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The Green SheetGreen Sheet

The Green Sheet Online Edition

August 27, 2012 • Issue 12:08:02

Industry Update

The Green Sheet, Inc.NEWS

    ViVOtech restructures

    Near field communication (NFC) payment software provider ViVOtech Inc. is restructuring operations and shedding its reader business to focus on its software business. On Aug. 6, 2012, ViVOtech reported it completed the sale of its card reader assets, technologies and ViVOpay trademark to POS manufacturer ID Tech.

    ViVOtech said in a July 27, 2012, statement that it has "not ceased operations but is in the process of restructuring operations and has reduced its team to a smaller group with the goals of maintaining customer relationship[s] and core contract work, and to address our supplier relationships and commitments."

    Fed approves debit security fee

    Debit card issuers can receive up to 1 cent per transaction to pay for transaction security costs under the final rule approved by the Federal Reserve Board. The new rule amends the Fed's debit card interchange fee regulation that went into effect in October 2011.

    Issuers have to develop and implement policies and procedures designed to reduce debit card fraud to be eligible to receive the extra penny on every transaction conducted with debit cards. Issuers must also annually review and adjust security policies. It is the responsibility of issuers to notify the card brands each year that they comply with the regulation and are eligible for the adjustment.

    The Merchants Payments Coalition, a national retail lobbying group, criticized the final rule for "making merchants pay for fraud prevention even if banks don't prevent fraud." The MPC said merchants already pay a large percentage of card fraud losses and now the Fed is requiring retailers to also pay 100 percent of banks' fraud prevention costs.

    "The Fed rule rewards banks with more merchant funds if they self-determine that they prevent fraud," the MPC noted. "That will not be effective and regulators should have to find that the banks actually reduce fraud before they get more funds."

    EC objects to MIFs

    Visa Inc.'s multilateral interchange fees (MIFs) may violate European Union antitrust rules, according to the European Commission, the governing body of the EU.

    "The Commission considers that Visa's MIFs harm competition between acquiring banks, inflate the cost of payment card acceptance for merchants and ultimately increase consumer prices," the EC said in a July 31, 2012, statement. "The Commission's analysis follows closely the judgment of the EU General Court of May 2012 in the MasterCard case, which fully upheld the Commission's finding in this respect."

    The EC further claimed Visa's rules that require cross-border acquirers to pay MIFs handicap cross-border acquiring and violate EU rules by maintaining national market segmentation.

    The MPC said the EC's statement confirms that interchange fees set by card companies skirt "antitrust laws and the principles of market competition." MPC Counsel Doug Kantor said, "European regulators are taking action to deal with Visa's outrageous swipe fees - even though the fees in Europe are a tiny fraction of what they are in the United States. This should be a wake-up call that credit card swipe fee reform is long overdue here."

    A representative of Visa Europe did not respond to a request for comment.

    To the cloud for Google Wallet

    Google Inc. said it is moving the NFC-enabled Google Wallet platform from the mobile phone to the online cloud. The new cloud-based Google Wallet application will support all credit and debit cards.

    "We changed our technical approach to storing payment cards," Robin Dua, Google Wallet Head of Product Management, said. "The Google Wallet app now stores ... payment cards on highly secure Google servers, instead of in the secure storage area of the phone. A wallet ID (virtual card number) is stored in the secure storage area of the phone, and this is used to facilitate transactions at the point of sale."

    Google said the new app accelerates the integration process, allowing banks to add their cards to the Google Wallet app in just a few weeks - and at no cost. If phones are lost or stolen, the Google Wallet app can be remotely disabled online. After Google Wallet is disabled, Google will not authorize transactions on that device. If Google manages to remotely locate the lost or stolen device, it will reset the wallet, clearing it of sensitive card and transaction data.

The Green Sheet, Inc.ANNOUNCEMENTS

    First airline on board Acculynk

    American Airlines Inc. agreed to use Acculynk's payment system PaySecure for online PIN debit transactions. Travelers who use debit cards to make purchases on AA.com will be able to enter PINs on PaySecure's graphical PIN pad. Encrypted PINs are transmitted directly over the electronic funds transfer network and are never stored by the airline or Acculynk.

