Direct Response Forum

Card Not Present News

Visa and MasterCard issued new alerts on May 15 that suggest the breach at payments processor Global Payments Inc. dates back to January 2011 - an exposure window significantly longer than what was originally reported when news of the breach surfaced in late March.

Rogers Communications and Canadian Imperial Bank of Commerce said at a joint news conference the mobile wallets will be available later this year and will be the first in Canada.

Facebook’s payment network is its largest source of revenue after advertising. Primarily through selling credits for virtual goods for use in social games like Farmville, Facebook earned $557 million last year through its payments network.

Some sources now say the data breach at Global Payments Inc., revealed in March, may have exposed 7 million accounts - a significant increase from the 1.5 million the payments processor first reported.

PayPal and SOFTBANK announced today that the two companies plan to establish a joint venture company, “PayPal Japan”, to build a digital payments business that will drive the future of commerce in Japan. In addition, PayPal and SOFTBANK today announced PayPal Here in Japan, the fifth country to receive this global mobile payment solution that is already available in the USA, Canada, Hong Kong and Australia. PayPal Here will enable millions of Japanese small businesses.

Mastercard announced on Monday the certification of 17 new smartphones for its PayPass Ready program. The new program certifies that devices with near field communications — or NFC — will be smoothly incorporated into its mobile payment system. 

PaidPiper, a startup that will debut at the CTIA Wireless show this week, is developing a mobile money transfer system suited to developed economies where the credit-card infrastructure is dominant.

A survey of online merchants conducted recently by Internet Retailerfound that since the swipe fee cap took effect, only around 15% say they’re paying less, while nearly 18% say they’re actually paying more. Maybe it’s too soon, the site suggests, pointing out that many merchants might not have renewed their contracts with the processing networks that act as go-betweens for banks and retailers. Still, it cites an analyst who says, “I would have expected Internet retailers to have appreciated a benefit from the rate reduction.”

MasterCard has unveiled its Mobile Payments Readiness Index (MPRI), an analysis of 34 countries and their readiness to use mobile payments. The index identified Singapore, Canada, the United States, Kenya and South Korea as the most prepared markets.

A new study from MasterCard Advisors says that credit card consumers who use "contactless" card transactions (where the consumer waves the card, or more recently, even a smartphone, over a payment terminal) tend to spend more money using their credit card than do card "swipers."

De Armas reiterated Wal-Mart’s well-known position that the company does not support any U.S. EMV plan that eliminates or marginalizes the PIN in favor of signature authentication. “Signature is a worthless form of authentication, it’s worthless,” he said, using wording similar to what other Wal-Mart executives have used at recent conferences when speaking about EMV.

MasterCard has ridden the wave of popularity that debit cards have seen over the past few years with new initiatives to gain market share. Over half of the debit cards issued in the U.S. are now processed by the company. MasterCard tripled its share of the U.S. PIN debit transactions and now has more than 20% of the market. Debit card transactions have been increasing over the past few years, and we expect the trend to continue over the Trefis forecast period. Transaction fees account for 22% of our price estimate of MasterCard’s stock.

The DOJ investigation is focused on aspects of Visa’s debit card business, as well as a new fee being charged in the wake of mounting Dodd-Frank regulations on credit and debit processors. Visa’s new fee would require merchants to pay for unwanted debit and credit cards, financially force the merchant into choosing unwanted cards and reduce merchants’ competitive choice of card network.

The Electronic Payments Association and its Council for Electronic Billing and Payment (CEBP) released today results of a study that documents volume, causes, and costs of bill payment exceptions[1] across several payment channels. The 2012 Exceptions Benchmarking Study reveals that 0.58 percent of total bill payments (including checks, ACH, cards and cash payments) in 2011 were not able to be posted accurately upon receipt by billers. Based on this exception rate, it is estimated that 130 million payments required exception handling, costing the industry approximately $720 million annually.

The not-so-secret dirty little secret about mobile payments is that consumer adoption has been slow, maddeningly so. There have been some notable successes. Person-to-person payments are taking off in developing markets and with the unbanked. On the retail side, Starbucks' has a hit with its extremely successful mobile payment app. The company's app has been used for more than 42 million transactions since its launch in January 2011.

Visa Inc. (V) shares slid as much as 4.7 percent after the No. 1 payment network disclosed a U.S. antitrust probe into its pricing and strategy.

MasterCard reported U.S. debit card purchase volume of $111 billion in the first quarter, up 19.4% from a year earlier. U.S debit purchase transactions grew 19.7% to 2.72 billion. The dollar-volume growth nearly doubled the 10.7% year-over-year growth in 2011’s first quarter.

PayPal's not just focusing on merchant services these days. The company announced it is teaming with regional bank The Bancorp Bank to provide a person-to-person solution allowing the bank's customers to send and receive funds using PayPal's platform.

On May 1, 2012 the Federal Reserve for the first time announced hard data on the law’s practical effect, and Card Hub’s 2012 Impact Study concluded that the law has ended up costing banks almost $8.4 billion on an annual basis ($8.06 billion for large banks and $329.4 million for small banks). Please find the latest updates below.

Cyber insecurity is an emergent threat, and America is unprepared to win on the digital battleground. Today, our critical infrastructure can be destroyed through cyber attack: power plants, hospitals, even stoplights. Last year alone, cyber breaches cost US companies about $100 billion. It begs the question: why haven’t we acted on cybersecurity yet?