The BBC reports that a computer hacker has gained access to more than 5 million Visa and Mastercard credit card accounts in the US. Consumers do not need to worry as both Mastercard and Visa apply so-called zero-liability policies. Visa and Mastercard have already contacted the banks involved and will work together with the third party processor to solve the intrustion problem. Do note that this is a US-issue.
I would also like to note that this information could be placed in different contexts for different types of use. Visa and Mastercard will probably once again stress that this technical threat is the reason why new and safer products are developed and should be used. Law enforcement officials would do the same I guess. And I would not be suprised if this issue will spring up in the legal batlle between Visa and third party processors about being allowed to switch transactions. As such the incident would suggest that it's best to not use third party processors....
Let's see where we stand in a years time.
Tuesday, February 18, 2003
Monday, February 17, 2003
Postbank teams up with SPAR to provide cash-service-counters
Het Financieele Dagblad reports that Postbank will open up 'service-counters' in the SPAR supermarket. This is a part of the ongoing debate on service level of banks. The goal is to place these counters in 400 supermarkets. On Friday the first service point was opened in Esch. The idea is that customers can withdraw a maximum of 250 euro per day at the counter.
Debts on current accounts...
..are a real profit maker for banks. Het Financieele Dagblad reports that consumer credit in the Netherlands has increased with 3 % to 16,4 billion euro. Two thirds (10,3 billion euro) is the regular consumer credit, the remaining third is actualy debt on current accounts (6,1 billion). Credit card debt (mostly 4 months outstanding) amounts to 820 million euro.
Source: CBS.
Source: CBS.
ABN Amro e-banking usage figures
E-merce reports that ABN AMRO started in April 2001 with banking via the Internet. Right now, 20 % of its 4,5 milion consumers and its 45.000 business clients have got the application. And 85 % of the consumers are actually using it.
Ten Banks End Online Gambling With Credit Cards
New York State Attorney General Eliot Spitzer publishes this press statement that explains that ten banks end online gambling with credit cards.
In New York, as in most states, promoting or facilitating unauthorized betting and gambling is illegal -- whether it occurs online or off. However, because Internet gambling businesses usually operate offshore in foreign locations, beyond the enforcement power of local authorities, they often avoid prosecution. Yet, in this case, the banks are all in the US.
The credit card transactions are "coded" by merchants and their merchant banks to indicate to credit card issuing banks (the lenders) what is being purchased. By blocking certain of these codes, issuing banks can avoid extending credit for much gambling activity that occurs on the Internet.
In New York, as in most states, promoting or facilitating unauthorized betting and gambling is illegal -- whether it occurs online or off. However, because Internet gambling businesses usually operate offshore in foreign locations, beyond the enforcement power of local authorities, they often avoid prosecution. Yet, in this case, the banks are all in the US.
The credit card transactions are "coded" by merchants and their merchant banks to indicate to credit card issuing banks (the lenders) what is being purchased. By blocking certain of these codes, issuing banks can avoid extending credit for much gambling activity that occurs on the Internet.
Congestion charges in London: payment by mobile and SMS
Planet Multimedia reports that congestion charging has started in London. Payment of the 5 pounds charge may take place by using SMS or the Internet.
My guess would be that the anti-congestion effect is temporary. In two years, traffic will be jammed once again. But the funny thing may be that by then, many cities have adopted the London model (as it appeared to work in the beginning....).
Facts of today:
Transport for London said
-traffic was about 25% lighter than normal and that there was no evidence of significant congestion problems but a spokesman conceded: "It's still very early days."
-that 66,000 people had paid the charge by 3pm and it expected more would do so on the way home.
See also:
-website of congestion charing London
-BBC article.
My guess would be that the anti-congestion effect is temporary. In two years, traffic will be jammed once again. But the funny thing may be that by then, many cities have adopted the London model (as it appeared to work in the beginning....).
Facts of today:
Transport for London said
-traffic was about 25% lighter than normal and that there was no evidence of significant congestion problems but a spokesman conceded: "It's still very early days."
-that 66,000 people had paid the charge by 3pm and it expected more would do so on the way home.
See also:
-website of congestion charing London
-BBC article.
Friday, February 14, 2003
Account number portability: Minister of Finance says more than was agreed to.....
Yesterday the parliamentary Commitee that discusses finance issues, spoke with the (demissionair) Minister of Finance, mr Hoogervorst on the topic of number portability; the possibility to use the same account number, regardless of the bank you're with. This is an issue that is already longer debated but leads to a lot of confusion. Banks state that it is too costly; different pieces of research show that the consumer is not waiting for it, nor willing to pay for such a service, but a small group of policy makers still view it as the solution for increased competition in the market.
