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Table of Contents

Lead Story

Embrace innovation in the new payments game

News

Industry Update

Small merchants falling behind on mobile

FTC sues processor, addresses DCTC, mobile security

FTC seeks to outlaw certain payment schemes

Dial downloads under five minutes?

Features

What's next for ISOs?

Nancy Drexler
Acquired Marketing

Selling Prepaid

Prepaid in brief

Issues surface over Direct Express

BillingTree bullish on prepaid mobile bill pay

Views

The ISO's terroir in the new payments landscape

Brandes Elitch
CrossCheck Inc.

Education

Street SmartsSM:
Honest thoughts about pet peeves

Dale S. Laszig
Castles Technology Co. Ltd.

Finding buyers in the online payments biz

Brian Crozier
NetPayment Solutions Inc.

Understanding mobile wallets

Michael Gavin
Merchant Warehouse

Why mobile should scare the app out of you

Jake Young
SecurityMetrics

Company Profile

Revo Payments

New Products

Mobile checkout in a snap

SnapMobile
BlueSnap Inc.

Beyond the dongle

Product: ROAMpay X4
Company: ROAM Data Inc.

Inspiration

Creative use of commemorative occasions

Departments

Readers Speak

Resource Guide

Datebook

Skyscraper Ad

The Green Sheet Online Edition

July 08, 2013  •  Issue 13:07:01

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Industry Update

NEWS

D.C. cab company deploys e-hail system

Taxi system integrator airsMobile Inc. picked up a fare in Washington D.C.'s controversial taxi market with the TaxiRadar e-hail and smart-meter system. DC taxi company USA Cabs is installing the system, which allows consumers to send smartphone messages to hail cabs.

AirsMobile partnered with PayAnywhere, a North American Bancard company, to provide card-based payment processing at riders' drop-off points.

AirsMobile is one of the first companies to meet requirements set by the District of Columbia Taxicab Commission. The DCTC mandated that mobile app developers for taxi reservations integrate their services with the in-taxi POS systems already chosen for installation in DC taxis. (See "D.C. taxis at payments crossroads," The Green Sheet, June 24, 2013, 13:06:02).

The DCTC's mandate proved controversial because it effectively shut out competing e-hail apps from developers such as mytaxi that had already partnered with other card processors.

Passengers with smartphones can use TaxiRadar to see the GPS location of available taxis in real time and hail them through messaging. After the taxi driver acknowledges the message, the customer can continuously track the taxi's location as it approaches.

Texas prohibits retailers from adding debit surcharges

In June 2013, the state of Texas passed legislation, signed by Gov. Rick Perry, prohibiting retailers and other commercial interests from adding surcharges to debit card transactions at the POS.

Set to take effect Sept. 1, 2013, the bill was supported by the Independent Bankers Association of Texas, essentially to prevent big-box retailers from cutting deals to steer consumers toward the debit cards of large banks, which would have shut out community-bank-issued cards.

"We felt that a prohibition on debit surcharges was essential to ensure parity of community bank debit cards and protection of community bank customers," IBAT Executive Vice President Steve Scurlock was quoted as saying.

"The passage of HB 3068 should preempt any efforts by retailers to enter into relationships with the largest financial institutions that could lead to steering of transactions toward those banks' cards." The legislation allows governmental entities to add surcharges on debit transactions.

Shift4 aims to speed U.S. transition to EMV

To spur U.S. adoption of the Europay/MasterCard/Visa (EMV) standard - and to grab market share - Shift4 Corp. issued an open letter to merchants and payments industry participants regarding the company's ability to ease the transition.

Shift4 Chief Technology Officer J.D. Oder said that bringing the technology to the United States "is going to be an expensive and convoluted process. It was difficult to implement in Europe ... but the variety of infrastructure and sheer number of banks and processors in the U.S. will make it exponentially more difficult here."

According to the letter, retailers certified for debit on Shift4's Dollars on the Net payment system will get EMV without making significant changes to existing software.

Shift4 said its bank- and processor-neutral gateway allows merchants to quickly switch banks and processors as needed, and merchants can choose from a variety of supported POS terminal devices.

The company added that for POS vendors, Shift4's Universal Transaction Gateway minimizes changes; vendors do not need separate certifications for each device.

Shift4 expects Dollars on the Net to stand in place of the POS in the certification process. According to Shift4, once a manufacturer's device is certified to a given processor, the device is certified no matter which POS solution a Dollars on the Net merchant uses. For processors, Shift4 replaces the POS application of record.

Half of processing FIs undecided on an EMV strategy

A survey of card processing financial institutions (FIs) by The Members Group found that 62 percent believe they need to develop an EMV strategy to reduce fraud losses, meet the liability-shift deadlines set by card networks, or to meet the needs of cardholders who travel abroad. Only 37 percent of respondents said their plan includes migration to EMV cards before October 2015, the month Visa Inc. and MasterCard Worldwide will shift fraud liability to the least secure entity in the transaction chain.

