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Table of Contents

Lead Story

Do banking silos hinder fraud prevention?

Patti Murphy
The Takoma Group

News

Industry Update

Is online PIN debit more secure?

Social networking meets the POS

Illuminating the compliance highway

Features

Research Rundown

Selling Prepaid

Prepaid in brief

Prepaid expo showcases speakers, regs

How prepaid cards assist in disaster relief

Making the case for disaster relief cards

Views

A PIN for all reasons

Scott Henry
VeriFone

Merchant training:
Competitive advantage, potential game-changer

Biff Matthews
CardWare International

Education

Street SmartsSM:
Gain traction on the red carpet

Jon Perry and Vanessa Lang
888QuikRate.com

Digging into PCI - Part 8:
Assign a unique ID to each person with computer access

Tim Cranny
Panoptic Security Inc.

Clarify your brand and use it

Peggy Bekavac Olson
Strategic Marketing

Selling and giving to specialized markets

Jeffrey Shavitz
Charge Card Systems Inc.

Going alternative

Caroline Hometh
Payvision

Company Profile

Vesdia Corp.

New Products

Separation of powers

iPA280
Ingenico

Going out made easy

TabbedOut
ATX Innovation Inc.

Inspiration

Make everyone your valentine

Departments

Forum

Resource Guide

Datebook

A Bigger Thing

The Green Sheet Online Edition

February 08, 2010  •  Issue 10:02:01

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Industry Update

NEWS

The Fed's 2010 payment research underway

The Federal Reserve has undertaken research to get a better handle on numbers and values of checks and electronic payments moving through interbank payment systems.

The 2010 Payments Study, the Fed's fourth such project since 2001, will consist of three separate research efforts to estimate the number, dollar value and composition of noncash payments by U.S. consumers and businesses, based on financial institution data reports.

Data collection and analysis is being coordinated and implemented by the 12 Federal Reserve Banks, with assistance from payment experts at Global Concepts and McKinsey & Co.

Previous payment studies by the Fed Banks have pointed to a continued decline in check usage, while card, automated clearing house (ACH) and other electronic payments have been growing.

"The Fed's 2010 Payments Study is a continuation of an ongoing effort by the Federal Reserve System to measure trends in noncash payments in the United States," said Richard Oliver, Executive Vice President at the Federal Reserve Bank of Atlanta.

"These studies underscore the ongoing evolution of check electronification while providing additional insight to help industry participants plan for the future."

Results of the research are expected in late 2010.

Help for Haiti continues

Following the Jan. 12, 2010, earthquake in Haiti, the payments industry continues to provide support. MasterCard Worldwide is waiving interchange fees on donations for Haiti relief efforts to 15 specified relief organizations using MasterCard-branded cards issued in the United States, Canada, Latin America and the Caribbean.

MasterCard also donated $250,000 to the American Red Cross and pledged revenues generated through donations to select relief organizations through Feb. 28, 2010. Additionally, it will donate twice the amount given to the American and Canadian Red Cross by every MasterCard employee.

Discover Financial Services pledged $100,000 to the American Red Cross and up to $1 million more through a card member matching program.

In addition, Coinstar Inc. enabled its centers to accept donations for Unicef and is waiving processing costs on the first $500,000 donated. First Data Corp. pledged $100,000 to Haiti disaster relief and began an employee donation program in which it will match funds. CO-OP Financial Services and CO-OP Shared Branching are donating $15,000 to CU Aid. CU Aid collects donations for credit union employees, volunteers and members affected by the earthquake.

The Green Sheet reported similar contributions by American Express Co., Western Union, Visa Inc. and MoneyGram International in "Chipping in for Haitian relief," in Industry Update, Jan. 25, 2010, issue 10:10:02.

SPVA increasing membership, global reach

The Secure POS Vendor Alliance added five more members at the end of 2009, its first year in existence. The nonprofit payments industry security organization welcomed Elavon Inc., ID Tech, Independent Purch-asing Cooperative Inc., Voltage Security Inc. and GHL Systems Berhad.

GHL Systems represents the SPVA's first Asian-based company. It deploys payment infrastructure, services and technology. Jason Phua, Vice President of Product Marketing and Strategic Alliances for GHL Systems, said, "This initiative reflects our ongoing commitment to ensure the highest levels of security and conforming to globally-recognized standards."

ID Tech, a Cypress, Calif.-based company with sales, manufacturing and research facilities around the world, specializes in mag stripe and smart card readers, bar code readers, keyboards and PIN pads.

IPC negotiates the lowest cost for goods and services for Subway restaurant franchises. Voltage Security delivers solutions for end-to-end encryption, tokenization, masking and stateless key management for data protection, including credit card data. Elavon is a global payment processor headquartered in Atlanta.

"We welcome these new companies and applaud their efforts to join the conversation and dramatically impact the industry in the coming years," said SPVA President Steven Hughes.

ANNOUNCEMENTS

Apriva rolls out mobile phone apps

Wireless transaction and secure information messaging solutions provider Apriva introduced two new wireless POS solutions designed with mobile merchants in mind: AprivaPay processes payments with Web-enabled mobile phones through its browser; AprivaPay Professional transforms smart phones into payment terminals via downloadable software.

