2013年9月2日星期一

IMPACT ON KOREAN INDUSTRIES

Economic deterioration of emerging markets is causing alarm among Korean enterprises. With the financial markets in emerging economies in chaos, there is growing concern for those companies that have already made investments or have been exporting to those markets, since they can be hit by rapid decrease in local spending. Domestic exporters have invested heavily in the region in an attempt to lower their dependency on the US and Chinese markets. Their direct investment in India, Indonesia and Brazil for eight and half years from 2005 to June 2013 amounts to 12.8 trillion won.

In particular, the Hyundai Motor Company is in trouble since India and Brazil are two major markets in the volatile region. It has a plant in India with 600,000 units of annual production capacity, which makes it the second largest among overseas manufacturing bases. Last year, it completed a factory in Brazil that can produce 150,000 units a year in order to enter the South American market.


In India, Hyundai Motors sold 220,000 units in January-July 2013, 5 percent yearon-year drop. That is still an increase in sales, given that the country’s total auto sales in the same period fell 10% to 1,450,000 units compared with last year. But there is possibility of production cuts in the event that demand is further easing.

This year, the company has seen an increase in sales: Russia with a year-on-year increase of 2.1%, Brazil with 128.3%, and China with 30.4%. And yet, Hyundai is nervous about whether an economic crisis will be expanded to other emerging markets.

Hyundai Motors is less worried about its plant in Brazil, but feeling a sense of crisis. Hyundai’s model named HB20, which is specifically designed for the Brazilian market and introduced at the end of 2012 after opening a new plant in the country, has been so popular that more than 70,000 units were sold until June2013. Nevertheless, the company is still concerned that its auto sales might lose momentum.

Meanwhile, it is difficult for domestic steel makers to export their products to faraway countries, such as Brazil and India. Therefore, steel exporters are experiencing poor sales performance in those nations. The industry is keeping a close watch on the situation in emerging economies because economic slowdown can affect their plan to build production facilities in Brazil and India.

Since 2005, POSCO, the world’s fifthbiggest steelmaker, has been proceeding with a steel mill project in Odisha, India with US$12 billion in investments. But the company has yet to set the start date of the offshore merchant account. In addition, the Korean steelmaker announced in July that it decided to pull out of its second steel mill development in Karnataka. Even though local residents’ opposition was the main reason behind POSCO’s decision, the choice can be interpreted in a way that faltering economy in India is a hindrance to its steel mill project. In other words, the company isin disadvantageous situation because a strong dollar will lead to the increase in raw material prices in the event of a financial crisis in emerging markets. Recently, the company’s direct investments in foreign markets jumped 40%.

The domestic electronics industry also began to keep a close eye on the situation. Samsung Electronics is running seven factories that manufacture TVs, mobile phones and home appliances in Brazil, Mexico, Egypt, and India although the company is exporting massive volumes of its products to those countries. A spokesperson for Samsung Electronics said, “We think that fluctuations in currency can have a negative effect on our export performance. So, we are closely monitoring the situation,” adding, “We anticipate that the rise in raw material prices will eventually happen.”
LG Electronics is in trouble as well. Since 2009, the company has concentrated on the expansion of its brand shops in rapidly growing and volatile economies of some Asian and Latin American countries. LG has been heavily involved in those markets due to the financial crisis in the US and the EU.

For mobile phone makers, the smartphones market in India, one of the world’s major markets together with China and the US, is of concern. According to the latest research from Strategy Analytics (SA), Samsung’s market share in India was 42%, ranking top in the first quarter of this year. Until last year, its annual growth rate for the Indian mobile phone market was 163%, surpassing that of markets in China (86%), Japan (24%), and the US (19%). But the market research firm says that in case of contraction in local demand, it is difficult to expect rapid growth.

Construction companies, chemical suppliers, and shipping companies in Korea, for which emerging markets are of little importance, are also keeping a close watch over the situation while anxious about the global economic contraction arising from those countries’ currency crisis.

However, the construction sector does not think that they are highly vulnerable to exchange rate fluctuations since they are mostly paid in dollars. An industry source remarked, “We are not heavily affected by exchange rate volatility in that we mostly purchase materials in neighboring countries in dollar. But we think that shrinking economy may cause a slight decrease in demand.”The chemical industry is not feeling the economic pain, either. Exports to certain Asian and Latin American countries are miniscule amounts. Besides, locally made products are consumed by local people.

The shipping sector, like the chemical industry, is not directly hit by economic woes of rapidly growing and volatile economies. Nonetheless, shipping companies consider the possibility of some reduction in commercial traffic caused by economic slowdown. An official in Hyundai Merchant Marine (HMM) pointed out, “The emerging markets account for merely 10% of the total markets. But there is possibility of reduced commercial traffic and a decrease in ocean freight rates. So, we will wait and see what happens next, and prepare for measures if necessary.”

The Korean securities industry also believes that the impact of speculation about emerging economies on the shipping industry is minimal owing to increasing freight rates, as well as expectations that the condition in the shipbuilding industry will improve thanks to economic recovery of the Euro zone. Analyst Lee Kang-rok from Kyobo Securities said, “We are temporarily witnessing the stock price adjustment process for the shipping industry caused by rumors about economic crisis in volatile markets in Southeast Asia. But Korean companies are expected to win more contracts in September when the vacation for European ship-owners is over.”

The situation in some Asian and Latin American countries is affecting our exports at the moment. According to Korea’s export performance from January to July 2013 by the Ministry of Trade, Industry and Energy (MOTIE), the growth of Korean exports to India fell 7.1%from a year ago. Korea also saw a year-on-year decrease of 15.7% and 15.1%in exports to Indonesia and Brazil respectively. Given that Korean exports grew 0.5%so far this year, exporters find themselves floundering in those markets for seven months.

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Somalia nationals jailed for firing

Three Somalia nationals were sentenced to 10 years' jail each, while four others to eight years imprisonment by the High Court here today after they pleaded guilty to firing at Malaysian soldiers in the Gulf of Aden two years ago.Judge Datuk Mohd Azman Husin handed down the 10 year-jail on Ahmed Othman Jamal, 30, Abdil Eid Hasan, 22, and Abdi Hakim Mohd Abdi, 22.

The four Somalis who were sentenced to eight years' jail were underage individuals. He ordered all of them to serve the jail sentence from the date of their arrest on Jan 20, 2011. The charge against them was read in English and translated into Somali.


When handing down the decision, Mohd Azman said the court took into account their guilty plea, background, threat to the world community and other factors, and found the jail sentence meted on all the accused, including the juveniles, was apt.

All the accused were seen smiling after Mohd Azman handed down the sentence.The Somalis were initially charged under Section 3 of the Firearms (Increased Penalties) Act 1971 with discharging firearms with intent to cause death or hurt on the Malaysian soldiers during a robbery onboard Bunga Laurel vessel.

The charge provides for the death sentence upon conviction. However, the charge was amended today and all of them, including a few others who are still at large, were charged with discharging firearms at the Malaysian soldiers to avoid them from being lawfully arrested by the Malaysian Armed Forces (ATM).

The offence was committed on board the Bunga Laurel vessel at 250 nautical miles of Oman between 8.10 and 10pm on Jan 20, 2011. The charge, under Section of the Arms Act 1960, read together with Section 34 of the third party merchant account, which carries a life imprisonment or for a term not exceeding 14 years.

Today, the case was fixed for hearing, but the prosecution, headed by Deputy Public Prosecutor Mohamad Abazafree Mohd Abbas amended the charge against all the accused after discussing the matter with the defence counsel.Meanwhile, in mitigation, lawyer Imran Hadzalie Abdul Hamid, representing Ahmed Othman, Abdi Hakim and an underage accused, said his clients had extended their full cooperation during investigation of the case.

Lawyer Edmund Bon, representing another of the underage individual, said the court should consider the accused guilty plea and that none of the Malaysian soldiers were injured. However, Mohamad Abazafree asked for a heavy sentence as the offence was a serious one.
"Based on the facts of the case, all the accused were arrested while attempting to rob the Bunga Laurel vessel in the Gulf of Aden. They were not normal robbers, but a group of pirates who was in the gulf, an area known for pirate attacks on merchant vessels.

"They also used firearms to attack ATM and attempted to capture the crew on board," he added.Citing the 'Reports on Acts of Piracy and Armed Robbery against Ships -Annual Report 2011', Mohamad Abazafree said there were 286 incidents reported.He said Malaysia was not the only country to detain and brought back the pirates to be tried as the Somali pirates had been prosecuted in several other countries, including South Korea, Holland, United States of America and Kenya.

According to the facts of the case, all the accused were in a small boat, which then approached Bunga Laurel with an intention to rob the vessel, but their action was discovered by an officer-in-charge who saw, through a binoculars, one of the pirates getting into the vessel.

