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The Green SheetGreen Sheet

The Green Sheet Online Edition

November 22, 2010 • Issue 10:11:02

Industry Update

The Green Sheet, Inc.NEWS

First Data releases SpendTrends, earnings

In October 2010, consumers remained concerned about the economy, despite discounted prices at retailers, according to the latest SpendTrends report from First Data Corp., which tracks all card spending. October's same-store dollar volume growth was 6.7 percent, while transaction growth was 8.6 percent.

The absolute average ticket value was lower compared to September. Also, in its third quarter earnings report, First Data reported a 2 percent increase in adjusted revenue, to $1.62 billion, compared to the same period of 2009, when adjusted revenue totaled $1.58 billion.

Consolidated revenue of $2.63 billion, which included ISO commissions of $93 million and reimbursable debit network fees of $858.6 million, rose 8 percent year over year. Debit network fees jumped 19 percent from the same period of 2009.

Visa quarterly profits up 50 percent

Payment volume growth spiked 14 percent to $828 billion for the third quarter 2010, year over year, according to Visa Inc. The card brand posted operating revenue of $2.12 billion, up 12.7 percent over the same period in 2009.

Growth was strong across all categories, especially data processing and international transactions. Profit jumped 51 percent to $774 million, or $1.06 per share, versus 69 cents a share one year ago.

SCA council expands mission, appoints officers

The Smart Card Alliance Payments Council, formerly the Contactless and Mobile Payments Council, expanded its charter to include chip-enabled payments and payment applications in the United States. The council also welcomed new officers. The charter expansion includes Europay/Mastercard/Visa, contactless, near-field communications-enabled, and mobile payment and chip-enabled e-commerce.

New council officers include:

  • Co-Chairs Simon Hurry of Visa and Oliver Manahan of MasterCard Worldwide
  • Vice Chair Troy Bernard, Discover Financial Services
  • Secretary Deborah Baxley, Capgemini Group

Cell phone scams on the rise

Consumers and banks are encountering a rise in fraudulent calls or text messages sent to cell phones seeking bank accounts and credit card numbers, warned Pat Carroll, Chief Executive Officer of ValidSoft.

Known as vishing (voice phishing) and smishing (short message service phishing), the scams typically use automated systems to contact cell phone numbers with messages fraudulently warning that consumers' account data may have been compromised and asking them to call a specified number.

Consumers responding to the messages may be duped into supplying their account data to thieves. "Without new technology to spot and stop these attacks, we're all vulnerable to these sophisticated criminal schemes," Carroll stated.

ValidSoft, a subsidiary of Elephant Talk Communications Inc., markets a system to verify that consumers and banks are communicating only with legitimate parties.

The Green Sheet, Inc.ANNOUNCEMENTS

Payments industry companies make Fast 500 list

Electronic Payments Inc. ranked No. 39 on the Technology Fast 500 list - Deloitte & Touche LLP's ranking of the fastest growing technology and media companies in North America.

US Dataworks Inc. made the list for the second time, ranking No. 427. Dynamic Card Solutions, which was recently acquired by DataCard Corp., was ranked No. 238 on the list.

NACHA lauds IPFA's live transatlantic deployment

NACHA - The Electronic Payments Association hailed the work of the International Payments Framework Association in beginning live traffic between two of its members on Oct. 25, 2010.

The members involved are the Federal Reserve Bank of Atlanta and the European clearinghouse Equens SE.

Janet O. Estep, President and CEO of NACHA, said, "The IPFA format creates a framework for nonurgent international transactions that leverages the strengths of the ACH Network in the U.S. and its counterparts globally."

PPI makes Silicon Valley business list

Payment Processing Inc. was named one of the 60 fastest growing private companies in Silicon Valley by the Silicon Valley/San Jose Business Journal. The company ranked 48th on the regional list, based on 2009 revenue.

TransFirst moves, expands Colorado operations

Processor TransFirst is moving its Colorado Operations Center to a facility in Broomfield, Colo. The center had been based in Louisville, Colo.

The new, larger center allows for more employee work space, new training facilities and anticipated growth.

VeriFone launches European hosted services

VeriFone Inc. launched a pan-European payment gateway, branded PAYware Merchant. The launch of the hosted payment service for large retailers, petroleum brands and hospitality companies was made possible by VeriFone's recent partnership with Gemalto, filling out its European distribution network.

