Venture Infotek, Diners Club International enter merchant acquiring
Venture Infotek, an Indian
transaction processing company, has signed a long-term merchant
acquiring agreement with Diners Club International, a subsidiary of
US card giant Discover.
Under the terms of the agreement, Venture
Infotek will provide single-source electronic payment services for
the acceptance of Diners Club and Discover cards across key
merchant categories like restaurants, hotels, airlines, travel
agents and major retail outlets in India.
Prior to the agreement, Diners Club cards were
accepted at only around 12,000 terminals across the country. The
partnership will expand card acceptance to over 172,000 terminals
out of the total 470,000 terminals in India.
Sandeep Bhalla, business manager for cards at
Citibank India, said: “As one of the most privileged card platforms
in the world, Diners Club has a 40-year franchise in India with a
very strong and loyal customer base.
“While Citi remains the exclusive issuer of
Diners cards in India, having a partner in Venture Infotek to grow
the acquiring footprint will help make the Diners product stronger,
more customer-friendly and more widely accepted.”
UK ATM network operator Link to accept China UnionPay
Chinese card network China UnionPay
(CUP) and Link, the national UK ATM network, have announced the
acceptance of CUP cards at all Link ATMs in the UK, allowing over
1.8 billion Chinese cards to be used for withdrawals via Link’s
According to Link, the UK Office of National
Statistics estimates that 141,000 Chinese tourists visited the UK
in 2007, spending an estimated £181 million ($301 million).
Additionally, around 100,000 Chinese students
study for more than one year in the UK, each spending an estimated
£25,000 per year.
Edwin Schooling Latter, managing director of
the Link Scheme, said: “The Link Scheme is delighted to be opening
the UK cash machine network to Chinese cardholders, be they
business or tourist visitors, resident students or sportsmen and
spectators coming to the 2012 Olympics.”
China UnionPay ranked second-biggest card brand in
China UnionPay (CUP) is ranked the
second-biggest bankcard brand in Asia-Pacific both by transaction
volume and by total transactions, and has become the top brand in
Asia-Pacific by the number of cards in 2008, according to The
CUP’s 1.8 billion cards generated
4,023.3 million transactions in 2008, up 43.8 percent compared to
the previous year, and total volume including purchases and cash
withdrawal transactions increased by 34.2 percent to $739.49
When counting only purchase volume,
CUP held 35.4 percent market share, a rise of 268 basis points,
outpacing growth in market share of rivals Visa, MasterCard,
American Express, JCB and Diners Club.
At present, nearly 50 financial
institutions in 8 countries and regions officially issue CUP cards
in local currencies.
Dubai to construct real-time payments system
The government of Dubai has enacted
the Dubai International Financial Centre’s (DIFC) new Payment
System Settlement Finality (PSSF) Law that creates the legal
foundation for building a regional transaction processing hub in
DIFC that will provide payment systems and other ancillary
The first such legislation in the Gulf, the
new PSSF Law paves the way for the launch of the Real-time
Automated Payments platform (RAPID) in the Dubai International
Financial Centre, to provide transaction processing services to
banks and their customers both in the DIFC and the wider Middle
East and North Africa region.
However, the benefits of the PSSF Law will not
be restricted to RAPID and will be available for all payment
systems designated under the conditions of the law. The PSSF Law
particularly supports payments that involve participants from
The PSSF Law will also assist Gulf-based
companies in conducting legally sound payments within the region
instead of having to use infrastructures outside of the region,
which often do not settle within the region’s own operating
NTT claims 10m mobile wallet users
Japanese telecom company and card
issuer NTT DoCoMo has announced that the number of subscribers to
its mobile credit payment service, DCMX, has topped 10 million in
Launched in April 2006, DCMX reached
1 million subscribers in November 2006, 5 million in February 2008
and 10 million in August this year.
DCMX is a service brand for DoCoMo-issued
credit cards, which allows subscribers to make purchases using
their mobile phones as credit cards via iD, DoCoMo’s branded mobile
payment platform for handsets equipped with contactless cards.
For security, DoCoMo’s phones can be locked
remotely over the wireless network if misplaced or stolen.
There are three plans offered under the DCMX
brand: DCMX mini, where payments within a monthly credit line of
¥10,000 ($105) will be billed together with the user’s monthly
DoCoMo phone charges, the standard DCMX plan and the premium DCMX
Subscribers earn loyalty points that can be
redeemed against future transactions each time they make a purchase
using the phone.
