Asia Pacific

• American
Express (Amex) and Cathay Pacific
Airways have announced the formation of a strategic
partnership to launch premium co-branded credit cards in the Asia
Pacific region – the American Express Cathay Pacific Elite credit
card and the American Express Cathay Pacific credit card. The two
new cards, which carry an array of rewards and special offers, are
being launched initially in Hong Kong and Taiwan, with plans
underway for other Asian markets. The co-branded credit cards offer
a faster way to earn flight awards and a wide array of lifestyle
awards.

“American Express Hong Kong starts a new
chapter by becoming the only Hong Kong co-brand card partner of
Cathay Pacific, one of the world’s leading airlines and home
carrier of Hong Kong. Cathay Pacific is a long-time business
partner of American Express and we are pleased to take our
partnership to new heights through this strategic card alliance,”
said Yat-chung Koh, senior vice-president and general manager of
the Greater China and Southeast Asia region for American Express
International.

• The number of individual bank accounts in
China rose 9.6 percent from a year earlier to more than 2.2 billion
during the first quarter of 2008, the People’s Bank of
China said in a report. On average, each Chinese citizen
has 1.69 bank accounts, and the number of individual bank accounts
per capita in Beijing, Tianjin, Shanghai and Shenzhen was far more
than the national average, it said.

• China UnionPay’s ATM
business has expanded to 45 countries and regions and holders of
the company’s bank cards can make direct purchases with the cards
in 27 of them, according to company president Xu Luode. UnionPay
card holders can now withdraw cash from 368,000 ATMs in the 45
service areas and make direct purchases through nearly 200,000
point of sale machines at about 150,000 business outlets in 27
service areas, according to Xu.

About 40 financial institutions have issued
more than 270,000 UnionPay cards to local residents in six
countries and regions. In 2007 UnionPay’s overseas business
increased nearly 70 percent (see China gets a taste for
credit).

• The number of foreign banks in China may rise
to 100 by 2011 from 76 at present, according to global consultancy
PricewaterhouseCoopers (PwC). In a survey of 42
foreign banks, PwC said nine anticipated at least 100 percent
revenue growth this year, while 16 expected to be in the 40 to 100
percent range. Foreign banks are required to incorporate locally
before being allowed to provide lucrative retail Chinese currency
services and bank card businesses.

• Visa, ICICI Bank and vendor
Elcom Systems have announced the launch of the
Visa eMarketplace in India, an online portal that connects sellers
and buyers of commercial goods and services. Visa eMarketplace
makes it possible for businesses in India to conduct the entire
procurement and payment transaction electronically and efficiently
over the internet using a Visa purchasing card. This is the first
Visa eMarketplace service to be launched in the Asia-Pacific
region.

The records provided also help ensure detailed
tracking for audit purposes. Core to Visa eMarketplace is the Visa
purchasing card which is meant for low-value, high-volume purchase
of non-personal goods and services.

• ICICI Bank has announced the
launch of the ‘Global Indian Account’ facility, aimed at addressing
the banking needs of Indians moving overseas. These customers,
prior to their departure from India, will have a bank kit
comprising the host country bank account, debit card and internet
banking deliverables, subject to regulatory requirements.

The Global Indian Account facility will be
available for Indians moving to the UK, US and Canada for work,
study or immigration. Along with this account, they would also get
a non-resident rupee account in India, which would facilitate
instant money transfers between their host country account and
their India account.

• Malaysian retailer Giant and
Citibank have joined forces to offer consumers a
co-branded credit card. The key benefits of the Giant-Citibank card
are a 2 percent rebate on all purchases made at Giant stores
nationwide, and up to 1 percent rebate on all other everyday
purchases outside Giant. Further benefits include special member
prices and discounts for cardholders.

Tom Herriott, chief operating officer of GCH
Retail, the owner of Giant, said: “Our 107 stores now serve over 8
million Malaysians a month. We expect many of them to sign up for
this card, which makes it even cheaper to shop at Giant. We are
targeting 50,000 cards for the first three months.”

