All articles by Verdict Staff
Verdict Staff
A reality check for the prepaid market
While the prepaid card market in the US has thrived in a myriad of forms including gift cards, remittance and corporate cards over the past decade, it has only just begun to establish a cultural and financial foothold in Europe Sensing the opportunity for customer acquisition and branding in previously untapped markets, a multitude of financial players have been entering the prepaid space recently either as issuers or co-branders.Nevertheless, numerous speakers at the recent 2007 Prepaid Cards Summit, held in London in October by VRL KnowledgeBank, were quick to point out the challenges that exist within the prepaid cards market alongside the current opportunities for growth
Visa settles American Express
The suit was filed in November 2004, and alleged that Visa and MasterCard, plus eight major banks, acted to obstruct American Expresss access to the bank-issued card market in the US American Express stated at the time that it had been effectively locked out of the bank-issued card business in the US, and sought damages for business lost as a result of anti-competitive business practices.Under the agreed settlement, Amex will obtain an aggregate maximum payment of $2.25 billion the largest amount ever paid to resolve an anti-trust matter
Marketing to stand out from the crowd
Marketing to stand out from the crowdCards marketers must constantly improve their customer acquisition and retention strategies and metrics tools to make an impact in a crowded world of multiple media outlets, as a new report from VRL KnowledgeBank explains.Card marketers continue to respond to many industry challenges, from increased competition to legislative issues, to capturing a profitable share of the customer
TSYS flies the nest to go it alone
TSYS flies the nest to go it aloneIn what was a widely anticipated development, global payment processor TSYS is set to transform into a fully independent company, after parent company Synovus announced that it would be disposing of its $4.7 billion stake (representing 80.8 percent of TSYS shares) at the end of December, pending regulatory approval TSYS, formed by Synovus in 1983, is the largest third-party card processor in the US.The move has major implications for the processing industry, as an independent TSYS will be much better placed to take on First Data, its larger rival in the processing space, and will be free to pursue acquisitions in line with its stated objective of international expansion This could also result in a faster pace of processor acquisitions in Europe, as both TSYS and First Data are likely to chase after acquisition targets among an ever-dwindling pool of national processors once SEPA is implemented.TSYS CEO Philip Tomlinson said: What will be different is the greater flexibility we will have with respect to planning and executing our growth strategies.Nancy Atkinson, a senior analyst for US payment research consultancy Aite Group, told CI that the spin-off makes sense for TSYS
Card networks shrug off economic concerns with strong results
American Express and MasterCard have each posted strong third-quarter results in the face of a possible deterioration of the US economy International markets accounted for a growing proportion of revenue growth.American Express beat analyst expectations with its announcement that the companys third-quarter earnings rose by 10 percent Quarterly profit rose to $1.07 billion from $967 million in the year-ago period, while revenue rose 11 percent to $6.95 billion from $6.27 billion
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Morgan Stanley points to wider subprime credit contagion
Morgan Stanley points to wider subprime credit contagionUS issuers are already feeling the effects of the subprime fallout and ensuing credit crunch (see US banks post disappointing results) and now Morgan Stanley has added to concerns that the crisis could spread into the wider credit market, saying a consumer credit recession was likely.In a client note, Morgan Stanley analyst Betsy Graseck said the effects of tightening in credit markets on US large-cap banks would be greater than anticipated and would spread into auto and card loans
Region round-up
According to the national electronic payment and interchange network, China UnionPay, transactions value hit $7.82 billion during the week, an increase of nearly 74 percent compared to the same period last year. Migrant workers in Chinas 14 provincial areas will now have a special bankcard which will allow them to withdraw money at rural co-operatives in their home town after they have deposited it in a city bank
South Africa’s balancing act
As its economy has strengthened, South Africas consumer finance sector has taken off, and its increasingly prosperous population is taking up the credit on offer But, concerned about the potential debt burden, the government is acting to check credit provision
Change in acquiring is far from over
Europes merchant acquiring industry has not escaped the trend of consolidation that has happened in other sectors, and the imminent arrival of the Single Euro Payment Area brings new opportunities for the major players in this field CI reports.The transformation that is taking place across Europes merchant acquiring industry mirrors a similar shift that has occurred in processing, with acquisitions and mergers predominantly being the main organ of volume growth
Marketing innovation in credit cards
While there are significant untapped product development opportunities for credit card issuers to distinguish themselves, Anja Snksen, senior consultant at Edgar, Dunn & Co, sees more sustainable opportunities through employing marketing advances, especially in the area of process innovation.Business is tough for credit card executives in Europe Major environmental changes such as the introduction of new technologies, the implementation of SEPA, the strong growth of prepaid cards, new entrants to the market and an increasing empowerment of cardholders will impact the credit card market and provide real challenges for decision makers