First Virtual Holdings Inc. of San Diego has named Michael D. Schauer to the new position of president, financial services.
Mr. Schauer had been president of GE Capital Consumer Financial Services since 1993. The unit of General Electric Co.'s GE Capital Services subsidiary recently announced an investment in First Virtual.
Mr. Schauer, 35, reports to Lee Stein, chairman and chief executive officer.
"We have a very heavy technology and direct marketing bias. ... We needed to balance that out," Mr. Stein said. "Mike has proven organizational skills within one of our serious investment partners."
GE Capital Services joined with First Data Corp. and First USA Paymentech in a combined $12.5 million investment commitment.
Mr. Schauer brings more than a dozen years of bank card experience to a company that he called "a leader in a category - even though it's an embryonic payment system." Mr. Schauer described the technology, which combines on-line ordering with a secure means of payment transmission off the Internet, as "rather slick" and "a lot of fun."
Mr. Schauer said his responsibility is to increase the company's presence as a facilitator of Internet payments.
First Virtual said its system has registered 178,000 MasterCard and Visa users and 2,500 merchants worldwide. The company hopes to add American Express and Discover cardholders, after rebuilding its system in July to accommodate those cards.
Because GE Capital is a major provider of credit services to retail stores, its contacts can be "very important" to First Virtual's effort to sign merchants, said Robert B. McKinley, president of RAM Research Group, Frederick, Md.
While Mr. Schauer headed GE's Cincinnati-based credit card unit, revenues doubled and outstandings climbed to $2.8 billion. His replacement has not been named.
The GE Rewards card came under fire this month for introducing a $25 annual fee for convenience users - those who pay off their balances without accruing interest.
Prior to joining GE, Mr. Schauer was executive vice president of retail lending at Bank One Arizona. He previously was a senior vice president of Michigan National Bank, in charge of credit cards and installment loans.