IBM recognizes Visa

Visa was awarded IBM Corp.'s Information on Demand 2010 Innovation Award for the card brand's use of cutting-edge information technology and real-time data analytics to prevent fraud and improve the consumer payment experience. Visa is an IBM corporate partner.

The Green Sheet, Inc.PARTNERSHIPS

Advanced Data deploys Precidia engine

POS software developer Advanced Data Systems chose the TransNet payment engine from Precidia Technologies Inc. to create an integrated payment system. Advanced Data supplies restaurants with surveillance video and card processing technology.

Axcess accesses new regions with Pay.On

U.K.-based Axcess Merchant Services Ltd. is working with payment gateway Pay.On AG. The agreement allows Axcess to support merchants in new regions.

Cardtronics services Bosselman ATMs

Bosselman Inc. chose Cardtronics Inc. to service ATMs at 24 Pump & Pantry convenience stores in Nebraska. Bosselman is buying the ATMs from Cardtronics, which will provide transaction processing and other services.

First Data, CardinalCommerce integrate alternatives

CardinalCommerce and First Data partnered to integrate alternative payment types with the existing credit and debit systems used by merchants. The system lets merchants process PayPal Inc. and other payment transactions.

Elavon certifies Charge Anywhere gateway

Charge Anywhere's payment gateway ComsGate was certified with Elavon Inc. The newest certification enables gateway merchants to process PIN debit transactions in addition to existing credit card processing.

Fountain Valley goes with CheckAlt

The City of Fountain Valley, Calif., selected remote deposit capture services from CheckAlt Payment Solutions. It is CheckAlt's first Orange County municipal client.

Datafast turns to Hypercom

Ecuadoran payment processor Datafast CIA Ltd. switched to payment terminals from Hypercom Corp. Datafast bought 4,500 countertop and mobile terminals.

Discover and PayPal team up

Discover teamed with PayPal to create Money Messenger, which allows consumers to send payments to each other. Discover cardholders can send money to another person via Discover.com or a smart phone, using only the recipient's email address or mobile phone number.

Dovetail joins IPFA

Dovetail Systems Inc., a developer of payment services hubs, joined the International Payments Framework Association. The company has implemented 19 connections to international, national and regional clearing systems.

FAC partners with processors and issuer

Online payment gateway First Atlantic Commerce reported that its 3-D Secure is certified to Allied Irish Bank Merchant Services, Elavon and Barclaycard. The payer authentication system enables merchants to shift liability for chargebacks on certain reason codes. 3-D Secure determines the enrollment status of issuing banks and cardholders, so merchants can predetermine the risk profile of consumers prior to transactions.

InfoTrax picks ProPay

InfoTrax Systems chose ProPay Inc. to provide payment security software and services to its clients. InfoTrax thus expects to reduce the resources spent on compliance with the Payment Card Industry (PCI) Data Security Standard (DSS).

MeS and Magento integrate services

Merchant e-Solutions Inc. integrated its online payment processing services with the open source e-commerce platform from Magento Inc. The partnership gives Magento merchants access to MeS's integrated payment platform, including card processing in over 150 currencies, gateway services and real-time reporting.

Michigan lodges choose Heartland

The Michigan Lodging and Tourism Association named Heartland Payment Systems Inc. its exclusive endorsed provider of card processing, gift marketing, payroll and check-management services. The association represents 500 businesses in the hospitality industry.

Insurance company picks FTNI for payments

Physicians Mutual Insurance Co. chose Financial Transmission Network Inc. for payment automation and back-office payment posting. FTNI incorporates ACH processing and check scanning with card processing.

ReD expands to Latin America

International payment fraud prevention group Retail Decisions PLC expanded its presence to Latin America. Ormeno & Associates, a consultancy in the region, will act as ReD's sales and account management division.

RFinity turns to BofA for processing

Mobile payments platform RFinity US LLC partnered with Bank of America Merchant Services for bankcard processing. The combination enables RFinity to market card processing services for transactions using consumer cell phones.

Newspaper processes payments through the cloud

The San Diego Union Tribune migrated its payments to Clearingworks hosted payments processing from US Dataworks. The newspaper now processes all paper-based remittances and web- and phone-initiated payments through the platform.

VeriFone partners with RSA and First Data

Two separate marketing agreements involving VeriFone expand utilization of the company's encryption. VeriFone and RSA, the security division of EMC Corp., agreed to co-market their end-to-end encryption and tokenization products.