The assault on the pirates was carried out from the Royal Malaysian Navy (RMN) Bunga Mas 5 vessel and the team won over possession of Bunga Laurel, within two hours after it was hijacked by the Somali pirates.Following a search, the RMN found several firearms, including two AK47 rifles, a pistol, more than 150 rounds of ammunition, hammer and a ladder used to climb into Bunga Laurel.
The prosecution team also comprised deputy public prosecutors Yusaini Amer Abdul Karim and Lailawati Ali, while other lawyers representing the accused were Lee Teong Hui, Saha Devan A.Arunasalam and Ameenudin Ibrahim.

A fixed Ujrah fee is levied by the bank in exchange of the services, features, benefits and privileges enjoyed by cardholders. The credit limit granted to the cardholder is based on Qardh al Hasan. The Meethaq MasterCard credit card allows access to almost anything – shopping, travel and bill payments without the need for cash or cheques.

The card is accepted globally at over 32 million merchant establishments and ATMs. Customers receive SMS alerts for every card usage and cash withdrawal regardless of any transaction amount. The chip and PIN card ensures secure transactions, especially online transactions. MasterCard Secure code allows cardholders to use a personal password/secure code which provides added security for online transactions.

Sulaiman al Harthy, group general manager - Islamic banking, said, “Meethaq is proud to launch the first Sharia based credit card in Oman as part of its focus to take the lead in offering a suite of banking products which combine traditional values with modernity and ensure the choice of staying true to one’s values. Meethaq has adopted the best practices in Islamic banking and finance worldwide to combine a robust model which protects customers and complements the Islamic banking industry. The Meethaq strategy is to attract customers through innovative Sharia based products and services.”

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2013年8月28日星期三

Inside SnapScan

Stellenbosch’s SnapScan, whose smartphone application won MTN Business’s 2013 App of the Year award this week, is betting that consumers will take to the idea of making in-store payments using their mobile phones instead of credit or debit cards.SnapScan falls under FireID, the company that now houses six start-up technology businesses, SnapScan being the most recently launched.

FireID started life as an information security company specialising in “two-factor authentication” technology for mobile phones. It was funded by billionaire Johann Rupert, through Reinet. Justin Stanford, one of FireID’s co-founders, was instrumental in securing the initial capital injection. However, Stanford was unable to convince Reinet’s investment committee to continue investing and in 2011 it pulled its funding of FireID, forcing the company to lay off its 40 employees. A month later, former Mxit boss Alan Knott-Craig, through World of Avatar, came to the rescue, but the terms of the arrangement were not made public.

SnapScan co-founder, 28-year-old Kobus Ehlers, says there are a number of benefits to this approach for retailers. “It takes about 30 seconds to sign up. We issue a QR code, which you print, and you’re done.”Merchants without bank accounts can cash out their takings at the end of the day. “Customers can pay with the app, the retailer can then get a voucher code at the end of the day that they can punch in at a Standard Bank ATM — or hand over at a Spar — and get cash.”

If customers don’t have the app installed, scanning the QR code will take them to the relevant app store where they can download it.“Payment information sits securely in the app,” Ehler says. “So, your card details only have to be put into the app once and thereafter all you have to do is enter your Pin. This means we never transmit your card details to the merchant.”

The company makes its money by charging a small transaction fee to the retailer on each purchase. This fee varies. “We take a small transaction fee, much like the acquiring component to third party merchant account,” Ehlers says. SnapScan has a partnership with Standard Bank, which means it can process transactions at “competitive rates”, he adds.In addition to transaction fees, SnapScan offers its customers the option of accessing analytics or running loyalty programmes, both of which are billed as add-ons.

The company offers three products. The first is an “instant merchant product” aimed at informal retailers who want their takings in cash. The second is the “standard” product that settles into a bank account like a traditional point-of-sale (POS) unit. The third is an “enterprise solution” designed to integrate with existing POS systems.

SnapScan started out operating in a number of stores around Stellenbosch. Ehlers was surprised by the good response  and the company is now planning to expand to Cape Town and Johannesburg. However, the timing isn’t confirmed yet. Expansion will be gradual and carefully monitored, he says.

“We work very iteratively. We want to understand the market really well. We’ve been really impressed with amount of repeat purchases we’ve seen in Stellenbosch along with the low rate of people abandoning it. To maintain that momentum we need to do a controlled roll-out.”Part of that means making sure SnapScan is accepted in multiple stores. “No one’s going to commit to an app if they can only use it in one store.”

Alipay, China's largest third-party e-payment provider, announced on Tuesday it will discontinue its still-nascent offline-payment service, a move widely perceived as a capitulation to its State-backed rival, China UnionPay.

While the company declined to elaborate on its reasons, industry observers believe Alipay's encroachment into the business of offline payments was eating away market share once firmly held by the country's largest card processor. UnionPay has recently insisted that its services are still required to conclude all bank transactions.

The abrupt cancellation of the collect-on-delivery service stands in stark contrast to Alipay's bold entry into the market last year, when it unveiled a 500 million yuan ($81.7 million) investment plan with the introduction of a handheld device to consolidate package tracking records with card payment functions.

The rollout was part of the broader strategy of Alibaba Group Holding Ltd, Alipay's parent, to grab a bigger share of business in the financial sector and satisfy soaring demand for package-tracking from China's booming e-commerce industry.

According to iResearch, a Beijing-based IT consultancy, online payments are expected to account for only 15.8 percent of all online transactions in 2015. About 70 percent of all online purchases made on China's business-to-customer sites are paid on delivery.

While Alipay holds almost half of the online-payment market, that has failed to translate into even bigger revenue, given consumers' preferences to pay for online-purchased, big-ticket items at the time of third party payment gateway.

Delivery people in China typically carry two devices, one for tracking and the other a portable POS terminal. Alipay's wireless device was able to combine both functions into one machine, ensuring that merchants receive payment within 24 hours of delivery.


Zhu Zhu, a Hangzhou-based company spokeswoman, said that over 10,000 such devices, which cost less than its competitors, were installed nationwide to cover e-commerce logistics, airlines operators, hotels, and similar businesses.

According to a news release by Alibaba's public relations team in Hong Kong in March, each Alipay device cost 3,000 yuan. To encourage use of the device, Alipay allowed package delivery services and e-commerce sites to use them for an unlimited period of time by paying a 500-yuan-per-device deposit.

Alipay said at the time that it was "essentially giving away these devices ... and is showing it's willing to lose money on hardware in exchange for a piece of the potentially vast revenue stream from COD processing fees," it said.

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Marketing in the New Cardless Society

If you walk into a Starbucks today, people are paying not with just their cards and cash anymore, but their phones, too. Consumers – at least in most parts of the world – are still getting used to the idea that their phones can function as debit or credit cards, but attitudes toward mobile money is going to change rapidly in the next few years.

The transition to mobile payments is by no means a bad thing, though. This presents unprecedented opportunities for card issuers as the marriage of mobile and payment technologies open a huge array of new location-based service options to reward loyalty, prevent fraud and create powerful partnerships.This has big implications for marketers. But as we move toward the reality of a cardless society, this new dynamic means card issuers must rethink branding, tracking, loyalty and monetization options that will no longer be possible without a physical card.

Many businesses are adapting to that new reality. For example, in January 2013, ATM maker Diebold debuted an ATM that allows consumers to scan their phones to withdraw cash, completely forgoing cards. Millennials, too, are putting pressure on companies to go digital. As online natives, they’re more accustomed to digital activities and more likely to adopt new digital payment forms such as mobile applications like LevelUp, which reward loyalty and change marketing dynamics. PayPal is moving into the mobile space, too, alongside Google and Twitter co-founder Jack Dorsey’s Square. With digital technology, financial institutions will lose traditional customer touchpoints such as direct mailings, disclosures and the delivery of third party merchant account. Brand and image will be relegated to the screen, rather than a card, so there will be a need to deliver value in real-time in order to connect with consumers.

Card issuers will need to work hard to make sure their brand doesn’t get eclipsed by the device delivering it. With no physical presence in a wallet, businesses can turn to digital services to differentiate. The organizations that establish an early presence with applications that touch a large number of consumers will have a significant competitive advantage over the next decade, especially when it comes to delivering location-based services. Through mobile payments, organizations can create campaigns that are truly relevant to a consumer’s location.

For example, if a family visits a college, the card issuer can offer real-time discounts on that brand of college merchandise. This location could also indicate that the consumers may be interested in a student credit card account. By working with retailers and other merchants to capitalize on location intelligence campaigns, card issuers can delight consumers as they walk in the door by offering a real-time discount on that specific merchant’s products. Coupling these campaigns with geo-fencing empowers consumers to disable location-based services when they’re not wanted, too. Not only that, when card issuers partner with other businesses, it’s possible to monitor activity for fraud more effectively. If an issuer’s card or service is used to pay at a a destination that isn’t recognized as an authorized retailer, financial institutions can analyze the transaction for potential theft or fraud.

