All articles by Verdict Staff
Verdict Staff
News Briefs
Planet Payment moves on Hong Kong… ACI and IBM forge ties… HSBCs talking ATMs… Alliance & Leicester buys Cupera… FundsTechs African platform…
Landmark European merger
Landmark European mergerPan-European payments processor Equens and Italy-based payments processor Seceti have mooted the formation of a new joint company under Equenss holding structure, a move that would create Europes largest payments processor by volume. In total, the partners would process 8.7 billion payments and switch 3 billion POS and ATM transactions annually, a volume equal to 12 percent of all eurozone transactions.Equenss contribution to the total would be 7 billion payments and 2 billion POS and ATM transactions
News Digest
PayPal shrugs of global economic woes… Qualcomm and INSIDE Contactless team up… Chile throws its weight behind US start-up..
The domestic debit prize
Debit is become an increasingly important source of revenue for the card associations as banks rein back their lending because of slowing national economies. Luke Olbrich, MasterCard’s head of SEPA debit, spoke to William Cain about how debit growth could help the scheme defy the tough economic outlook.
Region round-up
Citibank has launched its first renminbi debit card for retail customers in China… Kuwait-based Gulf Bank has launched a new mobile banking service… UK banking group Lloyds TSB has reported in its 2008 interim financial results… Brazils Banco Bradesco has launched a Visa payWave contactless card pilot … American Express has taken a 13 percent stake in Concur Technologies…
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Javelin study points to changing consumer habits
It noted that 37 percent of consumers said that they were using their credit cards less, while only 10 percent claimed that they were actually spending more.Some 57 percent of respondents said that they are more careful about their eating-out habits since the economic downturn, while 46 percent also noted that they now go out of their way to shop more at discount superstores.One other area that Javelin sought to explore was how credit card issuers were responding to the economic woes.With 28 percent of respondents claiming the credit crunch meant it was becoming increasingly difficult to pay off their outstanding credit card balances, card issuers are finding themselves precariously balancing their business between cutting back on customer acquisition amid the growing risk of defaults and the ubiquitous imperative to maintain profitability.Javelin found that as well as consumers spending less on their credit cards, issuers themselves are becoming increasingly edgy about the market.Nine of the 13 issuers that were contacted for the study confirmed that they have pulled back their efforts to acquire new customers, while eight have reduced customer credit lines.The majority of the larger US players in the cards market have continued to report losses for this segment this year, such as American Express, JPMorgan Chase and Citi.According to the study, over half of the financial institutions surveyed have suffered losses that are attributable to the current economic conditions brought on by the subprime lending meltdown or other crises (see pie chart above).Even at some institutions that havent suffered losses directly attributable to the economic downturn, cardholder acquisition and the entire make-up of the credit card portfolio is being altered based on pressures felt at the institutional level, the report says.This is a clear sea change in the attitude of the major card issuers in the US
Fair Fee Act faces network opposition
Legislation that would give merchants the power to negotiate over interchange fee levels has passed the first hurdle on the path to becoming US law but, as Charles Davis reports, Visa and MasterCard are expected to put up a strong fight against further regulatory intervention.
Russian bank looks for card partners
Moscow Bank for Reconstruction and Development (MBRD) is in talks with Western partners to help develop its credit card business in Russia Sergey Zaytsev, the Russian banks chairman, spoke to William Cain about how the banks retail partnerships give it a headstart in the fledgling market.
Obama sets sights on card industry
US Senator and Democratic presidential nominee Barack Obama has spoken out against what he sees as the predatory lending practices of credit card companies, accusing them of employing unfair and deceptive practices to trick Americans into signing agreements they cant afford.
First Data and JPMorgan Chase disband payments venture
US banking group JPMorgan Chase and global payment processor First Data have announced that they will be ending their merchant acquisition and payments joint venture Chase Paymentech Solutions (CPS) by the end of 2008, two years earlier than previously planned.