The goal of the London mass transit authority, the Transport for London (TfL), to have the city's bus system equipped with an "open" fare payment system by the start of the 2012 London Olympic Games will not be met. The reason for the delay is reportedly due to concerns that the near field communication- (NFC) based system would not be fast enough to handle mobile fare payments at peak travel times.
In February 2011, the TfL said London's system of 8,000 buses would be NFC-enabled by the start of the Olympics to accept open-loop, network-branded, NFC chip-embedded credit and debit cards, as well as the city's popular closed-loop, proprietary Oyster prepaid transit cards. The service would facilitate transit payments by riders tapping cards and smart phones on readers.
In the June 2012 edition of the Global Prepaid Exchange's Prepaid Insights newsletter, Global Prepaid Exchange's Tory Batten said the "read speed of NFC-enabled mobile devices is currently too slow to handle rapid passenger throughput at peak times. While Transport for London's Oyster cards operate at a read speed of 300 milliseconds, industry changes to switch the secure element from the phone to the SIM [subscriber identity module] has slowed the read speed down to above the 500 millisecond cut-off point."
Security was another concern, according to Batten, because credit and debit accounts contain sensitive personal financial information, unlike closed-loop transit cards, which only hold transit fare balances.
Shashi Verma, Director of Customer Experience at TfL, said, "We will only roll it out once we are confident it is 100 percent robust." He noted that the plan was always to introduce contactless payments in phases, with the bus system representing the first phase, followed by upgrades to the Tube (subway system), Docklands Light Railway, tram and London Overground network. TfL began testing the new technology on a small number of London buses in June 2012. The work is still scheduled to be completed by the end of 2012.
In reaction to the controversial New Jersey unused gift card fund collection mandate that is part of the state's updated abandoned property laws, prepaid card distributor InComm vowed in April 2012 to remove its own lines of open-loop, network-branded gift cards from over 2,500 New Jersey retail locations effective June 30, 2012.
On June 29, New Jersey Gov. Chris Christie signed into law a gift card compromise bill, S1928, that placed a four year and one month moratorium on the collection of consumer data mandate, which would expire in 2016.
In response to that news, InComm said it will continue offering its gift cards in New Jersey retail locations. "We plan to continue selling gift cards in New Jersey indefinitely as long as there is no requirement to collect consumer data at the point of sale," said Brooks Smith, President and Chief Executive Officer at InComm.
During a panel discussion at the Network Branded Prepaid Card Association's First Annual Congress held June 2012 in Washington, D.C., Federal Reserve Senior Economist Geoffrey Gerdes said Americans spent more than $80 billion using general purpose reloadable (GPR) prepaid debit cards in 2011.
That's just a fraction of the potential market, however. In 2010, payments initiated with all types of debit cards totaled $1.6 trillion, according to Fed data. But Gerdes said growth in prepaid debit card transactions is outpacing that of all other card categories, and the dollars loaded on prepaid cards are increasing at a rate of 30 percent a year.
U.K.-based prepaid card program manager Advanced Payment Solutions LLC was honored with three awards at the Prepaid365 Awards 2012 in London. APS' The Cashplus Prepaid Card won Best Payroll Prepaid Card, Best Unbanked Prepaid Card and Best Basic Bank Account with Prepaid Card.
Loyalty and gift card program manager FanBox Inc. developed a gift card program for the service stations and convenience stores of Valero Energy Corp. subsidiary Ultramar Ltd. FanBox integrated its MS2 platform into the c-store POS systems, as well as into the pay-at-the-pump stations of nearly 800 locations across Canada.
Digital gifting company Giftango Corp. won the Best Prepaid Innovation award at the Prepaid Awards Canada held June 7, 2012 in Toronto. The award went to Giftango's Premium Turnkey E-commerce Solution for its originality for businesses and consumers
Six months after Green Dot Corp. closed on its acquisition of Bonneville Bancorp and changed the name to Green Dot Bank, the GPR card provider said its bank is now issuing Green Dot's GPR cards. Green Dot Chairman and CEO Steve Streit called the complex integration of Green Dot with the bank a milestone and a great achievement for the company.