In addition, there are bonus point programmes
at selected retailers or DoCoMo’s online shopping mall.
ANZ targets teens with MySpace prepaid card
US social networking site MySpace
has teamed up with Australian bank ANZ to release a reloadable
prepaid Visa card.
The Recharge card, issued by ANZ, is the first
reloadable prepaid Visa card in Australia designed to offer
benefits exclusively for users of social networking sites.
Australian MySpace members can use the card
for both online transactions and traditional retail purchases, and
the card also allows MySpace users to top up their mobile prepaid
credit at the MySpace Recharge application.
The cards can be used for cash withdrawals at
ATMs that accept Visa. They are also reloadable with a maximum
available balance of A$1,000 ($859) and are subject to a card
issuing fee of A$5.95.
Purchasers do not have to be an existing ANZ
customer or have to open an ANZ deposit account.
EUROPE, MIDDLE EAST,
CARD USAGE TRENDS
Cyprus credit card spending drops 2%
Credit card expenditure in Cyprus
fell by 2 percent in the first eight months of 2009 compared with a
year earlier, according to data from JCC, the main card processor
Cypriots spent €1.2 billion ($1.7
billion) in the period January-August this year, 16 percent more
than the same period in 2008.
However the rate of expenditure
seems to be dropping at an increasing pace as sales in August fell
year-on-year by 5 percent to €154.2 million, after falling by 3
percent in July.
Expenditure by foreigners in Cyprus has fallen
in a similar fashion to tourist arrivals to the country. Spending
with non-Cyprus cards fell year-on-year by 17 percent in the first
eight months to €271.4 million. In 2008, spending by non-residents
fell by 3 percent to €491 million.
Residents of Cyprus spent €668.3 million
abroad in January-August, a rise of 9 percent compared with the
same period of 2008, although this was slightly lower than the 10
percent recorded in January-July.
MERGERS AND ACQUISITIONS
HSBC Poland sells card portfolios to Alior Bank
HSBC Bank Polska, a polish
subsidiary of UK-based bank HSBC, has agreed to sell its HSBC
credit card and consumer finance portfolios to Alior Bank.
The total amount, to be paid in cash on
completion of the deal, will be at a premium to the net book value
of the receivables at the date of completion.
The gross asset value of the two portfolios is
around PLN1 billion ($350 million). The portfolios, branded HSBC
Credit, have an estimated gross asset value of around £211.7
Following the sale of its non-core consumer
finance portfolio, HSBC Bank Polska has said it will focus on
growing its personal banking services aimed primarily at the
wealthy and middle-class segments.
The bank also said it intends to strengthen
its global banking and markets and commercial banking businesses.
The sale is expected to be concluded in the fourth quarter of
NCB launches new Visa card, teams up with MoneyGram
National Commercial Bank (NCB),
Saudi Arabia’s largest bank by assets, has launched a
Sharia-compliant Visa Platinum premium credit card.
The card is available with two separate
loyalty schemes: Bonus (cashback) and Amyali (air miles). In
addition to the loyalty programme, the Visa Platinum card offers
travel insurance benefits of up to $200,000, and Visa global
NCB has also recently joined forces with
MoneyGram International, a global money transfer company, to offer
MoneyGram’s international money transfer service at NCB’s 1,400 ATM
locations, creating one of the largest money transfer networks in
“Saudi Arabia is the second-largest send
market in the world behind the United States, and our alliance with
a premier financial institution like National Commercial Bank
represents a significant opportunity for MoneyGram’s expansion
plans in the Middle East,” said Anthony Ryan, president and CEO of
Diamond Bank launches Savings Xtra credit card in
Nigerian financial institution
Diamond Bank has announced the launch of its first credit card
linked to a savings account.
The Savings Xtra credit card is
available to anyone who has at least NGN40,000 ($270) in a Diamond
Bank Savings Xtra account.
The card is NGN-denominated, meaning
clients don’t have to source foreign currency when paying off the
Diamond Bank provides banking and financial
products and services to corporate and individual customers in
Its retail banking products include current
accounts, savings accounts, investments, loans, electronic
services, foreign exchange services, money transfers and credit
The card launch comes shortly after the bank
announced pre-tax profit in its full year to the end of April 2009
fell by two-thirds to NGN5.9 billion, hit by loan loss
The bank said it had made provisions of
NGN24.6 billion for loan losses, but said gross earnings rose to
NGN109 billion from NGN60.4 billion the previous year.