In the debate with the Committee Hoogervorst said that Dutch banks would introduce account number portability. Both his own staff and members of the Committee were suprised. Everyone knows that the banks are now introducing a account transfer service to ease the transfer for those that move accounts. The cost are considerable lower, while the same goal is achieved. Even when urged to be more specific, the Minister repeated his answer, but with the addition that he meant that it would be introduced in the long run, being 8 years (the point in time where all Dutch bank probably plan to use a uniform 10-number system for account numbering).
The Dutch Association of Banks was asked for comment and the spokesmen denied that banks had agreed on this Account Number Portability. The banks have only the agreement to first introduce the account transfer service and then evaluate if that was sufficient. Further debate and agreements will take place in the Maatschappelijk Overleg Betaaldiensten (Payment Council that serves a the Dutch public platform for discussions on payment services).
Source: Het Financieel Dagblad
In the debate with the Committee Hoogervorst said that Dutch banks would introduce account number portability. Both his own staff and members of the Committee were suprised. Everyone knows that the banks are now introducing a account transfer service to ease the transfer for those that move accounts. The cost are considerable lower, while the same goal is achieved. Even when urged to be more specific, the Minister repeated his answer, but with the addition that he meant that it would be introduced in the long run, being 8 years (the point in time where all Dutch bank probably plan to use a uniform 10-number system for account numbering).
The Dutch Association of Banks was asked for comment and the spokesmen denied that banks had agreed on this Account Number Portability. The banks have only the agreement to first introduce the account transfer service and then evaluate if that was sufficient. Further debate and agreements will take place in the Maatschappelijk Overleg Betaaldiensten (Payment Council that serves a the Dutch public platform for discussions on payment services).
Source: Het Financieel Dagblad
Thursday, February 13, 2003
Visa reports increased on-line usage
This BBC article states that on-line sales in the UK have increased:
Total Visa transactions
Q4 2001: 14.5 million
Q4 2002: 31.1 million
Sales volume
Q4 2001: 1.1bn euros
Q4 2002: 2.6bn euros
Fastest growing sector: Tourism/Entertainment, +531%
Slowest growing sector: Services, +57%
See also the Visa website for more statistics.
Total Visa transactions
Q4 2001: 14.5 million
Q4 2002: 31.1 million
Sales volume
Q4 2001: 1.1bn euros
Q4 2002: 2.6bn euros
Fastest growing sector: Tourism/Entertainment, +531%
Slowest growing sector: Services, +57%
See also the Visa website for more statistics.
Nipo reports user will pay extra for 3G services
Nipo-research shows that consumers may be willing to pay an extra 6 to 10 euro per month for 3G/UMTS services. Examples are mobile e-mail, MMS, location based service etc.
Wednesday, February 12, 2003
OFT's preliminary conclusion on Mastercards' Multilateral Interchange Fee
The UK Office of fair trading has released a press statement and
report in which it essentially explains that the MasterCard agreement, containing a multilateral interchange fee for credit-cards does not comply with competition law. It is a preliminary statement, but if the OFT does the same as the Reserve Bank Australia, their position will have an impact on the UK and European market.
Download the full OFT report.
report in which it essentially explains that the MasterCard agreement, containing a multilateral interchange fee for credit-cards does not comply with competition law. It is a preliminary statement, but if the OFT does the same as the Reserve Bank Australia, their position will have an impact on the UK and European market.
Download the full OFT report.
Tuesday, February 11, 2003
Minister Hoogervorst starts bank BUS-tour for the elderly
Today at 1.30 pm, mr Hoogervorst, Minister of Finance, officially started using the ABN AMRO - ANBO Service bus. This is a bus in which ABN AMRO provides bank services (for the elderly clients/customers in remote and rural areas) and in which the Union of the Elderly (ANBO) also provides its services. The bus will start touring as of February 24 and will visit 12 locations (6 per week) in two weeks. See also this press release.
The initiative of ABN AMRO should be viewed against the background of a considerable reduction of bank branches and the complaint of interest groups that service of banks is being reduced too much. It is also relevant to note that a draft law is in preparation (MP Crone) that would prescribe banks to open branches in certain areas. As a result all banks are active to ensure proper service delivery. Rabobank focuses in the segment of the elderly on further introduction of the Chipknip as the payment instrument in the residencies for elderly. And Postbank has started in November 2002 to introduce so called money withdrawal service points (franchise service for small shopkeepers).
The initiative of ABN AMRO should be viewed against the background of a considerable reduction of bank branches and the complaint of interest groups that service of banks is being reduced too much. It is also relevant to note that a draft law is in preparation (MP Crone) that would prescribe banks to open branches in certain areas. As a result all banks are active to ensure proper service delivery. Rabobank focuses in the segment of the elderly on further introduction of the Chipknip as the payment instrument in the residencies for elderly. And Postbank has started in November 2002 to introduce so called money withdrawal service points (franchise service for small shopkeepers).