    Capital Payments now Bluefin

    Gateway software provider Capital Payments LLC changed its name to Bluefin Payment Systems. Atlanta-based Capital Payments merged with Tulsa, Okla.-based Bluefin Payment Systems in July 2012.

    CSR execs achieve CIPP

    Payment Card Industry (PCI) Data Security Standard (DSS) compliance services provider Compliance Solutions and Resources said Darrel Anderson, Executive Vice President of Sales and Client Solutions, and Jan Carroza, Director of Corporate Communications, were confirmed as Certified Information Privacy Professionals by the International Association of Privacy Professionals.

    New EMV solution unveiled

    Identity security and card personalization firm Datacard Group released an upgrade to its CardWizard issuance software that helps card issuers migrate to Europay/MasterCard/Visa- (EMV) compliant smart card solutions. The EMV technology upgrade package offers a phased approach that allows customers to integrate smart card personalization services into existing card issuing environments.

    Fed releases government payment study

    The Federal Reserve Bank of Philadelphia released a summary of its conference entitled Government Use of the Payment Card System: Issuance, Acceptance, and Regulation. The summary, which explores consumer adoption and benefits of payment card options, is available at www.philadelphiafed.org/consumer-credit-and-payments/.

    Discover certifies First Data

    Discover Financial Services certified First Data Corp.'s Trusted Service Management solution for usage with Discover Zip, a mobile app that allows for NFC-enabled transactions.

    In other news, First Data said its July 2012 SpendTrend, a monthly comparison of year-to-year same-store electronic commerce data, found sluggish spending growth in July 2012 compared to July 2011. However, SpendTrend reported spending upticks in back-to-school supplies, discount retailing and housing. Summer vacation spending on hotels also saw growth.

    GoPago offers free POS hardware

    Cloud-based mobile payment app provider GoPago Inc. is offering free POS hardware and software to merchants using its GoPago LIVE payment system. The hardware includes a free Google Android tablet (loaded with GoPago software), tablet stand, cash drawer, receipt printer and credit card reader. GoPago LIVE charges a fixed per-transaction fee of 2.85 percent.

    Meritus launches mobile app

    Irvine, Calif.-based ISO Meritus Payment Solutions released a mobile payment solution called Meritus Mobile. The app turns Apple Inc. mobile devices, along with Android and Research in Motion Ltd. BlackBerry devices, into PCI DSS-compliant credit card processing terminals. The system features optional credit card swipe and printer peripherals.

    New app from Vantiv

    Merchant acquirer Vantiv Inc. introduced a new mobile payment application called Vantiv Mobile Accept. The app encrypts credit, debit and prepaid card transactions conducted via mobile devices.

    VeriFone extends contactless into Mexico

    Terminal manufacturer VeriFone Inc. is releasing what it calls the first major contactless payment system in Mexico City in conjunction with the Mexican financial institution Grupo Financiero Banamex. VeriFone's contactless-enabled card terminals are reportedly in service at 1,900 Mexico City merchants. The bank is issuing 100,000 NFC-enabled credit and debit cards to be used on the terminals.

    In other news, VeriFone said department store retailer Beall's Inc. is now using VeriFone's media-enabled terminals. VeriFone also reported it won a five-year contract worth more than $35 million to be the exclusive vendor for the District of Columbia Taxicab Commission Smart Meter project.

    W.net touts online career center

    The Women's Network in Electronic Transactions (W.net) launched an interactive job board focusing on companies in the payments industry. W.net said the online service is an easy-to-use and highly targeted employment resource. The board is open to both W.net members and nonmembers. For more information visit the W.net Career Center at www.wnetonline.org/career-center.

The Green Sheet, Inc.PARTNERSHIPS

    SBS for hospitality

    Hospitality industry software solutions provider Aldelo LP and payment processor Sterling Payment Technologies rolled out a restaurant POS subscription service called Sterling Bundled Services. "SBS will allow our dealers to close more sales while making hardware and software acquisition easier for the hospitality industry," said Aldelo President Harry Tu.

    Computop joins hybris program

    Bamberg, Germany-based gateway provider Computop Inc. joined the Extend partner program of hybris, a multichannel commerce software platform company. The deal enables hybris Commerce clients' access tothe Computop Paygate global payment platform.