When I was 15 or 16 I needed my mom to create a PayPal account using her credit card, so I could bid on something on eBay. Like many parents her age at the time, my mom held an unwavering fear of using her credit card online, likely fuelled by pre-2004 horror stories of people being duped into releasing their information to online scams.

Nearly ten years later those fears have completely diminished for the average consumer, regardless of age. We’re in the age of mobile commerce and today two Canadian companies have bridged the gap between online and offline payment for merchants. Along with Shopify’s announcement this morning, PayPal Canada announced an agreement with restaurant technology provider TouchBistro to allow customers to use their smartphone to check-in and pay with PayPal at cafés and restaurants at the POS.

The two competitors are both unveiling products in a space they envision to take off, one that hasn’t been taken advantage of by online retail solution providers. Why only offer merchants online stores when Shopify and PayPal can allow those stores to streamline operations?

Shopify is targeting its 65,000 merchants, as about one third of them also operate brick-and-mortar locations. It’ll cost merchants an additional $49 per month, while the hardware costs range from $19 for a credit-card reader to $499 for the whole nine yards. That includes a cash drawer, a bar code scanner, a receipt printer and aforementioned credit card reader.

“…the future of retail isn’t online versus in-store, it’s a seamless combination of both. Shopify has transitioned from simply powering online sales to powering all commerce: online, offline, third party payment gateway, and everything in between,” said Adam McNamara, Shopify's vice president of product.Shopify appears ready to initially bring in higher revenues from its offerings than PayPal. But PayPal may be the one who benefits most down the road.

PayPal is not only targeting a different clientele, but is executing a pilot program using TouchBistro for select restaurant locations in Toronto. TouchBistro provides a popular POS app used by over 1,000 restaurantss, cafes and food trucks. It is currently the top-grossing food and beverage app in 18 countries on the App Store. Using the PayPal mobile app, customers can check-in to these cafés or restaurants (even before they arrive) and pay using their PayPal account, where their name and profile picture shows up for cashiers.

They’ve even convinced popular startup coffee spot Jimmy’s Café, near Project RHINO, to accept PayPal mobile payments at their TouchBistro iPad POS. Unlike Shopify’s new offering, PayPal is betting on a hardware-independent approach.

"We're collaborating globally with existing POS providers so that businesses don't have to rip or install new hardware to deliver unique and useful mobile payment experiences for their customers,” said PayPal Canada’s Darrell MacMullin. “We're thrilled to work with TouchBistro…for our five million active PayPal users in Canada.”

Matthew Braga of the Financial Post wrote today that the iPad, which both Shopify and PayPal are using as the basis of their POS systems, “has quickly become a point-of-sale industry mainstay amongst hospitality and retail clients.

While traditional debit and credit terminals offered by banks offer scant analytical insight, the iPad systems promise more comprehensive options for “measuring sales analytics, maintaining customer databases, managing inventory and processing non-traditional forms of payment (such as devices using near-field communication or digital wallets).”

Braga wrote that the two companies are certainly targeting different audiences: Shopify is targeting its merchant customers who are already using its services, while PayPal is going after individual consumers.We’ll be sure to keep an eye on both these companies over the next six months as time will tell who ends up ahead of the other.

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2013年8月26日星期一

Navigating The Arctic's Icy Waters

Over the last few decades the Polar Regions have been experiencing an accelerated decline in ice cover due to global warming. Whilst the opening of arctic trade routes, most notably the Northern Sea Route and the Northwest Passage, may bear bountiful fruit for the shipping industry, the sector is also at the centre of much controversy over the use of these routes due to the huge potential and actual environmental impact that the movement of freight through these waters brings.

The shipping industry has often been blamed as a leading contributor to the increased carbon emissions, however the resultant melting of the Arctic ice actually poses huge opportunity for the industry.


The prospect of cutting voyage time is luring many owners to navigating their ships and cargo through the arctic region, due to the economic opportunity it presents. Therefore, this week Fathom takes a look at the exploration of the new shipping routes across the Arctic and the issues and benefits that ship owners face when it comes to thinking about navigating through the extreme conditions presented in the region to seek aforementioned economic opportunities.

We also study the future regulations that The International Maritime Organization (IMO) are currently exploring in order to protect the fragile environment and to mitigate the risks associated with moving freight across the arctic trade routes.

Black carbon (BC), also known as soot, is strongly light-absorbing carbonaceous material emitted as solid particulate matter (PM) and is formed by the incomplete combustion of fossil fuels, biofuels, and biomass. BC is the most effective PM, by mass, at absorbing solar energy and is one of the major causes of global warming. When BC is deposited on snow and high risk merchant account, it causes more sunlight and heat energy to be absorbed, resulting in surface warming. The potential rise in shipping traffic will result in further deposition of BC and therefore the risk of further melting is greatly increased.

 The shipping industry is a contributor of marine ecosystem degradation and therefore any increase in marine traffic within Polar Regions has the potential to cause major impacts to the ecosystems. These impacts could include oil spills, invasive species, marine mammal strikes, air, water and noise pollution and accelerated arctic warming from BC deposition.

The commercial shipping industry is thought to contribute about 1-2% of global BC emissions.Ships emit more PM and BC per unit of fuel consumed than other fossil fuel combustion sources due to the quality of fuel used.

Therefore, with the exposure of the Polar Regions, namely the Arctic, to increased levels of marine freight movement, the regulation and legislation around aforementioned impacts is under close scrutiny and development.

This increase in ice melt as a consequence of global warming and BC deposition has resulted in and will continue to result in the opening and expansion of passages that were once blocked by ice. The shipping community is fast jumping on the possibility of saving huge amounts of money on fuel and time by utilising these new routes.

 2013 seems set to be a record year for maritime activity on the 'Northern Sea Route'. There has been a tenfold increase in the number of vessels using the route during recent years. In 2012, 46 vessels sailed the whole route, compared to 34 in 2011 and only four in 2010.

As the Lloyd's Register Global Shipping Trends 2030 report points out, in future summer months when the ice has melted to a far more significant extent than today, it will be possible to cut journey times between Europe and Asia by up to a third by using Arctic routes.

The Northern Sea Route along the arctic coast of Russia reduces journeys between East Asia and Western Europe by 21,000 km, in other words, 10-15 days. The opening up of the Northwest Passage, which is currently only navigable one year in seven and crosses Canada's Arctic Ocean, would make a journey between East Asia and Western Europe about 13,600 km long as opposed to 24,000 km when using the Panama Canal. The Arctic Bridge linking Russia to Canada, and the Transpolar Sea Route linking the Arctic to the Strait of Bering and the Atlantic Ocean of Murmansk, would also be potentially usable.

Whilst shortening the voyage in theory is wonderful news for an operator looking to limit fuel costs and emissions; service providers and original equipment manufacturers need to understand how their products will operate under Arctic conditions, or even whether they need to start designing and testing new solutions in advance – though the IMO does not yet have an official set of guidelines that describes the requirements of offshore merchant account.

 Inadequate navigational aids, poor or non-existent charting, extreme cold and darkness, and lack of infrastructure are all concerns. The level of isolation means that should a vessel get into trouble, it will be difficult to secure a timely emergency response. Bunkering facilities, port reception facilities for ship's waste, pilotage in shallow passages, possible ice-breaking assistance all require further development.
This lack of experience in extreme and rapidly changing weather conditions could result in disaster and with polar regions being a hot topic, eyes will be watching the shipping community if vessels start utilising these channels.

The IMO is working with Member States and other interested stakeholder (such as NGOs) to develop a mandatory Polar Code to control the expected increase in shipping traffic in the polar waters. It is also intended to function alongside existing IMO conventions, such as SOLAS and MARPOL. The Polar Code will have to control traffic to mitigate against potential accidents. This will be achieved by drawing up traffic routeing and separation schemes, areas to be avoided, speed restrictions, and mandatory ship location reporting. The increased volume of traffic will however improve search and rescue capabilities in the Arctic waters.

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Middle East vandalism is destroying centuries

The Muslim Brotherhood in Egypt, for example, shows no regard for either Christian or Islamic heritage.Since violence erupted across Egypt over the ousting of President Mohamed Morsi, looting and destruction of historical relics have been commonplace. In the city of Minya more than 1,000 artifacts were stolen from the Malawi Museum, including a priceless 3,500 year old statue, pottery and coins.

Similar destruction has also been taking place elsewhere. After Islamists moved into Northern Mali, the great cultural city of Timbuktu was seized by an Islamic faction called the Ansar Dine. Referring to the ongoing demolition of property in Timbuktu, an Ansar Dine spokesman said, “The destruction is a divine order. It’s our Prophet who said that each time that someone builds something on top of a grave, it needs to be pulled back to the ground.”

