NEWS

n a survey undertaken by CyberSource Corp., e-commerce merchants named New York the riskiest North American metro area for e-commerce. By "riskiest," merchants mean that orders from these areas are most likely to be fraudulent. Miami, Los Angeles, Chicago, Detroit and the San Francisco Bay Area followed New York.

ANNOUNCEMENTS

OTI Receives AmEx Certification

On Track Innovations Ltd's (OTI) Saturn 5000 contactless reader received certification from American Express Co. (AmEx) to support its ExpressPay contactless payment program. This follows OTI's recent announcement as the only company to obtain type approvals on both its MasterCard PayPass compatible card and reader solutions. ExpressPay is an alternative to cash. Users hold the ExpressPay key fob next to a companion reader at checkout to make purchases. Payment is authorized in seconds and no signature is required. ExpressPay links directly to an existing credit, charge or debit card.

Payments University Offers Industry Information

The Payments University now offers payment operations and industry education programs for all payment professionals. The Payments University is an expansion of the education services provided by The Clearing House Payments Co. for Electronic Payments Network (EPN), Clearing House Interbank Payments System (CHIPS) and Small Value Payments Company (SVPCo) payments businesses.

The new curriculum covers an array of payments systems, including check, automated clearing house (ACH), and wire. Classes are conducted in classrooms around the country and via "Webinar," a combination of Web-based visuals and teleconference audio. For descriptions of courses and online registration visit www.paymentsuniversity.com .

Creditel Secures New Funding

Mobile transaction technology company Creditel secured $2.5 million in funding. Available on select Java-enabled handsets, Creditel authorizes credit cards and check cards and prints receipts, with real time online reporting. The funding allows Creditel to move forward with development of new products, new operating systems and enhanced integration with new phone models and receipt printing processes.

Major Saudi Arabian Banks Order ICE5500

Hypercom Corp. distributor Alhamrani Universal (AU) ordered 5,000 ICE 5500Plus and 5,000 S9 card payment devices for Saudi Arabia's major banks. This marks the largest one-time order ever for Hypercom Middle East. The support from STS, Hypercom's master distributor in the Middle East, as well as Hypercom's MEA office in Dubai Internet City has assisted AU's expansion in the Saudi POS market.

PaymentOne Recognized as Fast Growing Company

PaymentOne Corp. was ranked number 11 on Deloitte & Touche's "2004 Technology Fast 50" for Silicon Valley, a ranking of the 50 fastest growing technology companies in the San Francisco Bay Area. This is the second consecutive year Deloitte & Touche Fast 50 recognized PaymentOne. Deloitte & Touche ranked the company based on its five-year percentage revenue growth of 9,338%. Additionally, PaymentOne is ranked number 33 out of 500 on the 2004 Deloitte Fast 500, which encompass the top 500 publicly and privately held fastest growing companies in North America.

SVPCo Online Adjustments Accommodate New Adjustment Types

SVPCo-Check Services, the national check processing business of The Clearing House Payments Co., announced that its online adjustments platform can now accommodate expedited recredits and breach of warranty/indemnity, two new adjustments mandated by the Check Clearing for the 21st Century (Check 21) Act. Expedited recredits help consumers resolve payments errors caused by a check conversion, while breach of warranty/indemnity helps banks resolve errors caused by the electronic conversion from paper to substitute check. SVPCo's "online adjustments" is a Web-based adjustments system for banks, thrifts and credit unions.

Visa Provides Enhanced Chargeback Rights

Visa U.S.A.'s Interlink PIN-debit network now provides members with enhanced chargeback rights for cardholder disputes based on the quality of goods and services. Issuers may now permit cardholders who are dissatisfied with the delivery or quality of their purchases made with their Interlink cards to dispute the charges with their issuers. Visa is making this new issuer chargeback capability available only for Interlink card transactions processed by Visa.

After attempting to resolve a quality-related dispute directly with the merchant, cardholders of issuers providing this service may dispute the transaction on the grounds that the merchant was unwilling or unable to provide services; the cardholder did not receive the merchandise; the merchant did not provide the goods that it described; or the cardholder received unsuitable merchandise.

WAY Systems Secures Investment

WAY Systems Inc., provider of wireless and mobile phone-based POS solutions, secured an undisclosed amount of investment funding from George Wallner, founder and former President and Chief Executive Officer of Hypercom. Wallner's investment follows investments from Visa International, Transaction Network Services and Bill Melton, founder of VeriFone Inc. Wallner also joined WAY's Board of Directors.

WRG Earns Inc. 500 Ranking

"Inc." magazine's 2004 Inc. 500 ranking of the nation's fastest growing private companies named Western Reserve Group (WRG) number 400. WRG ranked 411 in 2003 and 467 in 2002.

