eBay’s Zong Deal: Mobile Payments Are All Fun & Games
7/07/11 Wall Street Journal
EBay Inc.’s $240 million acquisition of Zong Inc. shows that for the time being, mobile payments are all fun and games. Zong’s customer list is a who’s who of social gaming and virtual world companies, including Zynga Inc., IMVU Inc., Walt Disney Co.’s Playdom Inc., Stardoll AB, IAC/InterActiveCorp.’s Zwinky and Shanda Games Ltd.’s Mochi Media. Not to mention the company’s arrangement with Facebook Inc. to sell the social network’s virtual currency. The acquisition will be used to help push eBay’s PayPal payment platform further into microtransactions and digital goods. Click here to read more.
From eBay to Zong and Back Again
7/07/11 CNN Money
The $240 million cash deal is for Zong, a Silicon Valley company that raised $27.5 million in venture capital after spinning out of Switzerland's EchoVox in early 2010. One of those investors was Matrix Partners, whose partner Dana Stalder is a former eBay and PayPal executive. I spent some time discussing the deal with Stadler, and what follows is an edited transcript of our conversation. Click here to read more.
Debit Card Rules Save Banks $3.5 Billion, Moody’s Says (Editor's Note: This is a bad headline)
While new caps on debit card fees will cost Wall Street billions of dollars in precious revenue, the dent could have been much worse. The Federal Reserve’s decision last week to cap the fees at 21 to 24 cents per transaction, rather than the 12 cents it originally proposed, will save the banking industry some $3.5 billion in revenue each year, according to a new report by Moody’s. The Fed also agreed to delay the rules for more than two months, “allowing the banks to prepare for the changeover and earn swipe fees at the current rate." Click here to read more.
Outlook Cloudy on 'Swipe Fee' Change
7/07/11 Omaha World Herald
Consumers, merchants, bankers and the payment industry that connects them will find out over the next several months — if not years — how new federal laws on processing bank cards will change their day-to-day business. Will merchants pass savings on to customers from new, lower “swipe fees”? Will the reduced fees kill rewards programs on debit cards? Will banks drop debit cards altogether and come up with new types of cards? Click here to read more.
Visa CEO: Bulk Of Durbin Impact On Profits Comes In Fiscal 2012
Payment processor Visa said Wednesday afternoon it expects the bulk of the impact from new limits on debit swipe fees to hit in its 2012 fiscal year. In an 8-K filing with the SEC, Visa affirmed its fiscal 2011 outlook for net revenue growth of 11-15% and earnings per share growth of 20%, but said it expects slightly slower growth in 2012 with revenue up high single to low double digits and EPS growth in the mid to high teens. Click here to read more.
As Fed Debit Rule Sinks in, Merchant Class Action Grinds Toward Trial
7/06/11 Digital Transactions
Now that the Federal Reserve’s new debit card interchange regulations are finally out in the open, the profile of yet another payment card interchange and rules controversy is slowly rising. That’s the raft of merchant antitrust lawsuits pending in U.S. District Court in Brooklyn, N.Y., collectively known as “MDL 1720.” Merchants first sued back in 2005, and earlier this year they finally got a trial date: Sept. 10, 2012. Ahead of that, a judicial decision about whether their cases will be certified as a class action could come at any time. Click here to read more.
PaymentsPulse Poll Update - See the Top Three You Voted For!
A week ago TSG asked subscribers to weigh-in on who they thought was the biggest winner after the final rules for debit card interchange fees, network exclusivity and routing restrictions were issued. In the last week the poll has received a significant number of votes from the payments community. Currently the top three biggest winners include merchants, merchant acquirers and three-party debit systems. If you haven't voted yet head over to PaymentsPulse.com and tell us who you think the winner is!
As Plastic Reigns, the Treasury Slows Its Printing Presses
7/06/11 The New York Times
The number of dollar bills rolling off the great government presses here and in Fort Worth fell to a modern low last year. Production of $5 bills also dropped to the lowest level in 30 years. And for the first time in that period, the Treasury Department did not print any $10 bills. The meaning seems clear. The future is here. Cash is in decline. You can’t use it for online purchases, nor on many airplanes to buy snacks or duty-free goods. Last year, 36 percent of taxi fares in New York were paid with plastic. Click here to read more.
VIDEO: Warren Buffett on U.S. Housing, Employment, Economy
Warren Buffett, chief executive officer of Berkshire Hathaway Inc., talks about the outlook for the U.S. housing market and employment. Buffett, speaking with Betty Liu on Bloomberg Television's "In the Loop," also discusses President Barack Obama's policies and continued negotiations on a U.S. deficit plan. Click here to watch the video.