Monday, February 10, 2003
Paying for supervision.. who's auditing?
Het Financieele Dagblad reports that Dutch banks will soon have to pay for the cost of the supervisor. Yet, in exchange the banks demand a tighter control on the expenses (as they believe these expenses are too high). Two models are now being discussed:
1-a percentage of 15 % of the supervision budget will be paid out of public funds, the rest is to be paid by the supervised organisations,
2-all expenses will be paid by the supervised organisations but an overseeing budget council will monitor the development of these expenses.
One option, not in public discussion is to assign the budget monitoring role to the Algemene Rekenkamer (the national audit institution). This organisation will need to visit the central bank/supervisor anyhow, as De Nederlandsche Bank is a very hybrid organisation that combines the provision of public/private services and also recieves considerable income (seigniorage on bank notes). Any such organisation must be audited, if only to maintain a level playing field vis a vis the private sector. So DNB has a strong need to establish proper internal accounting and expense allocation systems that allow their private services to be competitively priced and their public services to be properly monitored. And the national audit institution is the appropriate organisation to audit this.
1-a percentage of 15 % of the supervision budget will be paid out of public funds, the rest is to be paid by the supervised organisations,
2-all expenses will be paid by the supervised organisations but an overseeing budget council will monitor the development of these expenses.
One option, not in public discussion is to assign the budget monitoring role to the Algemene Rekenkamer (the national audit institution). This organisation will need to visit the central bank/supervisor anyhow, as De Nederlandsche Bank is a very hybrid organisation that combines the provision of public/private services and also recieves considerable income (seigniorage on bank notes). Any such organisation must be audited, if only to maintain a level playing field vis a vis the private sector. So DNB has a strong need to establish proper internal accounting and expense allocation systems that allow their private services to be competitively priced and their public services to be properly monitored. And the national audit institution is the appropriate organisation to audit this.
Saturday, February 08, 2003
Secoin is testing system for micropayments
Planet multimedia reports that Secoin is starting test with its system for micropayments. Apparently (and despite clear explanation by the central bank) Secoin is the opinion that it is not an electronic money institution. Given that the system involves attracting deposits from the public, the only regulatory alternative would then be to consider Secoin a regular credit-institution......
Billing: a profession in itself
I just received a letter from my ISP (dated 5th of February), stating I had to pay my bill. The letter was really unfriendly with threats of knocking me out of their systems. So I checked my bank statement to find out if I missed something, but I had paid properly on January 31. So I mailed the people at creditcontrol@planet.nl to inform their of their rather untimely and incorrect letter. And suggested them to bill their three different bills in one time, using a direct debit.
Which goes to show that billing is a profession in itself. See also the oration of George Huitema (here available in Dutch) and the website of the Global Billing Association.
Which goes to show that billing is a profession in itself. See also the oration of George Huitema (here available in Dutch) and the website of the Global Billing Association.
Friday, February 07, 2003
SWIFT preparing for the future...
Het Financieele Dagblad wrote an article last week on the position of Swift. It was noted that Swift is turning to non-banc customers as well, in order to expand their operations. The article also notes that Swift is moving to an IP-based infrastructure. See also the website of SWIFT.
Wednesday, February 05, 2003
France prepares nationwide launch of purses and smart cards
Mercury News reports that France prepares nationwide launch of e-purses. Also in Paris, the use of the e-purse for parking appears ot be a killer application.
See also the earlier agreement of French banks and enterprises to move to a new generation of chip applications.
See also the earlier agreement of French banks and enterprises to move to a new generation of chip applications.
Joint accounts targeted for bank fraud
This morning De Financiële Telegraaf reports a new fraud method. Robbers send in a form in which they become the joint owner of an account. Not an easy fraud, as it requires forgery of identity papers, obtaining account information/signature of the legitimate account owner as well as control over the delivery/receipt channel. Yet, a number of incidents occured where fraudsters received a debit-card and pin-code on the 'joint account' that was then plundered. Procedures at the Postbank (where the fraud has first been observed) have now been tightened.
Tuesday, February 04, 2003
Telco's will be banks... or are they already?
John Caspers pointed out that Mobilkom Austria has, as the first telco company worldwide, chosen to obtain a bank license in order to provide the full spectrum of pre-paid and postpaid billing solutions. Its bank is called A1 Bank.
