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NF Edition #520 - 8/26/16
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Highlights this week...

EMV: The Anniversary - Complete the Survey, Get Results
Now that the EMV liability shift is quickly approaching its one-year anniversary, TSG is interested in gauging the current status of EMV implementation in the U.S.

Click to complete the brief survey
Deadline for completion is August 31st

Benefit for Completing
Participating companies will receive survey results. All data collected will be kept confidential, anonymous and will only be presented in an aggregated fashion.

New eReport - U.S. Merchant Acquiring: Pricing & Attrition Focus

This highly valuable report answers the most pressing questions that surface in the merchant acquiring community.

The report offers expert insight and exclusive data (nearly 25 charts/figures) on several key areas of the acquiring space including:
  • Industry attrition with a focus on the SMB segment
  • Expected future margins for ISOs and acquirers
  • Competition and customer acquisition costs
  • The identification of what merchants are seeking in a payments processor
  • A look at the ISO competitive landscape
  • Analysis on the future interchange fees
Preview  |  Purchase - priced at $6,300

America’s Biggest Banks Have a New Name for Their Venmo-Killer: Zelle
The Wall Street Journal | 8.24.16

May require subscription. U.S. banks want their customers to “zelle” each other. That is the new name for the banking industry’s reinvigorated person-to-person payment service that competes with Venmo, the popular money-transfer service from PayPal Holdings Inc. Early Warning, a bank-owned entity that is running the payment service, confirmed the name after The Wall Street Journal reported it earlier Wednesday. The service, which allows customers to use their mobile phones to zap money from their banks’ accounts to accounts at other financial institutions, has been operating for several years under the name clearXchange. That name, however, was never promoted as a corporate brand.

Related: U.S. Bank Group to Launch Zelle Instant Payments Brand in 2017

TSG in the News: Gas Stations Fight Hackers - But They're Going to Have to Pay for It
CNBC | 8.26.16

Gas stations and convenience stores are some of the last U.S. retailers to make the upgrade to the EMV card platform (some ATMs also have until Oct. 1, 2017, to make the technology switch). Because many hackers have been disrupted by retailers, they have increasingly targeted convenience stores and ATMs lacking the security measures, experts said. "From a criminal perspective, that window of opportunity is shrinking," said Jared Drieling, business intelligence manager at payment data analysis firm The Strawhecker Group. "There's going to be a rush to get those updated."

POS Malware Hits Two Hotel Chains
Bank Info Security | 8.26.16

Two hotel chains are warning that they've suffered point-of-sale malware infections that compromised customers' payment card data. Both say they were alerted to related card fraud by the U.S. Secret Service and that they're now assisting law enforcement agencies' investigations. Millennium Hotels & Resorts North America, based in Denver, says that a malware infection that lasted more than three months resulted in a breach of card data from "food and beverage POS systems" at all 14 of its U.S. hotels. Separately, Noble House Hotels and Resorts, based in Kirkland, Wash., warned that systems at one of its properties were infected with POS malware for a two-month period.

Bill Ready: PayPal 'Miles Ahead', Welcomes Rivals to the Ecosystem
The Australian Business Review | 8.23.16

PayPal’s global head of product, Bill Ready, is confident his company’s dominance in digital payments is set to continue, declaring PayPal is just scratching the surface of its potential as it enters the Fortune 500 for the first time. Mr Ready, who remains responsible for PayPal’s Braintree unit after it was acquired in 2013 and runs PayPal’s engineering operations, said the company was miles ahead of the competition. “This is something we can solve better than anyone else in the world,” he said.

Economy in U.S. Grew at 1.1% Rate, Slower Than First Estimated
Bloomberg | 8.26.16

The U.S. economy grew less than previously reported last quarter on lower government outlays and a bigger depletion of inventories, capping a sluggish first-half performance propped up mainly by consumer spending. Gross domestic product, the value of all goods and services produced, rose at a 1.1 percent annualized rate, down from an initial estimate of 1.2 percent, Commerce Department figures showed Friday in Washington. Household spending, the biggest part of the economy, was revised higher on used-car sales.

Visa And MasterCard's Latest EMV Window Dressing
Forbes | 8.22.16

Card giants Visa and MasterCard have been making headlines of late for introducing new software aimed at speeding up the checkout process for consumers using new chip-enabled or EMV (Europay, MasterCard, Visa) credit cards. While any effort by the major card brands to improve the process is welcome, these software fixes are more window dressing than they are serious improvements. MasterCard’s M/Chip Fast solution and Visa’s Quick Chip program are the latest attempt by the card brands to try to smooth over the poorly planned and executed EMV transition – where Americans transitioned from swiping their old magnetic stripe credit card to dipping their new chip card, while retailers began taking responsibility for fraudulent transactions made if they weren’t using chip technology.

