Jeffrey Green

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Reading the pages of this month's issue, one could get a sense that tensions are mounting between merchants, card issuers and the payment networks. Merchants continue to complain about rising expenses associated with credit card acceptance, and now they also contend policies regarding the storage of customers' card and payment data unfairly put the onus on them to secure such information.

As more states face growing public pressure to protect consumers from debit and credit card fraud, even merchants' garbage has become fair game. As this month's Cover Story notes, Texas' attorney general, Greg Abbott, has been especially vigilant in going after merchants who toss unshredded documents containing sensitive consumer data in dumpsters behind their stores.

I was watching the Live Earth concerts last month thinking about ways in which I could help save the planet by reducing the amount of paper I waste. And one of the first things that came to mind was the amount of paper statements and bills I receive each month that keeps piling up.

Capital One Financial Corp. appears to have found a way to compete with companies that support automated clearinghouse payments. Such efforts are designed to help merchants reduce their transaction costs by displacing purchases initiated with more-expensive, bank-issued debit and credit cards.

In January 2006, Edward A. Labry III was ready to leave First Data Corp. The former president of Concord EFS Inc. had completed his two-year obligation to stay on after First Data bought Concord in 2004, and he was unsure if the transaction processor wanted him to stick around.

One thing I learned recently is to be careful applying a credit card number to a company so that it can regularly tap into the account.

This month's cover story addresses the impact that MasterCard's change in ownership to a publicly traded corporation and Visa's plans to go a similar route are having on their relationships with merchants and issuers. It also addresses the relative openness the organizations will have to have in providing information to their stockholders.

Shortly before the holiday season, my wife Kathy and I were driving past a strip mall on our way to a friend's house for dinner. "It won't be too much longer," she said, "before many of these merchants are put out of business because more consumers are shopping on the Internet instead."

Can a name change help a company grow its business faster? Debitman Card Inc., which in late November changed its name to Tempo Payments Inc., sure hopes so.

This month's issue features a Special Report on Loyalty that includes an examination of how issuers are coping with increased market pressure to make their rewards programs efficient yet competitive. The section also looks at whether cobranded airline cards remain relevant as more issuers offer reward-point access to virtually any airline.

Compass Bancshares likes its relationship with Visa USA. In fact, about 65% of the issuer's 1.5 million debit cards are supported solely by Visa's products: Visa check card for signature debit, Interlink for PIN-based purchases and Plus for international ATM access.

The leading card brands and the issuers of their products are always looking for new markets to grow revenue. Small businesses offer that potential. Wealthy consumers do, too.

By early next month, First Data Corp. expects to complete its planned spin-off of Western Union, the company's well-known and historically profitable remittance subsidiary. Once that deal is complete, a "new" First Data will emerge focused less on consumer markets and more on meeting the needs of players in the payments industry.

Taking a company public carries risk, and it can be expensive. But, as an astrologer might say, when the planets align just right, positive things can happen, too.

Card fraud sure is getting a lot of attention these days, as well it should. Unfortunately, for all the attention the key industry players are giving fraud, fraudsters increasingly are getting more sophisticated in their schemes.