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Table of Contents

Lead Story

Loyalty, the currency of choice

Ann Train

News

Industry Update

Disputes rekindled by Financial CHOICE Act

Barcode technology gets digital makeover

Home Depot joins chip-and-PIN protest

Aussie crackdown on card surcharges

Features

FICO pedestal cracking

Acquirer Earnings Roundup: May 2016

Mobile coupon tidal wave

ISOMetrics:
Restaurant patronage on the rise

Views

CFPB targets payday lenders: What's next?

Patti Murphy
ProScribes Inc.

Brexit doesn't mean UK will exit fintech race

David Poole
myPINpad

Will vaping go up in smoke?

Brett Husak
National Bank Services

Education

Street SmartsSM:
Shifting MLS strategies and models

John Tucker
1st Capital Loans LLC

Taking stock at mid-year 2016

Jeff Fortney
Clearent LLC

Five ways to combat attrition effectively

Aaron Nasseh
Finical Inc.

Guide to a successful portfolio acquisition strategy

Adam Hark
MerchantPortfolios.com

Company Profile

Traffic Jamming

New Products

Simple, secure cross-border payments

UP eCommerce Payment Solution
ACI Worldwide Inc.

360-degree solution for chargebacks issues

FPR-360
Chargeback Gurus

Inspiration

Finding opportunity

Departments

Letter from the editors

Readers Speak

Resource Guide

Datebook

A Bigger Thing

The Green Sheet Online Edition

July 11, 2016  •  Issue 16:07:01

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Industry Update

RETAIL BREIFS

ANNOUNCEMENTS

New chargeback policy for AmEx

To promote EMV (Europay, MasterCard and Visa) adoption, American Express Co. changed its EMV chargeback policy. By the end of August 2016, merchants will not be held liable for AmEx chargebacks for fraudulent transactions that are under $25. AmEx also plans to limit merchant counterfeit fraud chargeback liability to 10 per account by the end of the year. The card issuer – not the merchant – will bear the financial liability for counterfeit transactions above the initial 10 transactions. This new policy will remain in effect until April 2018 and does not prevent cardholders from disputing additional fraudulent transactions, the company stated.

"Combating fraud is an ongoing priority for American Express," said Mike Matan, AmEx Vice President, Global Network Business. "We recognize the migration to EMV in the U.S. is an effort that will take time, which is why we are making these policy changes in order to provide flexibility to those merchants that may need more time to upgrade their point-of-sale terminals to accept EMV chip cards." The changes are expected to help reduce counterfeit fraud costs for merchants who have not yet upgraded their POS terminals to accept EMV chip cards. An AmEx analysis found that more than 40 percent of its counterfeit fraud chargebacks in the United States are for transactions under $25.

Clearent honored for impressive growth

Clearent LLC was named one of the fastest growing private companies by the St. Louis Business Journal for the fifth consecutive year. To maintain its growth, Clearent draws upon certain key factors including a focus on building a solid sales team; bringing on new sales partners; and delivering products, services and tools to help these professionals grow faster and increase profitability, Clearent stated.

CPI Card Group lawsuit deadline looms

Scott+Scott, Attorneys at Law LLP reminded investors that Aug. 15, 2016, is the last day to file lead plaintiff papers in the securities lawsuit against CPI Card Group Inc. The complaint alleges that at the time of the company's initial public offering, unbeknownst to investors, it had shipped more than 100 million more cards to its larger issuer customers than needed, significantly reducing the demand for additional card shipments in the fourth quarter of 2015 and fiscal year 2016.

Capital raised by D3 Banking

D3 Technology Inc. raised $10 million in capital from West Partners LLC for its D3 Banking solution. D3 will use the investment to help strengthen its team, invest in research and development, and continue expanding its hosted platform to keep up with increasing market demand. D3 Banking is a single platform solution that provides regional and midsize financial institutions with a comprehensive set of data-driven digital banking services for any computer, smartphone, tablet or other digital device, the company noted.

FTC settles with InMobi

Mobile ad firm InMobi will pay $950,000 in civil penalties and implement a comprehensive privacy program to settle Federal Trade Commission charges that it deceptively tracked the locations of hundreds of millions of consumers – including children – without their knowledge or consent. "This settlement ensures that InMobi will honor consumers' privacy choices in the future, and will be held accountable for keeping their privacy promises," said Jessica Rich, Director of the FTC's Bureau of Consumer Protection.

