NEWS

Visa, MasterCard to Face Antitrust Claims Over Currency Fees

A federal judge denied motions by Visa and MasterCard International requesting that antitrust claims against them be dismissed. The claims allege the companies conspired and hid currency-conversion fees charged to consumers for purchases made overseas. U.S. District Judge William Pauley in Manhattan is overseeing more than 20 class-action lawsuits against Visa and MasterCard concerning their currency-conversion fees, Reuters reported.

The lawsuits claim the credit card companies have conspired in a price-fixing scheme to set these fees and hide them from account-holders.

Colorado Can Charge Fees on Credit Card Payments

The state of Colorado passed a law in May 2003 (HB 1267) that repeals statutes that formerly prohibited state and local government entities from imposing a surcharge to cover costs of credit card payments.

As reported in the April 28, 2003 issue of The Green Sheet (Industry Update: "No More Credit at the Old Alma Mater," 03:04:02), Colorado State University planned to eliminate the acceptance of Visa and MasterCard credit card payments for tuition and fees as of July 1, 2003 because of the high cost of processing fees charged by banks.

However, because of the new state law, CSU officials said they will accept payments made with Visa, MasterCard, American Express and Discover, although not directly. The university is using a third-party system called CASHNet SmartPay to accept credit card payments. The company charges a fee of 2.9% per transaction.

Visa and 'The Virtuous Circle'

A new white paper developed by Visa International and Global Insight, "The Virtuous Circle: Electronic Payments and Economic Growth," reports that the role of electronic payments is "significant and sizable" in terms of promoting global economic growth and development. The white paper states that there are four key areas of growth - domestic, international, economic efficiency and capital accumulation - where electronic payments, including card-based payments, can help drive increases and efficiencies.

According to the report, electronic payment networks potentially could create cost savings of at least 1% of GDP annually over paper-based systems in any economy by increasing the efficiency and velocity of payments.

To download the Visa-sponsored white paper, visit www.corporate.visa.com/mc/documentdownloads/ downloads/virtuouscircle_062303.pdf

ANNOUNCEMENTS

ETA Arrives in Washington

The Electronic Transactions Association (ETA) announced that its transition to the new Washington, D.C., office is complete and on schedule. The ETA's new contact information:

Electronic Transactions Association

1101 16th Street, N.W., Suite 402

Washington, DC 20036

Phone: 800-695-5509

Fax: 202-828-2639

Paradata's Byrne Receives Award

The Northwest chapter of The Forum for Women Entrepreneurs (FWE) honored Paradata Systems Inc. President and CEO Shannon Byrne with the Entrepreneurial Achievement award. FWE is an entrepreneurial organization for women who build and lead high-growth companies. Byrne has been with Paradata Systems since 1995. Before joining Paradata, she worked with her own software consulting firm, Embyr Consultants, and for Geovision, Siemens, DMR Group and Statistics Canada.

ProPay Recognized by Direct Selling

ProPay USA received the Direct Selling Association's Partnership Award at the Direct Selling Association National Conference. ProPay allows small-size merchants to accept credit cards via a computer with Internet access or a touchtone phone. ProPay offers its service to more than 30 direct-selling companies and their representatives, including Mary Kay, Creative Memories and NuSkin.

PRE Certified on VeriFone

PRE Solutions, Inc.'s applications were certified to run on VeriFone, Inc.'s Omni 3750 point-of-sale terminal and will support VeriFone's Verix Multi-application Conductor (VMAC) utility. The VMAC allows multiple applications to reside on the same terminal, which share the system's data.

Lipman Receives Two Certifications

Lipman USA Inc.'s NURIT 2085, NURIT 3000, NURIT 3010 and NURIT 3020 point-of-sale terminals were certified for check debit processing by Payment Option Solutions, LLC. Lipman also received Visa PED approval for its NURIT 8320 terminal.

VeriFone Approved by Visa for 3DES

VeriFone, Inc. announced that it is the only vendor to have received approval by Visa International for Triple DES (TDES) and PIN Entry Device (PED) across its offering of point-of-sale solutions, including the Omni 3750, Omni 3600, Omni 7000MPD and the SC 5000 PIN pad. The devices also received EMVCo Type Approval Terminal Level 1, based on EMV 4.0 specifications for global smart card acceptance. VeriFone said all of its solutions support the full implementation of TDES for both Master Key/Session Key and DUKPT (derived unique key per transaction).

