Wednesday, February 17, 2010

World Card Intelligence Releases New Report on Hong Kong, Australia, more...




World Cards Intelligence (WCI) is Lafferty Group's leading research resource covering 65 countries worldwide, available online or in PDF. Each report contains historical data, market forecasts and independent analysis of the following areas:

  • Cards market - credit and debit

  • Consumer finance market

  • Lafferty’s unique profit pool calculation

  • Latest developments in pricing and enhancements

  • Networks - relative strength and positioning

  • Key issuers in the market

  • Merchant acquiring

  • Processing arrangements

  • Economic background

  • Demographics as they impact on the consumer lending and cards markets

Poland Key Highlights
  • While the Polish credit cards market is fairly well developed in terms of card products and penetration, there is a substantial opportunity to increase card usage and activation rates – a large proportion of credit cards are deemed to be inactive. Issuers and networks are addressing the problem of inactivity by educating cardholders, developing reward schemes, running frequent promotional campaigns and introducing cash-back services.

  • Soaring credit card default rates in 2009 forced issuers and networks to focus on educating customers about credit card functionality. A significant proportion of Polish credit cardholders do not distinguish between credit cards and instalment credit. Also, they are not familiar with the grace period, and they often use their credit cards for cash withdrawals.

  • The Polish credit cards market has experienced pressure on profitability from a number of sources, including inactive cards, a high level of bad debts and downward pressure on merchant service charges.

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Kuwait Key Highlights
  • The Kuwaiti credit cards industry has stagnated during 2008 and 2009 due to the adverse economic climate and the enforcement of stringent regulations by the central bank. However, the industry is expected to grow during 2010 as the burgeoning customer base and increasing income levels lead to a rise in the number of credit cards and billed volumes.

  • Due to stringent regulations, as well as more conservative credit policies, the structure of Kuwait’s credit card business is undergoing a transformation, with non-interest revenue streams contributing towards a growing proportion of credit card revenues. Even though profitability per credit card in Kuwait has come under pressure, it remains one of the highest in the region.

  • Despite the fact that more players have entered the credit cards business in Kuwait during the last few years, the three largest credit card issuers still hold an overwhelming majority of the market in terms of number of credit cards, billed volume and outstandings.

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Belgium Key

  • Credit cards in Belgium are principally in the form of deferred debit cards, which represent approximately 70 to 80 percent of cards with a credit function. Credit card penetration in Belgium is fairly low, at 42 cards per 100 adults on average. Debit cards and prepaid (Proton) cards are well represented at 179 and 130 cards, respectively, per 100 adults on average. Overall, at the end of 2009, there were almost 3.5 cards per adult in Belgium. It should be noted, however, that Proton prepaid cards feature as a function available on most debit cards in Belgium and do not constitute a separate physical card.

  • Debit cards in Belgium operate on a domestic debit scheme, Bancontact/MisterCash (BC/MC). In 1999, Belgian banks agreed to add the Maestro logo to domestic debit cards, enabling international debit functionality. By the end of 2009, almost all domestic debit cards in Belgium carried the Maestro logo. Under this system, all domestic transactions on the card are conducted through Bancontact/MisterCash, while international transactions are handled through Maestro.

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Czech Republic Key Highlights
  • Since 2001, the consumer credit market in the Czech Republic has been driven by strong economic growth and the restructuring of the banking sector, including the privatisation of banks. Consumer debt has grown by 431 percent since 2002, and was estimated to be worth $51.9 billion at the end of 2009. Although Czech consumers have shown an increasing willingness to borrow, they remain cautious in acquiring debt. Aggressive advertising campaigns emphasise the easy accessibility of bank loans and there is a wide choice of loans on offer.

  • Combined debit credit and charge card penetration stood at around 127 cards per 100 adults in the Czech Republic, at the end of 2009. Credit and charge card penetration levels are low, with almost 45 credit and charge cards (combined) per 100 adults. The rate is expected to increase marginally, nearing 50 cards per 100 adults by the end of 2011.

  • Czech Republic credit card issuers need to improve consumer understanding of credit cards in order to drive greater activity at the point of sale, thereby increasing profit potential. Issuers have recently begun to improve their card offerings, by providing additional extras, such as insurance, and expanding their loyalty and discount programmes, with a greater variety of partners in the retail and travel industries. Additionally, the premium card segment is under-developed in this market, with few Platinum or Premium card offerings available, as this segment has typically been dominated by Diners Club and American Express.

