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Feb 10th, 2012

Edition #290

 

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In this Issue

Durbin Begins to Bite at Visa As Debit Growth Slows in the Latest Quarter
First Data Releases January 2012 SpendTrend
To Envision Dodd-Frank’s Future, Look to Its Predecessor
Google Wallet Hack Shows NFC Payments Still Aren’t Secure
Visa Vies to Be Linchpin of Banks' Mobile Offerings
Turns Out This Recovery May Be For Real
PayPal Says It’s Full Speed Ahead on Mobile Payments After President Resigns
Attendance Up, Mood Upbeat At NEAA Show
Why E-Commerce Gets Dissed By Retail
Business Adds Up for Payment Processor
Consumer Bureau Threatens Banks' Credit Card Protection Profits
Dwolla Raises $5 Million From Union Square Ventures To Continue Building Its (Nearly) Fee-Free Payment Network
Visa Inc. Posts Strong Fiscal First Quarter 2012 Earnings Results and Authorizes New $500 Million Share Repurchase Program
Visa Tops One Million Chip Cards in the U.S.
Heartland Payment Systems Reports Adjusted Net Income Increased 73%; Adjusted Earnings Per Share Increased 67% in Fourth Quarter
Heartland Payment Systems Handles Nearly 44,000 Card Transactions as Official Concessions Processor of Super Bowl XLVI
Bank of America Responds to Breach
Google Wallet Picks Up Quiet Support from AT&T
E-Retail Sales Jump 14% in Q4
Consumer Credit Card Balances Keep Rising, Fed Says
Predictions on Latest Payment Initiatives at SCA
Girl Scouts Add Mobile Payments to Drive Cookie Sales


In Other News

This Day in History 1996

Kasparov Loses Chess Game to Computer

On this day in 1996, after three hours, world chess champion Gary Kasparov loses the first game of a six-game match against Deep Blue, an IBM computer capable of evaluating 200 million moves per second.  Man was ultimately victorious over machine, however, as Kasparov bested Deep Blue in the match with three wins and two ties and took home the $400,000 prize. An estimated 6 million people worldwide followed the action on the Internet.

Kasparov had previously defeated Deep Thought, the prototype for Deep Blue developed by IBM researchers in 1989, but he and other chess grandmasters had, on occasion, lost to computers in games that lasted an hour or less. The February 1996 contest was significant in that it represented the first time a human and a computer had duked it out in a regulation, six-game match, in which each player had two hours to make 40 moves, two hours to finish the next 20 moves and then another 60 minutes to wrap up the game. Click here to read more.

 

 

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Durbin Begins to Bite at Visa As Debit Growth Slows in the Latest Quarter

2/09/12 Digital Transactions  Facebook Like Button  Tweet Button

While acknowledging that federal pricing regulations are crimping growth in its debit card business, Visa Inc. late on Wednesday presented an upbeat report to investors that stressed new ventures like its recently introduced digital wallet, V.me. Separately, the world’s largest card network also unveiled new tools to help client banks roll out mobile-banking services for consumers. Visa chief executive Joseph W. Saunders also said the company will hold firm on credit card pricing in the face of pending litigation brought by merchant groups against credit card interchange.


First Data Releases January 2012 SpendTrend

2/09/12 First Data  Facebook Like Button  Tweet Button

First Data Corporation, released its First Data SpendTrend┬« analysis for the full month of January 2012 compared to January 2011. SpendTrend tracks same-store consumer spending by credit, signature debit, PIN debit, EBT cards and checks at U.S. merchant locations. Overall year-over-year dollar volume growth was 7.0% in January, while overall transaction growth was 7.2%.  Mild weather nationwide resulted in lower energy demands, providing consumers with additional income to spend at retailers.


To Envision Dodd-Frank’s Future, Look to Its Predecessor

2/08/12 DealBook  Facebook Like Button  Tweet Button

As fears mount that Dodd-Frank, the financial overhaul law, is about to be emasculated, it’s worth reflecting on the 10-year anniversary of a major regulatory success. I’m speaking of the mocked, patronized and vilified Sarbanes-Oxley, the law that cleaned up American corporate accounting. SOX, as it’s known, was a response to an epidemic in corporate accounting fraud that swept American business in the late 1990s and early 2000s.


Google Wallet Hack Shows NFC Payments Still Aren’t Secure

2/10/12 TIME  Facebook Like Button  Tweet Button

You probably won’t see the Wallet Cracker app in the Android Market anytime soon. That’s not because it doesn’t work; it actually works perfectly, which is the problem. In a video posted by security firm Zvelo, the program exposes the pin number of a Google Wallet account within seconds. This is disappointing because NFC payment systems, of which Google Wallet is the most visible, are at a critical juncture.


