The Strawhecker Group
NF Edition #505 - 5/13/16
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Highlights this week... Don't Forget to Check Out TSG's Newest eReports
The Strawhecker Group has just released two valuable, new, eReports - The U.S. Merchant Category Encyclopedia and the Merchant Processing Pricing Benchmark Study. Learn more about each.

Jumbo Acquirer Pricing Advantage Dissipating: TSG Report 
Digital Transactions | 5.10.16

Pricing advantages once held by super-large acquirers—those whose merchants process more than 3 million monthly credit and debit transactions—appear to have retreated, according to the Merchant Processing Pricing Benchmark Study recently issued by The Strawhecker Group.These jumbo acquirers had, on average, the lowest amounts for their processing and authorization fees says Robert Schmitz, Senior Associate at the Omaha, Neb.-based payments consultancy. The Strawhecker report did not include the actual pricing averages for the jumbo or smaller groups of acquirers, defined as small for those with up to 250,000 in monthly transactions; medium, 250,001 to 1 million; and large, between 1,000,001 and 3 million.

Learn more about TSG's Merchant Processing Pricing Study.

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Sen. Durbin Blasts Credit Card Group for Botched Rollout of More Secure Cards
Star Tribune | 5.12.16

Illinois Sen. Dick Durbin on Thursday blasted the card network-dominated group that sets the standards for chip-enabled plastic payment, accusing it of mishandling the rollout of more secure credit and debit cards, lacking transparency and refusing, at the expense of retailers, to promote PIN authentication. Durbin, a longtime crusader against the major credit card companies, wrote a March letter demanding that EMVCo, the group that sets standards for the chip technology, explain its governance and decisionmaking in light of the snags that EMV cards have run into since their introduction in 2015.

TSG in WSJ - More Chip-Card Headaches, This Time for Merchants
The Wall Street Journal | 5.10.16

May require a subscription to read. Chargebacks among small and medium-size merchants rose 15% in the fourth quarter from a year earlier, according to a recent survey by The Strawhecker Group, a payments consulting firm. The industry believes the volume of chargebacks has likely risen since then, because the fourth quarter included only a few weeks under the new rules and it often takes a while for the costs to flow through to merchants. TSG, which surveyed 3.5 million small-and-medium-size card-accepting merchants, didn’t put a dollar figure on the chargebacks. Other experts said the total was probably in the tens-of-millions of dollars and will likely continue to rise.

Walmart Sues Visa Over Chip Transactions with Debit Cards
USA Today | 5.11.16

Walmart is suing Visa for allowing customers to verify chip-enabled debit card transactions with a signature instead of a PIN. The lawsuit filed Tuesday in New York Supreme Court says that Visa requires Walmart to accept signature-based transactions for chip debit cards, which Walmart says are a less secure method of payment than PIN-based payments and more expensive to conduct over Visa's network. "PIN is the only truly secure form of cardholder verification in the marketplace today, and it offers superior security to our customers," says Walmart spokesman Randy Hargrove.

Related:

Once Again, Thieves Enter Swift Financial Network and Steal
Dealbook | 5.12.16

Thieves have again found their way into what was thought to be the most secure financial messaging system in the world and stolen money from a bank. The crime appears to be part of a broad online attack on global banking. New details about a second attack involving Swift — the messaging system used by thousands of banks and companies to move money around the world — are emerging as investigators are still trying to solve the $81 million heist from the central bank of Bangladesh in February. In that theft, the attackers were able to compel the Federal Reserve Bank of New York to move money to accounts in the Philippines.

Ingenico ePayments Bulks Up on Acquirers to Raise Omnichannel's Volume
ISO & Agent | 5.11.16

To expand the reach of its global e-commerce services, Ingenico ePayments is building up a vast network of connections to merchant acquirers, hoping to gain a competitive edge as the demand grows for omnichannel payments. The online and mobile commerce division of Paris-based Ingenico Group has worked to bring its total merchant-acquirer relationships to more than 1,000 in recent months, said Joe Leija, who was named general manager of Ingenico ePayments for North America on May 11. Previously he was a manager at Sage Payments Services' U.S. operations.

