached an agreement with The United States Commodities Future Trading Commission. The company agreed to comply with a CFTC Cease and Desist Order, which alleged that Derivabit brokered bitcoin option contracts between March and August 2014 without being properly registered with the Securities and Exchange Commission, in violation of the Commodity Exchange Act (CEA) and related CFTC guidelines. The bitcoin options trading platform subsequently discontinued illegally offering bitcoin options and will no longer operate an unregistered facility for trading or processing of "swaps."

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Security analysts are warning that cybercriminals are increasingly targeting data brokers and credit screening services that aggregate consumer data. Experian Information Solutions Inc. estimates that up to 15 million consumers had their personal information stolen from the company’s T-Mobile USA database; the incident was first reported on Oct. 1, 2015. The global data aggregator, based in Dublin, Ireland, with operations in the United States, United Kingdom and Brazil, employs 16,000 people in 39 countries. A statement on the company’s website portrayed the event as “an isolated incident [that occurred] over a limited period of time.”

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An alleged Chinese state-sponsored hacker ring known as the Codoso Group or Sunshock Group apparently breached the corporate computer network of LoopPay Inc. starting as early as March 2015. The Massachusetts-based subsidiary of Samsung Electronics Co. Ltd. is the developer of magnetic security transmission (MST) technology, a core component in the new Samsung Pay mobile wallet released in the United States Sept. 28, 2015. According to a report published in The New York Times on Oct. 7, LoopPay became aware of the intrusion in late August when an unnamed group discovered LoopPay data while investigating the Codoso Group in a separate breach incident.

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The PCI Security Standards Council in collaboration with a team of PCI Forensics Investigators (PFIs) released guidelines to help organizations implement breach response plans. Its Responding to a Data Breach: A How-to Guide for Incident Management document was unveiled during a PCI SSC-hosted North America Community Meeting in Canada. Additional data security awareness meetings were slated for Japan and France. According to the PCI SSC, the average cost of a data breach to merchants is now $3.8 million, collectively, per incident. In reflecting on the global state of data security awareness, PCI SSC International Director Jeremy King noted that in the United Kingdom, the government closely monitors data breach incident levels through an annual business survey that tracks all types of data breached.

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Payment veteran Randy Smith would like consumers to help his company create a new payment product. Card1, launched Sept. 18, 2015, on crowdfunding site Indiegogo, would aggregate consumer credit and debit card products into a single plastic payment card and cloud-based mobile wallet. Smith is promoting the Card1 platform on TechCrunch Disrupt’s Startup Alley, an AOL Inc. subsidiary that, in 2010, awarded first prize to his previous startup MobilePayUSA. Card1 combines the benefits of mobile wallet tech with the ubiquity of traditional plastic payment cards, Smith stated. Noting that Europay MasterCard Visa (EMV) and near field communication (NFC) technologies are now in approximately 10 percent of retail locations in the United States, he wanted to find a way to serve a broader population of consumers, particularly younger people who want to use their smartphones to make payments at the POS.

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Today is EMV Day, Oct. 1, 2015. Who is ready for the new card security protocol and who is not? Newly released reports from The Strawhecker Group and leading insurer, The Hartford, point to broad swaths of businesses where EMV readiness is sparse. But that’s OK for now, because so is card issuance. EMV (for Europay, MasterCard and Visa) is a security protocol for chip-embedded (smart) cards and card-accepting terminals. It is considered far superior to storing card and cardholder information on mag stripes because it employs encryption to mask card information exchanges. EMV cards are also too difficult for fraudsters to reproduce to make counterfeiting cards profitable for them.

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Partners, supporters and government officials gathered at New York's City Hall Restaurant on Sept. 29, 2015, to celebrate the official launch of Spare, following a successful one-year pilot. The iPhone app enables users to round up bar and restaurant tabs to the nearest dollar and thus donate their spare change to participating food banks. Proceeds from Spare are already making a difference in New York's fight against hunger, the company said. "There are currently 235 million missing meals in New York City, and nearly one in five residents lack reliable access to nutritious food," said Andra Tomsa, founder and President of Spare Inc., the company behind the app.

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