Before December 2015, when users declined to provide InMobi their locations (by selecting "No" when the app asked for location information or by turning the function off manually in Settings) the company collected and used related Wi-Fi network data to infer their locations anyway. However, InMobi told developers that geo-targeting was only available if users gave their permission to activate Location Services on their devices. This led to the injunction and civil penalties from the FTC for deceptive practices.

kwik finalizes funding round

Startup venture kwik, which has developed push-button reordering of favorite products for consumers, closed a $3 million round of seed funding by Norwest Venture Partners and other institutional and individual investors. Kwik, an NFX Guild company (an invitation-only guild for digital networks), stated it will use the funds to accelerate market availability via rigorous business development with brands, retailers and home delivery services across the United States.

MasterCard identifies five-year goal

MasterCard Worldwide intends to connect 40 million micro and small merchants to its electronic payments network within five years. This expands on the company's Universal Financial Access 2020 commitment made in 2015. "To date, financial inclusion has been predominantly centered on providing the underserved and the unbanked with tools and transaction accounts," MasterCard stated in a press release about the goal. "In order for financial inclusion efforts to truly have an impact, there needs to be an equal focus on both access and usage."This ongoing effort involves a broad-based collaboration with public and private sector entities throughout the world. "Helping micro and small merchants connect to electronic payments will accelerate adoption and usage of new financial tools for the unbanked and will have a true impact on people's daily lives," said Ajay Banga, President and Chief Executive Officer of MasterCard.

NAB enhances EMV program

Payment processor North American Bancard Holdings LLC added a new feature, called tip adjust, to select EMV-ready Ingenico and VeriFone POS terminals. This new feature addresses an EMV limitation that businesses in the restaurant and service industries often encounter: the inability for customers to leave a tip separately from the total purchase price. Tip adjust allows customers to add a tip on the receipt after the EMV transaction is completed.

Planet Payment makes Russell 2000 list

Planet Payment Inc. was added to the Russell 2000 Index. The index captures the 2,000 largest U.S. stocks, annually ranking them by total market capitalization. "We are pleased to be added to the Russell 2000 which reflects our continued positive momentum and efforts to increase shareholder value," said Carl J. Williams, CEO of Planet Payment.

Simility raises capital for fraud product

Simility closed an additional $1.5 million in its first round of funding, bringing the total raised to $7.2 million. This additional investment was led by early-stage specialist, The Valley Fund, along with Accel and Trinity Ventures. As a result, Simility noted that it has also launched the Simility Fraud Prevention Platform globally, and is now processing millions of transactions a day for customers on four continents.

Skybox Security honored for cybersecurity

Skybox Security Inc. received three cybersecurity awards in June. Respectively, SC Magazine gave the company a five-star rating in its Group Test for Vulnerability Management, The Cyber Security Awards named Skybox Horizon as its Innovative Product of the Year for 2016, and SC Magazine UK recognized Skybox Security Suite in the Best Vulnerability Management, Best Risk/Policy Management and Best Regulatory Compliance solutions categories.

Walmart Pay debuts in Georgia

Wal-Mart Stores Inc. introduced Walmart Pay to store customers in Georgia, who are among the first to use the checkout service, which is now available in more than 180 Wal-Mart stores in the state. According to Wal-Mart, it is the only retailer to offer a payment solution that is compatible with all iOS or Android devices and accepts any major credit, debit, prepaid or Walmart gift card – all through its own mobile app.

Consumers access Walmart Pay via the company's app, which shoppers have already been using to locate store items, order prescription refills and complete online orders. Wal-Mart claims that 22 million consumers are active users of its app, which is said to rank among the top three retail apps in both the Google Play Store and Apple Inc.'s App Store.

Wildcard Payments now Push Pay

Wildcard Payments changed its name to Push Pay Inc. to better align with the company's vision. "Our new name better reflects our faster payments initiatives and the payment gateway we have built," said Travis Dulaney, Push Pay founder and CEO. "We can validate accounts prior to making payments, which allows us to process payments with a lot more intelligence." Dulaney also serves as a member of the Federal Reserve Bank's Faster Payments Task Force.

RESEARCH

Early Warning, Javelin joint white paper

Early Warning Services LLC and Javelin Strategy & Research collaborated on a white paper to complement a recent Javelin webinar that explored the budding mobile wallet market and related fraud risk. The white paper, titled Securing the Mobile Wallet Experience, details growing mobile wallet adoption, consumer security behaviors, the need for superior authentication solutions, best practices for preventing fraudulent enrollments, and the value of background analytics and data.

EMVco releases global EMV statistics

Global technical body EMVCo reported sustained growth in the worldwide adoption of EMV chip technology. Official, aggregated data show that by the end of 2015, the number of EMV payment cards in global circulation had increased, year over year, from 1.4 billion to 4.8 billion. In addition, the report revealed that 35.8 percent of all global card-present transactions between January and December 2015 used EMV technology, up from 32 percent for the same period in 2014.