British Airways renews agreement with Amex
UK airline British Airways (BA) and
American Express (Amex), the US card network and issuer, have
announced they are to renew their strategic partnership.
The new agreement, managed by BA
rewards subsidiary Mileage Company, includes three consumer
co-brand cards, a corporate co-brand card and a merchant acceptance
In addition, the American Express Membership
Rewards agreement, launched in August 2008, is for the first time
extended into the US.
The terms of the agreement also mean BA will
continue to accept Amex as a payment method across the world, as
well as allowing US Amex customers to transfer memberships reward
points into the BA Executive Club Frequent Flyer programme.
In 2001, the two companies formed an alliance
to roll out a co-branded credit card, while in 2008 British Airways
became a participant in American Express’ Membership Rewards
programme in countries outside the US.
Monitise takes full control of Monilink
UK mobile banking expert Monitise
has announced it has taken full ownership of Monilink, the UK
mobile banking and payments network.
The financial services provider has bought out
joint venture partner VocaLink to take full ownership of business
operations in its home market, including all future revenues.
Under the deal, Monitise will also pay an
initial £1.5 million ($2.5 million) in cash over three years for
debt-free, 100 percent ownership of Monilink.
Monilink will operate under Monitise’s
worldwide Mobile Money banner.
Until now Monitise and VocaLink had held equal
50 percent stakes in Monilink, and VocaLink will continue to
provide Monilink with full access to its banking and payments
infrastructure in return for services fees.
It could also earn up to £1.5 million in
further consideration, subject to Monilink exceeding financial
performance targets, between now and 30 June 2013.
Through Monilink, Monitise supplies full
mobile banking and payments services to banks representing around
55 percent of UK current accountholders, including HSBC, Lloyds
Banking Group, NatWest, RBS and Alliance & Leicester.
Santander plans Brazilian IPO
The Brazilian division of Banco
Santander, Spain’s largest bank, plans to sell as much as $200
million of stock in an initial public offering (IPO).
In July, Santander said it would sell about 15
percent of its Brazilian unit through a new share issue, suggesting
the IPO would be worth around $5.6 billion, based on Banco
Santander’s current market value of around $37 billion.
According to a recent regulatory filing, the
lender plans to use the proceeds of the share offering for
expansion of its infrastructure and to increase its capital
Santander is the third-biggest non-state
lender in Brazil and said last year it was targeting two-thirds
growth in profit in the country by 2010. This deal would make it
one of the top IPOs of 2009 worldwide, and one of the largest since
the $19.6 billion offering by payment network Visa in March
Western Union extends Cuban allowances
Western Union, the US money transfer
specialist, is to implement new rules on sending money to Cuba.
The new rules mean that US citizens will be
able to send money to “close relatives” in Cuba, which includes
aunts, uncles, cousins and second cousins who are Cuban nationals,
and remove the limits on the total amounts and frequency of money
sent back to Cuba.
The company said in April it planned to expand
its network in Cuba, following a government announcement that
restrictions would be lifted on travel and money transfers to Cuba,
a country it has helped provide money transfer services to since
The new guidelines, issued by the US
Department of Treasury Office of Foreign Assets Control (OFAC),
became effective on 3 September, but do not change the political
status of Cuba, a communist-run country that is still heavily
embargoed by the US.
Digitel unveils two new applications in Venezuela
Digitel, the Venezuelan mobile
operator, has launched two new mobile payment applications via its
i-móvil online contents portal.
Mercantil Movil Internet, the first of the two
applications, offers access to mobile payment services, developed
in partnership with financial services provider Mercantil Banco
Mercantil debit cardholders can use the
m-payment application to perform balance enquiries, mobile payments
for utilities, credit card bill payments and transfers between
their own accounts or to third-party bank accounts.
The second application, Panísimas, provides a
social networking portal developed expressly for mobile devices,
enabling users to share pictures, audio and video files with
friends connected to the same network.
Digitel also reportedly changed hands
recently, when the owner Oswaldo Cisneros sold it for $800 million
to an as-yet unnamed buyer.