Alogent Recognized for Success

Alogent Corp. received the 2003 Excellence in Technology Marketing award from the Technology Marketing Association for its repositioning and penetration of the U.S. marketplace. Alogent provides payment-processing solutions for global financial institutions, remittance and payment processors. Alogent also received a Certificate of Merit for payment processing by The Banker, a publication for the international banking industry.

Tranax Has 3DES Kits Available

Tranax Technologies is offering Triple DES/EPP (Encrypted Pin Pad) field upgrade kits to all authorized Tranax distributors and certified ASPs for Tranax ATMs in the field. The cost and technical requirements of each kit will vary based on ATM model; installation instructions can be downloaded from the Tranax Web site.

Paymentech Offers Web Resource to ISOs

Paymentech, L.P. has developed the Strategic Partner Re$ource Center, a Web site for its banks and Independent Sales Organization partners. The Re$ource Center offers password-controlled access to announcements, product descriptions, a VAR database, reporting, user manuals, sales presentations, FAQs, help desk information and a support directory.

Keycorp Terminal Certified

CGI Group Inc. (CGI) certified Keycorp Limited subsidiary Keycorp Canada Inc.'s Interac software for Keycorp's K23 point-of-sale terminal, which supports credit and debit transactions. The K23 terminal can accept smart cards and is EMV Level 1 and 2 certified. The K23 application supports cash-back, surcharging and tipping functionality. Keycorp Canada has been a distributor of POS terminals, PIN pads and software applications for more than 10 years.

Global Payments Honored by Restaurants

The Restaurant Association of Maryland awarded Global Payments Inc. the 2003 Allied Member of the Year award. The winner was selected based on votes cast by more than 3,000 association members from across the state. Global Payments was recognized for its contributions to the restaurant industry and for serving as a merchant advocate.

TransFirst Receives Eight Bank Approvals

Dallas-based TransFirst has been endorsed by eight state banking associations that help members find the right processor through endorsement programs. The associations are:

• Community Bankers Association of New York State (CBANYS)
• New York Bankers Association (NYBA)
• Independent Bankers of Colorado
• The Independent Community Banks of North Dakota (ICBND)
• Community Bank Services (a wholly owned subsidiary of the North Carolina Bankers Association)
• Virginia Bankers Association
• New Jersey League of Community Bankers
• Ohio Bankers League

PARTNERSHIPS

PPI Selects SPS for ECC

Secure Payment Systems (SPS) will provide Payment Processing, Inc. (PPI) electronic check conversion, ACH and check guarantee services through PPI's sales channels. PPI processes for retail merchants, such as restaurants, grocery, hospitality, and MO/TO and Internet merchants.

SPS also announced that it has partnered with merchant acquirer Central Bancard, LLC. SPS will provide Central Bancard's retail customers with check and gift card products and services offered through the company's independent sales force.

Michaels Using VeriFone PIN Debit

Arts and crafts retailer Michaels Stores, Inc. has successfully implemented VeriFone, Inc.'s EverestPlus point-of-sale terminals in all 775 of its stores. Approximately 18% of Michaels' in-store transactions are online PIN-based debit. VeriFone said it has shipped 400,000 Everest terminals since 1995.

Fifth Third Wins GNC and La Quinta

General Nutrition Centers (GNC) selected Fifth Third Bank Processing Solutions to be its processing partner for its PIN-based debit card processing. GNC also will use Fifth Third Direct to automate back-office debit card operations by scanning receipts and other documents into the system in order to respond to customer and bank inquiries.

In addition, La Quinta Corp. picked Fifth Third to be its credit card processor. Fifth Third will process Visa, MasterCard, American Express and Discover transactions for La Quinta Inns and La Quinta Inn & Suites in 33 states.

Global eTelecom Renews with United Merchant

Global eTelecom, Inc. renewed an agreement with United Merchant Services whereby Global eTelecom will continue to provide United Merchant Services' merchants with electronic check conversion services.