Related: Why the Chip-Card Transition in the US has Been Such a Disaster

Visa And MasterCard Deny Home Depot’s Claims But Shed No Light on Disputed Fees
Digital Transactions | 8.24.16

In new court filings, Visa Inc. and MasterCard Inc. are denying the antitrust allegations that The Home Depot Inc. leveled against them in a June lawsuit. That’s no surprise, but the networks’ responses leave some arcane network fees shrouded in mystery. Visa and MasterCard filed answers to Home Depot’s lawsuit Aug. 19 in U.S. District Court in Atlanta. In them, the networks deny the home-improvement retailer’s allegations that they set “supracompetitive” interchange rates, conspired with banks to avoid competing in the credit and debit network markets, and tried to thwart the use of PIN authentication with the new EMV chip cards in the U.S. 

Costco's Credit Card Nightmare Just Got Even Worse
Yahoo! Finance | 8.22.16

Costco’s marriage to Visa has been rocky pretty much from the start — and this weekend shoppers faced a new problem, despite assurances that issues in the relationship were being ironed out. On Friday evening, a number of Costco members received emails from Citi, the issuer of the new Visa-Costco credit card, alerting them that their credit card accounts had been closed. In at least some cases, members reported that they received emails addressed to other people that contained the last four digits of other users’ account numbers, raising concerns that their accounts had been hacked.

eCommerce is Still Really Hard - Even After Jet and Dollar Shave Club Fetched $4B
Recode | 8.11.16

Up until a month ago, e-commerce startups were on the outs with many investors. The conventional wisdom in venture capital was that the risk-to-reward potential of companies in the category was typically not worth it, in part thanks to Amazon’s growing dominance. But a funny thing happened on the way to group-think-land: Two gargantuan acquisitions shook the entire industry from the ground up.

Case Study: Small Retailers are Going Bigger When it comes to Payments Security

The Point of Sale News | 8.24.16

Data breaches are damaging for every company that suffers them, no matter the size. Unlike their larger peers, however, small businesses frequently aren't given the chance to recover from the financial and reputational impact of a breach. According to a report from The New York Times, sixty percent of all online attacks in 2014 targeted small and mid-size businesses.1 That same year it was found that nearly three-quarters of companies that "suffer major data loss" shut down within 24 months.

Tune In To Payments Reality Check!
PYMNTS | 8.22.16

“Reality Check” was a TV show that aired in 1995 about a couple of kids who moved into a house and found a computer that was left behind by the previous owner. These kids – Samantha and Nick – soon discovered that the computer was not your run-of-the-mill ugly beige Compaq. Stuck inside the computer was the original owner of the house, a guy named Jack Clark. The storyline, of course, seems a bit at odds with the title of the show (which not surprisingly lasted only one season) but it stayed with me.

Payment Innovation: Take the Better Option Now
TechCrunch | 8.24.16

As technology becomes even more central to our lives, innovation is spilling over into everything on a global scale, including retail. And when small and great sums of money are on the line, you can be sure all parties involved will work tirelessly to protect themselves. Consumers are faced with more payment options at the check-out counter and online than in any other period in history: cash, credit, debit, mobile payments, biometrics — the list goes on. The embrace of advances in fintech inspires a notion of security and reduction in fraudulent activity. However, it’s necessary to examine what requirements should be prescribed given the digital divide that still exists in both developed and emerging economies.

Retailers, Payments Association Side with Australian Banks Over Apple Pay Negotiations
Apple Insider | 8.23.16

In separate responses to the Australian Competition and Consumer Commission, Coles Supermarkets, the Australian Retailers Association, Bluechain, the Australian Payments Clearing Association and Australian Settlements Limited all voiced support in favor of establishing digital wallet access standards, ZDNet reports. The letters were posted as the ACCC denied the banks interim approval to negotiate last week.

Samsung Pay Celebrates One Year With a Whopping 100M Transactions Processed
Digital Trends | 8.24.16

It looks like Samsung Pay can hold its own against the likes of Apple Pay and Android Pay. Samsung recently announced that only one year after the launch of its mobile payment service, it has handled a hefty 100 million transactions. Not only is Samsung Pay being used a lot, but it’s being used in a lot of places too — Samsung Pay is being used in a total of seven different countries, and the company is prepping for a major expansion of the service later this month.

Shopify Launches its POS App and Card Reader in the UK
TechCrunch | 8.23.16

Shopify is launching its retail hardware and point-of-sale app for merchants in the UK. The reader supports tap, chip and swipe payments, letting retailers accept both contactless and traditional card-based payments, and the free app works in tandem with the reader device on either iPhone or iPad. The Shopify app and reader combo means sellers can accept a range of payment options at festivals, pop-up shops, or in permanent stores, and it also ties the in-store shopping experience to a merchant’s online store, if they’re using Shopify to power their e-commerce.