• In a bid to capture a larger share of its
regional credit card business, United Overseas
Bank (UOB), Singapore’s largest card issuer, is set to
take steps to introduce new card programmes. The UOB Preferred
Platinum card was issued in June 2008 and issued in Singapore and
Malaysia. The card will subsequently be issued in Indonesia and
Thailand.

The UOB Preferred Platinum is the first credit
card developed for Asian customers who enjoy lifestyle benefits in
their home country as well as when they travel within the region.
With more than 2.5 million credit cards of UOB and its banking
subsidiaries in circulation in Asia, specifically in Singapore,
Malaysia, Indonesia and Thailand, UOB intends to double its current
share of the market over the next five years.

• HSBC Holdings plans to raise
its stake in 15 percent-owned Vietnam Technological &
Commercial Joint Stock Bank (Techcombank) subject to
Vietnamese government approval. Despite having only 2 branches in
Vietnam, HSBC is determined to expand its presence in the country.
In March 2008, Thomas Tobin, the chief executive of HSBC’s
operations in Vietnam, said the bank was in talks to increase its
stake in Techcombank to 20 percent. Techcombank, Vietnam’s 10th
largest bank by assets, has 73 branches in 16 provinces and cities
in Vietnam.

• The State Bank of Vietnam,
the country’s central bank, is likely to license the establishment
of two wholly foreign-owned banks in the coming months, according
to Vietnamese newspaper Pioneer. Applications for the establishment
of the two banks are almost complete, and three other applications
to set up wholly foreign-owned banks are also pending. By late
2007, Vietnam’s banking system included seven state credit
institutions, 31 urban joint stock commercial banks, four rural
joint stock commercial banks, 37 branches of foreign banks and five
joint venture banks.

• The Vietnam Bank Card
Association has announced that it will push back the
timeline for banks to start charging transaction fees at domestic
ATMs. The new date has not yet been set but is likely to be later
this year. The previous date to start charging fees was set on 1
July. The transaction cost was seen as necessary for banks to
develop card services. However, it was deemed that card service
suppliers needed more time to improve machines and services. There
are about 10 million bank cards and 7,000 ATMs in Vietnam.

 
Europe, Middle East, Africa

• Qatar-based Ahlibank has
partnered up with Centrepoint, one of the largest retail brands in
the country, to allow the bank’s cardholders to redeem their reward
Pearl Points at Centrepoint outlets throughout Qatar. Ahlibank
credit card customers earn one Pearl Point each time they spend QR4
($1) on their cards, which can already be redeemed against Emirates
Skywards miles and Gulf Air Frequent Flyer miles.

• To help meet the growing demand for travel
within the United Arab Emirates (UAE), Citibank
has unveiled the Citi Travel Pass, a Visa-branded card that allows
customers to earn points and redeem them for free tickets on a
variety of airlines operating in the UAE with no black-out period
conditions. Additionally, cardholders are entitled to two free
return flight vouchers to exotic locations such as India, Thailand,
South Africa, Egypt and Lebanon.

The cardholder needs to spend at least AED2000
($544) in order to qualify for the first free flight voucher, and
AED30,000 within the first twelve months of membership to qualify
for the second voucher.

“With a 20 percent per annum growth and market
spend crossing $7 billion by end of 2007, the UAE travel market is
ranked among the most dynamic frequent flyer markets around the
globe,” said Dean Proctor, Citibank’s cards business head in the
UAE.

• HSBC Qatar has begun
distributing chip and PIN cards to all its customers. All existing
cardholders who currently have magnetic stripe credit cards will
need to replace their cards. However, new card customers are able
to collect their cards at their branch.

• Global hypermarket chain
Carrefour and UAE-based card solution provider
Network International have announced a partnership
that will see JCB cards accepted at all Carrefour outlets across
the UAE. This will enable an additional 58 million cardholders to
have the ability to shop and pay with their JCB cards at Carrefour.
Network International has had an acquiring agreement in place with
JCB since 2006.

“JCB delivers an incredible value to customers
and our association with them is a natural step in our strategy to
offer our patrons a rewarding shopping experience,” said Henri
Changeux, senior vice-president for Carrefour in the UAE, Kuwait,
Oman and Qatar.

