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FOR 43 YEARS, THE LEADING PUBLICATION COVERING PAYMENT SYSTEMS WORLDWIDEAUGUST 2014 / ISSUE 1047FLEETCOR TO ACQUIRE COMDATAFleetCor Technologies, a provider of a variety of commercialcard programs for fuel, lodging, and related products andservices to businesses in 43 countries, will purchase Comdata, see p. 5SOFT SPACE MPOS IN SOUTHEAST ASIAMobile payments technology provider Soft Space expects to besupporting more than 35,000 mPOS devices through nine bankclients in seven countries by the end of the year. Collectively, see p. 5ASIA–PACIFICTOP U.S. CONSUMER CREDIT/DEBIT ISSUERSThe tables shown on page 10 list the largest issuers of both creditcards and debit cards based on consumer purchase volume only in2013. The 50 largest issuers of Visa and MasterCard credit cardsBrand Market Share 7,396.54 Bil. Purchase Volume in 2013 see p. 10U.S. COMMERCIAL BANK CARDS — PART 2Commercial credit, debit, and prepaid cards in the U.S. carryingMasterCard and Visa brands generated 585.47 billion inpurchases of goods and services in 2013, up 12.0% from hange vs. 2012(Basis Points) see p. 4PAYONEER GLOBAL B2B PAYMENTS–159The global cross-border business-to-business (B2B) paymentsindustry is estimated to be in the 40 to 50 trillion range. It issupported by legacy payment platforms that continue to operate see p. 6Banco Cooperativo do Brazil (Bancoob), the banking arm of theBrazilian Credit Union System (Sicoob), is First Data’s partneron a new merchant acquiring business in that country. First Data see p. 8INVESTMENTS & ACQUISITIONS — JULY 2014Turn to page 7 for a list of 57 mergers, acquisitions, and corporatefinancing deals that occurred in July of 2014.Prior issues: 1,045, 1,042, 1,041, 1,039, 1,037, s Enterprise TokenizationPINs and SmartphonesCard Manufacturer ShipmentsSyniverse’s Mobile Portal HSN Consultants, Inc. 2014 THE NILSON 8145.62174.51101.08113.97 2014 The Nilson Report2012 vs. 2013( Bil.)ASIA–PACIFIC GENERAL PURPOSE CARDSUnionPay, Visa, MasterCard, JCB, American Express, andDiners Club brand credit, debit, and prepaid cards in see p. 7INSIDE–36Purchase VolumeVisaFIRST DATA ACQUIRING IN BRAZIL–38–378 see p. 11U.S. Visa & MC Commercial CardsInvestments & Acquisitions — JulyTelephone, Prepaid & NonpaymentCard Shipments 20131011Largest U.S. Issuers of ConsumerCredit and Debit Visa & MC CardsAsia–Pacific General Purpose Cardsand Purchase TransactionsVISIT US ONLINE AT WWW.NILSONREPORT.COM
FAST FACTSThe Nilson Report #1047 3rd draft August 20, 2014 11:00 AM carNATIONAL RETAIL FEDERATION and other organizations askedthe U.S. Supreme Court on Monday, August 19 to hear an appeal ofa March ruling by the U.S. Court of Appeals for the D.C. circuit thatupheld the Federal Reserve’s debit interchange rule. If the SupremeCourt accepts the case, the announcement will be made later this year.GLOBALSHOPEX helps online retailers in the U.S. sell internationally by fully managing and operating their internationale-commerce, logistics, fraud prevention, and multilingualcustomer service. It assumes all fraud risks and chargebackson behalf of the retailer. Colleen Petschulat is VP BusinessDevelopment, (561) 672-7154, O now offers an EMV-compliant (Level 1 and Level 2) reader for itsiPad-based mobile payments service, which also provides full end-toend encryption. Brad Lauster is Co-Founder, (646) 798-8383,brad.lauster@bindo.com, www.bindopos.com.VISA TRANSACTION ADVISOR identifies fuel pump transactionsthat could involve lost, stolen, or counterfeit cards. After a card isinserted, Visa analyzes multiple data sets including past transactions,whether the account has been involved in a data compromise, andnearly 500 other pieces of data to create a risk threshold merchantscan use to decide if they want to perform in-person cardholderauthentication before gas is pumped. Sydney Green is Director of RiskProducts, (415) 805-4033, sygreen@visa.com, www.visa.com.FEATURED