The integrated security offering was branded VeriShield Total Protect. Processors will market the program to merchants as a means to reduce costs associated with PCI compliance and reduce their risk profile.

Additionally, First Data and VeriFone now market a VeriFone edition of the First Data TransArmor system to U.S. multi-lane and petroleum merchants.

Businesses using VeriFone's MX 800 series, Secure PumpPay and the Ruby POS systems can then take advantage of VeriShield's encryption with tokenization.

AT&T launches Zong trial

Mobile payment platform Zong partnered with AT&T to run a trial of a mobile payments program giving wireless customers the ability to make online purchases directly from their handsets. Zong enables direct carrier billing for purchases by verifying the cell phone number and account and then clearing the payment.

The Green Sheet, Inc.ACQUISITIONS

AmEx acquires Accertify

American Express Co. agreed to buy Accertify Inc. for approximately $150 million. The provider of hosted security software is expected to enhance fraud prevention for card-not-present transactions.

FIS buys marketer

Fidelity National Information Services Inc. acquired ValueCentric Marketing Group Inc., a developer of loyalty software. Terms of the deal were not disclosed.

The Green Sheet, Inc.APPOINTMENTS

BillingTree hires two

On-demand payment processor BillingTree Inc. appointed Sidney Fingerhut as ISO Manager. Previously, he was CEO of Fingerhut Enterprises. Also, Frank Helstab was named Director of Corporate Development. Helstab had been the Managing Director for the Institute of Corporate Planning & Finance.

France joins eWise

John France was appointed Managing Director of the European Payments Division of eWise, based in the United Kingdom. Previously, France was head of Processing Sales for Visa Europe.

Fleet One beefs up credit and marketing departments

Fleet One LLC made several appointments. The company hired Brian Hargrove as Director of Credit. Hargrove had been Corporate Credit Manager with M & A Supply Co. Joining the company's sales and marketing staff are Ryan Hart, Torry Chatmon and Tyler Fritsche.

Redshaw named CIO at AmEx

AmEx appointed Toby Eduardo Redshaw Executive Vice President and Chief Information Officer, effective in January 2011. He will also serve on the company's Business Operating Committee. Redshaw had been Global CIO at Aviva PLC in London.

Smart joins Aptys

Aptys Solutions hired Debbie Smart as Senior Vice President of Product Management. Most recently, Smart was Senior Consultant at ACI Worldwide Inc.

Cardtronics names new executives

Following a reorganization, Cardtronics made several executive appointments. Rick Updyke was named President of the U.S. Business Group. Updyke joined the company in 2007 with the acquisition of the financial services business of 7-Eleven Inc.

Ben Psillas was appointed Executive Vice President and Division Executive of the Network and Financial Services unit.

Psillas founded Allpoint, which Cardtronics acquired in 2005. Tres Thompson became Executive Vice President and Division Executive for the ATM Services unit.

Controller Brad Conrad was named Chief Accounting Officer, and Mike Clinard, President of Global Services, assumed responsibility for company operations in Latin America.

In addition, Tom Pierce joined Cardtronics as Chief Marketing Officer. Previously, he was Vice President of Marketing Strategy for FIS and worked in marketing at Metavante Corp.

FrontStream hires Vellayan

FrontStream Payments appointed Nina Vellayan President. Previously, she was Chief Operating Officer and Executive Vice President at Tier Technologies Inc., a provider of electronic payment solutions in the biller direct market.

The Green Sheet, Inc.BOTTOM LINES

  • MasterCard Worldwide's SpendingPulse October 2010 report indicated year-over-year apparel sales grew by 8.2 percent, while e-commerce sales rose 7.9 percent; consumer electronics and appliances spending dipped 3.1 percent due to a reported decline in total ticket prices for this category.

  • In the Consumer 2010 Holiday Spending Outlook survey by VeraQuest Inc., 56 percent of consumers said they plan to spend about the same this year as last; 30 percent will spend less; 14 percent plan to spend more. To pay for holiday purchases, 60 percent plan to use cash on hand; 43 percent will set aside funds; 36 percent plan to use credit cards or personal lines of credit.

  • According to a recent forecast published by eMarketer, fourth quarter 2010 e-commerce spending is expected to climb to $51.4 billion, up13.7 percent from the $45.2 billion spent during the same period last year. Total e-commerce sales are projected to reach $162.4 billion for 2010.
end of article

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