Banco do Brasil increases credit lines, looks to
Banco do Brazil (BB) recently
announced it is to increase credit limits for 1.2 million retail
clients and 240,000 small and medium-size enterprises by BRL36.7
billion ($19.5 billion) – the third such move this year.
The bank has seen its overall loan portfolio
rise 32.8 percent in the 12 months to the end of June 2009, ending
the first half of this year at BRL252 billion, aided greatly by
particularly well-publicised merger and acquisition activities.
Despite its increased lending, BB’s 90-day
non-performing loan ratio has stayed at better levels than the
wider market, ending June at 3.3 percent, compared to 4.4 percent
for the overall financial system. These figures stood at 2.5
percent and 2.9 percent, respectively, in June 2008.
BB also mentioned in a securities filing that,
while it is examining purchases as part of its international
expansion plan, it has no negotiations currently in progress.
The bank has been announcing its ambitions to
extend throughout Latin America, China and Africa, after recently
opening a remittance operator and seeking approval for a retail
unit in the US.
Atlantic joins forces with MITec to fight online fraud
First Atlantic Commerce (FAC), a
multi-currency payment gateway and risk management solutions
provider, and Mercadotecnia Ideas y Tecnología (MITec), a
transactional gateway in Mexico, have announced their collaboration
to fight online credit card fraud in Mexico.
FAC will provide MITec with an online risk
management solution as well as address verification services (AVS),
which allow merchants to automatically verify cardholder identities
by comparing the online billing address to the billing address
attached to the cardholder’s credit card, and process
transactions in real-time.
MITec is also using FAC’s 3-D Secure service,
which is an authentication solution for Verified by Visa and
MasterCard SecureCode designed to protect international online
merchants from fraudulent transactions.
FAC provides consumer authentication-only risk
services to merchants, acquiring banks and processors across the
Latin American Caribbean area, as well as a range of other online
risk services including North American AVS services, CVV2/CVC2/CID
validation and consumer credit card verification services.
FAC’s online payment and risk mitigation
solutions are compliant and PCI-certified, and also available to
banks and processors in other regions including Europe, CEMEA and
Mexico’s Wal-Mart to
relaunch bank unit
US retail giant Wal-Mart’s Mexican
unit is planning to relaunch its bank operation in the country, two
years after it first unveiled plans to break into Mexico’s banking
Wal-Mart de Mexico plans to use front-line
cashiers to offer savings accounts, take deposits and offer credit
cards to the 3 million customers who visit the retailer every day,
two-thirds of whom currently have no relationship with the
By the end of the year, Wal-Mart de Mexico is
aiming to have almost 20,000 cashiers in place along with nearly
150 branches and installation of ATMs.
It is also planning to open 270 stores in
Mexico by the end of 2009, 18 more than previously forecast.
Wal-Mart’s efforts to break into the Mexican
banking industry have been welcomed by banking regulators, citing a
lack of competition in the marketplace, in stark contrast to
Wal-Mart’s thwarted efforts to move into the US banking
Citi sells managed card assets worth $1.3bn
Citigroup, the third-largest US bank
by assets, has sold three credit card portfolios, representing $1.3
billion in managed assets. The bank has sold the portfolios as part
of a plan to unload weak businesses and troubled assets that have
caused it huge losses, although it has said it will continue to
service the portfolios through the first half of 2010.
The cards portfolios were part of Citi
Holdings, a division that includes assets the company is looking to
shed or close over time, one of the two segments resulting from the
company’s restructuring which took place in January.
The US government injected $45 billion in
Citigroup and is the bank’s largest shareholder, with roughly a 34
percent stake. The terms of the deal and the name of the acquirer
of the portfolios have not been revealed.
CARD USAGE TRENDS
Debit card transactions volume overtakes credit card spending in
TowerGroup, the US payment research
group, has published a new report which shows debit cards are far
more resilient in the current recessionary economy than credit
According to the report, in less than 15
years, debit card transactions in the United States grew from 1
percent of non-cash transactions to more than 50 percent.
TowerGroup predicts that debit card transaction volume and card
spend will continue to grow to 2015, through the current recession
and ensuing economic recovery.
“The debit card market showed steady growth
since its inception, but it is now the ‘top-of-wallet’ card for
American consumers as a result of tightened credit lines and
consumer frugality in the face of an uncertain economic future,”
said Brian Riley, research director for bank cards at TowerGroup.