CONFERENCESubscribers to The Nilson Report will receive a 300 discount.SAVE 300SMART CARD ALLIANCE has released a new white paper calledHCE 101, which examines HCE and NFC opportunities and securityconsiderations. Download at -card-emulation-101/.PRECASH will use its cloud-based platform to process paymenttransactions at McAllister Internationals’ new Redde Pay portal, whichprovides merchants with bill payment, international long distance,domestic and international mobile top-up, and other value-addedproducts. McAllister will distribute Redde Pay to its more than150,000 merchant locations in the U.S. Blair Jeffery is SVP at PreCash,(713) 600-2346, blair.jeffery@precash.com, www.precash.com.Robert McAllister is CEO at McAllister Industries, (858) 755-0775x1010, stries.com.HEARTLAND PAYMENT SYSTEMS, the 5th largest U.S. merchantacquirer, has purchased Leaf, which sells tablet-based point-of-salesystems. Terms were not disclosed. HPS made a 20 million investment in Leaf in 2013. Robert Carr is CEO at HPS, (609) 683-3831,bob.carr@e-hps.com, www.heartlandpaymentsystems.com. Sarah McCrary is CEO at Leaf, (857) 242-1509, sarah@leaf.me, www.leaf.me.PAYCHEX, a top provider of payroll, human resource, insurance, andbenefits outsourcing services for small and midsized businesses, nowoffers the Skylight PayOptions payroll card program, which gives employers an alternative to direct deposit and paper paycheck. NetSpend,a TSYS company, is program manager for the Skylight ONE PrepaidMasterCard, which is funded by direct deposit of employee wages.Chuck Harris is President at NetSpend, (512) 532-8225, charris@netspend.com, www.netspend.com. Michael Gioja is SVP at Paychex,(585) 383-3762, mgioja@paychex.com, www.paychex.com.2Two-Day ConferenceOctober 6-7, 2014The InterContinental Chicago Magnificent MileChicago, IllinoisTopics include: CFPB and prepaid disclosures, extension of Reg. E,payments linked to GPR cards, prepaid card forms and packaging,scrutiny of overdraft programs and rewards programs/points, newand emerging payment platforms including cryptocurrencies —the role of prepaid in the equation, payroll card programs, UDAAOissues and managing and maintaining oversight of third parties,payday lending and deposit advance, Durbin 2.0 on the prepaidmarket, and regulatory challenges that come with internationalexpansion. Speakers represent: Paul Hastings LLP, Meta PaymentSystems, The Bitcoin Foundation, FDIC, PayPal, Verizon, Bitpay,Citigroup, Green Dot, U.S. Treasury, Office of Assets Control,Asset Forfeiture & Money Laundering Section, U.S. Departmentof Justice, American Express, and more. Cost is 1,995. (Use codeTNR300.) Contact Nicole O’Neill at ACI, (212) 352-3220 x5257,n.oneill@americanconference.com. Register atwww.americanconference.com/PrepaidCard.VISIT US ONLINE AT WWW.NILSONREPORT.COMFEATURED CONFERENCESubscribers to The Nilson Report will receive a 20% discount.Conference links at www.nilsonreport.comConference links at www.nilsonreport.comPREPAID CARD COMPLIANCE 2014SAVE20%13TH ANNUAL SCAGOVERNMENTCONFERENCE 2014Two-Day ConferenceOctober 29-30, 2014The Washington Convention CenterWashington, D.C.Topics include: ID security technology and applications, IDsecurity implementation and policy, and healthcare ID security.Speakers represent: GSA, NIST, DOD, U.S. Department ofHealth & Human Services, and more. Cost for the two-dayconference plus access to all preconference and conferenceactivities starts at 840 for member; 1,080 for nonmembersuntil October 7 and 960 for member; 1,200 for nonmembersuntil October 30. (Use code SCDH14.) Contact Bill Rutledge atCnxtd, at (212) 866-2169, bill@cnxtd.com. Register atwww.govsmartid.com.Order Back Issues / Preview Upcoming Conferences / View Newsletter Archive