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Australia Key Highlights

  • The Australian credit card market is one of the most developed and competitive in the world. While the economic crisis has impacted the market, it is one of the few major economies not to enter recession and the banking sector has remained in relatively good shape. 

  • Australia’s cards market is subject to a hands-on approach by regulators, which has resulted in significant changes to the operating environment in recent years. In particular, the regulation of interchange fees in 2003, and subsequent tweaking, has had a profound effect on market dynamics. One of the key shifts among issuers was the move away from rewards-based cards to no-frills, low fee and low interest rates cards. The lower interchange means it is more difficult to fund rewards schemes.

  • Credit card profitability increased in 2009 as dramatic drops in funding rates were not passed on to consumers, and APRs actually increased during the year. While operating costs and net credit losses have also increased during the same period, these have, for the most part, been absorbed by gains in margins.

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Hong Kong Key Highlights

  • Hong Kong is a vibrant and advanced credit cards market, boasting some of the most lucrative benefits and rewards programmes offered anywhere in the world, which in turn helps encourage healthy spend levels. At the same time, a financially savvy consumer environment means issuers have to perpetually innovate their product offerings in order to maintain competitiveness.

  • Lessons learned during the 2001/2002 economic downturn have put the industry in a strong position to manage the current financial landscape. A combination of regulatory and self-regulatory measures has been introduced to improve credit management, including the introduction of positive and negative credit bureaus. As a result, while net credit losses are expected to peak in 2009 at a ratio of 5.2 percent (up from 2.7 percent in 2008), this is considerably behind the 2003 peak of 13.5 percent.

  • The principal focus for issuers in recent years has been to develop various innovative mechanisms to drive spending, including year-round discounts at specific merchants, free gifts for meeting spending requirements, advanced rewards programmes, prize draws, interest-free installment purchases, and flexible bonus point redemption schemes (including bonus point advances).

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Brazil Key

  • As the largest and most densely populated country in Latin America, Brazil should be a key market for any internationally ambitious credit card issuer, although competition is fierce and the market is dominated by five players. The combined share of the top-five bank issuers has grown consistently to 85 percent of all bank credit cards in issue. For international players to succeed in the market, they need a highly-focused strategy via joint ventures with a high-profile partner, or to conduct large-scale acquisitions.

  • The Brazilian credit cards market continues to grow at a very healthy rate, with significant growth potential from the remaining unbanked population. In 2009, the private-label cards sector will exceed the equivalent of total penetration of the adult population (1 card per adult). Lafferty Group forecasts that it will not be until 2011 that there will be the equivalent of one bank-issued credit card per adult. Even then, cards penetration will be skewed by multiple card ownership among a more concentrated population.

  • The Brazilian credit card profit pool is significant and – with the impact of the economic crisis in the US market – has become one of the largest markets globally, according to Lafferty Group research on 65 markets worldwide. Brazil is characterised by very high interest rates, large interest spreads, and relatively high merchant fees.

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Argentina Key Highlights

  • The Argentinean economy has experienced solid growth since its recovery in 2002, supported by strong growth in the price of commodities. Paradoxically, several conflicts that emerged since 2008 indicate that the country is in need of some major structural changes in its economic model. In the past year, the government has faced strong opposition from rural sectors over a decree that divides tax generated from lucrative soy exports among the provinces.

  • Almost all players in the consumer finance market have been marketing diverse benefits and promotions to credit card customers for the past five years, but this marketing has intensified since 2007. These campaigns typically offer large discounts of 15 to 35 percent at the POS at affiliated merchants, covering supermarkets, department and house-ware stores, and electronics stores. This strategy has clear benefits to all incumbents but also creates additional expense pressure both to merchants and banks.

  • Until December 2007, credit card transactions were subject to a 3-percent VAT rebate as a way of promoting increased consumer spending, but it was eliminated in 2008. The 5-percent tax rebate on debit cards was extended until December 2009 and it is anticipated that it will be renewed for another year. This rebate policy plays an important role in accelerating the inclusion of the unbanked into the financial system, and increasing the efficiency of the payment system to reduce overall costs.

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Saudi Arabia
Key Highlights

  • The Saudi credit cards industry, which experienced rapid growth in the number of cards and outstandings in the last few years, has been suffering from rising credit losses as some of the more aggressive issuers discover the true cost of offer credit to lower-income customer segments.