Such events are not without precedent in Egypt. The Ancient Library of Alexandria which contained irreplaceable scrolls and manuscripts dating as far back as 300 BC. was forever lost in a devastating fire. Even today the library is regarded as a symbol of “knowledge and culture destroyed.”

Though four theories exist about the cause of the library fire, most Western scholars do not believe the blaze was the result of the Muslim invasion and conquest of Egypt in 641. Early Muslim writers, third party merchant account, claim the conflagration was ordered by Caliph Umar.

As Robert Spencer notes in his book Not Peace but a Sword, when Umar was asked why the library should be burned, he replied, “If the books in it agree with the Qur’an, they are superfluous. If they disagree with the Qur’an, they are heretical. Only one book was needed.”Even if the theory about the Alexandria library is not true, there are other examples that of similar destruction. Less than two years ago, nearly 200,000 books were destroyed in the Egyptian Scientific Institute in Cairo.

Religious icons, statues, paintings and the like are regarded as apostasy by Islamic purists. That is why representations and cartoons of the Prophet Muhammad are so inflammatory to the true believers.Mosques in Saudi Arabia are completely devoid of any ornamentation for that reason.After Mohamed Morsi became president of Egypt in the summer of 2012,  some followers called for the destruction of the Great Pyramids. The idea had been proposed in the past, but the lack of technology served as a preventative.

The most popular story about the Sphinx at Giza losing its nose is that it happened during the Napoleonic Wars. Other sources attribute the de-nosing to an incident in the 14th century when local peasants were found making offerings at the base of the Sphinx with the hope that Nile floods would improve their harvest. When a Sufi Muslim learned of the offerings, he became so angry that he destroyed the nose.

As so frequently happens in the chasm between Islam and the West, such concepts are completely alien to our way of thinking. Why would Muslims want to destroy Islamic culture?Much of the reason relates to ancient tribal traditions of the desert which are still very much in evidence in the Middle East today. Because of that tribal heritage, Islamists have no true national identity. They only relate the “culture” of Islam which is contained within the pages of the Koran. Nothing more is necessary.

Robert Spencer explains, “You can pretty much correlate in Islamic history the strength and aggression and rise of the great Islamic empires of the past with the size of the Jewish and Christian communities that were subjugated within those empires and were paying for that imperial expansion. When those communities were exhausted economically, then the Islamic empires went into decline. This is an absolute correlation.”One need only look at Detroit and it neighbors here in the United States for validation. Once the fourth largest city in the country, it has become so heavily influenced by Muslims that some have nicknamed it “Dearbornistan.”

As long as Islam remains a one way street, there can be no compromise with the West. As Spencer points out, “In Islam, any moral law can be set aside for the good of the Muslims. This is Islam’s only functional moral absolute.”Flipkart recently raised $200 million from existing investors, making it the single largest round of funding in the Indian ecommerce market. The Bangalore-based company is on a growth track without worrying about profits for a next few years. It is bracing itself for challenges arising from its transition to being a market place from being just a book e-tailer.

Sachin Bansal, founder and CEO, speaks to Business Line on its evolution, expansion and innovations that could be a game changer for any e-commerce company. Edited excerpts:You have been talking about changing your business model. What does that mean for the third party payment gateway? Has the process started? Of late, there have been several consumer complaints on non-delivery, delayed delivery and cancellation as well. Is this due to the transition? How are you tackling the issue?

Every time we make changes, there are challenges. We are facing some problems as we overlooked a few things. Service is in our blood and we are very proud of it. Recently, I would admit that there were a few problems and we are agonised due to this. But we will bounce back. It is a temporary mess on the supply chain side. We are working towards fixing the problems in a few weeks time.

The last round of funding will be used in setting up a good supply chain and logistics infrastructure. It will also help filter out good sellers from bad sellers. Also invest in creating a process that will manage the same and also develop talent.Does moving to a market place mean more profits? Is the company nearing the breakeven point?

In India e-commerce has happened, but it is still far behind the developed countries. Currently, it is at $1 billion and is expected to reach $76 billion by 2020. Our funding proves that investors are now willing to put their money in this growth story. The focus at this point in time is to get more customers to shop online and make it a regular activity. Right now, it is about achievements and not thinking about profits for the next few years.

We keep looking at opportunities. We are interested in two types of companies – a company which is doing something we haven’t or can not do; second, companies with technical expertise that can help us scale up. We are in talks with 20 companies at the moment.You have discontinued selling consumer durables, any specific reason?

We will be soon coming back with consumer durables. We are building a different supply chain for shipping large and bulky items, this will also include furniture.We will soon have furniture as a category. We are shipping electronics items to only 50 cities as of now. With the new supply chain, we will be able to serve to each and every customer having a broadband connection.There have been rumours of several e-commerce firms trying to get into pharmacy. Any plans on that front?
No, we have not considered it as a category.Amazon has entered the Indian market and many others are planning to enter. Besides, several offline players are also betting big on e-commerce. Does this bother you?We were very sure that as soon as the market starts getting bigger, several players, including the brick and mortar players, will be making plans. This means that the market is on an upswing and we are well prepared for that. Competition is expected and our strategy will be to maintain our leadership position.

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2013年8月19日星期一

Narendra Modi–the idea whose time

How ironical it is, that the touted dream team of Indian economy - Dr Manmohan Singh, Dr Montek Singh Ahluwalia, and P Chidambaram will leave a legacy of terrible growth deceleration, persistently high inflation, rising unemployment, and a depreciating currency after 10 years in office. But the "lost decade" under UPA is not just an economic disaster. This total economic collapse is only a natural consequence of appalling lack of leadership, absolute breakdown of authority, directionless decision making, zero accountability, and complete disregard for integrity and ethics.

Ten years ago, an India that was racing towards a global superpower status, and striving to reclaim its position in the league of world nations, has been plunged into an abyss of hopelessness and despair. The confidence, enthusiasm and vigor that were the catalysts of India's resurgence seem to have suddenly evaporated. And in this scene, the man emerges. History bears witness that time and again effective leaders, who can mobilize people, tackle tough problems and spot opportunities in crises emerge in times of great stress, change and uncertainty.

In India too, a fierce wild wind that is blowing from the western state of Gujarat has already rustled many dead feathers in Delhi; the name is Narendra Modi. The man's emergence on national horizon is not an overnight phenomenon. It is a result of a life lived completely in the service of the motherland, years of devoted work at grassroots level, and a decade of governance with administrative acumen and effective leadership.

Unlike the Congress and most regional parties where leadership is hereditary and an election ticket is taken as a birthright, Modi's claim to fame is only one factor - performance. Even in this atmosphere of gloom, Gujarat under his stewardship stands out as a beacon of third party payment gateway. As the reputed global news magazine the Economist puts it - "So many things work properly in Gujarat that it hardly seems like India." With 5% of India's population, Gujarat today accounts for 16% of country's industrial output and 22% of exports.

The state has consistently maintained a double digit GDP growth over the past decade, with agriculture growing at 10% consistently even as India struggled to achieve a low bar of 3%. As a result of sustained efforts undertaken by Modi and his team, Gujarat today has minimal labor issues, state-of-the-art infrastructure, uninterrupted power supply and supportive bureaucracy. The state known for traders only a few years back has made rapid strides in agriculture, manufacturing and services sectors. The average citizen so awfully let down by the current national leadership is naturally looking at Modi to steer India out of the current crisis, and his stellar track record obviously puts him ahead of others in the race.

When corruption seems to be the order of the day, Modi's personal integrity and honesty stands out. Modi, his personality, his style of functioning and his growth model have been subject to unprecedented scrutiny and analysis in the past few years. Any strong leader will have his share of adversaries in politics and media, and frankly speaking, Modi has more than his fair share of them.

But even Modi's most stringent critics and political opponents will admit that the man does not a have single blot of corruption or scandal to his name. Check this out - in the recent Wikileaks controversy over leaking of US diplomatic cables, every politician whose name figured in the cables stood exposed and tarnished. Modi's name was mentioned about 100 times in the cable, but he was the only politician, not just in India, but across the world whose name but did not contain a single negative reference. When politics India has become synonymous with dynasty and nepotism, how pleasantly surprising it is to know that the family of the chief minister of one the richest states in the country lives in a modest 2 bedroom apartment, away from the glamour and clout that they could have so easily commanded!

There goes a saying in India - good politics is not good economics, and good economics is not good politics. This is because when the focus of a political party is so jaundiced on winning the next election by hook or by crook, it leaves very little scope for pursuing an economic policy that take years to show results and bear fruits. Our economic disaster can partly be traced to the lack of political willingness to take tough, visionary decisions.