Android Pay Automatically Adds Walgreens Loyalty Points
Engadget | 8.23.16

Despite Android Pay's promise of simplicity, getting loyalty points is still a small hassle -- you either have to carry the store's card or have the cashier scan it from your phone. Walgreens has revealed that it's the first retailer to integrate rewards points directly with Google's payment system. All you need to do is place your phone near the payment terminal to scan in your card, then tap it again to actually pay.

CFPB Orders First National Bank of Omaha to Pay $32M Related to Cardholder Add-on Practices
The Green Sheet | 8.25.16

The Consumer Financial Protection Bureau (CFPB) has ordered First National Bank of Omaha to provide $27.75 million in relief to roughly 257,000 consumers harmed by illegal practices with credit card add-on products. The bank used deceptive marketing to lure consumers into debt cancellation add-on products and it charged consumers for credit monitoring services they did not receive. First National Bank of Omaha will also pay a $4.5 million civil money penalty to the CFPB.

Singapore Proposes New Regulatory Framework to Handle Payments Innovation
Finextra | 8.25.16

Singapore's central bank is to streamline its regulatory framework to accommodate new innovations in payments systems and establish a National Payments Council to promote interoperability and common standards among competing services.The consultation paper from the Monetary Authority of Singapore (MAS) proposes to merge legislative rules under the the Payment Systems (Oversight) Act (PS(O)A) and the Money-changing and Remittance Businesses Act (MCRBA), which govern stored value and remittances respectively.

Analysis: SWIFT-Related Heists: Who's to Blame?
Bank Info Security | 8.22.16

A Reuters report claiming executives at SWIFT for years neglected the security of its bank-to-bank messaging system has stirred debate among security and anti-fraud experts. In the wake of the $81 million SWIFT-related cyberheist waged against the central bank of Bangladesh, and several other similar incidents, many experts acknowledge that much more needs to be done to ensure that interbank transactions routed through SWIFT are properly authenticated, monitored and secured. But while some experts call for SWIFT to take a leadership role on security, others argue that banks, not SWIFT, should take the lead.

NACHA Announces Approval of Rule that Establishes Third-Party Sender Registration Requirements
NACHA | 8.22.16

The Electronic Payments Association® announced  that a new rule was approved that will require Originating Depository Financial Institutions (ODFIs) to identify and register their Third-Party Sender customers. The registration process will promote consistent customer due diligence among all ODFIs, and serve as a tool to support NACHA’s continuing efforts to maintain ACH Network quality.

Years of Fed Missteps Fueled Disillusion With the Economy and Washington
The Wall Street Journal | 8.25.16

In the past decade Federal Reserve officials have been flummoxed by a housing bubble that cratered the financial system, a long stretch of slow growth they failed to foresee and inflation persistently undershooting their goal. In response they engineered unpopular financial rescues, launched start-and-stop bond buying and delayed planned interest-rate boosts. “There are a lot of things that we thought we knew that haven’t turned out quite as we expected,” said Eric Rosengren, president of the Federal Reserve Bank of Boston. “The economy and financial markets are not as stable as we previously assumed.”

UK Banks Seen Losing Customers After Brexit
Reuters | 8.23.16

Aug 23 British banks could lose a good number of European and domestic corporate customers in the aftermath of Britain's vote to leave the European Union in June, known as Brexit, according to a private study released on Tuesday. About 40 percent of European companies and nearly 25 percent of U.K. companies already have or are planning to reallocate their banking business due to Brexit, the survey from Greenwich Associates showed.

Existing-Home Sales Wobble as Inventory Stays Tight and Prices March Higher
MarketWatch | 8.24.16

Sales of previously owned homes fell in July as tight inventory continued to weigh on the market and prices pushed higher. Existing-home sales declined 3.2% to a seasonally adjusted annual rate of 5.39 million, the National Association of Realtors said Wednesday. That was 1.6% lower than year ago. The July figures were lower than the 5.48 million pace forecast by economists surveyed by MarketWatch.

Small Businesses Expecting Growth, but Face Challenges Accessing Working Capital, according to CAN Capital's Small Business Health Index
PR Newswire | 8.22.16

Small businesses are overwhelmingly positive in their expectations for the next 12 months, with 64 percent anticipating growth, according to the Small Business Health Index from CAN Capital, the market share leader in alternative small business finance. With growth comes the need for funding to finance expansion and new projects, but 42 percent of small business owners say it's quite or extremely challenging to gain access to working capital.

TSYS Names Karim Ahmad Head of Global Product and Innovation
TSYS | 8.22.16

TSYS announced that Karim Ahmad, a veteran of the financial services and consulting industries, has been named executive vice president of global product and innovation, effective September 6. He will report directly to Pam Joseph, president and chief operating officer of the company. “We are excited to welcome someone with Karim’s industry knowledge and experience to our executive leadership team at TSYS,” said Joseph. “He will focus on accelerating our product development efforts and speed-to-market capabilities, positioning TSYS as a thought leader in all aspects of the payments industry.”