  • In the broader consumer finance market, personal lending is contracting due to stricter regulation regarding debt-service-to-income ratios, and mortgage lending has failed to take off as a result of delays to a draft mortgage finance law. Credit card outstandings contracted by 5 percent during 2009 due to deteriorating credit quality related to the poor economic climate, as well as mounting losses on credit lines granted by aggressive issuers in previous years. Credit card outstandings grew by 6 percent during 2008. More stringent regulations, along with more conservative bank credit policies, have conspired to engender an adverse climate for credit cards. Customer behaviour is also affecting credit card outstandings, with many clients choosing to consolidate their debt through personal loans with lower interest rates.

  • While profitability per credit card has dropped, the industry pre-tax profit pool has grown due to the expansion of the market. All local banks participate in the credit cards market, but the top three issuers control more than 60 percent of cards in issue and credit card outstandings. After experiencing stagnation during 2009, the credit card industry is expected to experience growth during 2010 and 2011. However, the rate of growth in cards and credit card billed volume will be lower than what was experienced during the last few years.

                                                                                          Click to request more information

                                     For further information, please contact:

                  Sadeek Varacchia T: +44 (0)203 008 8420  E:


Chevron Launches "Debit Hold" Education Program

SAN RAMON, Calif. – Chevron has launched a new program to educate consumers about the cause of debit holds, reports industry publication Oil Express.

The company is making decals available to retailers that explain that the banks, not the retailers, are responsible for debit holds.

Debit holds occur when a consumer uses a debit card at the pump and a “hold” of a set amount, typically $50 to $100, is placed on the debit card. This hold can last several days if the transaction is signature debit and is unrelated to the actual fueling price. Consumers who carry a minimal amount in their debit accounts often overdraw their accounts paying for fuel if they fill up with an amount far less than the hold amount.

Consumer confusion runs rampant over the issue of debit holds, and the credit card industry appears happy to allow consumers to misdirect their ire over holds toward retailers. "I've had quite a few angry calls from customers," one retailer told Oil Express. "The customers usually call the dealer first, who tells them he has no control over the situation. Then they call the oil company, where they're told to call their bank. The bank then says it's nothing to do with them. By the time they get around to calling us, they're furious. I even had one woman say that if we didn't give her money back, she was going to burn down the station."

According to Oil Express, Chevron’s new decals read: "Attention: debit card users. Please note that a hold may be placed on your funds by your financial institution when using your debit card. Please contact them for information regarding these holds. Chevron is not responsible for placing or removing holds."

Chevron officials noted that consumers who use PIN debit see their “holds” last a few minutes, at most, since they are real-time transactions. The company also suggested that consumers concerned about the issue should contact the bank that issued the debit card to explain its policy regarding debit holds.

Over the past few years NACS has fielded countless media calls to explain the issue of debit holds. A fact sheet is online to help retailers explain the issue.

Plant Payment Awarded Patent for Foreign Currency Conversion

Planet Payment Awarded U.S. Patent 7,660,768 for

Time-of-Transaction Foreign Currency Conversion

Long Beach, N.Y. – Feb. 16, 2010 -- Planet Payment [LSE: AIM: PPT and PPTR; OTCQX: PLPM], a leading multi-currency and data processor, is pleased to announce that it has been awarded U.S. Patent 7,660,768 by the United States Patent and Trademark Office for its Time-of-Transaction Foreign Currency Conversion process. The patent describes Planet Payment’s innovative approach to payment card processing services, including Planet Payment’s Pay in Your Currency™ service, also known as Dynamic Currency Conversion, a service that gives cardholders the convenience and certainty of paying for purchases in their native currencies when travelling internationally.

With Planet Payment’s Time-of-Transaction Currency Conversion method, the charged amount is converted at the time-of-sale, using an exchange rate determined by Planet Payment for each individual transaction. The patent describes Planet Payment’s unique exchange rate calculation methodology, which allows for the determination of an exchange rate specific to each transaction, based upon a number of configurable business rules and logic.

“Planet Payment’s philosophy from the inception was to build a best-in-class Dynamic Currency Conversion service that operates as a true marketing tool, allowing merchants to sell more to their international cliental more efficiently,” said Philip D. Beck Chairman and CEO of Planet Payment. “The unique processes described in the patent allow for a more personalized approach to Dynamic Currency Conversion with exchange rates developed for individual transactions, while our methods for offering choice to cardholders ensure transparency and merchant ease-of-use. The patent, together with the successful implementation of our services with an ever-expanding customer base of over 30 banks in 11 countries, validates Planet Payment’s market-leadership in multi-currency payments.”