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Visa Europe: 1-in-5 In-Person Card Transactions are Now Tap and Pay 
Finextra | 5.11.16

Visa Europe has put out another batch of contactless payments metrics, showing that one-in-five in-person card transactions it processes are now tap and pay. The card giant says that it has seen three billion contactless payments in Europe in the last year, nearly triple the amount in the previous 12 months. Europeans used their cards 360 million times in April alone, with the average value rising 12% to EUR13.83.

Two of Canada's Largest Banks Now Support Apple Pay
The Verge | 5.10.16

Starting this week the Royal Bank of Canada and the Canadian Imperial Bank of Commerce, two of Canada's biggest banks, will allow their customers to use Cupertino's mobile payments app. The remaining trio that completes Canada's Big Five — TD, Bank of Montreal, and Scotiabank — are expected to sign on in the coming months. Although the payments app launched in the US in October 2014, the service was introduced across the border 13 months later, in November.

Apple Pay Now Available to Canadian MasterCard Cardholders
MasterCard | 5.10.16

MasterCard announced it will bring its cardholders Apple Pay, which is transforming mobile payments with an easy, secure and private way to pay that’s fast and convenient. MasterCard credit cardholders banking with Royal Bank of Canada (RBC), Canadian Imperial Bank of Commerce (CIBC), Canadian Tire Bank and ATB Financial can pay with Apple Pay starting today, and cardholders who bank with BMO Financial Group (BMO) will be able to use Apple Pay in the coming weeks.

Barclays to Launch Contactless Payment App for Android Phones
The Guardian | 5.12.16

Barclays is launching the UK’s first Android contactless payment service, which will allow customers to use their smartphone to “wave and pay” in shops, restaurants and across the London transport network. Hot on the heels of Apple Pay, and offered as a direct rival to Google’s Android Pay which launches in the UK this year, Barclays’ Contactless Mobile will enable customers to pay with their Android handset in the same way as a contactless bank card. The service is expected go live in June.

Wendy’s: Breach Affected 5% of Restaurants
Krebs on Security | 5.11.16 

Wendy’s said that an investigation into a credit card breach at the nationwide fast-food chain uncovered malicious software on point-of-sale systems at fewer than 300 of the company’s 5,500 franchised stores. The company says the investigation into the breach is continuing, but that the malware has been removed from all affected locations. “Based on the preliminary findings of the investigation and other information, the Company believes that malware, installed through the use of compromised third-party vendor credentials, affected one particular point of sale system at fewer than 300 of approximately 5,500 franchised North America Wendy’s restaurants, starting in the fall of 2015.”

Verizon Breach Report Criticized
Bank Info Security | 5.11.16

Verizon's annual report into data breaches has triggered an avalanche of criticism that the company made critical errors when studying the most frequently exploited software vulnerabilities. The 2016 Data Breach Investigations report, released on April 27, is considered one of the most comprehensive annual guides on data breach trends, compiling data contributed by a wide range of computer security companies, law enforcement and government agencies. It also draws on more than 3,100 confirmed data breaches, an impressive sampling of attacks.

Bitcoin May Help Criminals, But Blockchain Can Help Thwart Fraud
BankThink | 5.11.16

We all know bitcoin as an edgy and anonymous cryptocurrency. It provokes strong opinions. Department of Justice officials reference it in connection with real-life crimes, just as made-up bad guys reference it in movies. But the underlying ledger technology behind bitcoin — the blockchain — should lack such negative connotations due to its capability of tracking users' activities in a rigorous way. While bitcoin is viewed as "secret currency," the technology behind the cryptocurrency is immensely useful to financial services companies in preventing hacking.