Signature Partners with Merrick

Signature Card Services formed a new ISO/MSP alliance with Merrick Bank of South Jordan, Utah, which is looking to expand the number of card-present transactions it processes. Signature also represents Santa Rosa, Calif.-based National Bank of the Redwoods and will continue in that relationship as well.

MIST's NBS Teams with CardBASE

CardBASE Technologies and NBS Card Technology have partnered and combined their technologies to promote MASCOT, CardBASE's multi-application smart card product, and NBS's card-personalization system, the NBS Advantage Series, as a complete package to their customers. NBS Card Technology is a division of Card Technology Corp. and a subsidiary of MIST Inc.

POS to Resell Ingenico Product

Payment Option Solutions, LLC will resell Ingenico's eN-Check 3000 check reader. Ingenico's device allows merchants to verify that a customer's checking account has sufficient funds to cover the check.

Global Payments Gets Musical

Sam Ash Music Corp. picked Global Payments Inc to process its credit card and check guarantee and recovery transactions and to provide 24-hour help desk support. There are 42 Sam Ash "Musical Instrument Mega Stores" in 12 states in the U.S.

B of A Renews with Vital

Vital Processing Services renewed its payment-processing agreement with Bank of America. Vital will provide POS authorization, capture, clearing and settlement services to help the bank service its national merchant acquiring customers.

Certegy Will Shop at Home

The Shop At Home Network selected Certegy Inc. to provide ACH/electronic check warranty services for its Internet and telephone order business. The Network has 400 affiliated television and cable systems, direct-broadcast satellite systems and many of its own stations.

ACQUISITION

Provident Sells its Merchant Biz

Provident Financial Group Inc., parent company of Provident Bank, is selling its merchant services business for a $13 million gain after taxes. The business brought in about $1 million in quarterly revenue, the Cincinnati Enquirer reported. Provident did not release the sales price or the name of the buyer.

Provident also sold its 13 Florida banks in Sarasota, Manatee and Hillsborough counties and 16 ATMs to the Royal Bank of Canada for $75 million, and it sold $471 million of sub-prime mortgage loans in order to increase profit, reduce credit risk and focus more on its banking unit in the Midwest, where it operates 65 branches in Cincinnati, Dayton and Kentucky.

APPOINTMENTS

CyberSource Appoints Sales Exec

CyberSource Corp. appointed George Jathas to Senior Vice President, Worldwide Sales. Jathas has more than 20 years' experience in the payment industry. He has worked at such leading companies as Chase Merchant Services, National Data Corp. (now Global Payments Inc.), First Data Corp., and most recently Promisant and Orbiscom.

PaymentWorks Hires Two

Austin, Texas-based PaymentWorks, Inc., an ATM deployment company, hired Brian Marberry and Janelle Reiling to head the company's bankcard program. Marberry previously served as National Sales Director for First Bank of Beverly Hills. Reiling is the former Sales Manager for National Bankcard Systems.

TransFirst Hires Banking Veteran

TransFirst appointed Robert M. Berry to Senior Vice President of the Shared Services Division. Berry has more than 25 years' experience in the banking and related card issuing and merchant acquiring industries.

Berry previously worked at Keystone Advisors Inc.; he also has held executive management positions with such corporations as American Express TRS and Citicorp Diners Club.

BOTTOM LINES

• Borders Books & Music will open two new superstores in Florida in the fall of 2003 - one in Clearwater in September and one in Brandon in November - bringing its total number of stores in the state to 26.
• May Department Stores Co. bought Chicago-based Modern Tuxedo's 25 tuxedo-rental and retailer shops and is adding them to its bridal-group division of retailers.
• Dollar Tree Stores, Inc. acquired Salt Lake City-based Greenbacks, Inc., another operator of "dollar stores." Greenbacks has 100 stores in 10 states, primarily in the Rocky Mountain region.
• Mexican retailer Grupo Gigante plans to expand into the U.S this year and will target U.S. Hispanics. The stores all will be located in Los Angeles.
• Wal-Mart Stores, Inc. had in the fiscal year ending in January 2003: >More than 1.3 million employees worldwide and plans to hire another 800,000 over the next five years. >Sales of $244.5 billion, making it the world's biggest company in terms of revenue. >A profit of $8.04 billion.