The patented process supports a number of unique marketing applications, such as Planet Payment’s FX Assured® Best Rate Guarantee Service. With FX Assured, Planet Payment develops an exchange rate for a card transaction that is calculated to be more favorable than the rate and fees that would have otherwise been charged to that cardholder by the card issuer for the same transaction. The patented process also provides merchants with other innovative ways to attract new international customers through more targeted promotions and offers – for example, providing customers from specific countries who use their payment card for a purchase with a discounted currency exchange rate that could be below prevailing exchange rates offered elsewhere.

In addition to these concepts, Planet Payment has developed and deployed innovative receipt formats that secure a cardholder’s currency selection, in compliance with Card Association rules and consistent with Planet Payment’s philosophy of providing transparency and informed choice. Planet Payment’s proprietary methods simplify the offering of the currency choice, by empowering the cardholder to make the selection on the receipt, which in turn simplifies the implementation and training process for merchants who adopt the service.

In addition to the U.S. Patent, Planet Payment has been awarded patents in Singapore, New Zealand, and the Philippines, with patent applications pending in many other jurisdictions

About Planet Payment®:

Planet Payment’s Common Shares trade in the UK on AIM under the symbols PPT for unrestricted Common Shares and PPTR for Reg S Common Shares and in the USA on the OTCQX under the symbol PLPM.

Planet Payment enables processors, acquiring banks and their merchants to accept process and reconcile credit card transactions in multiple currencies, allowing cardholders to view prices and settle transactions in their native currency. The Pay in Your Currency™ service is Planet Payment’s suite of multi-currency processing solutions, which includes a multi-currency pricing e-commerce service and a Dynamic Currency Conversion service. Planet Payment’s BuyVoice™, a mobile payment and commerce solution, allows merchants to accept payments and sell product to customers using any mobile or landline phone. With the iPAY™ gateway, Planet Payment also offers comprehensive Internet processing solutions for credit card and electronic check payments.

Planet Payment is headquartered in New York and has offices in Atlanta, Beijing, Bermuda, New Castle Delaware, London, Hong Kong, Shanghai and Singapore.

Source: Company press release.
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TxVia Signs Processing Agreement with American Express Incentive Services (AEISTM)

TxVia to Implement Platform-as-a-Service (PaaS) Delivery Model for Leading Prepaid Program Manager; AEIS to Participate in TxVia’s Payment Processing Developer Network

NEW YORK--(BUSINESS WIRE)--TxVia, Inc., a pioneer in processing technology for network-based payment systems, today announced it has signed an agreement to provide American Express Incentive Services (AEISTM), a prepaid incentive industry leader, with prepaid processing platforms based on TxVia’s platform-as-a-service (PaaS) delivery model.

“PaaS allows us to successfully deploy processing solutions into these environments, ensuring reliability and scalability, which would simply not be achievable with software-as-a-service (SaaS) or in-house software processing solutions.”
“We had far-reaching requirements including multiple systems integrations to support our broad range of products and configurations,” said Russell W. Yergensen, CFO of AEIS. “TxVia’s PaaS model will support current functionality of American Express merchant network, thus offering a seamless transition to our clients, merchants, and cardholders. The PaaS offering allows us to fully upgrade our current platform and product needs and positions us well for the future as we continue to evaluate new opportunities to ensure robust offerings for our clients.”

“We’re delighted that AEIS—one of the top prepaid card program managers—has chosen to partner with TxVia,” said Anil D. Aggarwal, TxVia chairman and CEO. “With our PaaS delivery model, AEIS can create highly competitive prepaid offerings, leveraging its industry expertise, wide-ranging experience and tremendous client base.”

TxVia’s PaaS delivery model enables clients, at their option, to take significant control of their processing platforms, as well as their product and service attributes: Clients can utilize Web-based tools—including an integrated development environment (IDE) called TxDev—to participate in our Payment Processing Developer Network to securely extend TxVia’s best-in-class features and functionality and meet their end users’ specific needs. With faster time to market with better payment propositions, TxVia’s clients are able to increase their revenues, and can concurrently reduce their total cost of ownership and protect their intellectual property. Following launch, AEIS will become part of TxVia’s Payment Processing Developer Network.

“As with many highly successful prepaid card program managers operating at significant scale, AEIS has developed many unique, competitive capabilities that make for a complex system and architecture,” said Aggarwal. “PaaS allows us to successfully deploy processing solutions into these environments, ensuring reliability and scalability, which would simply not be achievable with software-as-a-service (SaaS) or in-house software processing solutions.”

About TxVia, Inc.