FAST FACTSWEB.COM will offer MasterCard’s Simply Commerce PCI-certifiedplatform as its preferred payments provider. Web.com provides 3.2 million small businesses with e-commerce and mobile commerce products.Deborah Barta is Simplify Commerce Product Lead atMasterCard, (636) 722-4038, deborah barta@mastercard.com,www.simplify.com.BLACKLINE PAYMENTS ADVISORS is a new consulting firmformed to serve all segments of the payments industry — investors,acquirers, payment aggregators, retailers, banks, technology providers,and more. BlackLine is an affiliate of corporate law firm Frost BrownTodd. Pat Moran is CEO at BlackLine, (615) 743-6987, pmoran@blacklinepayments.com, www.blacklinepayments.com.COMMERCE BANK, the 27th largest U.S. issuer of Visa/MasterCardcredit cards, is offering a Visa-brand affinity card in partnership withUSA Triathlon, the national governing body for triathlons. Chad Doza isSVP Consumer Credit Card at Commerce Bank, (816) 234-2161,chad.doza@commercebank.com, www.commercebank.com.MONERIS SOLUTIONS has formed a partnership with MilanoComputer Systems to provide an integrated payment processing andsalon management service to the beauty and health industry in theU.S. and Canada. Chris Lee is Pres., No. American Strategic Partnerships at Moneris, (847) 240-6623, chris.lee@moneris.com,www.monerisusa.com.GLOBAL PAYMENTS’ Integrated Solutions division has released CustomerBuilder, a digital card-linked offers product.Merchants can use CustomerBuilder to create, distribute, andtrack digital offers used as incentives to attract new and returning customers. Eddie Myers is President, Integrated SolutionsDiv. at Global Payments, (510) 795-4928, OUT is a merchant service provider with tier-one bank sponsorships in the U.S., Latin America, the Caribbean, Asia–Pacific, andEurope. Its clients include all merchant risk verticals. Cleveland Brownis CEO, (408) 590-1176, cleveland@payscout.com, www.payscout.com.CONFORMANCE TECHNOLOGIES’ Data Incident Management Program suite of services provides merchants with assistance in the eventof a data incident. Components include data incident forensics, POSequipment or software replacement, 10,000 in legal services and legalnotifications, consumer notifications, and public relations managementservices. Darrell Anderson is President, (480) 603-6129, danderson@conformancetech.com, www.conformancetech.com.HYPERWALLET offers companies outside of Nigeria the ability topay individuals in that country via direct-to-bank money transfers andreloadable prepaid cards. Payments are delivered in local currency,typically within 1-2 business days. Reloadable prepaid debit cards canbe denominated in euros, U.S. dollars, or British pounds. Mike Montyis SVP of Sales & Financial Networks, (65) 6408-0640, mike.monty@hyperwallet.com, www.hyperwallet.com.FIME is the first laboratory to be accredited to provide functional testingservices for JCB’s new generation of contactless terminals.Alex Chen is Sales Director at FIME Asia, 886 (2) 6636-0400,alex.chen@fime.com, www.fime.com.MBANK POLAND, a unit of Commerzbank, has deployed HID Global’sActivID DisplayCard Tokens to provide its corporate banking customers with multifactor authentication to securely access their online andmobile banking accounts. Harm Radstaak is Managing Director, EMEAat HID Global, 44 (014) 4017-4850, hradstaak@hidglobal.com,www.hidglobal.com.See links at www.nilsonreport.comCONFERENCES & SEMINARSTHE MONEY EVENT AT CTIA’S SUPER MOBILITYWEEK: September 9-11, 2014. The Sands Expo and ConventionCenter, Las Vegas, Nevada. Estimated attendance for SuperMobility Week: 40,000. Cost for the three-day conferenceis 595 for retailers and financial institutions and 895 forgeneral admission. Subscribers to The Nilson Report willreceive a 20% discount. (Use code Nilson20.) ContactAndrew Borowiec at (202) 552-5998, info@themoneyevent.com.Register at www.themoneyevent.com.MOBILE PAYMENTS CONFERENCE 2014 (MPC): October6-8, 2014. The DoubleTree by Hilton – North Shore, Skokie,Illinois. Estimated attendance: 300. Cost for the three-dayconference is 699 for early bird registration until September 8, 799 for