Another 52 percent were undecided about their implementation timeline. Brandon Kuehl, Product Development Architect, expects most of the undecided FIs to solidify their strategies within the next 12 months.

Some 14 percent of TMG's clients cite travelers as the primary reason their institutions are considering issuing EMV cards. Clients currently implementing EMV are doing so to provide a better customer experience, especially for cardholders who travel frequently, according to Kuehl. Many unmanned kiosks in international locations accept only chip and PIN cards, creating a challenge for mag-stripe cardholders.

ANNOUNCEMENTS

Alpha Card moves to new HQ

Trevose, Penn.-based ISO Alpha Card Services relocated its global corporate headquarters. The new facility, still in Trevose, has over 13,000 more square footage than the old address and houses Alpha Card's own in-house payroll processing center.

CrossCheck preferred by SBMA

CrossCheck Inc. was named the preferred payment guarantee company for the Southern Building Materials Association, which represents the lumber and building supply industry.

CrossCheck said building material businesses using the company's services can accept and authorize checks using their existing payment terminals, by phone or by Internet at the CrossCheck website, reducing the need for them to invest in equipment.

CSI unveils SPIN P2P

Person-to-person (P2P) payments processor Computer Services Inc. introduced its Social Payments Instant Network (SPIN), designed to enable banks to provide customers more direct P2P payment functionality through mobile and Internet banking applications. CSI said SPIN eliminates the delay in funds availability for P2P payment receivers, allowing funds to clear within minutes.

10,000 UV check scanners shipped

CTS North America, the bank branch automation solutions subsidiary of CTS Electronics, said sales of its LS150 Ultraviolet (UV) check scanner exceeded 10,000 units earlier in 2013. Banks in developing countries especially need durable, highly accurate check scanners to combat check fraud, the company noted.

WSAA founds CPP scholarship

In collaboration with the Electronic Transactions Association, the Western States Acquirers Association launched a scholarship program to benefit 10 qualified ISOs and merchant level salespeople who want to take the ETA's Certified Payments Professional (CPP) exam.

Scholarships will pay for the CPP exam fee and study materials, which will be issued via email. Applicants must register to attend the 10th Annual WSAA Conference to be held Oct. 8 to 9, 2013, in Burlingame, Calif.

Ben & Jerry co-founder to headline conference

Jerry Greenfield, co-founder of the Ben & Jerry's ice cream franchise, will deliver the keynote address at The Members Group's 2013 Client Conference scheduled for July 22 through 24 in Stowe, Vermont. Payment aggregator TMG said Greenfield will pay tribute to America's entrepreneurial spirit.

Heartland named top IT workplace

For the third consecutive year, payment processor Heartland Payment Systems Inc. was named to IDG's Computerworld 2013 List of Best Places to Work in Information Technology (IT). Heartland said it employs over 400 IT professionals in three centers in the United States: Plano, Texas; Portland, Ore.; and Jeffersonville, Ind.

mPowa resizes footprint

London-based mobile payment company mPowa said it is expanding its global footprint with a number of contracts around the world, including with Portugal Telecomm Group and First National Bank in South Africa.

peerTransfer raises $6.4 million

Boston-based education industry payment firm peerTransfer closed $6.4 million in new funding, led by QED Investors, FIDES and KIBO Ventures. The company specializes in streamlining international payments for over 350 educational institutions in North America, Europe and Australia.

Punchey targets big payments by small businesses

Mobile payment startup Punchey Inc. reported it ended its beta test for a dongle-based mobile payment solution that provides rate discounts for small businesses that handle large payments. Such businesses, mechanics and lawyers, for example, shouldn't have to pay the same rates as those handling micro payments, for example, coffee shops and food trucks, Punchey said.

Text2Pay adds bitcoins processing

Online payments provider Text2Pay reported that it now supports the processing of peer-to-peer digital currencies like bitcoins. "By offering bitcoins to merchants, customers will experience faster payment processing, lower fees, and increased security and privacy," said Text2Pay Managing Director Mark Reiken.

RESEARCH

European e-commerce outpaces U.S.

According to the U.K.-based Centre for Retail Research, the European e-commerce market edged out the U.S. market in terms of 2012 e-retailing growth. Online sales in the European market totaled $302.20 billion, up 16.62 percent from $260.41 billion in 2011, according to the research firm.

In comparison, e-commerce in the United States grew year-over-year by 15.9 percent, from $194.61 billion in 2011 to $225.54 billion in 2012, the firm reported.

NFC needs chain-link security

In a white paper titled The NFC Security Quiz: 6 Key Questions Answered, Palaiseau, France-based secure-chip testing provider FIME said that all near field communication (NFC) stakeholders must understand their liabilities, undertake risk assessments, seek clarity on their areas of responsibility and investigate ways to optimize security. "This creates a 'security chain,' which FIME believes every actor engaged in the NFC sector must actively support," the provider said.