• Oman has seen the launch of its first credit
bureau, the National Bureau Commercial Information
(NBCI), with the support of Hamoud Sangour al Zadjali, executive
president of the Central Bank of Oman. The NBCI will provide
decision-making tools to any company or financial institution
extending consumer credit in Oman.

Khalid Ahmed al Hosni, vice-chairman and
managing director of the newly-launched NBCI, said: “The bureau
will facilitate the credit transparency of counterparties to
consumers as well as commercial credit exposures and improve the
quality of lending.”

• Hungary-based Investbank has
announced the launch of a new card. The MasterCard Purchase credit
card comes with a credit card for parents and an accessory card
option for teenagers called SideCard, which can also be used for
payments and cash withdrawals. It can be programmed and monitored
with an upper limit specified by the parents.

• Global credit rating agency Fitch
Ratings says it does not see any evidence credit cards are
being widely used by borrowers to fund UK residential mortgage
payments. The agency’s findings contradict those of a recent report
by the homelessness charity, Shelter. The Shelter Breaking Point
report, published in June 2008, suggests 16 percent of UK
households have used credit cards to help meet housing costs in the
last 12 months. However, based upon information available to the
agency, Fitch believes use of a credit card to pay monthly mortgage
instalments or outstanding arrears is currently at low
levels.

Fitch notes from its reviews of mortgage
originators and servicers that most entities do not allow or, at
least, strongly discourage using credit cards for mortgage
payments, and such guidelines are typically documented. Information
obtained from Fitch-rated UK residential mortgage servicers over
the last several years shows an average 93 percent of mortgage
payments are made by direct debit, cheque or debit card. The
remainder (7 percent) is split between cash, standing order and
other options such as credit card.

• Israeli newspaper Globe has reported the
Bank of Israel is opposed to removing ownership of
credit card companies from the banking sector. The Bank of Israel
Supervisor of Banks, Rony Hizkiyahu, is due to publish a paper in
which he will state credit card companies should not be taken out
of the banking system. This runs contrary to the views of senior
Ministry of Finance officials, who believe the separation of credit
card companies from the banks should be considered seriously.

The issue is currently being reviewed by the
Ariav Committee which is due to report its findings in August 2008.
At present, Bank Hapoalim controls
Isracard; Bank Leumi controls
Leumi Card; and Israel Discount
Bank and First International Bank of
Israel jointly own Israel Credit Cards-Cal. The
Finance Ministry feels separating the credit card companies from
the banks will enable institutions, such as insurance companies,
that acquire credit card companies to compete with the banks for
consumer credit.

• A consortium of French banks, telecom
operators and technology vendors that launched a contactless mobile
payments trial in 2007 is reporting customer satisfaction rates of
above 90 percent for the scheme. The Payez Mobile pilot was
launched in November 2007 to test customer satisfaction and
interoperability among systems provided by different suppliers.
Around 1,000 customers and 200 sales outlets in the cities of Caen
and Strasbourg were recruited to participate in the pilot.
Participants can make payments of less than €20 ($31) by tapping
their handsets against specially designed terminals.

The consortium involved in the pilot includes
French banks BNP Paribas, Groupe Crédit
Mutuel-CIC, Crédit Agricole and LCL, Groupe
Caisses d’Epargne, La Banque Postale and Société
Générale as well as mobile operators Bouygues
Telecom, Orange and SFR.
MasterCard and Visa are involved
in the programme, along with handset manufacturers
LG, Motorola and
Sagem and vendors Ingenico and
Sagem Monetel.

• South Africa’s Bankserv says
that despite a swathe of outside interest, the business is no
longer for sale. Bankserv, established in 1993, is an automated
clearing house providing interbank electronic transaction switching
and settlement services. The Jali government commission on banking
charges suggested changes in the banking system that could see
Bankserv’s client numbers increase but its fees being cut. In 2007,
there were up to eight bidders, both foreign and domestic, for the
business which is wholly owned by local banks. Bankserv says
year-on-year volume trends remain positive. In the last recorded
quarter, it had more than 348 million transactions with a value of
ZAR1.51 trillion ($190 billion) being switched, cleared and
settled. 