Visa Vies to Be Linchpin of Banks' Mobile Offerings

2/08/12 BTN  Facebook Like Button  Tweet Button

Visa Inc. has launched a mobile banking product with Monitise plc, pitting the card network against major technology vendors. Visa's new product, announced late Wednesday, puts it in competition with companies like Fiserv Inc., Fidelity National Information Services Inc., and Total System Services Inc. Visa's product also furthers a trend of the San Francisco network offering products and services that banks would otherwise have to build on their own.


Turns Out This Recovery May Be For Real

2/09/12 US News  Facebook Like Button  Tweet Button

We’ve had 18 straight weeks of good economic news, and the news from last week was very impressive. Unemployment is down from 8.5 percent to 8.3 percent, non-farm payrolls surged to 243,000 vs. an expected 140,000, vehicle production is up, and consumer confidence is on the rise. Eighteen straight weeks: That’s pretty darn good when you consider that everyone was screaming double-dip recession and we saw close to a 20 percent drawdown in the equity markets in the late part of last summer.


PayPal Says It’s Full Speed Ahead on Mobile Payments After President Resigns

2/06/12 All Things Digital  Facebook Like Button  Tweet Button

When Scott Thompson announced he was stepping down as president of PayPal to become CEO of Yahoo, the company was shocked. But a month later, both PayPal and its parent company eBay say they have the depth of leadership necessary to execute its plan to enter the world of in-store payments. In an interview, David Marcus, PayPal’s VP of mobile, made the case for why its mobile payments strategy will prevail in a market surrounded by incumbents like Visa, MasterCard and American Express, as well as new entrants like Google.


Attendance Up, Mood Upbeat At NEAA Show

2/08/12 ISO&Agent  Facebook Like Button  Tweet Button

An upbeat crowd filled the conference room and jammed the exhibit hall last week here at the Northeast Acquirers Association 2012 Winter Seminar and Outing, despite a relatively weak national economy, a decidedly bad local economy and weather a little too warm for skiing. “Attendance was up, the mood was optimistic and people are looking forward to opportunities in 2012,” said Alan Forgione, association president and principal account executive at ACI Worldwide Inc.


Why E-Commerce Gets Dissed By Retail

2/08/12 StorefronBacktalk  Facebook Like Button  Tweet Button

Pity poor E-Commerce. It’s barely 18 years old, has racked up about $200 billion in revenue last year and still has trouble getting noticed. Consider MasterCard’s and Visa’s EMV announcements. Both brands set various incentives for retailers if they process 75 percent of their transactions through EMV contact-and-contactless terminals. Of course, what MasterCard and Visa meant was in-store transactions. The idea that an E-Commerce transaction is not a real transaction should be repugnant to any retailer in 2012.


Business Adds Up for Payment Processor

2/06/12 Crain's Cleveland Business  Facebook Like Button  Tweet Button

May require subscription: It took the Shanahan brothers less than six years to build a business with $155 million in annual revenue. And $200 million in annual revenue probably isn't far off: Financial Transaction Services LLC, which resells payment card processing services, is bringing on roughly 1,000 new merchants per month, a rate that one industry insider described as “aggressive.” The Highland Hills company also plans to acquire three other companies in the payment card processing business over the next few months, said FTS president Jeff Shanahan, whose brother, Brian, is CEO.


Consumer Bureau Threatens Banks' Credit Card Protection Profits

2/06/12 American Banker  Facebook Like Button  Tweet Button

Attorneys general and plaintiffs' lawyers have long alleged that payment protection plans, which promise to delay or cancel debts in the event of unemployment, illness, or death, are a poor value and sold to people who don't want them or can't use them. Banks return only 21 cents of every dollar in payment protection premiums to consumers in the form of suspended or cancelled debt, a gross payout ratio that would be flatly illegal if the products were categorized as insurance.


Dwolla Raises $5 Million From Union Square Ventures To Continue Building Its (Nearly) Fee-Free Payment Network

2/07/12 Business Insider  Facebook Like Button  Tweet Button

Credit card fees really add up.  Ben Milne's business was losing $55,000 per year to them, so he created Dwolla to side step the charges altogether. The startup just raised a $5 million Series B round of financing to keep pounding the pavement. The round was led by Union Square Ventures; partner Albert Wenger is joining the board. Village Ventures, Thrive Capital, Paige Craig and Marc Ecko also participated. Dwolla has grown its network to 80,000 account holders who are moving millions of dollars per day.


Visa Inc. Posts Strong Fiscal First Quarter 2012 Earnings Results and Authorizes New $500 Million Share Repurchase Program

2/08/12 VISA  Facebook Like Button  Tweet Button

Visa Inc. today announced financial results for the Company's fiscal first quarter 2012 ended December 31, 2011. Net income for the quarter was $1.0 billion, or $1.49 per share of diluted class A common stock, an increase of 21% over the prior year.   The weighted-average number of diluted class A common stock outstanding was 690 million. Net operating revenue in the first quarter of fiscal 2012 was $2.5 billion, an increase of 14% over the prior year.


Visa Tops One Million Chip Cards in the U.S.