Greenwich makes blockchain prediction

Blockchain, also referred to as distributed ledger technology (DLT), has captured the attention of the financial services sector. Financial service firms and technology providers around the world will spend more than $1 billion in 2016 in the race to bring blockchain to capital markets, according to a new report from Greenwich Associates LLC. In its latest in a series of DLT-focused research, Greenwich assessed the current state of blockchain adoption across banks, brokers, asset managers, exchanges and leading blockchain technology companies.

"Although companies have only recently begun to experiment with the technology, some important trends are beginning to emerge," Greenwich stated. "Respondents included representatives from a broad array of different organization types, 89 percent of whom were either key decision-makers or actively involved in blockchain initiatives. Out of those respondents who told us their companies were focused on blockchain, 98 percent identified as decision-makers or actively involved in blockchain initiatives."

InstaMed tracks healthcare payment trends

Healthcare payment provider InstaMed released the 2015 Trends in Healthcare Payments Annual Report. The sixth annual report features key healthcare payment market trends impacting providers, payers and consumers. The latest report focuses on the sweeping shift to consumer payment responsibility, consumerism's demands on providers and payers, the unsustainability of paper processes and increased security risks for healthcare payments.

ATM Council skimming survey

The National ATM Council Inc., a not-for-profit national trade association representing the U.S. ATM sector, released its U.S. Retail ATM Skimming Survey. The survey results show 93 percent of companies operating ATMs at retail locations throughout the United States have never experienced a credit card skimming incident. Of the respondents, more than half have been in the ATM business for 10 or more years, and they inspect their ATMs at least once per week.

"These skimming survey results confirm that retail ATMs are secure and the incidence of card data theft is extremely low," said Bruce Renard, NAC Executive Director. "At the same time, we recognize from prior experiences in other countries that we are likely to see a rise in card fraud and skimming in the near term, with the implementation of EMV in the U.S."

NAC stated it continues to work with the retail ATM sector to help raise awareness and promote detection and deterrence of skimming among the industry and consumers. These initiatives include the skimming survey, issuance of industry alerts and ongoing development of anti-skimming guidelines for retailers.

Square Root studies store execution

Square Root, creator of enterprise store relationship management software, released findings from its national survey of retail store managers. The study, Turning Brand Vision Into Store Execution, conducted in partnership with Worldwide Business Research's WBR Digital, revealed that poor training, outdated tools and technology, and broken relationships between corporate and frontline stores leaves brick-and-mortar retailers struggling to deliver consistent brand experiences and keep pace with changing customer expectations.

PARTNERSHIPS

APPS, Womply team up

Atlantic Pacific Processing Systems Inc. and Womply Inc. partnered to offer APPS Insights, a platform dedicated to the three core areas of focus for merchants: revenue, reputation and competition. APPS Insights takes valuable information pertaining to merchant businesses and converts it into actionable intelligence, the partners stated. "With APPS Insights, powered by Womply, we are excited to continue differentiating our merchant product offering," said Abe Maghaguian, President and CEO for APPS.

DealerSocket adds ProPay

DealerSocket Inc. reported it has enhanced its FEX dealer management system (DMS) payment processing options for independent automobile dealers by fully integrating with ProPay Inc.'s LenderPay platform. This partnership is designed to provide FEX DMS users with more options to select the credit processor that best serves each dealership's unique needs. "Dealers can now accept credit cards, debit cards and electronic bank transfers without ever leaving the DealerSocket platform," said Cameron Darby, Chief Operating Officer at DealerSocket.

MainStream, Revel partner

MainStream Merchant Services Inc. partnered with Revel Systems Inc., provider of iPad-based business management solutions for brick-and-mortar retailers, food businesses and more. MainStream stated that partnering with Revel enables the company to provide total business management solutions to its clients through enhanced operations, increased efficiency, added visibility and greater precision to cost and profit management, all of which contribute to an elevated customer experience.

Mobility aligns with Tascet

Mobility Exchange and Tascet Inc. disclosed they had formed a strategic partnership to deliver groundbreaking mobile capabilities to prevent fraud and synthetic identities, build integrity into existing and emerging business models, and advance new initiatives aimed at improving services and operations ‒ while also protecting consumer security and privacy. "When we became familiar with Tascet's SuperToken technology, we knew it would provide a significant ROI for our clients," said Ron Patterson, President of Mobility Exchange.

NRHA, PAI partner up

The North American Retail Hardware Association and Payment Alliance International formed a partnership to provide independent home improvement retailers with new credit card processing and payment services opportunities. Through PAI's program, independent home improvement retailers receive a detailed charge analysis comparison to see how the program benefits their bottom lines; they also gain access to the most up-to-date payments technology, the companies noted.