 
Latin America

• Chile’s SBIF
(Superintendencia de Bancos e Instituciones Financieras/Regulator
of Banks and Financial Institutions) says total Chilean credit card
debt rose by 1.38 percent in April 2008 to CLP1.27 trillion ($2.5
billion) from March 2008’s CLP 1.25 trillion. March’s debt was up
3.11 percent on February 2008. A separate report by Banco
Central de Chile says total Chilean credit card
transactions rose by 23 percent in value in 2007.

• In 2007, Latin American and Caribbean (LAC)
consumer-to-business e-commerce transactions rose by 40 percent to
$10.9 billion, a Visa LAC study reveals. The study
was conducted by AmericaEconomia Intelligence
between January and May 2008. Between 2005-2007, the value of
consumer-to-business e-commerce transactions grew by 121 percent in
LAC. Transactions totalled $4.92 billion in 2005 and $7.83 billion
in 2006. Venezuela has the fastest growing e-commerce market in
LAC, rising by 224 percent between 2005-2007. Chile saw 183 percent
growth in the same period, followed by Mexico with 143 percent and
Brazil with 116 percent.

• The Mexican government has authorised
Mexico’s IXE Grupo Financiero to launch a new
bank, Banco Mexicano de Consumo. IXE says it will
apply to the banking regulators to rename the new bank ‘Banco
Deuno’. The bank, aimed at the Mexican middle class, will offer
consumer credit products as well as savings and investment
accounts, IXE says.

• Brazil’s Banrisul will
invest BRL150 million ($93.8 million) in its technology
infrastructure this year, its vice-president and IT director Rubens
Bordini says. Banrisul currently has 3,000 ATMs and 60,000 point of
sale terminals in Brazil. In 2007, Banrisul invested BRL132 million
in its technology infrastructure. Bordini says that 82 percent of
the bank’s customer transactions take place via electronic
channels.

• BBVA Colombia plans to
invest $141 million this year in expanding its branch and ATM
network as well as its mobile and internet banking channels. The
bank is owned by Spain’s BBVA.

• Bolivia’s BNB (Banco
Nacional de Bolivia) has launched a mobile banking service, which
allows its customers to transfer funds between their accounts and
pay their bills, including their credit card bills.

• Brasil Telecom has launched
a 3G mobile network using Gemalto’s USIM cards.
USIM is a 3G software application loaded in a SIM card and enables
a mobile subscriber to access services such as multimedia content,
TV, and m-banking and payments. The software authenticates the
subscriber with the network, encrypting financial transactions and
preventing unauthorised parties from viewing the subscriber’s
information.

• US security vendor Entrust
is helping 10 of the top 16 Chilean banks comply with a mandate to
install two-factor authentication technology. Its IdentityGuard
system includes user names, passwords, IP (internet protocol)
geolocation software, and a token which calculates a one-time
passcode for each transaction. In 2007, the Chilean government said
all domestic banks must implement two-factor authentication to
protect electronic transfers by January 2008, or face fines.
Entrust only named two of the banks using IdentityGuard, Chile’s
Banco Santander and Banco
Security. Santander will use IdentityGuard to protect
680,000 customers, while Banco Security will use it to protect
17,600 customers.

• The Financial Services Commission of
Jamaica (FSCJ) has given official approval to
Caribbean Information & Credit Rating Services
(CariCRIS) to operate in Jamaica. FSCJ is Jamaica’s capital market
regulator. CariCRIS is developing regional debt markets across the
Caribbean.

• US card reader vendor Magtek
is seeking systems integrators in Latin America to distribute its
new MagnePrint card authentication system. MagnePrint protects a
card’s magnetic stripe against fraud attacks such as skimming and
cloning.

“In Latin America, we have distributors who
sell our card readers, card-issuing equipment and PIN equipment,”
Kiran Gandhi. Magtek’s vice-president, told CI. “We need
distributors who are system integrators.”