Few alternative currencies expected to survive

In a review of alternative currencies, payment consultancy Mercator Advisory Group said few of them have "staying power." Its report, Alternative Currencies: Is There Staying Power?, identifies four types of virtual currencies, such as bitcoin (an open currency) and Amazon Inc.'s Coins (a closed currency).

"Distrust of government-issued currencies, or competitive threats involving businesses, for years has prompted the occasional alternative currency to emerge, but few have had much staying power," said Jeffrey Green, Director of Mercator's Emerging Technologies Advisory Service and author of the report.

"Fears tend to subside once the situation stabilizes and conditions improve. But alternative currencies that complement and reward traditional payment card use have found a niche that will keep them prospering for years to come."

PARTNERSHIPS

Comdata, Infintech mutual partners

Comdata Corp. signed a formal referral agreement with ISO Infintech LLC. As part of the agreement, Comdata plans to grow its e-payables business by increasing business-to-business client enrollment and participation, while Infintech expects to add to its commercial and purchasing card processing business, the companies said.

Elavon expands RCG partnership

Elavon expanded its three-year partnership with business consulting and technology services provider RCG Global Services to maintain quality in planned growth strategies. "Working with RCG helps us create new efficiencies and align our business objectives with the goals of the entire organization," said Elizabeth Holmes, Senior Vice President, IT Governance & Quality Assurance at Elavon.

FAC, MasterCard turn to Kount

Global payment gateway provider First Atlantic Commerce teamed with Kount Inc. to integrate its turnkey risk management and fraud protection service into FAC's payment platform to protect merchants against card-not-present fraud.

In a separate agreement, Kount will begin offering the MasterCard Expert Monitoring Application Programming Interface from MasterCard Worldwide to its merchant customers.

First Data pairs with HP, Skynet

First Data Corp. collaborated with Hewlett-Packard Development Co. LP in integrating the HP Converged Infrastructure with its VisionPLUS Flex solution, to allow financial institutions to cost-effectively process payment portfolios of up to 10 million accounts in one platform and install the system "in days rather than months," the companies stated.

In other news, First Data inked a deal to power credit card transactions for Mahala, a secure mobile payment app built on quick response code technology developed by Skynet Technology Group Inc.

PayLeap gets nod from Cox

Payment authentication and encryption provider Acculynk formed an alliance with Cox Business, the commercial voice, video and data solutions arm of broadband communications and entertainment company Cox Communications Inc. Acculynk's cloud-based payment processing service PayLeap will be made available to Cox's 300,000 business customers later this year.

Xero gains Stripe

Xero integrated Stripe's online payment card acceptance into its online accounting software service, and both systems received backing from PayPal Inc. co-founder Peter Thiel.

"Cashflow is the most important aspect of running a business," said Jamie Sutherland, U.S. President of Operations at Xero. "Having software in place that allows users to get paid faster is invaluable to the business owner.

Zipmark signs WorkingPoint

Zipmark Inc. signed an agreement with online small business management platform provider WorkingPoint Inc. to extend its secure digital check platform to WorkingPoint's business customers. Zipmark charges 1 percent per transaction, up to a $5 maximum, and it deposits funds into business accounts the next business day.

ACQUISITIONS

PaySpan gains mPay Gateway

Health care payment and reimbursement automation firm PaySpan Inc. acquired the assets of POS patient payment solutions provider mPay Gateway as part of its plan to create a unified reimbursement solution that will enable health care providers to more efficiently manage payment collections, PaySpan said.

APPOINTMENTS

Counterman joins Bluefin

Bluefin Payment Systems appointed Julie Counterman as its Senior Vice President of Business Development and Sales. She will head the company's integrated software vendor, e-commerce, inside sales and relationship management teams.

Directly before joining Bluefin, Counterman was the Executive Vice President of Sales and Marketing at Accelerated Payment Technologies. She previously held executive positions at Harland Financial Solutions, InterCept Inc., Spectrum, Elavon and MCI WorldCom.

Planet Group hires Magwire

Sherry Magwire is the new Chief Technology Officer at Planet Group Inc. She is responsible for all information technology functions, and for technically supporting the company's client base, which uses Planet Group solutions for payment processing, gift and loyalty programs, customer e-correspondence, business process management and more.

Magwire has more than 30 years' experience in information technology and payment processing spheres.

Sphyra promotes Manfred

Sphyra selected Chris Manfred to be its Director of Acquisitions. Manfred joined the company in 2010, and worked in sales, which enabled him "to learn the ins and outs of the payment processing industry," the company stated.

Manfred is now responsible for the management of current customer relationships. He is also charged with overseeing the development and implementation of new sales tools.

RETAIL BRIEFS

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

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