Mobile Payment Industry News: 10/28/09

Wednesday, October 28, 2009

Analysts: Processors Must Seek Growth in Non-Credit Card Markets

Digital Transactions News: With credit card growth sputtering, an expanding debit card market will help lift transaction processors’ volumes for the foreseeable future, according to new research from Goldman Sachs & Co. The investment bank also predicts processors will find robust growth markets in nascent channels like mobile payments and established debit-related markets like prepaid cards.

Debit is seen as a growth engine, offsetting in part the slump in credit. U.S. debit volume will hit $1.187 trillion this year and will exceed credit card volume in 2010, at $1.284 trillion, according to Goldman’s research. Those figures, which include signature and PIN debit traffic at Visa and MasterCard, represent growth rates of 5.4% and 8.2%, respectively, leading the Goldman analysts to nominate the debit market as the “undisputed leader” as a processor growth market.

Read the Article in Full at DTN

Bill Lifting US Online Gambling Ban Seen Raising $42B In Revenue

By Corey Boles * OCTOBER 28, 2009, 5:33 P.M. ET

Of DOW JONES NEWSWIRES

WASHINGTON (Dow Jones)--A measure decriminalizing many forms of Internet gambling would raise nearly $42 billion for the U.S. Treasury over the next decade, according to an analysis conducted by a non-partisan congressional scorekeeper. The Joint Committee on Taxation said that after reviewing legislation that would lift an online gambling ban, it concluded the move would generate $41.8 billion over 10 years. The legislation would allow Internet poker, but continue a ...

Quote of the Day: Inside the Browser is Perfect Place for Criminals to Be...

Quote of the Day

“The browser is where the sensitive information is when users are shopping and banking online,” says Mickey Boodai (left), CEO of Trusteer, a vendor of software to protect against financial malware attacks. “Inside the browser is the perfect place for criminals to be.”

Editor's Note: Our PCI Certified PIN Entry Device NEVER allows financial data (card numbers/online banking authentication) to EVER enter the browser. The data is Triple DES DUKPT Encrypted INSIDE our device and the encrypted packet is sent via a conduit (Internet, not browser) to it's destination where it is unencrypted. In the unlikely event the packet is intercepted, the encrypted information is useless gobblygook. They would need the key to unlock the encryption and each transaction has a Derived Unique Key Per Transaction. (DUKPT)

1.2 Billion Reasons Banks Should Choose HomeATM

Innovation in alternative payment products has been primarily outside the banking world. Which is exactly why banks should look to HomeATM's secure technology for online banking log-in, real-time money transfers and credit, debit and PIN debit transactions. Otherwise...

Research consulting firm Celent estimates that by 2012, banks will see a decline of $1.2 billion in interchange revenue due to increasing acceptance of online alternative payments."

Banking institutions should be adopting payment options of their own – for their customers as well as merchants. HomeATM provides that capability with our PCI 2.x Certified PIN Entry Device. It would help banks to retain customers and expand their merchant offerings.

The truth is, HomeATM is NOT an alternative payment at all. Our transactions are as mainstream, thus conventional as a brick and mortar transaction. Banks should be embracing what we do because we provide the safety net against the $1.2 Billion interchange revenue falling to alternative payment mechanisms.

The bank issues the card, the bank issues the PIN. All that is left to finish the equation is for the bank to issue the Card and PIN Reader, and there is only ONE PCI Certified Device in the world to choose from.

Once equipped with our device, consumers are enabled to use mainstream...i.e., "conventional" (card present) approach to eCommerce transacting, thus eliminating the leading cause of fraud...which, happen to be "Card Not Present" transactions. How do we eliminate CNP fraud?

By changing the web environment from CNP to Card Present. That would do it, would it?

In addition, based on the fact that all transactions are done outside the browser space, (our device instantaneously Tripe DES and DUKPT encrypts both the Track 2 data and the PIN inside the device so that the data is NEVER in the clear) banks would provide their customers with a secure environment (separate machine) with which to conduct e-Commerce and online banking.

Security Creates Trust, Trust Creates Peace of Mind,

Peace of Mind Creates Loyalty, Loyalty Provides Security

That trusted environment would equate to peace of mind...and that peace of mind would equate to loyalty...and that loyalty would equate to securing their customer base, thus reducing the significant threat posed by attrition. (49% of online banking customer would switch banks if they or someone they knew was a victim of card fraud - ACI Worldwide/September 2009)

Additionally, a secure environment would attract those fearful about the lack of security, vastly improving the customer acquisition model and thus value proposition of our technology.

"Conventional" wisdom dictates that banks would not only retain a larger share of the $1.2 Billion they are projected to lose in interchange revenue, but they would increase the number of transactions, thus revenue from said transactions, by injecting a badly needed mainstream approach to online banking, by replicating ATM authentication, and eCommerce, by replicating brick and mortar...credit, debit and PIN debit transactions.)

Oh, did I happen to mention that Celent also estimated that by 2013, online payments will climb to $268 billion and 30% of those payments will come from alternative payment sources. (that projects to over $75 BILLION in LOST revenue to banks)

This increased market acceptance will certainly move alternative payments into the mainstream, and we can provide banks with the means to help them prevent that from happening.

