All articles by Verdict Staff
Verdict Staff
Capital One moves into prepaid
After struggling with stagnant credit card growth in the US, Capital One is turning its attention to the prepaid card sector with the $700 million acquisition of NetSpend Holdings, a major retail prepaid card marketer Capital One, the fourth-largest issuer of Visa and MasterCard cards in the US, said it expects the acquisition to be accretive in 2009. Best known for its credit card operations and marketing expertise, Capital One is aiming to tap into the increasingly profitable prepaid market in the US, which, according to US research consultancy Aite Group, is expected to amount to $178 billion by 2010, up from an estimated $113 billion in 2007
Maximising customer value
As competitive intensity, costs and complexity increase, serving customers with the right loyalty solution is a significant challenge. Michelle Geraghty, Global Solutions leader, MasterCard Advisors, argues that, as customers seek to maximise the value they receive, cards rewards programmes will continue to grow.
Region Round-up
In May 2007, credit card lending by Mexican banks totalled MXN238.7 billion ($22.22 billion), up from MXN166.9 billion in May 2006 and MXN233.9 billion in April 2007..
Canada embraces move to chip
The countrys payment card industry which has a strong payment infrastructure already in place has formally committed itself to chip migration over the next few years
Banks pressure NETS to raise fees
The debit network argues that since even its owners, Singapores banks, have been lured by the interchange revenue offered by the international card schemes, it has no alternative
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Lessons from the Asian credit crises
A new report from the Bank of International Settlements (BIS), the central bank of central banks, has examined the excessive credit card lending in the Asia-Pacific region of the mid- to late 1990s, which resulted in the default crisis that hampered the regions economies earlier this decade, and asks what lessons can be learned to avoid such a crisis in the future.
Citi looks overseas for credit growth
The worlds largest card issuer, Citi, has been fighting sluggish credit conditions in the US and is now favouring expansion and acquisitions abroad, particularly in the growth markets of Latin America and China, in order to bolster its cards business Credit conditions in the US have improved since the spike in bankruptcy filings in late 2005 caused a significant dent in US card issuer profits, but the nature of the saturated market and lower-than-expected earnings in domestic card portfolios is forcing lending giants such as Citi to look overseas for healthier profit margins
Interchange fees come under scrutiny in the US again
Visa and MasterCard are facing more scrutiny from US Congressional lawmakers over the setting of interchange fees, amid growing discontent from retailers and merchants which claim that such fees are a violation of federal antitrust law and cost consumers over $40 billion a year. On 19 July, the US House Judiciary Committee Antitrust Task Force heard testimony from disgruntled merchant and consumer bodies, including the National Retail Federation (NRF) and the US Public Interest Research Group They claim Visa and MasterCard are colluding to set interchange fees in much the same way as a price-fixing cartel, and that the system lacks transparency.
GE locks up eBay card issuance
GE Money has teamed with eBay to launch the eBay MasterCard, a credit card that combines the payments service features of PayPal with a revolving credit platform, capping an astonishing run of private-label deals for GE Tightening its grip on the online payments market, GE Money, the consumer lending unit of General Electric, has teamed with online auction giant eBay to launch the eBay MasterCard.
MasterCard to launch prepaid contactless card in Italy
Postepay, the prepaid card from Italian post office Poste Italiane, has enjoyed considerable success since its launch in 2003, and now MasterCard Worldwide is aiming to enhance the proposition further by adding its contactless PayPass technology to the Postepay prepaid model. MasterCard and Poste Italiane are teaming up to launch the Postepay Evolution MasterCard prepaid card, which will also represent the entry of PayPass in the Italian market By the end of 2007, Poste Italiane will launch a trial of the new card, which will be available for purchase and use at retailers in Milan and Rome in a variety of retail categories, including cinemas, fast food and chain restaurants, supermarkets and other outlets.