PaySpan boosts FI connections

PaySpan Inc., provider of electronic healthcare payment and reimbursement solutions, revealed it is deepening its partnerships with financial institutions. Leveraging PaySpan's Patient Financial Engagement solution suite, financial institutions such as Commerce Bank are now able to offer a toolset to assist providers with efficient calculation and capture of patient financial responsibility, PaySpan said.

TMG, CO-OP, Mercator joint project

The Members Group, CO-OP Financial Services and Mercator Advisory Group reported they are making progress on their collective plan to create much-needed clarity regarding blockchain technology's potential in the community financial institution sphere. The companies have developed and begun testing a strategic decision framework for blockchain. The companies envision the tool serving as an evaluation template for financial institutions exploring use cases for the emerging digital ledger technology.

TSYS, Equinox create joint solution

Total System Services Inc. and Equinox Payments unveiled a semi-integrated payment solution to help value-added resellers quickly and easily develop and release EMV-certified technology to their lodging and restaurant merchant customers. Running on the Equinox Apollo terminal, the Voyager application is an EMV-certified solution with features specifically designed for lodging, as well as retail and restaurant environments.

Vantiv, CAP COM partner

Vantiv Inc. was chosen by CAP COM Federal Credit Union to process payments in a multiyear partnership agreement. "Being chosen by a well-respected, highly rated credit union like CAP COM Federal Credit Union is a testament to the empowering solutions we've worked hard to develop and implement for our credit union partners," said Bill Hampton, General Manager, Financial Institution Services at Vantiv.

ACQUISITIONS

Accenture to buy dgroup

Accenture entered into an agreement to acquire dgroup, a Germany-based consultancy that delivers end-to-end management consulting services to help companies achieve digital transformation. Accenture anticipates the acquisition will increase its digital consulting capabilities in the German market and strengthen the broad range of services Accenture provides to support digital transformation, primarily for retail and consumer goods companies.

CheckAlt purchases Klik

CheckAlt acquired Klik Technologies Corp. to strengthen its position as a provider of payment solutions for financial institutions. The combined company serves an expanded customer base, providing a broader set of payment processing solutions to enable financial institutions and corporate clients of diverse sizes and locations to generate revenue, reduce transactional costs, increase transaction processing efficiencies and mitigate fraud, according to CheckAlt.

LaSalle acquires Processing.com shares

Chicago-based LaSalle Capital collaborated with Processing.com's executive team on a vision for Processing.com's expansion. As part of the transaction, LaSalle acquired an interest in Processing.com. Avi Chesed, CEO of Processing.com, stated, "We believe that LaSalle's expertise in helping build technology-enabled service companies will enable the company to expand its global footprint and vastly accelerate our expansion."

APPOINTMENTS

PatientPay selects Boemer

PatientPay, provider of paperless billing solutions for the healthcare industry, appointed Paul Boemer as its Executive Vice President. In this role, Boemer will lead PatientPay's efforts to expand its presence in hospitals and relationships with banks and revenue cycle management companies. "We are excited to have such an accomplished builder of businesses and customer relationships join the PatientPay team," said Tom Furr, PatientPay's CEO.

Hildebrand joins NMA

Butch Hildebrand signed on as Director of Sales at National Merchants Association. Hildebrand is charged with developing and implementing strategic sales initiatives to continue the company's growth. Hildebrand has extensive experience in leading sales teams in multiple industries including logistics, engineering and advertising.

Green Dot appoints Jacobs

Fulfilling its recent commitment to separate its Chairman and CEO roles, Green Dot Corp. appointed William Jacobs as Chairman of its Board of Directors. Jacobs has served as the Chairman of the Board of Directors of Global Payment Inc. since June 2014. He also served as Lead Independent Director of that company and as one of its business advisors. Green Dot founder, Director and CEO Steve Streit said, "Bill has been a terrific addition to our Board of Directors. As a long-tenured executive in the payments space and an experienced board member, Bill brings significant operational and governance expertise to our company and its many stakeholders and we feel lucky to have him serving as our Chairman."

Kane joins JP Morgan leadership

JPMorgan Chase & Co. named Matt Kane its CEO of Commerce Solutions, reporting to Gordon Smith, the company's CEO of Consumer and Community Banking. Kane will relocate to Dallas, where the business is based, and join the Consumer and Community Banking leadership team. Kane succeeds Mike Passilla, who will become Vice Chairman of Commerce Solutions. "Matt is an extremely accomplished and versatile executive who will build on the strong momentum in Commerce Solutions," Smith said.

Cayan taps Trueblood

Cayan LLC added Rachel Trueblood as its Senior Vice President of Marketing. A retail industry veteran, Trueblood is now responsible for leading the company's marketing strategy and overseeing its execution to drive Cayan's overall success. She joins Cayan at a time of expansive growth and her marketing leadership experience in the retail industry will be integral to Cayan's continued development and success, the company said.

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

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