Global Payments to Provide EMV and Contactless Mobile Payments Solution to Mary Kay Independent Beauty Consultants in Canada
Global Payments | 8.23.16

Global Payments Inc., a leading worldwide provider of payment technology services, is pleased to announce a relationship with Mary Kay Cosmetics Ltd., to provide EMV and contactless mobile payments acceptance to their Independent Beauty Consultants in Canada. Global Payments' mobile payments solution provides Mary Kay consultants with a Bluetooth-enabled reader that pairs with their Apple iOS or Android smartphone or tablet, for simple and more secure on-the-go credit and debit acceptance. The solution is designed to feature an in-app inventory catalogue, digital receipts and a portal that is intended to provide real-time insights into each consultant's business operations, as well as detailed reporting.

Ant Financial, Tencent Win Digital Wallet Licenses in Hong Kong
Bloomberg | 8.25.16

Ant Financial and Tencent Holdings Ltd. have won approval to operate digital wallets for customers in Hong Kong, a significant step in the two Chinese internet giants’ overseas expansion. The license helps the companies bounce back from an earlier setback to their growing payments businesses. China’s central bank in July banned people who didn’t own a mainland bank card from storing money in Ant Financial’s Alipay or Tencent’s WeChat Pay accounts, depriving them of a large potential customer base of overseas Chinese. But the Hong Kong Monetary Authority has now granted approval for users in the city to store money in the local version of their online wallets.

Discover Bank Receives Top Honors from Department of Defense for Military Work-at-Home Program
Discover | 8.25.16

Discover Bank recently received the Employer Support of the Guard and Reserve’s (ESGR) 2016 Pro Patria award in Delaware and was recognized as a national semifinalist for the 2016 Secretary of Defense Employer Support Freedom Award for the company’s military work-at-home program. Discover’s award-winning program, now in its fourth year, provides training, resources and job opportunities for military personnel and their family members seeking careers within the financial services industry.

Ingenico Group and Datacap Deliver Seamless and Secure Pay-at-the-Table Solution to the Restaurant Industry
Business Wire | 8.24.16

Ingenico Group, the global leader in seamless payment, and Datacap Systems, an integrated payments middleware provider, announced the installation of its Pay-at-the-Table solution at Uncle Oogie’s, a New Jersey and Philadelphia-based chain of pizzerias. Using Ingenico Group’s smart terminals, Datacap’s point of sale partner, PDQ Signature Systems was able to streamline the Pay-at-the-Table implementation for Uncle Oogie’s.

U.S. Bancorp Strikes Robo-Advisory Deal with BlackRock Unit
American Banker | 8.24.16

U.S. Bank jumped into the robo world by striking a deal with FutureAdvisor. It plans to make the digital investment service available to its customers next year. The Minneapolis bank is planning to aim its robo service toward "upcoming investors," which often will be millennials, but not necessarily so, said Mark Jordahl, president of U.S. Bank Wealth Management. The new service will combine technology from FutureAdvisor with a dedicated team of advisers from U.S. Bank. That combination was especially interesting to the bank, he said.

BlueStar Expands VARs Offerings with TailWind Partnership
The Green Sheet | 8.24.16

BlueStar, a leading global distributor of Digital Identification, Mobility, Point-of-Sale, RFID, Digital Signage, and Security technology solutions, is pleased to announce a partnership with TailWind Solutions. TailWind, founded in 2006, is a global company working to create point of sale (POS) mounting solutions for card payment machines, tablets, and technologies. Since it was founded, the company has grown exponentially, increasing sales to a global level, with channel partners in more than 40 countries and customers in all sectors where face-to-face card payments are critical.

Conexxus and National ATM Council Announce Issuance of Skimming Detection & Deterrence Guide for Convenience Stores ATMs

PR Newswire  | 8.25.16

Conexxus and the National ATM Council (NAC) today announced issuance of their jointly developed ATM Skimming Detection & Deterrence Guide (Guide) for use at U.S. convenience stores. The Guide was created to help ensure that America's convenience stores and retail ATM providers maintain their excellent track record for providing safe and secure transactions at in-store ATMs, despite a heightened near term card "skimming" risk from current implementation of EMV at U.S. ATMs.

Paytronix Amps Up Customer Experience With Pay at Table and Campaign Center Analytics
MarketWired | 8.23.16

Paytronix Systems, Inc., a leading provider of reward program solutions to restaurants and retailers, today announced upgrades to the Paytronix Platform that allow users to amp up both the customer experience and merchant experience. The new capabilities include mobile Pay at the Table, Scoring, Survey Tools, and a new Account Filter user interface. 

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