In each Latin American country, Magtek needs to
create an infrastructure for card authentication based on
MagnePrint.

Countries targeted for MagnePrint include
Chile, Peru, Argentina, Brazil and Colombia.

• Acquirer VisaNet Brazil
(Companhia Brasileira de Meios de Pagamento) has teamed up with
Brazilian multiplex operator Rede Cinemark to
launch Visa Passfirst. The service enables Visa credit cardholders
to buy their cinema tickets at the Cinemark website, and to use
their cards instead of paper tickets to gain entry to the cinema.
Initially, the service is being offered solely in São Paulo.

VisaNet says cardholders who buy their cinema
tickets online do not need to print out tickets. Technology rollout
for the service is being handled by VisaNet across Brazil. Visa
Passfirst has been in use at Brazil’s football stadia since April
2007, allowing people to watch matches without paper tickets.

• Toronto-based Smart Processing
Solutions (SPS) says Mexico’s Mercadotecnia, Ideas
y Tecnologia (MIT) has signed a licensing agreement for
its SmartIssuerPro card issuing and management system. MIT will use
SPS software to launch a gift card programme for a selected group
of clients in Mexico. MIT provides transaction gateway services
linking Mexican banks, payment networks and retailers. SPS develops
software for card issuers, processors and acquirers.

• TSYS has won a contract to
provide payments processing for Mexican credit card issuer
Globalcard’s new consumer card portfolio. As part
of the deal, TSYS will supply account processing services, risk
management, portfolio management and reporting tools to Globalcard.
The financial terms of the deal were not disclosed. Globalcard
issues Visa and private-label credit cards to unbanked Mexican
consumers. In April 2008, TSYS launched an operation in Brazil
under the direction of Antonio Jorge de Castro Bueno.

• Visa LAC will give a $30,000
prize to the footballer who scores most goals in the Copa Santander
Libertadores 2008 Latin American soccer championship. The final
game in the tournament was due to take place 2 July. The prize
winner will also receive $30,000 from Visa to give to the charity
of his choice.

• Visa has launched a smart
card pilot in the Peruvian city of Trujillo. Banco de
Crédito, BBVA Banco Continental, Scotiabank, Interbank, Banco
Interamericano de Finanzas and Caja NorPerú are taking
part in the pilot, which involves EMV-based debit and credit cards
being issued to selected cardholders. Visa says that 100 percent of
merchants in Trujillo which are customers of Peruvian acquirer
Visanet Peru (Compañía Peruana de Medios de Pago) have been
equipped with EMV card readers. Merchants across Peru are also
being issued with EMV readers, Visa says.

 
North America

• Hispanics lag behind other groups in adopting
web banking, says US market research firm
Synovate. Only 24 percent of Hispanics claim to
have paid monthly bills online recently compared to 38 percent of
general market consumers and 34 percent of African-Americans. Only
59 percent of Hispanics have access to the web compared to the 80
percent of general market consumers and African-Americans who have
internet access. Hispanics overall are also less likely to own
financial products such as bank accounts and credit cards, Synovate
says.

• The July issue of Consumer Reports warns its
readers against the pitfalls of reward point-paying credit cards
with higher APRs (annual percentage rates) than those charged by
traditional credit cards. Readers are advised to opt for credit
cards which offer cashback, since they can be sure of getting
something concrete back. By comparison, reward points are less
generous than cashback and come with complex rules and
restrictions. Consumer Reports is published by independent
non-profit body Consumers Union.

• Bank of America is offering
its customers the opportunity to obtain credit and debit cards
displaying patriotic designs with US military themes. The cards,
which are targeted at current members of the US military, veterans
and their families, are being launched as part of BofA’s ‘My
Expressions’ range of sports, cause-related, and special interest
banking products. BofA is also offering University of Texas
Longhorns sports fans credit and debit cards displaying the Texas
Longhorns logo.

