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Visa Inc. is taking a different approach to sponsoring this year's Summer Olympic Games in Beijing, trying to show such investments pay off for banks in a tangible way.

Direct mail solicitations from card issuers declined in the first quarter as economic concerns prompted banks to curtail offers to subprime borrowers, according to data from Synovate, the New York market research unit of Aegis Group PLC.

Citigroup Inc. has introduced a reward program that offers cardholders points worth 10% of eligible purchases.

The saying goes, "If something's not working, try something else." And clearly, when it comes to the financial services and retail industries' response to phishing, something's not working. Unique phishing attacks reported to the Anti-Phishing Working Group hover around 25,000 per month, with spikes as high as 38,000 in the last year. Somewhere around 150 brands are targeted each month. And Gartner estimates that 3.3 percent of the 124 million consumers who received a phishing email last year lost money because of the attack. Why aren't industry efforts—from consumer education, to diligent takedown, to spam filtering—putting a dent in the problem? "Because we haven't addressed it at the Internet level; it's like Band Aids," says Gartner analyst Avivah Litan.

During the first quarter, U.S. households received an estimated 1.13 billion credit card offers in the mail, down 18% from 1.37 billion during the first quarter of 2007, according to the latest Synovate Mail Monitor report, released Wednesday. The eight U.S. card issuers Synovate tracks decreased mailings in the first quarter by an average of 54% compared with the same period last year. Washington Mutual Inc. decreased mailings by 39%, and Citigroup decreased mailings by 36%, the report says. "All issuers have been cutting back on sending mail to lower-income and subprime households," Andrew Davidson, Synovate's financial services group vice president of competitive tracking services, tells CardLine. "That peaked in 2005." However, Synovate's findings indicate some glimmers of issuer optimism, Davidson says. In the first quarter, American Express Co. increased mailings by 36%, and JPMorgan Chase & Co. increased its mailings by 7% compared with the first quarter of 2007. And compared with the fourth quarter last year, WaMu's mailings were up 149%, Citi's were up 24% and Discover Financial Services' were up 15%. "That's an encouraging sign for the card industry because it suggests they have a more-confident outlook going forward," Davidson says. He adds that the Federal Reserve's cuts to the prime interest rate late last year and early this year finally seem to be trickling down to cardholders in the form of lower introductory and fixed annual percentage rates. During the first quarter, the average rate was 12.2%, down from 12.9% in the first quarter of 2007, according to Synovate.

Consumer confidence in the U.S. economy and their own financial well-being in May fell to its lowest level since June 1980, according to the Reuters/University of Michigan Surveys of Consumers, released today. The May Index of Consumer Sentiment score was 59.8, falling from 62.6 in April and from 88.3 in May 2007. The June 1980 score was 58.7. Consumer purchasing power has been diminished by smaller income gains, fewer jobs, higher prices of necessities, falling home prices, tighter credit standards and record levels of outstanding debt, Richard Curtin, director of the surveys, said in a statement. "For consumers to increase their savings as well as cope with the higher costs of food and fuel will require a prolonged shift in budgets away from discretionary spending," he said. The Reuters survey suggests that consumers' purchasing plans for vehicles and household durables-furniture, appliances and home electronics-were the least favorable since the early 1980s. The U.S. Bureau of Economic Analysis today reported that real personal consumption expenditures increased 0.70% in the first quarter, compared with first-quarter 2007's increase of 2.56%. This metric is expected to be at or below 1% for the rest of the year, Curtin said. Nine in 10 consumers surveyed by Reuters thought the economy was in recession during May. Gross domestic product grew at a seasonally adjusted annual rate of 0.9% in the first quarter, an improvement from an earlier estimate of 0.6%, the bureau reports. First-quarter 2007 GDP growth was 0.6%, followed by 2.8%, 4.9% and 0.6% in the second, third and fourth quarters, respectively.