2/06/12 PR Newswire  Facebook Like Button  Tweet Button

Visa Inc. today announced that U.S. financial institutions have reported issuing an estimated one million Visa-branded, EMV chip-enabled cards as of December 31, 2011, demonstrating the significant progress the industry is making toward implementing Visa's U.S. chip roadmap. In August 2011, Visa announced plans to accelerate mobile innovation and the adoption of EMV contact and contactless chip technology in the U.S. "Migrating the U.S. market to chip will help build an infrastructure for accepting NFC mobile payments, enhance international acceptance and reduce fraud."


Heartland Payment Systems Reports Adjusted Net Income Increased 73%; Adjusted Earnings Per Share Increased 67% in Fourth Quarter

2/09/12 Heartland Payment Systems  Facebook Like Button  Tweet Button

Heartland Payment Systems, Inc, one of the nation's largest payment processors, today announced GAAP net income of $11.2 million, or $0.28 per share, for the three months ended December 31, 2011. Adjusted Net Income and Adjusted Earnings per Share were $14.2 million and $0.35, respectively, for the quarter ended December 31, 2011, compared to Adjusted Net Income and Adjusted Earnings per Share of $8.2 million and $0.21, respectively, for the quarter ended December 31, 2010.


Heartland Payment Systems Handles Nearly 44,000 Card Transactions as Official Concessions Processor of Super Bowl XLVI

2/09/12 TD Waterhouse  Facebook Like Button  Tweet Button

As the official concessions payments processor of Super Bowl XLVI in Indianapolis, Ind., Heartland Payment Systems(R) (NYSE: HPY) processed 43,982 credit and debit card transactions totaling $924,500 on Super Bowl Sunday and during accompanying special events. To help support the significant influx of transactions, Heartland Payment Systems provided an additional 60 wireless POS terminals to supplement the nearly 600 POS registers already in use at Lucas Oil Stadium.


Bank of America Responds to Breach

2/09/12 Bank Info Security  Facebook Like Button  Tweet Button

Bank of America blames a suspected breach of credit card data on an unidentified third party. The incident illustrates the risks institutions increasingly face when they rely heavily on partners and suppliers. BofA has sent letters to select customers, notifying them of a possible compromise that likely exposed details about their credit card accounts.


Google Wallet Picks Up Quiet Support from AT&T

2/06/12 ETA Daily Scoop  Facebook Like Button  Tweet Button

Officially, Google Wallet is available only on a single smart phone (Galaxy Nexus S) offered by Sprint, but it appears that AT&T may have joined Sprint in making the mobile payments app available to its subscribers through its version of the Android  Market. What’s important about the apparent deal ( which is not being announced with any fanfare) is that AT&T is the first of the partners in the Isis joint venture to give users access to Google Wallet on an NFC-equipped smart phone.


E-Retail Sales Jump 14% in Q4

2/06/12 Internet Retailer  Facebook Like Button  Tweet Button

Online retail sales increased 14% in the fourth quarter of 2011 and 13% for the full year, comScore Inc. reported today. In the all-important fourth quarter that includes the holiday season, e-retailers sold $49.7 billion worth of goods to U.S. consumers. E-commerce sales hit a record $161.5 billion for all of 2011. “The fourth quarter of 2011 capped off what was yet another strong year for online retail, one in which every quarter achieved double-digit increases versus the prior year,” says comScore.


Consumer Credit Card Balances Keep Rising, Fed Says

2/08/12 CreditCards.com  Facebook Like Button  Tweet Button

Consumer credit card balances climbed higher in December, as more Americans pulled out their cards for the holidays. But experts say holiday shopping may not be the only culprit contributing to swollen balances. The Federal Reserve's latest G.19 consumer credit report showed a 4.1 percent rise in revolving debt as more consumers chose credit over cash. Revolving debt, which is made up almost entirely of credit card debt, rose by $3 billion in December to $801 billion


Predictions on Latest Payment Initiatives at SCA

2/08/12 The GreenSheet  Facebook Like Button  Tweet Button

At the Feb. 8 opening of the Smart Card Alliance 2012 Payments Summit in Salt Lake City, payments industry leaders tried their hand at forecasting the fate of Europay/MasterCard/Visa (EMV) introduction in the United States, near field communication (NFC) and mobile payments, and transit payments. In a brief session hosted by Randy Vanderhoof, SCA Executive Director, executives from MasterCard Worldwide, Isis, PayPal Inc. and the New York Metropolitan Transportation Authority answered questions about the changing payments landscape.


Girl Scouts Add Mobile Payments to Drive Cookie Sales

2/07/12 Mobile Commerce Daily  Facebook Like Button  Tweet Button

The Girl Scouts may be a 100-year-old organization but it is also firmly planted in the 21st century now that the young saleswomen selling much-loved cookies are accepting payments via their mobile devices. Working with Sage Payment Solutions, many Girl Scouts are now equipped with mobile devices that have a credit card reader attached. Already, some Girl Scout troops are reporting an increase in cookie sales since adopting the technology.




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