• Bank Freedom, a subsidiary
of Prepaid Card Holdings, has launched a
Spanish-language website for its MasterCard-branded Bank Freedom
prepaid card. Spanish-speaking consumers can go to http://www.bancolibertadtarjeta.com/
and order a Bank Freedom Prepaid MasterCard. Bank Freedom has been
promoting its cards in Spanish on US Spanish-language radio
stations. The cards are issued by MetaBank.

• Disney-themed ATMs are being installed at
Universal Studio’s theme parks and CityWalk entertainment venues in
Orlando, Florida and Hollywood. The 25 ATMs will carry the
GE Money brand and will be owned and operated by
Cardtronics.

• US-based processor Global
Payments has secured a five-year $200 million loan from a
syndicate of banks. Global will use the loan to fund part of the
$439 million cost of setting up a joint venture with
HSBC. The JV, in which Global holds a 51 percent
stake, will provide payment processing to merchants in the UK and
internet merchants globally. The remainder of Global’s investment
in the JV will be funded from Global’s excess cash and an existing
$350 million revolving credit facility

• Payment terminal vendor
Hypercom is relocating its global headquarters
from Phoenix, Arizona. The newly-designed 45,000 square-foot HQ is
in Scottsdale, Arizona.

• Hypercom’s Optimum T4210 and
T4220 point of sale terminals and PV1310 PIN Pad have received
Class A certification from US-based acquirer National Processing
Company. The T4210 is a dial-up terminal, while the T4220 offers
ethernet connectivity.

• JPMorgan Chase has renewed
its contract with the State of Colorado to
distribute benefit payments to the 127,000 Coloradan households
receiving funds for food assistance, child support and other
state-funded programmes. The claimants receive their benefits via
JPMorgan’s electronic system on Colorado Quest prepaid debit cards.
These cards are used to disburse state benefits such as food
stamps, old age pension and child care.

• Eduardo Vergara has joined JPMorgan
Treasury Services as global commercial card executive. In
his new role, Vergara will be responsible for the day-to-day
management of JPMorgan’s global commercial card business and for
the direction of its card products.

• The State of Michigan Unemployment
Insurance Agency (UIA) has partnered with
JPMorgan to add two electronic payment options for
welfare recipients. Unemployment benefits can now be deposited
directly into recipients’ bank or credit union accounts via an
automated clearing house direct deposit facility provided by
JPMorgan. Benefits can also be deposited to prepaid Visa debit
cards issued by JPMorgan.

• US prepaid card firm Meta Payment
Systems (MPS) is to launch a service later this year
offering preferential rates on small loans to borrowers who pass a
TransUnion credit check. Once approved, the loans will be deposited
immediately on an iAdvance Line of Credit prepaid card issued by
MPS’ parent, MetaBank. The rates will be lower than those offered
on the iAdvance prepaid card launched by MPS and MetaBank in
February 2008. That version of iAdvance does not involve a credit
check.

• The Washington, DC Department of
Employment is using prepaid debit cards issued by
JPMorgan to pay salaries to 19,000 workers
participating in a summer youth employment scheme.

The Passport-to-Work Summer Youth Program is a
10-week scheme for young people living in DC who are aged 14 to 21.
The prepaid Visa cards are issued and processed by JPMorgan as part
of its Payroll debit card programme, launched in 1987.

• MPower Ventures, a fund
which invests in products targeted at underserved consumers, has
invested in a mobile banking and payments technology company,
Sapphire Mobile Systems. Sapphire is being
rebranded as MPower Mobile and relocated from Philadelphia to
MPower’s Austin, Texas base.

• Dallas, Texas-based payment system provider
On-Line Strategies (OLS) is to receive funding
from Wisconsin-based Copia Capital. OLS intends to
use the funds to support the marketing and sales of its main
payment processing product, OLS.Switch, and the managed service
version, OLS.Host.

• RBS Lynk, the Royal Bank of
Scotland Group’s US payment processing arm, is offering restaurant
merchants a loyalty programme from Chockstone.
Portland, Oregon-based Chockstone says its technology allows
merchants to analyse customer transactions at the POS and offer
them promotions in real time.

• Online stores and businesses which are
customers of Plano, Texas-based website hosting company
Soft