EdoInteractive, which combines the popularity of prepaid cards, social networking and mobile services among the Generation Y set, launched this week. CEO Ed Braswell tells CardLine he came up with the concept for the company and its products when his teenage daughter received several closed-loop retailer gift cards for her birthday and he noticed she also uses social networking Web sites and text messaging to connect with her friends. EdoInteractive offers a MasterCard prepaid card called Facecard, issued and processed by undisclosed partners, and a marketing platform merchants can use to target promotions via social networking among cardholders. Cardholders and their parents and friends may load funds onto the prepaid card. Cardholders also may transfer funds between their accounts. The service launched this week in the Nashville area with an undisclosed number of merchants. It also will be offered to students at 52 universities, including the University of Tennessee, University of Georgia, University of North Carolina and University of Texas, says Braswell. The company is using messages and electronic invitations on sites such as Facebook to promote discounts at events, including the Bonnaroo music and arts festival in Tennessee and the Country Music Awards Fan Fest.

The Center for Financial Services Innovation announced Wednesday that it has invested in iSend, an international payments company, and Progress Financial Corp., a lending company focused on Hispanic immigrants. The Chicago-based center, which is a nonprofit affiliate of the Chicago-based ShoreBank Corp., made the investments through Catalyst Fund LP, a limited equity partnership it created to invest in financial-services companies that serve the underbanked, the center says in a statement. Center spokesperson Lori Bonhma would not say how much it invested in each company. Progress Financial, which is based in Mountain View, Calif., makes unsecured loans between $500 and $5,000 to underbanked Hispanic immigrants, according to its Web site. It has four locations in California and has plans to expand across the country. Watertown, Conn.-based ISend enables immigrants living in the United States to pay for goods and services in their home counties. Consumers who use its service can pay utility bills and mobile-phone bills in Mexico, Brazil, Guatemala, Honduras and El Salvador, by visiting an iSend store, according the company's Web site. Consumers also can make mortgage payments in Mexico, Brazil and Guatemala, the company says on its site.

The ongoing pilot of a mobile-phone electronic-wallet coupon and payment system at McDonald's fast-food restaurants in Japan lends credibility to mobile payments, Red Gillen, senior analyst at United States-based Celent LLC, tells CardLine Global. McDonald's and NTT DoCoMo, Japan's largest mobile-network operator, are testing the system in 175 McDonald's restaurants in Tokyo. DoCoMo subscribers download an application and register on McDonald's Japan's mobile Web site. Subscribers receive digital vouchers on their mobile phones that consumers can redeem by tapping phones against contactless readers at the counters of participating restaurants. Customers keep track of their coupons on their phone bills. Gillen says other large Japanese merchants may start to follow McDonald's lead with this system. "If McDonald's is doing something, it will get a lot of attention," he says. Mobile payments in Japan mostly have focused on transit, but Gillen says merchants near train stations may start to take advantage of the technology. McDonald's Japan plans to expand the program to a total of 3,800 stores by 2009, according to a published report.

Consumers in Thailand spent approximately 197.3 billion baht (US$6 billion or 3.9 billion euros) with their credit cards in the first quarter ended 31 March, up 14.4% from the 172.5 billion baht spent in the same period last year, according to Bangkok-based Kasikorn Research Center, a subsidiary of Kasikornbank Group. Outstanding balances at the end of March stood at about 174.7 billion baht, up 5% from 166.4 billion baht at the same time last year. Card debts at least three months overdue totaled about 6 billion baht at the end of March, up 22.4% from about 4.9 billion baht a year earlier. "The credit card-spending rise could be attributed partly to rising prices of goods over the previous year," a Kasikorn spokesperson tells CardLine Global. "Intense competition" among issuers in Thailand also has led to aggressive marketing campaigns designed to increase card spending, the spokesperson says. Thailand had more than 11.9 million credit cards in circulation as of February.

Consumers needing their coffee fixes in South Korea can use their Visa-branded contactless devices to pay for their purchases, Visa Inc. says in a statement. The card company says it has teamed with coffee chain Starbucks to enable Korean consumers to pay for their purchases with cards or mobile phones that carry Visa's payWave contactless application. Consumers can make contactless purchases of up to 30,000 won (US$29 or 19 euros), the statement says. Twelve major financial institutions in South Korea issue cards with payWave, Visa says. Those institutions include Shinhan, Samsung, Hyundai, BC and Lotte. Such merchants as Homeplus, 7-Eleven, Lotte World, Red Mango and Kyobo Books already accept contactless payments.

