Friday, May 30, 2003

Visa, Philips team to promote 'contactless' credit card

EE Times and Planet Multimedia report about the alliance of Visa and Philips to promote 'contactless' credit cards. See also the press release at the website of Philips.

Essentially they don't start a new thing, they just get along nicely for now:

The two global organizations have signed a Memorandum of Understanding (MOU) that outlines the scope of cooperation between the two companies. This agreement includes exploring the business requirements for secure payments utilizing contactless chip technology. Specifically, Philips and Visa are looking to identify joint business partners, such as hardware manufacturers and content providers, and to investigate developing business and technical models that meet their unique needs.

E-payments: what are they and what makes them different?

The former IPTS-ePSO forum has now moved to the European central bank and is starting its first discussions (see this page). One of the topics is what constitutes an e-payment. I hope to provide my share of input for that discussion as well; a framework for e-payments is underway (shortly to be published on this site).

Paying for supervision

Here in the Netherlands, not all supervised entities pay for their supervision. Insurers do, but banks don't. The Ministry of Finance now has started a consultation round on a new structure/regime. Essentially, the supervised banks and insurers pay the direct costs of supervision while the Ministry of Finance pays for the compliance/repressive and preventive costs.

See also the webpage of the Ministry of Finance (in Dutch).

Wednesday, May 28, 2003

Megapool stops on-line sales

Emerce reports that Megapool stops its on-line sales, due to the fact that, with its nationwide pricing on the Internet, it became too vulnerable to local shops that were competing on price.

Chip and PIN - start in UK

In the UK, the trial for Chip and PIN - transactions has started last week in Northampton. Chipcards and PIN replace the use of bank cards with magstripe and signature in an effort to combat fraud by implementing the EMV standard.

In the Netherlands, we will also face the move from magstripe to chipcard in the future. And we will soon be able to hear firsthand about the first experiences in a talk on June 18th, by Anthony Pickup, programme manager for the co-operative group. The speech will be held during the conference: van strip naar chip, that takes place in Amsterdam.

Tuesday, May 27, 2003

The A-Select Authentication System

A very nice and elegant authentication system is the The A-Select Authentication System. Have a look at their website and see how banks may sell authentication services separately.

Global mobile messaging revenues to double to $70 billion, says Analysys

Analysis has published a research report:Where Next For Mobile Messaging?

The report forecasts:

-revenues growing from USD31 billion in 2002 (USD13 billion in Western Europe) to USD69 billion by 2007 (USD25 billion in Western Europe), provided that operators take immediate action to drive service growth and control cannibalisation of existing revenues,

-total messaging volumes, comprising SMS, MMS and mobile instant messaging/email, will quadruple from 670 billion in 2002 (131 billion in Western Europe) to 2600 billion in 2007 (607 billion in Western Europe).

Monday, May 26, 2003

Credit-cards: overview on tv

This saturday, the tv-programma Kassa discussed different features of credit-cards. In the programma I've explained the product features. What didn't make it into the final cut was:

- there are 1,057 million debit-card payments in the Netherlands and 45 million credit-cards payments,

- the credit-card is quite useful for usage abroad / on travels and to administer/separate certain type of payments,

- credit-cards are expensive for the retailer, so acceptance will be limited to specific sectors.

See the tv-fragment here.

Thursday, May 22, 2003

More direct fees for payments...?

At a European Business Studies Conference drs. Jaap Koning, one of the directors of our central bank, stated explicitly that direct fees for payments were the best way forward to improve the efficieny of the payments system. He explained that the fact that cash appears to be free to the consumer, results in inefficient payment behaviour. But the analytical best way forward was that both banks and retailers would introduce direct fees. Mr Koning also noted that this would of course not be appealing to the consumer and labeled the topic as "politically sensitive".

His statement should be viewed as the verbal version of the recent press release of the central bank, that explains that as of 2008, they will close down the remaining three cash-distribution agencies, to leave the distribution of cash in private hands. Also, DNB has announced that as of 2005 they will charge the banks the real cost for all the cash handling. Assuming that these will be recovered, we may expect new or increasing fees from banks.

Last time a similar debate took place in the Netherlands, coordinated action by banks and Ministry of Finance (actually Wim Kok, former prime Minister and socialist) resulted in the first wave of fees for business customers of banks (1988) and some private customers (1991-1994). It's going to be interesting to see how public and parliament will react this time.

Wednesday, May 21, 2003

Beenz revisited... welcome to eBay Anything Points!

Beenz was a loyalty point programme, to be used to also buy stuff on the web. In a new form, the idea is emerging again, now as eBay Anything Points!

Monday, May 19, 2003

Is it a phone..... or a credit-card ?

Technoloy in principle allows the combination of front-end proximity technology with back-end credit-card infrastructure. Ron Onrust referred me to this article in CNET. It explains that wireless technology may be integrated in the mobile phone cover. No need for magstripe; just wave the phone near the payment terminal and another payment is made.

Dutch readers may want to read the E-merce version of the article.

One sheep over the fence...

Following the settlement in the Wal-Mart case, on-line retailers may want to have a shot at the credit-card companies as well. New York Times reports:

Paycom Billing Services, a company that processes credit card and check transactions for online merchants, sued MasterCard International yesterday, asserting that MasterCard violated antitrust laws and charged excessive fees.

The inaugural speech Bart Jacobs

can be downloaded here (Dutch text). It discusses not only the correctness issues for security but the relationship with legal aspects of information techology as well.

Tuesday, May 13, 2003

The race for mobile payments ..?