    Companies integrate for Magento

    DataCash Group Ltd., a multichannel payment processor and MasterCard Worldwide company, worked with Session Digital Ltd. to integrate Datacash's processing module with the e-commerce platform Magento. The platform, owned by online auction site eBay Inc., serves over 100,000 merchants globally by enabling them to build and operate online stores.

    Meritus integrates with OrderLogix

    Meritus Payment Solutions partnered with order management solutions company OrderLogix Inc. to integrate its gateway solution, Payment XP, with OrderLogix's order management applications. The resulting system offers continuity programs, advanced reporting and advanced customer service solutions to small and midsize businesses.

    Moneris adds online registration service

    Canada-based merchant acquirer Moneris Solutions Corp. teamed with GoSignMeUp, an online registration provider for classes, events, workshops and training. Moneris integrated its proprietary eSelectPlus payments gateway with GoSignMeUp to provide payment processing directly through GoSignMeUp's registration software.

    JV forms for mobile apps

    Multimedia company and application developer Neutrino Media Group Inc. entered a joint venture with cloud-based mobile payment platform provider QuickPay Corp. to develop Neutrino's suite of mobile apps. The new suite, to be marketed as "ROYCE powered by QP QuickPay," will be used to pay for parking, shopping and travel.

    Deutsche Telekom working with Wirecard

    Two international German companies formed a strategic partnership. Electronic payment and risk management solutions provider Wirecard AG will provide payment processing for telecommunications firm Deutsche Telekom AG. Wirecard will also provide technical support for the Telekom MasterCard Wirecard and help launch Deutsche Telekom's mobile wallet in 2013.

The Green Sheet, Inc.ACQUISITIONS

    Affiniture buys Diners Club businesses

    Private investor group Affiniture Cards Ltd. purchased from Citigroup Inc. the Diners Club card issuing businesses in the United Kingdom and the Republic of Ireland. Citi said it is divesting assets and businesses in its Citi Holdings portfolio to concentrate on growing its core franchise, Citicorp. Terms of the deal were not disclosed.

    Global steps it up with Accelerated

    Payment processor Global Payments Inc. acquired payment technology company Accelerated Payment Technologies Inc. from the private equity firm Great Hill Partners. The $413 million cash deal is expected to close in Global's 2013 second fiscal quarter.

The Green Sheet, Inc.APPOINTMENTS

    ACI makes executive moves

    International payment processor ACI Worldwide Inc. hired Daniel Frate as Executive Vice President of Global Markets and Product Management. Frate was formerly Executive Vice President and Head of Products and Pricing for PNC Bank. ACI said Frate is responsible for "alignment of product roadmaps with market needs."

    David Morem left his position as Executive Vice President of Global Products to become ACI's Executive Vice President of Global Maintenance. He will be responsible for product maintenance and customer support operations. Morem replaced Ralph Dangelmaier, who left ACI to head a private company.

    Jared new to Merchant Link

    Cloud-based payment gateway and data security solutions provider Merchant-Link LLC made Ben Jared its new Director of Business Development. Jared, who was previously Area Sales Director for ACI, brings experience in international payment processing, payment security and PCI compliance, to his new position of developing Merchant-Link's retail vertical.

    Meritus adds two execs

    Jon Lindhjem and Jason VanWagoner were appointed to executive positions at Meritus. Lindhjem was named Vice President of Business Development, where he is responsible for marquee clients, partner relationships and software integrations.

    Prior to joining Meritus, Lindhjem worked for merchant service provider TransFirst LLC and founded mobile shopping app developer NuWallet Inc.

    VanWagoner is the new Director of Business Development and takes on the responsibility of growing Meritus' business through the direct selling and direct response arenas. VanWagoner was formerly Director of Strategic Business Channels at Molding Box Inc., an outsourcer of printing, shipping and handling services.

The Green Sheet, Inc.BOTTOM LINES

  • The U.S. Census Bureau estimated U.S. retail and food services sales, seasonally adjusted, grew to $403.9 billion in July 2012, an increase of 4.1 percent over last July.

  • According to the National Automobile Dealers Association, the U.S. auto industry sold 1.1 million units in July 2012, up 8.9 percent from July 2011.

  • A Research and Markets' Garden Centers & Farm Supply Stores report projects combined annual revenue of about $30 billion in 2012 for the 16,000 garden and farm supply stores operating in the United States < end of article

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