advanced registration from September 9 to October 6,and 899 on-site. Subscribers to The Nilson Report will receivea 20% discount. (Use code MPCNILSON14.) Contact MarlaEllerman at MM&T, (602) 315-8808, marla@mmtmagonline.com.Register at http://mobilepaymentconference.com/.C4 CARDS, PAYMENTS AND CONSUMER CREDITCONGRESS BRAZIL 2014: (The annual meeting for thePayment Industry in Brazil) September 17-18, 2014. Frei CanecaConvention Center, São Paulo, Brazil. Estimated attendance:500 delegates and 1,200 visitors. Cost range for the two-dayconference is 1,200 to 2,000 depending on sessions and earlybird dates. Subscribers to The Nilson Report will receive a20% discount. (Use code NRPT2014.) Contact Cristian Alickeat Next Business Media, 55 (11) 3173-4413, cristian.alicke@nextbm.com.br. Register at www.congressoc4.com.br.PAYTHINK 2014 (FORMERLY ATM, DEBIT &PREPAID FORUM): October 20-22, 2014. The JW MarriottDesert Ridge Resort & Spa, Phoenix, Arizona. Estimatedattendance: 1,000. Cost of the three-day event starts at 1,195. Subscribers to The Nilson Report will receive a 300discount. (Use code NILSON300.) Contact Ingrid Olsen at(212) 803-8456, ingrid.olsen@sourcemedia.com or Austin Hart at(212) 803-8388, austin.hart@sourcemedia.com.Register at www.paythinkforum.com. HSN Consultants, Inc. 2014 THE NILSON REPORTAUGUST 2014 / ISSUE 1047 / THE NILSON REPORT3
FAST FACTSGEMALTO has supplied a complete software platform and service toFrance-based retail bank LCL to deliver PINs for payment cards usingSMS text messages. Philippe Cambriel is President for Europe, Mediterranean and CIS at Gemalto, 33 (1) 5501-5500, philippe.cambriel@gemalto.com, www.gemalto.com. Laurent Bergamelli is Head of Cardsat LCL, 33 (4) 4260-5302, laurent.bergamelli@lcl.fr, www.lcl.fr.CARDTEK GROUP, a provider of a full suite of EMV-compliant cardmanagement software products, has opened an office in Bogota,Colombia, to lead sales to Latin America and the Caribbean.Gokhan Inonu is President at Cardtek USA and Cardtek South America,(847) 376-8367, gokhan.inonu@cardtek.com. Giorgio Mazzoloni isBusiness Development Director, 57 (317) 570-4810,giorgio.mazzoleni@cardtek.com, www.cardtek.com.MASTERCARD inControl, a payment platform that lets businesses andconsumers set spending limits on their accounts and manage how,when, and where they use their cards online, is now being offered inAsia–Pacific to issuers using First Data’s VisionPLUS card management system. Raj Dhamodharan is Group Head of Emerging Payments,Asia–Pacific at MasterCard, (65) 6390-6928, raj dhamodharan@mastercard.com, www.mastercard.com. Marc Mathenz is SVP at FirstData, (65) 6511-8700, marc.mathenz@firstdata.com, www.firstdata.com.DIGITAL RIVER has added local payment options including installmentloans to its payment gateway service in Brazil through a relationshipwith EBANX. Souheil Badran is SVP at Digital River, (952) 225-3736,sbadran@digitalriver.com, www.digitalriver.com. Alphonse Voigt isCEO at EBANX, 55 (41) 3232-9913, al@ebanx.com, www.ebanx.com.U.S. COMMERCIAL BANK CARDS — PART 2from page 1Commercial and consumerpurchase volume combined was 3.316 trillion last year, withcommercial products accountingSmall business and prepaidproducts generated 176.33 billion in debit card purchase volumein 2013, accounting for 10.5% ofU.S. Visa & MasterCard Commercial CardsPurchase Volume hg.Small Business 119.249.3% 68.67 14.0% 187.91 11.0%Purchasing & Fleet 112.866.3% 72.81 22.1% 185.67 12.0%Debit & Prepaid 99.30 10.6% 77.03 21.3% 176.33 15.0%Corporate 18.104.0% 17.47 349.498.4%TOTAL4.5% 235.98 17.9% 35.574.2% 585.47 12.0% 2014 The Nilson Reportfor 17.7% of that amount, up from17.0% in 2012. Five years ago,commercial cards equaled 14.3%of combined Visa and MasterCardpurchase volume.Corporate T&E, small businesscredit, and purchasing productsgenerated 409.14 billion in creditcard purchase volume in 2013,accounting for 25.0% of 1.639trillion from combined consumerand commercial