TxVia offers the most advanced processing technology for network-based payment systems. Our solutions encompass fully integrated, end-to-end issuing, acquiring and network processing for a range of payment products including prepaid, debit, credit and hybrids. TxVia's solutions have been deployed extensively in prepaid, where the complexity of the product line and diversity of the value chains require highly customized processing platforms. As the only mass provider of custom solutions, we're modernizing electronic payments by offering unparalleled product and service quality, product manageability and configurability, platform performance and operations, client control, and cost savings. Our clients, which include some of the largest payments companies, realize significant scalability, reliability, time-to-market, economic, security and other benefits, overcoming the risks and product and service degradation often associated with other processing options.

We pioneered the platform-as-a-service (PaaS) delivery model for network-based payments as an outgrowth of software-as-a-service (SaaS). With PaaS we rapidly and cost-effectively create highly customized and fully segregated processing platforms for our clients. This approach best manages the ever-increasing complexities of payments across the various products, verticals, organizations, geographies and channels that encompass the industry. With our PaaS delivery model, clients can outsource processing to TxVia completely or bring all or a part of their requirements in-house, allowing them meaningful control over their processing--from functionality and release timing to infrastructure and service levels. Regardless of the configuration, PaaS users do not share a platform with other organizations and products, and are able to redefine the payments value chain to their specific needs.

About AEIS

AEIS, a wholly-owned entity of Maritz Holdings Inc., is an authorized issuer and reseller of American Express prepaid products. AEIS provides business-to-business reward solutions including stored-value cards, American Express® Gift Cheques and Web-based reward management. Its products address a broad array of applications such as employee reward and recognition, sales incentives and consumer promotions while helping clients drive consumer and employee behaviors, build loyalty and increase brand awareness. AEIS is headquartered in Fenton, Mo. and is a licensee of U.S. Patents 5,689,100 and 5,956,695 and Canada Patent 2,215,969. For more information, please contact Catherine McDonald at 636-226-2039,, or visit

The mark, American Express, marks containing “American Express”, and abbreviations of such marks (i.e., Amex, AEIS, AE, etc.) are trademarks of an affiliate of American Express Company and are used under limited license while American Express Incentive Services, L.L.C. and AEIS Canada (“AEIS Companies”) change their corporate names and rebrand. The AEIS Companies are now subsidiaries or affiliated companies of Maritz Holdings Inc. (formerly Maritz, Inc.) and neither American Express Company nor its subsidiaries hold any ownership interest in the AEIS Companies.

Heartland Payment Systems, Inc. Announces Participation in Baird’s 2010 Business Solutions Conference

http://www.heartlandpaymentsystems.comPRINCETON, N.J.--(BUSINESS WIRE)--Heartland Payment Systems, Inc. (NYSE:HPY), one of the nation’s largest payments processors, today announced that Robert Baldwin, President and Chief Financial Officer, will be presenting at Baird’s 2010 Business Solutions Conference on Thursday, February 25, 2010 at 12:05 P.M., in Boston, MA.

Interested parties can listen to a live webcast of the presentation on the Investor Relations section of Heartland’s website at: The webcast will be archived on the Company’s website after the live presentation for 90 days.

Bill Payment Practices of the Under Banked

A New Report From Aite Group

Bill Payment Practices of the Unbanked and Underbanked
Walk-in and mail remain the dominant channels for unbanked and underbanked consumers paying bills.

Boston, MA, February 16, 2010 – A new report Aite Group, LLC examines the channels and payment methods used by unbanked and underbanked consumers for making bill payments, and segments these consumers by payment method preference. The report is based on in-person surveys of 257 check cashing store customers.
The report shows that traditional bill payment methods retain their dominance with unbanked and underbanked consumers. Cards, online payments, and direct debit have made only small inroads into bill payments in this market - a market that continues to rely on checks, cash, and money orders. Forty-five percent of those consumers pay their bills via mail, and 41% do so in person.

"Electronic bill payment methods have a long way to go to gain greater acceptance among the unbanked and underbanked" says Gwenn Bézard, research director with Aite Group and co-author of this report. "The majority of unbanked and underbanked consumers are not yet motivated to use emerging bill payment products," adds Judy Fishman, analyst with Aite Group and co-author of the report.

This 27-page Impact Report contains 18 figures. Clients of Aite Group's Retail Banking service can download the report by clicking on the icon to the right.

Related Aite Group Research:

To purchase this report or

for additional information,

please contact:

Aite Group Sales Tel: +1.617.338.6050

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