Nach der Beteiligung an Paybox austria am 13. Juli 2001 gründete mobilkom austria im Jänner 2002 als erster Mobilfunkbetreiber weltweit eine Bank. Die A1 Bank hält die Banklizenz für die Durchführung des Zahlungsverkehrs. „Wir haben mit der Kombination – mobile Zahlungslösung und Bankenlizenz – alle notwendigen Kompetenzen, um innovative m-commerce Anwendungen für unsere Kunden zu entwickeln. Das sind Micropayment-Lösungen, Prepaid-Lösungen und Garantieleistungen gegenüber österreichischen Händlern. Gleichzeitig etablierten wir einen Standard, der allen Handykunden in Österreich den Zugang zu Services bietet und sichere Zahltransaktionen garantiert“, so Ametsreiter.
Nach der Beteiligung an Paybox austria am 13. Juli 2001 gründete mobilkom austria im Jänner 2002 als erster Mobilfunkbetreiber weltweit eine Bank. Die A1 Bank hält die Banklizenz für die Durchführung des Zahlungsverkehrs. „Wir haben mit der Kombination – mobile Zahlungslösung und Bankenlizenz – alle notwendigen Kompetenzen, um innovative m-commerce Anwendungen für unsere Kunden zu entwickeln. Das sind Micropayment-Lösungen, Prepaid-Lösungen und Garantieleistungen gegenüber österreichischen Händlern. Gleichzeitig etablierten wir einen Standard, der allen Handykunden in Österreich den Zugang zu Services bietet und sichere Zahltransaktionen garantiert“, so Ametsreiter.
Paybox, wasn't that a mobile payment thing.... once...?
Economic historians may still grab the opportunity and use Google's cache to download the Paybox demo or browse the older pages. But this window of opportunities will most probably disappear quickly.
Monday, February 03, 2003
Survey on direct debits by consumer union
The Dutch Consumer Union reports that a survey (1700 participants) shows that 20 % of the respondents have at some time experienced operational problems with the product direct debit. The problems are:
- wrong amount debited,
- banks too slow to respond and reverse the direct debit,
- amount debited without authorisation of the customer.
The Consumer Union has called upon the Dutch Association of Banks to improve the situation as far as the banks are concerned. See also the list of 40 complaints of the Union, in which it becomes clear that utility companies (bulk users of direct debits) make a mess of their billing/administration.
In my view, the solution for this problem would be to improve the feedback loop for individual banks and create a financial stimulus to improve a reduction of operational errors. See this link.
- wrong amount debited,
- banks too slow to respond and reverse the direct debit,
- amount debited without authorisation of the customer.
The Consumer Union has called upon the Dutch Association of Banks to improve the situation as far as the banks are concerned. See also the list of 40 complaints of the Union, in which it becomes clear that utility companies (bulk users of direct debits) make a mess of their billing/administration.
In my view, the solution for this problem would be to improve the feedback loop for individual banks and create a financial stimulus to improve a reduction of operational errors. See this link.
New currency in the Netherlands... : Raam
David Post reports in Het Financieele Dagblad about the issuing of a new currency called "Raam" (which translates as Window). The central bank DNB said it would launch an investigation into possible legal violations.
The Raam (see Ceejee for image) is issued by an organisation founded by Maharishi Yogi. The Raam is printed by Johan Enschede (printer of numerous bank notes all around the world, including the Euro) and is issued in denominations of 1, 5 and 10 raam. One Raam is worth 10 euro.
The Raam was issued on 19 October 2002, with Limburgs Dagblad having the first article:
Vlodrop. The Fortis-bank issues the new currency of the Maharishi- the name is Raam- only at the Roermond branch. This was emphasized by Fortis yesterday, a day on which collectors and those interested from all over the country started to learn how to become owners of the new Raam notes.
According to spokesman M. Bongaerts of Fortis Nederland, the bank only sells the notes in Roermond as a service to Maharishi, an important customer of Fortis. The Maharishi wants to use the currency to supply Third-World countries with a strong inflation-resistant currency. The notes will be used primarily to finance organic agriculture projects.
The Raam (see Ceejee for image) is issued by an organisation founded by Maharishi Yogi. The Raam is printed by Johan Enschede (printer of numerous bank notes all around the world, including the Euro) and is issued in denominations of 1, 5 and 10 raam. One Raam is worth 10 euro.
The Raam was issued on 19 October 2002, with Limburgs Dagblad having the first article:
Vlodrop. The Fortis-bank issues the new currency of the Maharishi- the name is Raam- only at the Roermond branch. This was emphasized by Fortis yesterday, a day on which collectors and those interested from all over the country started to learn how to become owners of the new Raam notes.
According to spokesman M. Bongaerts of Fortis Nederland, the bank only sells the notes in Roermond as a service to Maharishi, an important customer of Fortis. The Maharishi wants to use the currency to supply Third-World countries with a strong inflation-resistant currency. The notes will be used primarily to finance organic agriculture projects.
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