The UPA in past has resorted to disastrous schemes like farm loan waiver and NREGA with dire consequences to the economy. Their new initiatives like direct cash transfer and food security bills are steps in the same direction, taken only with a view on the coming general elections. Who cares about fiscal discipline? This is even after all policymakers have acknowledged that without proper infrastructure for third party merchant account, such schemes result in huge leakages and losses to public exchequer without bringing any tangible benefits to the lives of intended beneficiaries.

A politician's true test will lie in being able to take difficult, enduring decisions even if it requires risking short term political gains. Modi has demonstrated this in Gujarat time and again. In his tenure right from 2001, he has desisted from taking populist decisions or giving freebies. When he faced considerable opposition in the last state elections in 2012, he could have easily added a few more seats to his tally by announcing some freebies and subsidies here and there, but he resisted taking that path. Instead, Modi has always focused on generating investment which eventually leads to more growth, employment and better standard of living in the long run. It takes tremendous discipline and confidence in oneself to do this, especially when short term rewards are so attractive. No other politician in India except Modi had courage to oppose the proposed Food Security Bill, for the risk of losing some vote share.

But Modi's single biggest achievement has been to aggressively steer the national discourse from vote bank politics to development politics. One of the biggest drawbacks of Indian democracy is that electoral outcome is still based on caste/religious blocks voting en masse in favor or against a particular candidate. This remains the primary factor above all everything else, and the candidate's track record, integrity and other real issues get overshadowed. Modi has sounded a death knell to politics based on such narrow identity considerations. In the past ten years, he has never tried to polarize the electorate through caste-based references or policies. Elections in Gujarat have been fought purely on the basis of what the government has done in past 5 years and how that has affected the lives of people. In the process, he has offered himself, his government and his policies for unparalleled examination, criticism and debate. Every possible social/development indicator has been brought out and analyzed threadbare. If previous central and state governments had been subjected to even a fraction of assessment and scrutiny by the yardsticks that have been applied to Gujarat, India's situation today would have been radically different.

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Keeping employees happy goes a long way

A MONTH ago, 10 employees from Customer Care Center, a consulting firm specialising in customer care and behaviour, had a whale of a time in Cameron Highlands. In total, founder and chief executive officer Allen Teh had spent RM2,000 on the trip.Was this expenditure necessary? Isn’t it enough they are drawing salaries? Can’t they pay for their own recreation?

“There is no such thing as ‘I pay you, you work’. People are not robots,” maintains Teh, 51.Company trips, Teh said, are not only a way to foster team spirit, but promote a feel-good atmosphere at work.“It is an inside-out thing. Only when the staff feel good can they project the same feelings to customers,” says Teh.He cites exemplary figures who have influenced him during his work in the past.

“Public Bank chairman Tan Sri Teh Hong Piow is an example of a leader who has always treated his staff like family. He would attend their birthday parties and he mentioned them in his memoirs as well as referred to them as his ‘children’ though he had his own family,” cited Teh.

Another would be the late Loo Cheng Ghee who established the fried chicken giant KFC back in the 1970s.
Teh, who used to work for the company during the 1980s, revealed that Loo had made it a point to provide a breakfast of high risk merchant account and buns to employees in the Jalan Kuchai Lama branch where the fast food chain’s old manufacturing plant was located.In both cases, not only have these leaders inspired staff loyalty but a reputation for legendary service.

Taking a leaf from a layman is George James Kennedy, owner of Rockafellas Restaurants and Clubs, the holding company behind barbeza, a club in Ipoh Garden East.Pioneer staff have been with the former Juliana’s disc jockey since he opened Rockafellas Lumut, a seaside bar at the coastal port, popularly used as a gateway to Pangkor Island in 1998.

He cited his financial controller, Suzita Burda, now 32, and Inderjit Singh, now 35, who have stayed with the company for between 11 and 15 years. The others have clocked in no less than between five and eight years.In an industry notorious for its high staff turnover, Kennedy, 50, cites leadership by example as the anchoring factor to inspiring staff loyalty.

“In my bar, there is no such thing as ‘This is not my department’. I encourage my staff to take ownership of the club. If they see something is not right, they have to put it right. If I walk into the toilet and find that it is dirty, I will clean it.“I tell them if they can learn to cultivate the ownership attitude, they will develop a capable character. And I make sure I am always the first man in and last man out,” said Kennedy who got his first start in the nightlife industry as a deejay in Royal Casuarina (now Impiana Hotel) at age 17.

For Teh, imparting the feel-good philosophy at workplaces has to start with emotional wellness.“This is especially crucial for jobs where staff are subjected to high levels of stress. When people do not know how to release the emotional build-up from work-related stress, there is always a possibility they will snap at the customer and give the organisation a bad image,” explains Teh.

Kennedy, for example, expects his staff to be punctual and to keep to their word.“One of the common traits in human nature is procrastination. My policy is when something needs to be done, it is to be tackled immediately, not later or the day after.“But it is also important to remember being the boss does not mean you are always right.“When you have made a mistake, you must be big enough to apologise,” says Kennedy.

Honesty is also a much appreciated trait as Kennedy had to fire staff for messing around with company accounts in the past. And because they are in the nightlife industry where the influence of alcohol is unavoidable, staff must adopt a measure of vigilance.“In all my years in the industry, I have never had to hire bouncers. I will go in and defuse the situation myself,” said Kennedy.

On how to maintain grace under pressure, Kennedy shared a tip learned from a security personnel during his earlier years. The rule is to never stand in front of an aggravated individual in a confronting manner. Kennedy’s trick is to always slide next to him, offshore merchant account, pat it reassuringly and ask for the affected parties to keep the peace, guaranteeing safety for both workforce and customer.

How important is it to keep the hired help happy?Teh cites from personal experience how a rude sales staff at an electrical goods chain had cheesed him off so much with lackluster attitude, he walked away.

“I had wanted to buy a DVD player and I reckon the store didn’t lose much with just one customer walking away. But let’s say they could have made a margin of RM50 for one DVD player and say if the same employee would have made five customers walk away in one day. That’s RM250 of lost opportunity in a day. That’s only one shop. The electrical goods chain had 100 outlets. If that attitude prevailed in every shop on a daily basis, that would mean a loss of RM750,000 a month,” said Teh, who opines a reversal in behaviour could have changed things.

At barbeza, treating the staff like family is one factor that had helped him keep customers who had known him since he was a deejay in Casuarina. He recalls the day when he had to tell his staff in Rockafellas Lumut he had sold the business.“For the past 10 years, I was travelling back and forth between Ipoh and Lumut at odd hours in a Toyota Liteace. I was clocking in 16-hour work days where I would spend the night in Lumut then go to work in Ipoh. It came to a point when I asked myself what I was doing with my life,” revealed the father of a 19-year-old daughter.

By then, Kennedy had made close to RM400,000 from his investments and he was prepared to ‘retire’, by focusing on barbeza. Instead of leaving his staff demoralised and without employment, he asked them to join his new venture. In Kennedy’s case, creating an atmosphere where customers could go to a place where everyone knew their names contributed to sales of RM150,000 a month when barbeza first opened in 2008. Before Kennedy sold off his Lumut outlet in the same year, it had achieved a record sales of RM147,000 in the short span of nine days in 1999, a feat that inspired staff from the Lumut outlet to follow him to his new venture in barbeza.

“We achieved all this with no hanky panky, just good food and service,” boasted Kennedy.The memory of a treat, which saw an all-expense paid trip to Bali for five staff upon achieving a sales target of RM80,000, also played a part.In Teh’s case, revenue for Customer Care Center totaled to RM1.5mil to RM2mil last year. This came in from classes conducted including ‘mystery shopper’ services where company representatives posed as customers for clients to assess frontline performance.

2013年8月14日星期三

Chase Paymentech launches Chase Checkout

"We are always looking for ways to help merchants grow their businesses and Chase Checkout does just this by enabling clients to accept payments however they operate," said Dan Charron, president of Chase Paymentech. "Chase Checkout is a 'one-stop shop' for small-business owners: one agreement, one system, one statement and one trusted merchant services' relationship to manage."

The Power of a Single, End-to-End Payment Partner
Chase Checkout gives merchants the convenience of working with one trusted provider - with integrated reporting, 24/7 live U.S-based customer support and a commitment to security- when they accept payments via:


Mobile Checkout: When merchants accept mobile payments with Chase Paymentech, they can process credit and signature debit card payments and gift card transactions in any location within the third party merchant account. Merchants have transaction level access to monitor and process voids and returns from their smartphones. Merchants can view sales and transaction summaries from the Mobile Checkout app after the payments have been processed.

Additionally, they can create a catalog of item descriptions and images and email or text digital receipts. The use of signature capture and the location of the point of sale on the digital receipt helps minimize fraud and chargebacks. Finally, merchants' customer data is protected in transit with point-to-point encryption.