The Inc. 500 ranks the nation's leading entrepreneurial firms according to sales growth over the previous five years. In 1999, WRG reported sales of $2.8 million. In 2003, WRG reported sales of $15.8 million, a 565% growth.

PARTNERSHIPS

Alliance Data Systems Signs Seven-Year Renewal With J. Crew

Alliance Data Systems Corp. signed a seven-year renewal agreement to provide private label credit card services for J. Crew's 157 retail and 42 factory stores nationwide; its Web site; and its catalog operations. Alliance Data will provide J. Crew with services including account acquisition and activation, card authorization, statement generation, and marketing and loyalty services. J. Crew will continue its use of Alliance Data's Quick Credit product, which ensures that qualified customers can receive a credit approval in less than 30 seconds, whether they apply in-store, via catalog or on the Web.

AmEx and Rite Aid First to Offer AmEx Gift Card

American Express (AmEx) and Rite Aid drugstores are offering customers the AmEx gift card. The card is available at Rite Aid's 3,400 stores nationwide. The AmEx-branded gift card is a universal gift card accepted at locations that welcome the AmEx card. It is also replaceable if lost or stolen.

In other news, AmEx and the Industrial and Commercial Bank of China (ICBC) launched the first AmEx-branded card in China. The ICBC AmEx cards are dual-currency cards. The card targets the aspiring affluent and successful individuals in China. Card benefits include special golf course access, companion air tickets, and emergency assistance within and outside of China, including an interpreter referral service. ICBC will issue and market the cards, extend credit, manage accounts and provide customer service support.

Mercantec Integrates to Authorize.Net

Lightbridge Inc., the parent company of Authorize.Net, formed a partnership with Mercantec Inc., a global provider of e-commerce solutions for small and mid-sized businesses, to integrate Mercantec's PowerCommerce 2005 to the Authorize.Net payment gateway. As part of the agreement, Authorize.Net certified Mercantec through its shopping cart certification program.

CEO America and HBNet Team

Hypercom's subsidiary, HBNet Inc., and loyalty program provider, CEO America Inc., teamed up to provide card issuers and retailers with Creditz digital currency transactions and HBNet's transaction delivery network. Creditz is the only international sub micropayment system that exchanges cash from consumer to merchant, merchant to consumer, manufacturer to consumer, and consumer to consumer in stores, online, and through cell phones, including payments of less than $0.01. Creditz's digital currency card converts loyalty points/miles and rebates into digital currency to purchase products.

Franchise Association and First Data Launch Program

The International Franchise Association (IFA) partnered with First Data Corp. to launch "Customers First." Designed for IFA members, Customers First helps reduce merchant costs for payment card processing and provides access to multiple payment types.

The program offers payment programs to fit the needs of franchise systems small and large and allows members to take advantage of a variety of services including gift cards, loyalty solutions, credit and debit cards and electronic check services.

Visa and Axalto Expand Visa Smart Breakthrough Program

Axalto joined Visa International's Smart Breakthrough (VSB) card program, which Visa expanded to provide a broader choice of chip technology products for its member banks. Through the VSB program, Axalto will promote the Palmera VSB Classic and Palmera VSB Protect Java cards to Visa members globally and the e-Galleon VSB Classic static/native card to Visa members in Latin America.

Lynk Announces Two New Partners

Lynk Systems Inc. formed an alliance with POS reseller East Bay Cash Register Systems Inc. (EBCRS). EBCRS is the newest member of the OneLynk Alliance, a value-added reseller program of Lynk.

Lynk also has a new wireless option for ATM transaction processing. Lynk's Code Division Multiple Access (CDMA) technology will provide a faster, more secure option for routing wireless ATM transactions. Lynk joined with Triton in its implementation of CDMA wireless technology.

Metavante Renews TNS Contract

Metavante Corp. renewed its agreement with Transaction Network Services Inc. (TNS) to serve as Metavante's primary transaction network provider for dial ATM traffic in the United States. In addition, TNS will provide "always-on" connectivity through TNS' persistent-dial private network for telecommunications solutions.

Moneris and SurePayroll Offer Online Payroll Processing

Moneris Solutions formed an alliance with SurePayroll Inc., the nation's largest online payroll provider, to offer SurePayroll's payroll processing solution to its small business customers. The Web-based service includes payroll processing, a tax filing service, direct deposit, basic payroll reports, quarterly reporting, electronic delivery of pay stubs and optional check printing.

Payment Data Systems and Yodlee Sign Agreement

Yodlee Inc. selected integrated electronic payments solutions provider Payment Data Systems to deliver an account-to-account funds transfer capability to Yodlee's customer base of more than 150 financial institutions and portals.

The funds transfer solution will enable a consumer to open new accounts within a financial institution or to add funds incrementally to existing accounts from either external or internal accounts. The companies said that the three-year agreement has the potential of providing new revenues of more than $3.8 million a year.

