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First Data Corp. and JPMorgan Chase & Co. today announced they have agreed to end their joint venture, merchant acquirer Chase Paymentech Solutions LLC, by the end of the year. New York-based Chase will retain 51% of Chase Paymentech's assets, including most of its employees, its Canadian and European operations and the company's Dallas-based headquarters, according to the announcement. Greenwood Village, Colo.-based payments processor First Data will assume management of the ISO and Agent Bank division of Chase Paymentech and will integrate 49% of the assets, including a portion of the staff, into its established merchant acquiring business. The September buyout of First Data by Kohlberg Kravis Roberts & Co. triggered a clause in the joint-venture contract that enabled Chase to end the alliance (CardLine, 3/14). Chase and First Data formed Chase Paymentech in 2005. Observers expect fierce competition between Chase and First Data when they operate as two separate entities, according to Adil Moussa, an analyst with Boston-based Aite Group LLC. Chase "used to compete quite openly with First Data. There's no secret about that," Moussa tells CardLine sister publication ISO&Agent Weekly. "They would go after the same accounts and really outbid each other. Now it's going to be even more so." Banks and ISOs typically use differing strategies to acquire merchants, with ISOs usually acting more assertively, Moussa says, adding that First Data has no such advantage in this case. Chase "has proven it's not that type of bank. [Chase is] not going to sit back and wait for merchants to show up. They will go after them aggressively."
May 27 -
MoneyPass has signed a series of new agreements that the company's top executive says partly reflects banks' and credit union members' cardholders' nail biting about the worsening economy. Since April, the Minneapolis-based surcharge-free ATM network has made deals with South Valley Bank & Trust, a Klamath Falls, Ore.-based community commercial bank (CardLine, 5/23); Bellingham, Wash.-based Horizon Bank; and Vienna, Va.-based Navy Federal Credit Union. Those agreements represent only the surface of the problem, Doug Miraglia, president of MoneyPass, tells ATM&Debit News, a CardLine sister publication, in an e-mail message. Since January, MoneyPass has signed 100 financial institutions, and as a result the company anticipates a busy second half, Miraglia says. "It may have something to do with the economy because consumers seem particularly cost- and fee-conscious right now," he says. MoneyPass's surcharge-free ATM network has 12,000 to 15,000 surcharge-fee ATMs nationwide.
May 27 -
SignaPay, Ltd., an Irving, Texas-based independent sales organization, has launched SenorPay, a sales division concentrating on Spanish-speaking merchants. Additionally, SenorPay will sell iPay Station, a product unbanked consumers can use to pay bills and buy prepaid phone cards, alongside credit and debit card payment services and merchant cash advances. The effort amounts to more than a Web site translated into Spanish, John Martillo, company president and CEO, tells CardLine sister publication ISO&Agent Weekly. The company will provide all support services in Spanish, and documents and marketing materials will be in Spanish, too, Martillo says. The risk manager, who assesses whether a merchant is creditworthy enough to accept payment cards, is bilingual. Martillo says SenorPay is available as a reseller program for independent sales agents. These agents will benefit from something Martillo lacked when he first sold processing services to the New York Hispanic market. "There were no marketing materials to support me as an agent," Martillo says. On average, according to the 2006 Consumer Expenditure Survey from the U.S. Bureau of Labor Statistics, Hispanic consumers spend $43,053 a year on household goods, apparel, transportation and other products and services.
May 27 -
A federal appeals court has upheld a lower court's ruling that AdvanceMe Inc. holds no patent on merchant cash advances.
May 23 -
The name change may seem subtle, but it reflects monumental changes. That assessment of the switch from Merchant Processing Inc. to Phoenix Merchant Processing Inc. comes from Jim Keller, CEO of the Beaverton, Ore.-based ISO.
May 23 -
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Heartland Payments Systems Inc., a Princeton, N.J.-based payment processor, is buying the Network Services business of Dallas-based Alliance Data Systems Corp. for $77.5 million, Heartland announced this week.
May 8 -
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