American Express Co. reportedly will work with ICICI Prudential Life Insurance Co. to offer its policyholders an online-payment service. The arrangement would enable policyholders to use AmEx cards to pay premiums through the India-based insurance company's Web site. Neither ICICI nor AmEx would discuss the initiative with CardLine Global. Consumers also can continue to pay premiums with cash at insurance offices. ICICI Bank and United Kingdom-based financial services group Prudential Plc created ICICI Prudential Life in 2000 as a joint venture.

Although NTT DoCoMo, Japan's largest mobile-network operator, has put 28 million contactless wallet phones into the pockets of subscribers, only about one in five tap the phones daily to make payments or use other services, according to CardLine Global sister publication Cards&Payments. "Actual usage is not so high," Haruhiko Nomura, executive director of DoCoMo's Multimedia Services Department, tells CardLine sister publication Cards&Payments. "I don't know why, even when it's preloaded [with] the applications." Nomura outlined the challenges DoCoMo and its competing mobile telcos face in getting more consumers to use the phones. Among the biggest obstacles are worries among subscribers about the safety of putting their contactless credit and prepaid payment accounts onto the phones along with their monthly transit passes, Nomura said earlier this month at SourceMedia's CTST conference in Orlando, Fla. More fundamentally, it is difficult to introduce a technology, he said. "The mobile-wallet service is a new experience to everybody," said Nomura. "It takes [a] long time to persuade the end customers." DoCoMo and other wallet-phone backers must convince more merchants to accept payment or other services loaded on the phones and convince more service providers to put their applications on the devices. "We need to show them the actual benefit. Otherwise, they will move to the [other] new technologies," he said. But DoCoMo, which launched the wallet phones in 2004 and continues to lead the national rollout, sees progress. As of the end of March, merchants had installed 608,000 terminals that can accept payment from the phones, Nomura said. That includes vending machines and shops that take DoCoMo's own contactless credit brand, iD.

H&R Block has started testing mobile-banking services for its Emerald MasterCard, the company announced yesterday. Cardholders can use the service to check balances and receive account-reload alerts on their mobile phones, the company says. H&R Block plans to conduct a test through the summer and then provide the service to all its Emerald Card customers throughout the summer, says Kevin Morrison, assistant vice president of products for H&R Block. Metavante Mobile Financial Services, a division of Milwaukee-based Metavante Corp., and Monitise Americas, a joint venture of Metavante and London-based Monitise plc, is providing the service to H&R Block. Metavante provides the processing for Emerald Card transactions and Monitise provides the connection between Metavante and the telecommunications companies, says John Focht, division president of Metavante's issuing solutions group. H&R Block distributed 2.6 million cards this tax season, up from 2 million cards last tax season, Morrison says. Customers use the cards to receive tax refunds and can sign up to have payroll checks deposited to the cards, connect them to lines of credit and savings accounts, and link to funds-transfer services. H&R Block has 13,500 offices across the United States where consumers can sign up for an Emerald card, the company says.

Alliance Data Systems Corp. today announced that Bank of Montreal has renewed an agreement with the Dallas-based transaction processor's loyalty business, the Air Miles Reward Program. The terms of the renewed contract have been revised and expanded, according to Alliance Data. The processor now becomes responsible for estimating the redemption rate and maintaining an adequate reserve for each Air Miles reward mile Bank of Montreal issues. The new structure eliminates the need for Bank of Montreal to maintain its own reserve for the redemptions. The bank and processor adjusted the pricing to reflect Alliance Data's responsibility for redemption. Bank of Montreal will pay Alliance Data approximately $370 million by the end of June to cover the cost of redemptions related to outstanding Air Miles reward miles Bank of Montreal issued under the previous arrangement and will increase the balance of the account to more than $650 million. Alliance Data's deferred revenue balance also will increase to nearly $1.2 billion from $800 million, according to the company. Bank of Montreal customers earn reward miles for purchases made with the issuer's Mosaik Air Miles MasterCard credit card and Bank of Montreal debit card.

The Greater Sudbury Police Service has charged seven individuals arrested earlier this month with more than 300 crimes related to credit card forgery and theft. Greater Sudbury, Ontario, and Ontario provincial police arrested the seven May 6 for possession of forged credit cards and merchandise from stores in the area. Yesterday, the Greater Sudbury Police Service announced that its ongoing investigation found that within a four-hour period one day before they were arrested the group used forged cards to purchase $19,000 in gift cards and $1,600 in merchandise from area businesses.