All GLG News Analyses Filed Under: Transaction & Payment Processing

Kamala WorthingtonPresidentKW Marketing Consultant

Chase Expands Surcharge Free ATM Access At Hess Express Gas Stations In NY & NJ

March 7, 2008

Analysis of:Chase in ATM Branding Deal With Hess Express Gas Stations | www.finextra.com

"Chase What Matters" is Chase's new tagline in its national ads. Chase's customers' are saying "surcharge free ATM access" is what matters to them, which is why Chase is expanding its ATM branding deal with Cardtronics to install Chase branded ATMs at Hess Express Gas Stations in NY and NJ. Surcharge fees have continued to rise since 1996 when the average surcharge fee was only $0.45 cents. The $2.00 surcharge fee is the most common, however, in the last year some banks have raised their surcharge fees to as high as $3.00 for non-bank customers. As of July 2007, U.S. consumers paid over $4.4 billion in ATM fees. Chase's ATM branding deal with Cardtronics is a great business case of how a bank can expand its ATM network without the investment of building more branches or locate prime space to install ATMs. Cardtronics owns and operates the machines and Chase's customers' gain "surcharge free" access at Duane Reade in NY, NJ & CT and now at Hess Express Gas Stations in NY & NJ.

Kamala WorthingtonPresidentKW Marketing Consultant

Debit Card Growth Continues to Skyrocket; Surpassing Other Payment Instruments

March 5, 2008

Analysis of:Debit Cards in Use to Reach 5.2 Billion By 2012, According to New Report by Global Industry Analysts, Inc. | www.prweb.com

Over the past five years consumers have chosen "debit cards" as their preferred payment of choice, trumping credit cards, cash, checks and other forms of payment. 63% of consumers chose debit cards for ease of use;57% perceive debit cards are safe and secure;53% chose debit cards because they can pay with their own money;while 49% said there is "no annual fee" assessed and 46% prefer debit cards because they provide access to cash. Debit cards growth has spilled over into POS (Point-of-Sale) transactions and fall into two categories: signature and PIN secured debit cards. Both types of cards draw on funds in a consumer's DDA (Demand Deposit Account). Debit cardholders can choose whether to authorize a POS debit card purchase with a signature or by entering a PIN. Based on whether the consumer chooses signature or a PIN secured POS transaction determines which type of payment network will process the transaction, i.e. a branded network or ATM/EFT network (Electronic Funds Transfer).

MasterCard’s coherent global structure is a material advantage over Visa’s federation

March 3, 2008

Analysis by: GLG Expert Contributor

Analysis of:IPO Approaching, Visa on Separate Path from Rival | www.americanbanker.com

On the eve of Visa Inc.’s IPO, there are important differences between it and MasterCard in terms of global coherence, size, system architecture, management and legal liability exposure. Net, over the long haul MasterCard’s unitary structure should enable it to grow volume, transactions and therewith earnings faster than its larger cousin and consequently to command slightly higher valuation multiples.

While Visa Inc's payment network is a magnificent asset, its IPO won't be a bargain

March 3, 2008

Analysis by: GLG Expert Contributor

Analysis of:Subdued Vista for Visa's IPO | online.barrons.com

Visa Inc.'s IPO, unlike MasterCard's, will be fairly and fully priced. Nonetheless, it is a compelling story with a huge opportunity to improve operating margins, in important respects more attractive than MasterCard and in others tangibly inferior.

Kamala WorthingtonPresidentKW Marketing Consultant

United Technologies Goes Public With $3.0 Billion Bid for Diebold

March 3, 2008

Analysis of:United Tech Makes Bid for ATM Maker Diebold | www.reuters.com

UTX has made an unsolicited bid for ATM manufacturer Diebold for approximately $3.0 billion in an all cash offer. UTX believes Diebold would benefit from its "international presence and disciplined operating systems." UTX has been pursuing Diebold for the last two years, however, Diebold's management has rebuffed previous attempts by UTX to merge or be acquired. UTX is now making public its intentions to acquire Diebold by going directly to its Board, however, the Chairman of the Board of Directors for Diebold has also rebuffed UTX's offer to acquire Diebold. UTX has been eyeing Diebold's Security Systems Unit and other computer hardware in an attempt to breathe some life into its fledgling Fire and Security Unit that UTX acquired through acquisitions in 2004. UTX's CEO, George David, would also like to close a big deal such as 'Diebold" before his anticipated departure from UTX by year end. UTX's offer is roughly 27% lower than Diebold's 52-week high of $54.50 in July 2007.

Kamala WorthingtonPresidentKW Marketing Consultant

Visa Ups the Stakes With $19 Billion IPO Which Is Expected To Shatter U.S. IPOs On Record

February 29, 2008

Analysis of:IPO REPORT: Visa Would Be Richest-ever U.S. IPO At Nearly $19 Billion | www.smartmoney.com

Visa's much anticipated IPO could shatter the current Top 10 U.S. IPOs on record and go down in history as the largest U.S. IPO if Visa's share price hits its target price of $37 to $42 per share. Visa is facing a sluggish market that is hampered by the U.S. credit crunch. Visa is hoping to usurp its rival MasterCard who's IPO raised $2.4 billion. Visa had originally indicated it wanted to raise $10 billion, however, in its amended registration statement filed with the SEC, Visa plans to raise up to $19 billion in its long awaited IPO. Visa will float a little more than 50% of the company to the public. Despite current market conditions, debit and credit card volume is projected to grow by 11% CAGR annually from 2006-2012 and Visa owns 66% market share of debit and credit card transaction volume. Visa is pushing for a "cashless" society, which has influenced debit and credit card growth as consumers' payment preferences shift from cash and checks to debit and credit cards.

Strange move by Diebold

February 29, 2008

Analysis by: GLG Expert Contributor

Analysis of:Diebold to cut 800 jobs due to deteriorating credit markets | www.atmmarketplace.com

Diebold cuts 800 jobs despite growing ATM markets in Asia, Australia and elsewhere. While blaming the credit woes in the USA for this move, one wonders if bigger issues are at play.

Merchant Cash Advance Concept

February 28, 2008

Analysis by: GLG Expert Contributor

Analysis of:Merchant Cash Advances Open Doors | www.greensheet.com

The Merchant Cash Advance Concept is not new.  I have been in the regional and community bank business for over 40 years, and I was with a reginal bank that was using a broader concept that the one described in the commentary in the 1960s.

Credit Squeeze Release Valves Open Wider

February 28, 2008

Analysis by: GLG Expert Contributor

Analysis of:Merchant Cash Advances Open Doors | www.greensheet.com

An upswing in the merchant cash advance business is just one of the ways a need for cash in the small business sector is met and banks may be happy right now to let this business slide off their plate.  But with the small business sector continuing to outpace the market in terms of real growth, are they missing a very real revenue opportunity?  Is it time for banks and regulators to create finance vehicles that make sense to everyone in a near-prime market?

Win-Win Logistics Move - FEDEX - Wincor Nixdorf

February 28, 2008

Analysis by: GLG Expert Contributor

Analysis of:Wincor Nixdorf, FedEx partner to provide nationwide ATM service, support | www.atmmarketplace.com

 The major key points will be: Optimizing the relationship between the two companies. Providing a positive alternative to Wincor Nixdorf on their supply chain needs. Optimizing distribution channels and storage space. Facilitiating quicker response to customers.

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