Retail Checkout: In retail settings, Chase Paymentech's Future Proof Terminal helps merchants accept both traditional and emerging forms of payment such as EMV (Europay, Mastercard and Visa) chip-enabled cards, NFC-enabled (near field communications) mobile wallets and other contactless payments. Also, through iTerminal?, businesses and professional service firms such as accounting, law and medical, can use their existing computers to accept payments, helping them save on traditional start-up equipment costs.

Online Checkout: Chase Paymentech offers e-commerce merchants, and merchants who accept telephone orders, a suite of PCI-compliant and easy-to-use web-based payment processing options accessible with a merchant's existing computer. These options require no additional hardware and integrate seamlessly with merchants' shopping cart functionality, catalog creation and inventory management.

Chase Mobile Checkout is ideal for merchants who are interested in growing their business by taking payments wherever their business takes them. This includes businesses that wish to use mobile payment acceptance to enhance their customers' experience with services like line-busting or those that wish to accept payments in the field, third party payment gateway, maintenance or transportation professionals. In addition, Chase Mobile Checkout is ideal for small businesses that want to accept debit and credit cards but have found it too difficult or too costly to do so in the past.

"The ability to serve my customers from anywhere helps deepen my relationship with them," said Irina Zhuravsky, owner of Irina's Alterations in Dallas, TX. "It's comforting to know that I'm receiving the support and security I need from Chase to conduct transactions while on the road."

Chase Mobile Checkout's compact card reader is battle-tested for real-world use. The device, which fits securely in the audio port of Apple and Android-enabled smartphones, features the recognizable Chase octagon and includes a rechargeable lithium ion battery so it does not drain the smartphone's power supply. Having an integrated battery also increases the likelihood of positive card reads on the first swipe, and since hardware encryption is performed in the device, personal information is not stored within the smartphone.

"Chase Mobile Checkout is not just smaller than carrying around a cash register, it's built for jobs like mine," said Jamie Rourke, co-owner of RO Style Salon in Tampa, FL. "When I am not in the salon, I travel all over the nation as a freelance artist. It is so convenient and important for my business to take a payment anywhere, 24/7, and it makes being a business owner that much easier."

The setup for Chase Mobile Checkout is simple. After merchants activate their account, Chase Paymentech ships the card reader along with instructions on getting started that include how to download the Chase Mobile Checkout app onto a smartphone.

The success of social networking community Twitter has given rise to an entire shadow economy that peddles dummy Twitter accounts by the thousands, primarily to spammers, scammers and malware purveyors. But new research on identifying bogus accounts has helped Twitter to drastically deplete the stockpile of existing accounts for sale, and holds the promise of driving up costs for both vendors of these shady services and their customers.

Twitter prohibits the sale and auto-creation of accounts, and the company routinely suspends accounts created in violation of that policy. But according to researchers from George Mason University, the International Computer Science Institute and the University of California, Berkeley, Twitter traditionally has done so only after these fraudulent accounts have been used to spam and attack legitimate Twitter users.

Seeking more reliable methods of detecting auto-created accounts before they can be used for abuse, the researchers approached Twitter last year for the company’s blessing to purchase credentials from a variety of Twitter account merchants. Permission granted, the researchers spent more than $5,000 over ten months buying accounts from at least 27 different underground sellers.

In a report to be presented at the USENIX security conference in Washington, D.C. today, the research team details its experience in purchasing more than 121,000 fraudulent Twitter accounts of varying age and quality, at prices ranging from $10 to $200 per one thousand accounts.

The research team quickly discovered that nearly all fraudulent Twitter account merchants employ a range of countermeasures to evade the technical hurdles that Twitter erects to stymie the automated creation of new accounts.

Bulk-created accounts at these Webmail providers are among the cheapest of the free email providers, probably because they lack additional account creation verification mechanisms required by competitors like Google, which relies on phone verification. Compare the prices at this bulk email merchant: 1,000 Yahoo accounts can be had for $10 (1 cent per account), and the same number Hotmail accounts go for $12. In contrast, it costs $200 to buy 1,000 Gmail accounts.

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Earnings Call Transcript

Thank you, very much [Ork]. Good morning, everyone and thanks for coming so many of you again to join us for the presentation results for the year into June 2013. For us the overwriting theme of the year is seeing the momentum of the results credit to sticking to our long term strategy. So that starts for us with the fact that we are now in the seventh year of the focus on customer satisfaction and I will go into a moment, we've seen that at record high in this period, but most importantly see those highs translate into momentum in terms of increase in products for customer growth and the balance sheet.

We've seen a productivity culture, enabling investment. So the long term focus on making the prices more efficient, making the whole group more efficient, enabling us to continue to invest. On that theme of high risk merchant account, what we've seen in this period is a couple of things.

Number one, the completion of the sixth year co-bank modernization program. So that team has now been dispended. The 1500 people working on that in fact doing other things that is now completed and we are now shifting our focus to leverage -- continuing to leverage that and innovating on the back of that core and finally the benefit of just sticking with a considerable bit of setting. So we came into considerable bit of settings.

You will see in the presentation that they have been further strengthened. So the customer focus, the productivity, the technology the conservatism, these are common themes and the results for the period show that they are continuing to produce good results.

In terms of the themes business by business, the retail banks 13% cash impact growth was a very, very strong result. One of the features of this result is ongoing strength in the top line and it starts with the retail bank. So income there up 8%, against that strong income growth, expense is very well managed 3% growth year-on-year.

You can see on the more negative side that 11% decrease in deposit income and you got to hear across multiple businesses for me and from David, no doubt for those of you speaking to group executives this common theme that as a result of ongoing deposit competition and the low rate environment, we got ongoing [pitch] on deposit income and you can see that in the retail bank.

Business and private bank net profit after tax down 2%. The standout feature here, first of all we did see strong balance sheet growth. So all those system growth and business lending can be quite high to major against any major system growth of 4% balance sheet growth in that Business Bank exceed system growth while credit quality has been maintained. Expenses were flat, so real focus on productivity in that business. Again you can see a lower net interest margin, again the story of a low interest rate environment and competition flowing through into deposits.

This is the latest in a series of announcements for SNAPCAM, after it was unveiled as a 'Hero' launch app by Stephen Elop for the new Nokia Lumia 1020, while it recently revealed its partnership with printing giant Xerox.

SNAPCAM is the disruptive photo app that allows users to create digital photo albums, which can then be shared, printed and delivered as physical albums.

Users can organise pictures into 'events' and share these with friends and family, who can add their own shots too. In a few clicks, these can be transformed into full colour, printed photo albums and delivered to many countries across the world.

The app integrates directly with third party photo sources, including Facebook. It also offers photo enhancement, offshore merchant account, edit, crop and add finishing touches to their photos before sending them to print.

The partnership will see SecureTrading processing payments from across the globe, with the service going live in 40 countries. On top of the payment gateway, SecureTrading will also provide a suite of bespoke counter-fraud services.

"Steve Hayward, CEO at SNAPCAM said: "By working with SecureTrading we have brought to life our 'thinking globally, acting locally' ethos and developed it beyond having an environmentally sensitive product. By being able to provide competitive, locally sensitive pricing in local currency to all our territories, we are helping to drive the physical photo revival globally."

Justin Fraser, head of sales and marketing said: "SNAPCAM is one of the few apps that has immediate global appeal. There's no doubt it is going to explode in popularity, and we're relishing the opportunity to support SNAPCAM and add value to the business throughout its growth."

2013年8月12日星期一

How David Marcus is dismantling PayPal

On the third floor, PayPal President David Marcus shows me a sea of high-walled beige and grey hexagonal cubicles. The kind you stared at for 16 hours a day if you worked at a Peninsula-based, late-1990s tech company. They look identical to Yahoo’s except no purple and yellow. The walls block out most of the natural light in the room and any sign of coworkers. Even “Cubicle Guy” would have to stretch to prairie dog over them. Marcus can’t hide his contempt looking at them.

On the fourth floor, you could hold a middle school prom. It’s just a huge, flat empty space. Those same cubicles are there, only they’ve been dismantled and leaning against walls. It’s so flooded with the July San Jose sun, it’s almost blinding. “The carpets are next,” Marcus says, of the ugly beige floors with darker beige squiggles on them.

On the fifth floor, though, I see David Marcus’ vision of the future, what working at PayPal could be like. It’s an open environment with modern white and chrome desks, no walls between them. Along the walls are open collaboration seating areas meant to deemphasize conference rooms. There are still a few conference rooms that you can reserve for third party payment gateway, though very few. In their place are several small “focus” rooms that don’t operate on a schedule.The message? If you can actually see your coworkers, you don’t need more meetings, because you are always working together. Marcus mutters something about PayPal’s “meeting disease,” as we walk past.