Acquisiton Opportunity – Loyalty & Gift Provider
TSG is representing a loyalty & gift acquirer and processor in a sale of the company. This is a unique opportunity to directly enter the gift and loyalty segment with a proprietary platform that can be leveraged globally. The company is at a point where it needs a parent with the financial resources to build out a sales force and distribution channels. The existing management team has focused on development of the platform and has developed customers and credibility in the large retailer segment, ISO’s, and financial institutions. Its key differentiator is that the platform offers a real-time loyalty/gift, electronic voucher issuance and redemption in real time, and can use both email and mobile as delivery methods. In addition, the products work with a merchant’s existing POS terminal/technology. If interested, please contact TSG Senior Associate Barry Davis at
BDavis@TheStrawGroup.com and he will provide an NDA and outline the next steps. Click here to view one-page teaser.
June Jobs Increase Falls Short
The lackluster number of new jobs created last month stunned economists and scaled back market expectations for an improving jobs picture. The Bureau of Labor reported that the economy added just 18,000 new jobs in June, while the unemployment rate inched up to 9.2%. The essentially unchanged number of jobs was a big disappointment given that consensus estimate predicted a 125,000 increase, according to Briefing.com. The market was expecting unemployment to stick at 9.1%. Click here to read more.
Retailers Beat Expectations for June
7/07/11 The New York Times
June retail sales blew by analyst expectations and suggested that, at least when they are shopping, consumers are feeling good. Despite worries that a drop in consumer confidence and high gas prices would dampen results, every sector that is tracked from discount to luxury — on Thursday reported increases at stores open at least a year, a measure known as same-store sales. At the 25 retailers followed by Thomson Reuters, same-store sales rose 6.5 percent. Analysts had expected an increase of 4.9 percent. Click here to read more.
SpendingPulse June 2011 U.S. Retail Sector Report
MasterCard Advisors SpendingPulse, a macroeconomic report tracking national retail and services sales, today provided summary results for the performance of specific U.S. retail industries in June 2011. The Luxury and Restaurant categories continued to add momentum to their performance in May, while overall year-over-year growth was supported by gasoline and grocery sales. Specialty Apparel showed gains as well. Click here to read more.
Survey Says Electronic Payments Will Play Critical Role in Canada
The ability to use electronic payments will play a critical role in the future success of Canadian companies, but a new survey released today found there are barriers slowing adoption of the technology. What's the hold up? The latest study conducted by the Canadian Financial Executives Research Foundation (CFERF), found that while there are significant issues making wide-spread adoption of electronic payments in Canada a challenge for businesses, top executives indicated a high level of preference for increased electronic payments. Click here to read more.
Mobile Payments To Triple To $670B By 2015; Digital Goods Will Represent 40% Of Transactions
Juniper Research is releasing a new study today that reports that the transaction value of mobile payments for digital and physical goods, money transfers and NFC (Near Field Communications) transactions will reach $670 billion by 2015, up from $240 billion this year. The top 3 regions for mobile payments (East Asia and China, Western Europe and North America) will represent 75% of the global mobile payment gross transaction value by 2015. Digital goods payments will account for nearly 40% of the market in 2015. Click here to read more.
Social Media: Company.com Operating ISO-Oriented Site
A new social-networking site not only offers independent sales organizations and agents an array of opportunities to boost revenue and earnings, but also controls a pool of cash available to the industry through loans, backers claim. Bill Wade, an entrepreneur with 20 years’ experience in the merchant-acquiring business, created the site, called “company.com,” and serves as CEO of its parent, the Company.Com Corp. The site provides ISOs with tools to find new merchants. Click here to read more.
WikiLeaks to File Complaints Against Credit Card Giants
7/05/11 Silicon Republic
Whistle-blowing website WikiLeaks will file a complaint with the European Commission on Thursday against Visa and MasterCard if the two credit card giants don't lift their ban on donations to the site, a lawyer has said. WikiLeaks, which has published confidential US diplomatic cables as well as classified information on the war in Iraq and Afghanistan, has infuriated officials by making such information public. Visa and MasterCard imposed a ban on all payments made to WikiLeaks in December. Click here to read more.
Visa Blocks WikiLeaks Donations Via DataCell Once Again
For a few hours on Thursday, credit card donations once again flowed to WikiLeaks through a payment gateway at Icelandic hosting company DataCell. Then Visa shut it down again. DataCell CEO Andreas Fink said his company had found a new payment acquirer, Valitor, willing to process payments to WikiLeaks, and accepted thousands of donations to the whistle-blowing website before running into problems around 3.30 a.m. Icelandic time. Click here to read more.