Instead of consumers helping to move alternative payments to the mainstream,
HomeATM can help banks move mainstream to the consumers!

Fiserv Enriches the Online Bill Payment Experience with CheckFree RXP Enhancements

Fiserv, Inc. announced this morning that CheckFree RXP, the industry's leading online bill payment services platform, is being updated with features designed to increase consumer usage of online billing and payment. The new features, which include a bill pay widget, a tool for managing fee-based payments, and enhanced electronic bill activation and storage are being deployed via "Feature Packs." Feature Pack updates are deployed centrally and enable the seamless implementation of new functions ensuring that the Fiserv network of financial institutions, billers and their customers have access to the most up-to-date online bill payment capabilities.

Fiserv Enriches the Online Bill Payment Experience with CheckFree RXP Enhancements

New features facilitate usage of online payments and electronic bills while providing consumers access to faster fee-based payment options

Brookfield, Wis., October 28, 2009 - PIN Payments News Blog - Fiserv, Inc. (NASDAQ: FISV), the leading global provider of financial services technology solutions, today announced that CheckFree RXP, the industry's leading online bill payment services platform, is being updated with features designed to increase consumer usage of online billing and payment. The new features, which include a bill pay widget, a tool for managing fee-based payments, and enhanced electronic bill activation and storage are being deployed via "Feature Packs." Feature Pack updates are deployed centrally and enable the seamless implementation of new functions ensuring that the Fiserv network of financial institutions, billers and their customers have access to the most up-to-date online bill payment capabilities.

Bill Pay Widget

The bill pay widget makes it easy for consumers to schedule bill payments from the bank or credit union's online banking home page. The widget is a condensed display of key criteria, including the biller to be paid, the pay date and the amount, which allows a user to make a payment quickly to any biller they have previously paid. The widget can be integrated into any page within the online banking service, enabling consumers to schedule a payment through the widget directly rather than visiting a dedicated bill payment page. This prominent placement keeps bill payment "top of mind" for current users and exposes the service to potential new users.

"Fiserv primary research and our experience with some of the most innovative financial institutions in the industry indicate that one of the best ways to encourage consumers to change their behavior and try a new online service is to make it readily available and highly visible," said Erich Litch, senior vice president and general manager, Consumer Services, Fiserv. "The average online banking user logs into their service 15 times per month. Integrating bill pay more seamlessly into the online banking home page makes it more easily accessible during these frequent visits, which can lead to increases in adoption, usage and on-time payments."

Clients of CheckFree RXP from Fiserv will be able to launch the bill pay widget in February 2010.

Overnight Check Payments and Fee-Based Service Management

Javelin Strategy & Research forecasts that 43 million households will make an expedited payment in 2010, and 25 percent of these payments will be made through a financial institution.

The CheckFree RXP overnight check payment option meets a need for fast payment delivery to billers with which Fiserv does not have a direct electronic payment connection, such as a local insurance company or other small business. Consumers can select the overnight check option to quickly pay these billers, thereby avoiding late fees or interruption of service. Upon delivery of the payment a tracking number is sent to the consumer via email for his or her records.

Overnight check payments will incur a fee, which can be set by the financial institution. This fee may be significantly less expensive than a late fee and less damaging than the impact the consumer could incur if the payment did not arrive overnight.

In order to facilitate the management of various fee-based payments, such as overnight checks, a fee manager feature is being added to CheckFree RXP. Fee Manager allows a financial institution's customer base to be segmented into tiers, each of which can be assigned service pricing at a level appropriate to their relationship with the bank. For example, users may be charged a lower fee for an expedited payment if they maintain a premium account. This tier structure can simplify the use of variable fees for online payment services and will allow institutions to differentiate among account types.

E-Bill Activation and Extended Payment History

According to the Consumer Billing and Payment Trends survey conducted by Fiserv each year, consumers who receive electronic bills (e-bills) at their financial institution website are more loyal to the institution and the biller from which they receive the bill, use more financial institution products and services and are more satisfied overall. In order to encourage the use of e-bills, CheckFree RXP from Fiserv now prompts consumers to sign up to receive an e-bill whenever they add a new biller.

"Experience has shown that e-bill usage is heavily influenced by the promotion of e-bills directly within the online bill payment service," said Litch. "When Fiserv promoted e-bill activation through the addition of a thumbnail image of bills in a previous Feature Pack, activations rose 30 percent. Enabling consumers to easily sign up for e-bills within the process of adding a new biller can remove some of the confusion and barriers to adoption and streamline the activations of e-bills."

In order to make the use of online billing and payment more convenient, users are also able to access 18 months of their payment history online beginning in October 2009.

About Fiserv

Fiserv, Inc. (NASDAQ: FISV) is the leading global provider of information management and electronic commerce systems for the financial services industry, driving innovation that transforms experiences for financial institutions and their customers. Ranked No. 1 on the FinTech 100 survey of top technology partners to the financial services industry, Fiserv celebrates its 25th year in 2009. For more information, visit www.fiserv.com.

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