The entire company is going to look like this soon. Nearly 3,000 cubes are getting thrown out. Marcus is going to force people to work together via every means necessary, even furniture. Force the company to operate in small teams. Force them to collaborate on everything. Force them to be — groan with me, if you’ve heard every other guy at a has-been large tech company say it — more startup-like.As he’s stripped away worker comforts, many have balked at these changes and others he’s instituted over the the year and five months he’s been in charge. Those people, Marcus says, need to go.

“There are plenty of companies in Silicon Valley that have cubicles,” he says. “They are welcome to go find them. It’s harsh but you have to let people know it’s happened. This is how it is.” He stops just short of saying, If they don’t like it, they can leave. But it’s clearly the message. “You can’t change the culture nice and slow and gently,” he says. “You need a series of electric shocks. The more violent the better.”

Marcus has inherited a turnaround story unlike almost any other playing out in the tech rustbelt today. PayPal is still the market leader in its category. Not just by market cap and number of employees but by transactions, too. PayPal isn’t a fading legacy brand like Yahoo–  it’s still growing. PayPal is heralded as one of the best acquisitions in Silicon Valley history. It’s one of the key things that has been pushing eBay forward: Payments have increased from 24 percent of eBay’s revenue in 2006 to 43 percent last year. Its CEOs have repeatedly said that one day PayPal will be bigger than eBay.

Silicon Valley is obsessed with network effects, or when the benefit of others being on a site makes the experience that much better for everyone – and more valuable to the company. Network effects give you an unfair advantage over newcomers; even a challenger that’s technically better will struggle to pose a threat. (Witness PayPal’s parent company eBay.) Forget building a $1 billion company. Network effects are how you get a $10 billion company.

But PayPal is the cautionary tale of what happens when a network effect works too well. It turns out that solving the many security, fraud, trust, marketing, and chicken-and-egg challenges of building a new system for buying and selling goods around the world creates a moat so wide and deep it can actually be a problem.

Simply put: PayPal got soft. It stopped innovating, because it didn’t have to. PayPal was one of the most ambitious startups of the late 1990s, co-founded by the holy trinity of intense over-performers Max Levchin, Peter Thiel, and Elon Musk. As that talent migrated, offshore merchant account, the new team realized no one was chasing PayPal any longer. Its sprint slowed to an amble. It still grew. PayPal took a break, got a snack, and took a nap. It still grew. Pretty soon PayPal’s technical muscles started to atrophy. Pre-Marcus, PayPal was still dominant and growing but was also fat, slow, and out-of-touch.

“I’ve never seen as many things broken, and a company still being successful. It was just kinda bizarre,” says Bill Scott previous director of ecommerce UI at Netflix and one of the key new hires Marcus has brought in to transform PayPal’s user experience and make it a more lean, iterative organization.


Under PayPal’s previous regime several sources have told me that the company actively tried not to hire the best engineering talent, because great developers are a headstrong, disruptive force. They just wanted competent coders who could get the job done.

Ship Values Rebounding Most

The value of five-year-old Capesizes, the largest iron-ore carriers, rose 5.7 percent to $31.4 million this year, while Panamaxes, the biggest to navigate the Panama Canal, climbed 16 percent to $21.2 million, according to the Baltic Exchange. Investors should buy Golden Ocean and Norden because the shares don’t fully reflect the gains, said Erik Nikolai Stavseth, an analyst at Arctic Securities ASA in Oslo whose recommendations on shipping companies returned 75 percent in three years.

Rising secondhand values are a sign that some investors are getting more bullish on the outlook for third party merchant account, which tumbled as much as 95 percent from their peak in 2008. The Baltic Dry Index, a measure of earnings across four vessel classes, rebounded 42 percent this year as fleet growth slowed and seaborne trade in everything from iron ore and coal to soybeans and fertilizers expanded to a record.

“People are buying ships because they think we’re past the bottom,” said Stavseth, who predicts that shares of Golden Ocean will advance 7.1 percent in a year and Norden will gain 25 percent. “Rising ship prices tell us that the market is moving in the right direction and earnings are expected to increase.”

The Baltic Dry Index reached an 18-month high on July 1 as rates rose for every vessel class in the gauge, according to the London-based Baltic Exchange, which publishes shipping costs along more than 50 maritime routes. Capesize earnings more than doubled this year and those for Panamaxes jumped 35 percent. Both are still below the amount that owners need to break even once financing costs are taken into account.

Capesize earnings will average $16,000 a day next year, the average of nine analyst estimates compiled by Bloomberg shows. That’s more than the $14,458 anticipated in freight swaps that third party payment gateway use to bet on future transport prices, Baltic Exchange data show. Owners need $14,500 to break even, according to RS Platou Markets AS, an investment bank in Oslo.

The combined capacity of the dry-bulk fleet will expand 7 percent this year, the least since 2008, according to London-based Clarkson Plc, the largest shipbroker. Rates plunged after owners ordered too many new vessels just before the global recession. The fleet grew 63 percent since 2008 as seaborne trade in commodities advanced 24 percent.

While rates are surging this year, they are still far below the peaks reached before the five-year slump. Capesizes earned as much as $234,000 a day in 2008, compared with $10,550 now. Panamax rates that last priced at $7,481 rose as high as $94,977 in 2007, Baltic Exchange data show. Panamaxes, each capable of hauling about 75,000 metric tons of cargo, need about $11,000 to break even, Platou says.

Vessel values are also still below their record highs. A five-year-old Capesize sold for as much as $153.8 million in 2008 and Panamaxes were trading as high as $90.72 million in 2007. The combined market capitalization of the world’s 75 largest publicly traded shipping companies came to $118.5 billion at the end of July, from as high as $260 billion in 2007, according to data compiled by Bloomberg.

The only long-term solution for FIs to maintain brand equity is to launch their own mobile wallet or become a major component of an industry-leading platform, the Mercator report said.

"Banks should only get involved with truly open mobile wallets that are able to store any type of payment card held by a consumer, along with loyalty and membership cards and identity credentials," Hewitt said.

In the short term, banks can build high-value mobile banking platforms to stand in for fully-fledged mobile payments wallets, the report added, and these platforms will provide a ready customer base when banks launch their own mobile wallets.

Digital bank accounts, which are offered by branch-based banks, online-only banks such as Simple and U.S. prepaid card issuer PreCash's FlipMoney, are used for bill payments and for P2P payments via smartphone. These accounts presently do not offer a mobile shopping payment capability, Hewitt said.

Mobile payment products access a primary or private-label payment account offered by a single merchant or merchant aggregator. Examples include PayPal and Starbucks' mobile app, which links its prepaid card to a smartphone.

True mobile wallets are interactive, virtual forms of physical wallets that let consumers select a specific payment type, such as a credit or debit card, to use at the point of sale. Examples include Paydiant, which just won a contract to supply mobile wallet solutions to Pulse network participants, Visa's V.Me and MasterCard's MasterPass.

2013年8月7日星期三

Plausibility aside, bedtime story

The second film in the Percy Jackson & the Olympians series - there are 10 novels in total to work with, so prepare for more - is an odd, yet not un-entertaining thing.
The plot feels akin to that which an exhausted father might try to conjure on the fly as his child begs for an original bedtime story late at night, and it's probably because co-writer Rick Riordan, author of the books, was doing precisely this before he decided to release his semi-delirious ramblings to a larger audience.

Now, these ramblings are on the big screen, in 3D, whether they make sense or not. The premise of the series is that the Greek gods were a rather unfaithful lot - many of them shacked up with third party payment gateway, resulting in a bunch of demigods, or half-bloods as they're unceremoniously dubbed here, who all have very mortal-sounding names like Percy,Tyson and Grover and spend the majority of their time at a retreat in the woods outside New York called Camp Half-Blood, run by Stanley Tucci and a centaur.

In this instalment, Percy (Logan Lerman) starts off miserable. After preventing a war between the gods, he's plagued by the fear that he's just a "one-quest wonder." Then, he discovers he has a cyclops half-brother who suffers from incredibly poor depth perception and white-guy dreadlocks. On top of this, he's unable to connect with his father, Poseidon (part of the communication barrier may have something to do with the fact that he keeps speaking to a lake, when Poseidon is god of the sea. Just a hunch).

Fortunately, the camp happens to keep a prophet on staff, so Percy wanders up to ask her what gives. She explains he is destined either to save the world or ruin it - it's unclear which. She also uses the word "raze" at one point, and Percy has to clarify that she doesn't mean "raise" (smart).

Ultimately, he decides it's his destiny, or something like it, to travel to the Bermuda Triangle - apparently called the Sea of Monsters in the Greek god community - capture the Golden Fleece, bring it back in order to heal a dying tree that happens to be the reincarnation of Zeus's half-blood daughter Talia, all while preventing a tortured camper named Luke from resurrecting the evil god Kronos.