credit products.Commercial cards accounted for24.4% one year before.4 1.678 trillion from combinedconsumer and commercial debitand prepaid products. Commercialdebit cards accounted for 9.9%one year before.Small business products accounted for 45.9% of all commercial credit card purchase volumein 2013. Purchasing, whichincludes fleet cards, accountedfor 45.4%, and corporate T&E accounted for 8.7%.Small business debit cardsand commercial prepaid cardsaccounted for 30.1% of allVISIT US ONLINE AT WWW.NILSONREPORT.COMcommercial credit and debit cardpurchase volume in 2013.Visa cards held a 59.7% shareof combined credit and debitcommercial purchase volumeversus MasterCard in 2013, downfrom 61.7% in 2012. Visa held a63.5% share of small businesscredit cards, a 60.8% share ofpurchasing/fleet cards, a 56.3%share of debit and prepaid cards,and a 50.9% share of corporate cards last year. MasterCardgained ground versus Visa inevery category.Commercial cards generated15.4% of combined commercialand consumer credit and debitpurchase volume for Visa’s U.S.region, down from 15.5% in 2012.Commercial cards generated22.4% of combined commercialand consumer credit and debitpurchase volume for MasterCard’sU.S. region, up from 20.4%in 2012.Prior issues: 1,023, 999, 975, 954,951, 931Order Back Issues / Preview Upcoming Conferences / View Newsletter Archive
SOFT SPACE MPOS IN SOUTHEAST ASIAfrom page 1.Soft Space’splatform, which ishardware agnosticand integrates withbusiness applications, is sold on awhite-label basis. It is recognizedby Visa and MasterCard mobilepayments best practicesprograms. ComponentsCustomers are expected to proinclude card reader,cess 1 bil. in payments this year.mobile application, Webmanagement console, andreal-time dashboard.points for its clients use Soft SpaceNo processing is done inmobile technology, which worksany smart device. Encryption iswith most iOS, Android, andperformed on every transactionMicrosoft devices. Soft Space hasfrom the time the card is insertedoptimized its payment service tointo the reader. Decryption occurswork with devices that have lowat the acquirer’s server.specifications, which are commonin Southeast Asia.its clients, which includeKasikornbank, Thanachart Bank,CIMB Bank, Hong Leong Bank,Maybank, Sacombank, and BNZ,are expected to process 1 billionworth of card payments in 2014.About 20% of all card acceptanceA fraud protection moduleoffers pattern analysis,customizable business rules,velocity checks, smart notification,and merchant risk profiles.A geolocation module offersadditional risk managementincluding the ability to trackpayments by location, limittransactions by zone, and denycross-border authorizations.Chris Leong is Director of Strategyat Soft Space Sdn Bhd in Selangor,Malaysia, 60 (16) e.com.my.FLEETCOR TO ACQUIRE COMDATAfrom page 1.Comdata provides 20,000 companies with one ormore of its payment card products, which collectivelygenerate more than 54 billion in sales annually.It is a provider of over-the-road credit cards tofleet operators in the U.S., a market in which othercompetitors include WEX, EFS, and U.S. Bank’sVoyager. Comdata is the top issuer of co-brandeduniversal fleet cards that carry either the MasterCardor Visa brands. Competitors include FleetCor,to refinance Comdata’s debt and nearly 7.3 millionWEX, Chase, and Wells Fargo. More than 90% ofshares of FleetCor common stock currently valuedFleetCor’s MasterCard cards are issued by Regionsat about 1.05 billion. The seller is Ceridian, aBank and processed by Comdata. The remainingholding company backed by Thomas H. Lee Partnerscards are issued by Bank of America and processed byand Fidelity National Financial. The transaction isFirs
purchases of goods and services in 2013, up 12.0% from 2012. PAYONEER GLOBAL B2B PAYMENTS The global cross-border business-to-business (B2B) payments industry is estimated to be in the 40 to 50 trillion range. It is supported by legacy payment platform