Arcot extends authentication to cells

Arcot unveiled a new Europay/MasterCard/Visa Inc. (EMV) authentication solution for card-not-present transactions in which cardholders authenticate transactions with their mobile phones. The new solution, ArcotOTP, makes the MasterCard Chip Authentication Program available for a broader range of devices.

BOKU gets millions for mobile payments

BOKU Inc. raised $25 million in series C capital from DAG Ventures Inc. and continued contributions from three other venture capital firms. "BOKU is an outstanding investment opportunity, especially considering the widespread use of more than 4 billion mobile phones worldwide, and their potential as a payment method for online transactions," said Nick Pianim, Managing Director of DAG Ventures.

A breach debrief

The Payment Cards Center of the Federal Reserve Bank of Philadelphia released a discussion paper on the Heartland Payment Systems' security breach of 2008 following a workshop on the topic held at the Center in August 2009. Heartland Payment Systems: Lessons Learned from a Data Breach, authored by Julia S. Cheney, Senior Industry Analyst at the Philadelphia Fed, is available on the Web at www.philadelphiafed.org/payment-cards-center/publications.

FCP needs talent

First Capital Payments is hiring to accommodate its national expansion. The company is enlarging its headquarters in downtown Rochester, N.Y., and is expected to hire 40 new employees.

iStream processes 1.2 million transactions

In December 2009, iStream Financial Services Inc processed 1.2 million transactions comprising remote deposit capture, ACH and direct deposit transactions, which represented a total clearing volume of more than $1 billion. IStream processes for over 6,000 locations in 48 states and supports over 4,000 users.

#h4 Doin' it right

Staying ahead of the curve begins with information and analytics. Making business decisions without adequate information is like trying to cross a creek by stepping on rocks while blindfolded. To give merchants clarity on the way forward, cash advance provider AdvanceMe Inc. devised a way to conveniently provide them relevant data tailored to their individual business needs.

AdvanceMe now offers enhanced statements that compares merchants' current credit and debit card sales with the numbers for the same month in the previous year. In addition, AdvanceMe includes benchmark data, which allows merchants to compare their sales to the averages of similar businesses within their industries.

For Main Street, U.S.A.

"Small businesses need timely data to create strategies and plans that will ensure future growth," said Mark Lorimer, Chief Marketing Officer of AdvanceMe. "Reporting personalized and aggregated card sales data monthly demonstrates our commitment to small business success, helping owners to be better informed and proactive."

This detailed level of reporting is made possible by accessing the database of the Data Services Division of AdvanceMe's parent company, Capital Access Network Inc. This peer-to-peer data compares merchants' sales with the sales of other retailers in the same merchant category, region (including population size) and, in some instances, average ticket sizes.

Glen Goldman, President and Chief Executive Officer of CAN, said, "Small businesses, employing fewer than 100 people constitute the majority of businesses in the U.S., but are not included in most same-store sales reports that usually focus on big-box retailers and Wall Street-followed companies. The data we provide through our Data Services Division is drawn exclusively from Main Street merchants."

To view the format of the new enhanced AdvanceMe statement, visit www.AdvanceMe.com/viewdocument/AdvanceMeStatementSample.pdf.

MRI offers funding programs

Los Angeles-based Merchant Resources International Inc. made its three basic merchant funding programs customizable according to business type and needs. Merchants can adjust estimated terms and holdback percentages.

MRA awards scholarships

The Michigan Retailers Association made 34 university and college scholarships available for its members, their employees and families for the 2010-2011 school year. The annual MRA scholarship program awards $1,000 to university and college students and $500 to community college students. The MRA said it is unique in that it is a payment card processor for its members.

Paymetric launches customer award program

Paymetric Inc. launched its 2010 Paymetric Customer Innovation Awards to honor exceptional, innovative achievements made by companies implementing Paymetric solutions.

Winners will be named in four categories: most innovative use of tokenization, best use of technology, best global use of technology and best result of software-as-a-service migration. Nominations close on March 30, 2010, and awards will be presented in May.

Trustwave establishes knowledge center

Trustwave established a data security and compliance knowledge center in London for businesses in Europe, the Middle East and Africa.

Through the center, businesses can access information and resources required for Payment Card Industry Data Security Standard validation.

PARTNERSHIPS

PaySecure drawn to Spirit

Acculynk partnered with Spirit Airlines Inc. to add PaySecure to its Web checkout in 2010. PaySecure allows consumers to pay for products and services online with PIN debit. "Airlines produce a majority of their revenue via the Internet, and it is very encouraging that such a Web-savvy industry has embraced PaySecure," said Ashish Bahl, CEO of Acculynk.

Apriva introduces payWave vending

Apriva partnered with Visa Inc. to integrate Visa payWave into its wireless payment vending solutions. "We are delighted to join forces with Visa to actively assist vending machine operators that are looking to leverage the inherent financial and operational benefits associated with cashless transaction solutions," said Bill Clark, Apriva's Executive Vice President, North America.