Checking in With Spear Phising, Criminals Check Out With Hotel Credit Card Data
Ars Technica | 5.10.16

Hotel chains focus on hospitality, but their security practices have made them entirely too hospitable a target for data theft. Hotels have been brutalized over the past year by a wave of point-of-sale system breaches that have exposed hundreds of thousands of guests' credit card accounts. And those attacks, as a recent episode described by Panda Security's Luis Corrons demonstrates, have become increasingly targeted—in some cases using "spear-phishing" e-mails and malware crafted specifically for the target to gain access to hotels' networks.

Fed to Delay Rate Hike Until September on Tame Inflation Outlook: Poll
Reuters | 5.12.16

The U.S. Federal Reserve will likely wait until September before raising interest rates again, stretching to nine months the time since its first hike in nearly a decade, as it waits for clear signs inflation is picking up, a Reuters poll found. This is the second time this year that economists have delayed their rate-hike expectations, casting doubt on the likelihood the Fed will be able to deliver two rate hikes this year as the U.S. Presidential election in November could make further policy changes sensitive.

The April Jobs Report in 9 Charts
The Wall Street Journal | 5.06.16

U.S. employers added 160,000 jobs in April, and the unemployment rate was unchanged at 5%. Here’s a look into what we can learn by diving into the details of the monthly employment report. Over the past year, the economy has added a total of 2.7 million jobs. This is a somewhat slower pace than was seen over the course of 2015 when the economy was adding about 3 million jobs a year.

Discover Rated Fourth among 100 Global Banks for Quality and Excellence in Banking 
Discover | 5.10.16

Discover rated fourth among 100 major global banks and was the only U.S.-based bank to receive four out of five stars as part of the quarterly Lafferty Bank Quality Ratings (LBQR). The new service from Lafferty Group evaluates quality and excellence in banking globally. “Receiving a top rating for quality is gratifying to us given the emphasis that we place on it at Discover,” said David Nelms, CEO of Discover. “We are focused on being a leading direct bank and payments partner and believe that if we serve our customers well, then our shareholders will benefit too.”

TSYS Signs Leading African Banking Group
TSYS | 5.10.16

TSYS announced that Ecobank, the leading pan-African banking group, has deployed the latest version of the PRIMESM payments solution platform, PRIME 4, to support its acquirer processing of MasterCard, Visa and UnionPay International point-of-sale (POS) transactions across 28 countries in Middle Africa. Ecobank has a major presence in Africa with more than 1,100 branches servicing over 10 million customers in 34 countries, making it one of the largest providers of financial products and services on the continent.

MAC Names New Board
The Green Sheet | 5.09.16

The Merchant Acquirers' Committee (MAC) is pleased to announce the results of its 2016 Board of Directors Elections. The new Board of Directors and Officers represent a broad range of experience and expertise from a wide variety of companies in the merchant acquiring industry.

Creditcall Achieves EMV Certifications with Five Major U.S. Processors
Creditcall | 5.11.16

Creditcall, the omni-channel payment gateway and EMV Kernel provider, adds TSYS and Heartland to already existing EMV certifications with leading U.S. processors including First Data, Chase Paymentech and Elavon. Secured for ChipDNA, Creditcall’s developer friendly EMV SDK for Windows, Linux, iOS and Android, together with Verifone’s VX 820  PIN pad and Miura Systems’ M010 PIN pad, this momentum equates to more choice and simplicity for developers.

Visa Teams Up with Marvel to Offer Financial Education through "Guardian" Comic Book
Visa | 5.07.16

Visa Inc. and Marvel Custom Solutions announced the release of a new educational comic book that teaches readers of all ages about personal finance. The new comic, Guardians of the Galaxy: Rocket's Powerful Plan, was released in conjunction with Free Comic Book Day. It combines Marvel's iconic Super Heroes with Visa's financial literacy expertise to introduce readers to fundamental money management concepts. Visa Inc. is also partnering with the Public Library Association (PLA) to make the new Marvel comic book available at public libraries nationwide. 