“With direct deposit of payroll and government benefit payments now
common, the debit card is even more important to consumers.” (see
FRAUD AND SECURITY
RBS WorldPay, VeriFone team up for payment card data
US point of sale (POS) terminal
manufacturer VeriFone has teamed up with payment processor RBS
WorldPay to market VeriFone’s VeriShield Protect end-to-end
solution for encrypting payment card data.
The software works by encrypting the card
number on swipe, at the POS, reducing risk for both the merchant
and the customer. VeriFone’s VeriShield Protect eliminates usable
cardholder data from the merchant’s POS applications, networks and
servers, using Advanced Encryption Standard-level encryption that
preserves existing card track data formats so it works
transparently with retailers’ existing payment infrastructure.
In addition to encrypting card data,
VeriShield Protect monitors all systems in real time at the device
level via VeriShield Secure Device Management Service (VSDMS), so
if a breach occurred the retailer would be immediately alerted. In
addition, data encryption keys can be managed remotely as part of
the device management service.
MERGERS AND ACQUISITIONS
Elavon acquires merchant processing portfolio of MB
Elavon, a subsidiary of US Bancorp
and a merchant acquirer, has acquired the merchant processing
portfolio of MB Financial Bank, the Illinois-local operating unit
of US financial group MB Financial.
Elavon will provide its payment processing
solutions, customer service and support operations to MB Financial
Bank’s merchant customers. In addition, new merchant services
referrals to Elavon will be marketed through the bank’s 70 branches
across the greater Chicago metropolitan area.
The transition of merchant services to Elavon
will not affect MB Financial Bank clients’ banking relationships;
however, merchants will be now able to use credit card processing,
a PCI compliance programme, point of sale devices and software,
e-commerce products, gift card solutions, electronic cheque
services, and enhanced reporting and customer service.
“Our alliance with Elavon delivers the kind of
dependable service and value that our middle-market commercial and
small business clients are accustomed to,” said Mitchell Feiger,
president and CEO of MB Financial.
Wal-Mart, MasterCard and First Data team up for prepaid
US retail giant Wal-Mart has teamed
up with MasterCard and payment processor First Data to replace the
retailer’s paper-based payroll programme with prepaid cards and
electronic pay stubs. The new electronic payroll programme will be
rolled out to all US employees in September this year. MasterCard
will be the exclusive brand for the card, which can be used
anywhere debit MasterCard is accepted, including ATMs.
First Data will provide the processing and
reload network for the programme as part of First Data’s Money
Network payroll distribution service.
Wal-Mart is planning to deploy Money Network
MasterCard-branded Paycards and electronic pay stubs to cut down on
paper consumption and give employees easier access to their
Wal-Mart employees may receive their pay
either by direct deposit or through the First Data Money Network
programme and may access their wages through the Money Network
MasterCard Paycard or Money Network cheques. Employees will also be
able to receive their cash fee-free at any Wal-Mart outlet or Sam’s
“We have worked closely with Wal-Mart and
First Data to develop a customised programme that will simplify the
payroll process and support environmental sustainability,” said
Chris McWilton, president of US markets at MasterCard Worldwide.
“We are excited that we are able to support Wal-Mart’s vision for
truly responsible and sustainable business operations by providing
Wal-Mart and Sam’s Club associates with the benefits of immediacy,
security, simplicity and efficiency offered by paperless
FRAUD AND SECURITY
Heartland Payment Systems hacker charged
A Miami man has been charged in the
US with hacking into the computer networks of payment processors
and retailers and stealing the details of 130 million credit and
debit cards. Albert Gonzalez, 28, from Miami, has been charged –
along with two unnamed co-conspirators – of stealing the data from
payment processor Heartland Payment Systems, and merchants 7-Eleven
and Hannaford Brothers.
Gonzalez is already in jail after being
charged last May for his alleged role in the hacking of a computer
network run by a national restaurant chain. The trial on those
charges is scheduled to begin in New York in September.
Since then he has also been hit with another
series of indictments for hacks affecting eight major retailers –
including TJX – and involving the theft of data related to 40
million credit cards. If convicted, Gonzalez faces up to 20 years
in prison on the wire fraud conspiracy charge and an additional
five years on the conspiracy charge, as well as a fine of $250,000