TSYS signs Caterpillar, U.S. Bank

In a multi-year agreement, Caterpillar Financial Services Corp. will use Total System Services Inc.'s TS2 platform to process commercial credit accounts. Caterpillar will also have access to TSYS' CounterPASS, a virtual POS product that features Internet-based reporting, statements and customer relations services. In other news, U.S. Bank enhanced its relationship with TSYS using TSYS' processing services for its consumer-directed health care benefit cards.

Glacier Bancorp selects DCS

Dynamic Card Solutions LLC signed an agreement with Glacier Bancorp Inc. to introduce a card program to instantly issue unembossed Visa cards at Glacier Bancorp's bank branches. Glacier Bancorp is a holding company of 11 banks and 94 branches in six western states.

First Savings Bank taps Harland

First Savings Bank chose Harland Financial Solutions' PhoneixEFE core processing platform. The Clarksvillle, Ind., bank will also use Harland's Microsoft Corp.-based platform for its newly acquired Community First Bank. "The contemporary architecture of PhoenixEFE gives us the flexibility we need to get products to market quickly and expand our reach in the commercial market," said Tony Schoen, Chief Financial Officer for First Savings Bank.

Fiserv delivers smooth conversions

Fiserv Inc. assisted MB Financial Bank, the Chicago area operating unit of MB Financial Inc., with its conversion of two Federal Deposit Insurance Corp.-closed banks it recently acquired to the Signature Bank Platform.

"Our technology partner, Fiserv, has been most responsive to our delivery needs as we continue to grow and acquire," said Larry Kallembach, Executive Vice President and Chief Information Officer, MB Financial Bank.

Heartland joins with restaurant associations

Heartland Payments Systems Inc., the National Restaurant Association, and state restaurant associations partnered to roll out a unified restaurant industry payment processing platform.

The partnership's Full Course Business Solutions suite is designed to help reduce expenses, improve operations and increase profitability for restaurant owners across the nation.

HSBC appoints Gemalto for EMV migration

The HSBC Group selected Amsterdam, The Netherlands-based Gemalto to facilitate the EMV migration of HSBC's bank network across 19 markets in the Asia Pacific region. "We bring these world-class solutions to our banking customers so that their customers in-turn benefit from the secure, fast and efficient banking provisioning capabilities," said Tan Teck Lee, President of Gemalto Asia.

IPS, QPS partner for floating solution

Due to a partnership between Integrity Payment Systems and Quicksilver Payment Solutions LLC, qualifying small U.S. businesses can commit a small percentage of their daily credit and debit receipts to monthly overhead bills via the companies' joint solution, PayFast

IPS' back-end technology allows it to "split the merchant's credit and debit card batch multiple times to make multiple micro payments," said Mike Ponder, President and CEO of IPS.

Payoneer selects Cotendo

Global payments solution provider Payoneer selected Cotendo Inc.'s content delivery network and site acceleration suite to enhance the performance of its payments platform. Payoneer reported a 75 percent improvement in access times in some regions after integration of the suite, which increased customer satisfaction.

US Dataworks, The Bankers Bank partner

Oklahoma City, Okla.-based The Bankers Bank is installing the Clearingwork platform from US Data-works Inc. for its image check clearing network. "We see the Clearingworks-powered Image Exchange network as another way we can expand our value-priced service offerings to our colleague bankers' banks serving the thousands of community banks across America," said Mark Keeling, Executive Vice President and Chief Operations Officer of The Bankers Bank.

ACQUISITIONS

Elavon acquires Citizens National's portfolio

Louisville, Ky.-based Elavon, a wholly owned subsidiary of U.S. Bancorp, acquired the merchant processing portfolio of Sevierville, Tenn.-based Citizens National Bank. Citizens serves the three Tennessee counties. In addition to acquiring the bank's merchant processing accounts, Elavon has secured a 10-year referral agreement for new business through its 18 branches.

PAI adds CPC's portfolio

Payment Alliance International completed its acquisit-ion of the merchant processing business of Comdata Processing Systems, a wholly owned subsidiary of Stored Value Solutions. With this acquisition, PAI gains more than 50 ISOs and 5,000 merchant locations nationwide. Existing CPS clients will now benefit from PAI's full range of products and services, PAI noted.

APPOINTMENTS

2Checkout taps new CMO

2Checkout.com Inc. appointed Christopher Daly as CMO for the Columbus, Ohio-based e-commerce and payments provider.

Daly's industry experience came from stints at Alliance Data Systems Inc., PayPal Inc. and Bill Me Later.

FS-ISAC elects board members

The Financial Services Information Sharing and Analysis Center elected or re-elected the following board members for the three-year term that began Jan. 1, 2010: Max Morris, Vice President, Threat Intelligence Services, Wells Fargo; Anish Bhimimani, Managing Director IT Risk Management, JPMorgan Chase & Co.; Mark Clancy, Managing Director, Chief Information Security Officer, Depository Trust and Clearing Co.; and James Doyle, Vice President - Corporate Investigations Division, Prudential Financial Inc.

BOTTOM LINES

Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.

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