ACQUISITIONS

Pay By Touch to Acquire ATM Direct

Pay By Touch signed an agreement to acquire ATM Direct, provider of an all-software solution that brings PIN debit to the Internet. The acquisition will round out the Pay By Touch offering, which includes payment processing services from iPAY and biometric payment authentication services from Pay By Touch. ATM Direct will allow Pay By Touch to facilitate PIN debit purchases made online.

APPOINTMENTS

Princeton eCom Appoints Averett to Board of Directors

Princeton eCom, a provider of integrated payment solutions, appointed Ron Averett, eCom's President and Chief Operating Officer, to the Board of Directors. Averett is responsible for the day-to-day operations of the firm. His career includes more than 20 years of senior management experience in banking and financial services. Prior to joining Princeton eCom, Averett served as Senior Vice President in charge of Chevy Chase Bank's $5.2 billion credit card division. Previously, he was a Senior Vice President at Advanta Corp. He began his career in financial services at Citibank.

Davis Appointed Dynamic Payment Solutions VP

Dynamic Payment Solutions (DPS) named Richard Davis Vice President of Business Development. Before joining DPS Davis served as Senior Channel Sales Manager for Authorize.Net. He will oversee the development of the agent and referral partner programs for the Utah-based ISO. DPS is a registered MSP/ISO of HSBC Bank that began in the bankcard industry in 1996. DPS specializes in providing e-commerce merchants with Web stores and payment gateways, and offers a full suite of products and services for all merchant types.

Irvin Joins WRG

Jack Irvin joined Western Reserve Group (WRG) as Service Manager, bringing more than 25 years of manufacturing and technical experience to the company. Founded in 1989, WRG manufactures ATM devices, software application products, and provides transaction processing and financing services for the ATM industry.

Keough Named Q Comm's CEO, President

Q Comm International Inc. named Michael D. Keough CEO and President. Prior to joining Q Comm, Keough served as CEO, President and Chief Strategy Officer of ClearOne Communications.

He also served as Senior Vice President of World Wide Sales for Tempo, a division of Textron, and Learnframe. Keough's experience also includes serving as Senior Vice President of Sales for Megahertz; Vice President of Sales for the Mobile Communications Division of USRobotics; Data Sales Manager for AT&T Information Systems; and Sales Training Instructor/Marketing Representative for IBM.

Solveras Names Patterson SVP, COO

Solveras Payment Systems tapped Pat Patterson to serve as Senior Vice President and COO. Patterson joined Solveras in 2003 as Vice President of Business Development.

Patterson will oversee all aspects of Solveras' daily operations as well as vendor and supplier relations. Prior to joining Solveras, Patterson was Senior Vice President and General Manager of the Patterson Press division of Fiserv Inc.

Sinovoi Joins United Bank Card

United Bank Card (UBC) hired Maxwell Sinovoi as National Sales Manager, Western Division. UBC designed this position to enhance its presence in the western region and increase its ISO portfolio. Sinovoi's primary duty will involve recruiting new ISOs and agents to sell merchant accounts on behalf of the company. Sinovoi has over a decade of sales experience. He spent five years on Wall Street and began his career in the payment processing industry with Marketsource. He also worked at VeriFone and with Ingenico, where he spent the last two years working with ISOs across the country.

Ruesch International Acquired, Staudt Named President and CEO

New York-based private equity firm, Welsch, Carson, Anderson & Stowe acquired foreign exchange and international payment service provider Ruesch International Inc. Following the acquisition, the company appointed Thomas P. Staudt President and CEO.

Staudt joins Ruesch following a successful career in the financial services and healthcare industries. He has held CEO and other top-level positions in national companies including Wells Fargo Bank, Card Establishment Services, MedE America and Source Medical.

White Named EXS' CIO

Electronic Exchange Systems (EXS) appointed Jim White Chief Information Officer. White will lead the efforts to streamline the overall information systems for EXS and its clients. He will also be responsible for the finance and systems integration business units. White has more than 15 years of financial and operating experience in the payments industry. He joined EXS in 2001 as Director of Compensation and Residuals; in 2003 the company appointed him to Executive Vice President.

Bottom Lines

• CyberSource Corp. said in its sixth annual online fraud report that fraudsters will take more than $2.6 billion from eCommerce in 2004; that's 37% more than last year.
• Blockbuster Inc. partnered with 16 new retailers to distribute its gift cards, adding 16,000 new locations before year's end.
• Walgreens, the country's ninth-largest retailer, said it will no longer accept American Express cards, effective Jan. 14, 2005 throughout its stores nationwide.
• Wal-Mart Stores Inc. announced plans to build its first New York City store as early as 2008. The store will be located in Rego Park, where Queens Boulevard intersects with the Long Island Expressway, "Newsday" reported.