Green, Editor

In my September editor's letter, I jokingly wondered whether MasterCard would be on the phone negotiating the rights to supply play payment cards for Hasbro Inc.'s The Game of Life. This was after Visa had secured such rights for Hasbro's modified Monopoly Here and Now Electronic Banking version ("A Debit Card Monopoly?" September 2006).

For card issuers, volume can mean everything. Most importantly it helps generate revenue to support reward programs and other promotions that help drive more volume.

Visa's announced plans to conduct an initial public offering within the next 18 months were not necessarily a surprise. After all, MasterCard's stock price has nearly doubled since it went public in May, and Visa's issuing banks have been seeking ways to reduce their antitrust liabilities.

As a child, I liked playing Monopoly. But I loved being the banker.

I often wondered why Discover Financial Services, which purportedly has the lowest interchange rates among the major card brands, has had difficulty securing merchant acceptance of its Discover card. Discover claims about 4 million U.S. merchant-acceptance locations. That compares with about 6 million that accept Visa and MasterCard.

Several articles in this issue bring to light changes occurring in the relationships the card associations have with merchants and financial institutions. And taken together they portend a future of greater cooperation with the added potential of outright mutiny.

Being an American Airlines frequent-flier club member must have special perks. Otherwise, why would Citibank send me what must be my 20th mail solicitation with an exclusive offer of 15,000 AAdvantage bonus miles (with no annual fee for 12 months)?

Every year at this time I get a bit excited. Major League Baseball is back for another season, and for the umpteenth time I'm holding out hope that the Chicago Cubs (I'm a longtime season-ticket holder) finally will make it to the World Series in October.

It is true that consumers are writing fewer checks. The Federal Reserve says that number fell to 36.7 billion in 2003 from 41.9 billion in 2000. Much of that reduction has come from payment card brands that have promoted the use of their products as more efficient alternatives to paper checks. For years retailers supported that assertion, and they bought millions of devices to enable customers to pay with plastic.

Personal bankruptcy filings soared in the weeks leading up to Oct. 17, the launch date of the new bankruptcy-reform law that makes it more difficult for many filers to write off all or most of their debts. While claims the past four years averaged 30,000 per week, the week before the new law took effect saw filings climb to about 500,000, far exceeding what they were for the week leading up to Oct. 1, according to Lundquist Consulting, a Burlingame, Calif.-based firm that tracks bankruptcy statistics.

Media coverage showing in vivid detail the effects of Hurricane Katrina really has brought home just how devastating the storm was, particularly for New Orleans. It still remains unknown to what extent the city can or will be rebuilt.

It is not often new markets emerge that could dramatically influence a financial institution's revenue potential. That is unless prepaid debit cards are involved.

A couple months ago, my wristwatch stopped working. While that in itself was not a big event, the timing was quite ironic. The watch broke the same week Timex and ExxonMobil announced they were discontinuing a test in which they were selling various styles of Timex watches with built-in Speedpass transponders.

As it happens the timing of my change in responsibilities (I previously was editor of CCM sister publication ATM&Debit News) coincides with major changes under way in the cards industry. Fortunately, I was lucky enough to have followed the events that prompted much of these changes.