Merchant acquirer Heartland Payment Systems Inc. eliminated three fees on its financial aid disbursement card, Acceluraid. Heartland eliminated the $30 dispute, $1 bill pay and 50 cent card-to-card transfer fees. Heartland chairman and CEO Robert O. Carr said the move is designed to lower the potential financial burden on students who use the prepaid debit cards.
National Basketball Association Hall of Famer and entrepreneur Earvin "Magic" Johnson partnered with Southern California-based OneWest Bank FSB to launch the Magic card, a MasterCard-branded reloadable prepaid card. The card features the Magic Mojo account to help cardholders track purchases and save money to reach financial goals.
Moneris Solutions, the largest credit and debit card processor in Canada, won the Leading Prepaid Organization award at the inaugural Prepaid Awards Canada. Moneris was recognized for its provisioning of gift cards to over 6,000 Canadian businesses; its rewards and recognition program found at www.giftcertificates.ca; and its Starter Pack program, which allows merchants to try Moneris' program at no cost or obligation.
NetSpend Holdings Inc. said it is now distributing PayPal Inc. prepaid cards via 7-Eleven Stores Inc. locations. Netspend CEO Dan Henry said 7-Eleven is the first major U.S. retailer to offer the alternative financial service provider's MasterCard-branded prepaid card. NetSpend and PayPal inked a distribution agreement in February 2012.
Business printing supplier Relyco Sales Inc. unveiled the rapid! payroll card program. Relyco said employee benefits of rapid! include instant issuance of both Visa Inc.- and MasterCard Worldwide-branded cards, eliminates check cashing fees, facilitates online payments, and allows for text message alerts and money transfers.
Employee reward and recognition prepaid card program manager InteliSpend Prepaid Solutions LLC tapped Atlanta-based employee wellness program provider gBehavior. InteliSpend will offer gBehavior's Rewards for Wellness corporate wellness incentive platform to InteliSpend's employer clients.
Additionally, InteliSpend signed an agreement with FlexWage Solutions LLC to incorporate the company's WageBank payroll card solution that enables employees to access earned wages in advance of scheduled paydays. InteliSpend said it will be rolling out the product to its own employees, as will its clients.
Prepaid gift and loyalty card firm TenderCard chose merchant service provider CardWare International for after hours and overflow support. CardWare said TenderCard wanted an experienced support specialist that offered program flexibility and a consumer focus.
Vancouver, British Columbia-based prepaid card provider VendTek Systems Inc. teamed with Afghanistan mobile telecommunications firm Telecom Development Co. Afghanistan Ltd. (dba Roshan) to offer mobile prepaid top-up services through self-service kiosks and POS terminals in Afghanistan. Vendtek said the companies' goal is to replace the scratch card top-up method that predominates in the Middle Eastern country.
Gift and meal voucher processor Edenred SA reported entry into the meal voucher markets of Japan and Brazil through the acquisitions of Barclay Vouchers Co. Ltd. and Comprocard, respectively. The Barclay Voucher purchase represents the 39th food voucher market Edenred has entered, while the Comprocard is reportedly the food voucher market leader in the oil-producing state of Espirito Santo in southeastern Brazil.
U.K.-based online payment provider Moneybookers Ltd., which is in the process of rebranding itself as Skrill, purchased Austria-based prepaid voucher firm paysafecard.com Wertkarten AG. The acquisition, which is subject to regulatory approval, will combine Skrill's digital wallet service with paysafecard's eVoucher solution available in 31 countries.
Virtual prepaid card provider Ixaris Systems Ltd. named Kenneth Bonnici to the position of Group Chief Financial Officer. Bonnici, with over 18 years of experience in finance and management, was formerly Operations Director at Ixaris and Managing Director for the company's Malta office.
David Newville, the former Policy Manager at the Center for Financial Services Innovation, joined the U.S. Department of the Treasury in its Office of Financial Access, Consumer Protection, and Financial Education. Newville will report to Deputy Assistant Secretary Melissa Koide, formerly CFSI Vice President of Policy.
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