Payment Service Provider Bibit has just issued this press-release to announce that their payment service platform is also available on i-mode and Vodafone Live. This allows consumers payment services over the mobile phone. For merchants, Bibit has developed a mobile payment terminal, to be used on-site (conferences etc.). E-merce notes that the cost of the service, when included in the regular e-payments contract of Bibit, is 110 euro per month.

All in all we now see four types of companies in the mobile payment race. The payment service providers, the telco's themselves, the independent companies such as mobile2pay and moxmo and the banks. An interesting race it is.

IBAN: I Beg (for) A Number ?

As of July 1, European regulation endorses/encourages the use of the IBAN, the International Bank Account Number, for cross border payments. But reality may be slow in catching up. I've just heard of the case of a worldwide company that makes fotocameras and such, that has a European service network. So the broken camera goes to Belgium, while the money goes to Edinburgh. And the Dutch instructions for the consumer are to pay using a cheque or credit-transfer. The actual instructions are interesting as they suggest that any credit transfer may take up to 4 weeks. Also, the company still uses a bank sort code and mentions neither Bank SWIFT code nor IBAN.

Needless to say that, within 90 days before the EU regulation comes into effect, this company could improve its incoming payments by mentioning its IBAN to the consumer. So in my view, the IBAN could best be viewed as the acronym for I Beg for A Number. Both enterprises and consumers will soon be begging for these IBAN's and I assume we can expect more troubles coming from ill-implemented usage of the IBAN in the near future.

Dutch companies and consumers may discover their IBAN at this site.

Thursday, May 08, 2003

Legal protection of Conditional Access Services

For information on the implementation of this Directive (that forbids use and sale of equipment to get free access to encrypted tv or password protected information services) have a look at: the European Commission website.

Vodafone develops transaction enabler for the Internet

Planet Multimedia reports that Vodafone is developing a transaction enabler for the Internet on the basis of identification with the SIM-card. As was explained by Vodafone's head of Research and Development, Bert van den Bos on a meeting of Freeband.

Tuesday, May 06, 2003

The Way 2 Pay

After quite some years of contemplation and (re)development, ING has now entered the market with the Dutch version of Paypal: Way2Pay. In order to allow payments until registration is complete, the users credit card may also be used for payments to shops (a temporary wallet solution). The product is local now, but will be rolled out to other countries in the future. The formal credit institution behind it is ING Bank.

Monday, May 05, 2003

Visa and Mastercard settled in the Wal-Mart case

Last week, during my holiday, quite some events took place. See the numerous entries below. Most interesting was of course the settlement between Visa, Mastercard and merchants (Wal-Mart being a major retailer/stakeholder in the debate). Bottom line of the quarrel was that Visa and Mastercard forced the acceptance of debit-cards unto merchants that accepted the credit-card in their shop. They did so with a similar price-tag, which is not completely in line with the fact that debit-card payments have a different cost/risk set-up.

Visa and Mastercard did not await the legal ruling but decided to settle. They've agreed to pay money to the retailers, to lower fees and to allow merchants a choice. See:

- Visa's statement on the settlement,

- Mastercards' statement,

- the merchants' counsel press release,

- the New York Times' article,

- commentary by Arik Hesseldahl.

What still strikes me is the vagueness of the press releases by the cards organisations. But that may be due to the fact that there's no need to provide too much information, as that might have a negative impact on other cases/trials in the US or other parts of the world.

Students fraud campus-payment system

Trouw reported that 133 students at Fontys hogescholen have hacked the payment card system (use in coffee machines, copying) etc. for a total amount of 120000 euro. There's no mention of the news at the Fontys website though.....

UPDATE: but some news at this site.

ABN AMRO reports earnings....

See their their press-release. A lot of earnings appear to come from the consumer division, but a closer look reveals that the division leans on an incidental sale for its income growth.

Taking out this sale, one may get the impression that ABN AMRO bank has gone a little too far in cutting cost and closing down branches. The bank has recently stopped providing its consumers with free envelopes to send in payment orders to the bank (actually a product feature that was introduced to compete with the state-owned PCGD-payment services in the 1980s). Also I hear repetitive stories of consumers that have to wait for quite some time in the limited number of remaining bank branches. Soo the operating costs may be lower, but perhaps this is too much at the expense of the customer.

Banks suffer income as a result of low intrest fees

Boston Consulting Group notes, as a conclusion in their annual payment report, that banks are now suffering an income loss due to lower interest rates. A number of siggestions are made to the banking industry with the bottom line that if banks fail to adapt to the new competitive environment, they may become highly vulnerable.

NMa allows fee discount for Ahold

Last week the Dutch Competition Authority (NMa) announced, that it allows a special discount agreement, dating from the earliy 1990s, between Interpay and Ahold. It contained a price advantage ( 0,03 guildercents: 1,2 eurocent) for pin-authorisation transactions in exchange for a guaranteerd number of transactions. The agreement was contested by Superunie.

Survey shows German customers use Internet for money transfer, but not much more

See this article about a survey carried out by the German Mummert consulting group. The survey shows that of the 800 clients questioned, 86 per cent transfer their money online and about 82 per cent use their bank's online services to manage their accounts and 70 per cent use them for standing orders. Other online services appear to play little or no role.

Pre- or postpaid: it's about cost control

Volkskrant reported last week that we have 12,1 million mobile phone users in the Netherlands. Two thirds have a pre-paid phone, as this allows them to control cost. Consequently there is not a lot of turnover and some mobile operators oblige users to top up at least 20 euro per half year and to use the phone. Others allow top ups for lower amounts (10 euro) and do not invalidate the pre-paid money after a specific period of non-use.

Friday, May 02, 2003

Pay with Visa on the Ramblas...

Just a brief observation from the Ramblas in Spain. Painters allow payment with Visa, as noted by a self painted VISA brand, clipped to the painting standard.