Morgan Stanley Warns 34,000 Clients of Data Breach
Morgan Stanley Smith Barney has warned 34,000 customers that their addresses, account and tax ID numbers, and other data--including Social Security numbers for some--may have been stolen, the Credit.com news site reported today. The data was reportedly on two CD-ROM discs that were password-protected but not encrypted, according to two letters Morgan Stanley sent to customers on June 24. Click here to read more.
Five Ways Austin Can Springboard Mobile Wallet Adoption
When any new technology emerges, there’s much postulating about “what if’s” and “could be’s.” At this point, that’s about all we have when it comes to near field communication (NFC) in the United States. However, Isis – the joint mobile payments venture between AT&T, T-Mobile, and Verizon – is looking to solidify NFC adoption among the techno-savvy in Austin, Texas. Austin is one of two announced pilot cities for the Isis mobile wallet technology (with Salt Lake City the second). Click here to read more.
MOBIbucks Secures $5 Million in Series A Financing
MOBIbucks, the leader in cardless mobile payment and marketing solutions, announced today it has raised $5 million in Series A funding. Acadia Woods Partners, a New York-based technology, media and life science venture capital firm, led the round which also included the participation of several new and original angel investors. The investment fuels MOBIbucks' rapid growth in key markets around the world and funds customer service in support of new installations. Click here to read more.
5th Finger's Mobile Platform
5th Finger's latest RedShop Mobile platform provides retailers in-store mobile apps and mobile sites that can make a measureable impact in revenue. The successful RedShop Mobile platform is already in making a difference for large Retailers such as Jo-Ann Fabric and Crafts and JoS. A. Bank with more to be announced soon. 5th Finger's latest platform release is able to make a significant impact on retailer's revenue through solutions tailored to the in-store experience. Click here to read more.
Dwolla Touts Security As Mobile-Payment Startup Pursues Growth
7/05/11 NFC Data
Online and mobile-payment startup Dwolla Corp. has been building a payment network called Grid that company executives believe to be more secure than MasterCard Worldwide’s and Visa Inc.’s card networks. At least one observer,however,is not so sure. Most of the $1 million per week in transactions coming through Dwolla are online payments,the highest dollar transactions being business-to-business funds transfers and consumer-to-business payments such as rent. Click here to read more.
Moviegoers Can “Get Loot” When They Purchase and Use a MasterCard Prepaid Card
MasterCard Worldwide today announced the launch of “Get Loot,” an entertainment-based program that offers U.S. consumers and avid movie fans the opportunity to experience the movies with friends and family like never before by using a MasterCard Prepaid card. From July 1 through the end of October, consumers who get and load funds on participating reloadable MasterCard Prepaid cards will receive two free movie tickets while supplies last. Click here to read more.
Western Union Acquires Travelex Global Business Payments Unit For $976 Million
7/05/11 Fox Business
Western Union Co. (WU) agreed to acquire the global business payments division of Travelex Holdings Ltd. for GBP606 million ($976.2 million) in cash, as the payment-transfer company seeks to expand in the growing cross-border trade market. The deal will combine Travelex Global Business Payments with Western Union's existing Business Solutions unit. For 2011, Travelex Global Business Payments' projected revenue is roughly GBP150 million. Click here to read more.
Regions Bank Completes Purchase of $1 Billion Credit Card Portfolio
Regions Bank today announced that it has completed its purchase of the Regions-branded credit card portfolio from FIA Card Services, effective June 30, 2011. Last month Regions announced it had signed a definitive agreement with FIA Card Services to acquire the portfolio of 500,000 existing Regions consumer credit card accounts. Additionally, Regions has acquired a portfolio of 40,000 business credit card accounts, representing a total portfolio of more than $1 billion. Terms of the transaction were not disclosed. Click here to read more.
Citi Named Best Global Emerging Markets Bank and Best Global Transaction Banking House by Euromoney Magazine
Citi was named Best Global Emerging Markets Bank and Best Global Transaction Banking House by Euromoney magazine as part of its Euromoney Awards for Excellence 2011. “We are tremendously proud of this recognition from Euromoney. Our primary goal is to help our clients succeed in the global marketplace as they look toward emerging markets for yield and growth. Citi’s unique international network and experience on the ground in more than 100 countries are strategic strengths. Click here to read more.
W.net Career & Leadership Summit Boasts Top Talent in Atlanta this September
Women’s Network in Electronic Transactions (W.net) announced today that the 2011 Career & Leadership Summit will be held on Tuesday, September 13, 2011 at the Hyatt Regency Atlanta. The theme, “Sharpening Your Leadership Skills – Staying Relevant in Today’s Workforce” will focus on developing the professional skills of women in the electronic transactions industry and educating the attendees on current technology and market trends with insights and presentations from some of the industry’s most influential executives. Click here to learn more.