German iPad POS Startup Orderbird Closes $20M Series C
TechCrunch | 5.10.16

Timing is everything, right? Just a few days after recovering from a denial-of-service (DoS) attack, orderbird, which claims to be the leading iPad point of sale (POS) solution in German speaking markets, is announcing that it’s closed €20 million in Series C funding. Leading the round is Digital+ Partners, along with strategic investor Metro Group, who have put in a combined €16.5 million. Previous backer, the European payment-provider Concardis, has also participated again this time around but via a secondary listing.

Prologue Financials from Fiserv Brings Greater Speed, Accuracy and Efficiency to Financial Accounting
Fiserv | 5.11.16

Fiserv, Inc., a leading global provider of financial services technology solutions, announced the availability of Prologue Financials. The fully updated accounting suite features enhanced, built-in automation and controls and a newly designed user interface, enabling users to increase the efficiency of financial accounting processes. "Finance and accounting professionals are continually looking for better, faster and more cost-effective solutions to help streamline accounting, reporting and compliance processes."

US Petroleum Industry’s First Fuel Dispenser Payment Terminal That Is PCI PTS 4.0-Certified & Supports EMV Payments
LTP | 5.12.16

Gilbarco Veeder-Root, the world’s leading fueling systems provider, announced the launch of FlexPayTM IV as the next generation of its industry-leading line of EMV-certified dispenser-based payment terminals. Gilbarco jointly developed FlexPay IV with Verifone, a world leader in payments and commerce solutions, to enable gas stations and convenience stores to securely accept EMV (“chip card”) payments from consumers at the pump.

Groupon Just Sold Its Restaurant Software Business to a Startup
Recode | 5.09.16

Four years after Groupon acquired restaurant software business Breadcrumb, the commerce company has sold it to Upserve, a startup that also makes restaurant software, in an all-stock deal. The companies declined to disclose the exact size of the purchase. Breadcrumb was founded in 2011 with the goal of making checkout software -- known as point-of-sale software in the industry -- that retail operations could use to manage their business from an iPad. 

KCB Bank and GoSwiff Roll Out Mobile Payments in Rwanda During World Economic Forum's Africa Meeting
PR Newswire | 5.11.16

KCB Bank and GoSwiff, a global payment acceptance solutions provider, are rolling out a mobile payment solution (mPOS) for Rwandan merchants, to drive financial inclusion and digital payments in the country. The introduction of the mPOS solution, a first of its kind in Rwanda, coincides with the World Economic Forum in Kigali; which is emphasizing the need for Africa's key decision makers to pursue new approaches for structural transformation in response to rapid technological changes. 

TMG Financial Services Expands ATIRAcredit Card Rewards Program to Empower Charitable Giving through Points Redemption
TMG | 5.10.16

TMG Financial Services today announced an expansion of its ATIRAcredit card rewards program to empower charitable giving through points redemption. Expanding the reward redemption platform furthers an already robust list of ATIRAcredit cardmember benefits. ATIRAcredit’s Good Life Rewards offer three ways for cardmembers to redeem points: cash back; merchandise and gift cards; and travel, events and activities.

W.net Names Intel Exec Tinsley to Board
The Green Sheet | 5.10.16

Women’s Network in Electronic Transactions (W.net), the payments organization dedicated to women in payments, is pleased to announced Michelle Tinsley, director of the mobility and secure payment team in the Retail Solutions Division, at Intel®, has joined its 2016 Board of Directors. Tinsley brings more than 24 years of experience at Intel and is currently responsible for Intel’s efforts in setting global strategy for mobile retail devices and defining product strategies to solve end retailer problems.

Net Element's Unified Payments Launches Mobile Point of Sale for iOS
MarketWired | 5.12.16

Net Element, Inc., a provider of global mobile payment technology solutions and value-added transactional services, announced that Unified Payments launched a mobile point of sale ("Mobile POS") application that allows for mobile transactions in a card present or card not present environment. The free app is available today by visiting the Apple iTunes App Store.

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