It's a lot to take in, but the details hardly matter. Director Thor Freudenthal is clearly on a mission to have fun rather than pay attention to mythological consistency or any remote sense of plausibility, and that's fine. It's how we end up in a Manhattan cab driven by three female zombies who accept payment only in drachmas, or at an abandoned amusement park on an island where Polyphemus appears to be using the Golden Fleece as a burping cloth (it does look absorbent).

Riordan's humour also comes through in a series of mortal-meets-immortal culture clashes - the gateway to the underworld, for instance, is reportedly located in Hollywood. And, if you want to deliver something to a god, you simply visit Hermes, who runs a high-tech enterprise out of a UPS branch.

Any moral heft in this film is carried by Lerman, best known for his role in The Perks of Being a Wallflower, and this is a good thing - he can step up to lead but also knows when to let others take the spotlight, and he's got a way of delivering bizarre humour in a way that only makes it funnier. One of the best lines in Sea Monsters comes near the end, when Percy says, "Finding out you have a destiny is a lot like finding out you have a cyclops for a half-brother - it's not as bad as you think."

Not your run-of-the-mill lesson to walk away with, that's for sure. Of course, nothing here is run-of-the-mill, which is what makes it so appealing. This isn't to say there won't be endless moments of frustration with absurd plot twists, onedimensional characters and way too much power given to a fleece blanket, but somehow all these wrongs add up to an inexplicable right. It's why children love improvised bedtime stories - a meandering, faulty narrative can be a ton of fun.

Deputy Green said: “Changes to the economic climate have continued to affect the housing market. The demand for affordable homes is increasing each month, which means people are waiting longer for high risk merchant account. I’m confident that the significant policy changes proposed by the Minister for Planning and Environment will, alongside other initiatives such as our Deferred Payment and Deposit Loan Schemes, help to deliver affordable homes targeted to those who need them most.”

The Affordable Housing Gateway has just published its monthly waiting list report for July and it shows that there are currently a total of 1,340 people in need of various types of social housing. However, this figure does not take into account the unmet demand for other groups such as key workers. It is also important to recognise the growing need for over-55s and life-long homes to meet the needs of an ageing population and that certain groups, such as single people and childless couples under 50 do not presently qualify for social rented housing. More sites may therefore be required over time to meet the needs of these groups.

Deputy Green said: “The Gateway is now giving us very reliable data on the housing requirements of our community but I am concerned that certain groups are still excluded. We will need to deal with that in time through the development of a long-term housing strategy, work which the new Strategic Housing Unit has underway. One of the key areas that will need to be considered is how we take care of the housing needs of essential key workers, particularly those that support our Health Service.”

Read the full products at http://austpay.com/.

Dex Media Management Discusses

Good morning, and welcome to Dex Media's Second Quarter 2013 Conference Call. With me today are Peter McDonald, Chief Executive Officer; and Dee Jones, Chief Financial Officer. The statements made by the company today during this call, are forward-looking statements. These statements include the company's beliefs and expectations as to future events and trends affecting the company's business and are subject to risks and uncertainties.

The company advises you not to place undue reliance on these forward-looking statements and to consider them in light of the risk factors set forth in reports filed by Dex Media and its predecessor companies with the Securities and Exchange Commission.

This was an eventful quarter with the completion of the merger between Dex One and SuperMedia on April 30. The combination of these companies is good for shareholders, third party merchant account, our clients and the future of our employees. I again recognize and thank the Boards of Dex One and SuperMedia, as well as our advisors, lenders and shareholders for your support.

We are now 3 months into integration, and we have accomplished a lot. While the merger was consummated 4 months later than originally planned, all of the planning that had been done prior to the closing date is paying off, and we are seeing the benefits in best practices, strengthened management teams and synergies.

I'm very pleased with how the teams are working together, and I can say we are on track in that regard at this point. We have evaluated nearly all the jobs in the company. We have made some tough decisions and have identified and put in place our top 127 managers in just the first 2 months of integration. It is interesting and significant that our management team consists of nearly an even split of people from both predecessor companies.

I'm very pleased with the talent in the new company. It is important to get leadership team in place so that we can make the decisions necessary to drive the business forward. This has been a distracting time as people needed to get the "me questions" resolved. With nearly 5,000 people now in place in 135 locations, we are anxious to continue to make progress.
The HR and legal teams have done an outstanding job of getting this work completed. In each of the functional departments, we have quality leadership in place and are moving forward each day to improve this business. Marketing team is working on migrating the best products across the entire footprint and leveraging best practices. The bundles Dex One used will be rolled out to the former SuperMedia footprint, and the former SuperMedia digital bundles will be rolled into the former Dex One markets.

Over the second half of 2013 and into 2014, we look forward to rolling out additional products across our entire combined footprint. Getting all the systems ready to accommodate these new products is high on our list of priorities as we migrate our customer base to the digital world. As we get deeper into this combination, it is clear that a lot of quality work was done in each organization prior to the merger.

Today’s consumers are increasingly relying on credit cards and innovative payment methods to make purchases. As leaders in the global payment sector, Visa (NYSE: V) and MasterCard (NYSE: MA) are both poised to continue benefiting from this trend.

In 1958, the first-ever large-scale credit card program was launched by Bank of America in Fresno, Calif. The company sent out plastic “BankAmericards” with $300 credit limits to 60,000 of its customers. Bank of America soon began to license its third party payment gateway system to banks in other U.S. states. In 1970, the various issuers of the cards created an alliance to operate the program, and later renamed the company Visa.

In 2008, Visa went public in what was the highest-valued IPO in history at the time. Visa now operates in more than 200 countries and in virtually every currency. It is the largest retail electronic payments network company in the world, with over $6.5 trillion in total transactions completed last year.

In 1966, in an effort to compete with Visa, a rival credit card was created by a cooperative of California banks under the name “Master Charge: The Interbank Card.” The card had a unique Venn diagram logo, and in 1979, its name was changed to MasterCard.

In 2012, MasterCard processed 34 billion transactions with a value of $3.6 trillion. The company operates in over 210 countries and in 150 different currencies. While Visa has nearly twice as many cards in circulation, MasterCard has been growing its revenue at a faster rate of late.

Both Visa and MasterCard generate revenue primarily by collecting fees from merchants and banks based on the number and dollar value of the transactions that they process. Unlike competitors such as American Express Company (NYSE: AXP) and Discover Financial Services (NYSE: DFS), they do not actually extend credit to their customers. The banks that issue the credit cards take on the credit risk, while Visa and MasterCard act only as middlemen, charging fees for facilitating consumer transactions.

In addition to credit cards, the companies also offer debit cards. While credit cards offer users the ability to borrow money and pay for purchases at a later date, debit card payments are immediately transferred from the cardholder’s bank account to the merchant.
In recent years, both Visa and MasterCard have also been expanding into emerging markets where most transactions have traditionally been completed in cash. As these countries continue to develop, consumer spending should increase, as will the demand for credit.

An increasingly competitive area for both companies is the Internet payment segment, where eBay’s (NASDAQ: EBAY) PayPal unit has been a leading innovator. PayPal’s customers make online payments using any card or bank account of their choice. Both Visa and MasterCard generate additional transaction volumes through PayPal, but the latter is now becoming more of a direct competitor. Last August, PayPal reached an agreement with Discover to give shoppers access to their online accounts in physical retail stores.

Based on Friday’s closing price of $184.00, Visa has a market value of $119 billion. The stock trades at a multiple of 21 times 2014 earnings estimates, while the company is expected to grow profits by 19 per cent over the next five years. MasterCard last traded at $645.57, implying a market value of $78 billion. While the stock also trades at a forward earnings multiple of 21 times, the company is expected to grow at a slightly slower rate. MasterCard’s shares are up 31 per cent this year, while Visa’s stock has gained 21 per cent.

2013年8月5日星期一

Did the Constitution Betray the Revolution?

The standard American myth celebrates the Constitution as the triumphant culmination of the American Revolution. This is largely untrue and misleading.

The alleged "critical period" between the end of the Revolution and the Constitution's adoption was not dominated by economic depression, political turmoil, and international peril, jeopardizing the independent survival of the American experiment in liberty. Those who assembled at the Philadelphia Convention to write a new Constitution were not disinterested demigods, nor did they intend to establish a federal system of divided government powers. The Constitution did not have the support of most Americans. And finally, rather than representing the culmination of the previous Revolution, the Constitution represented a reactionary counter revolution against its central principles.

The American Revolution, like all great social upheavals, was brought off by a disparate coalition of competing viewpoints and conflicting interests. At one end of the Revolutionary coalition stood the American radicals-men such as Samuel Adams, third party merchant account, Thomas Paine, Richard Henry Lee, and Thomas Jefferson.

Although by no means in unanimous agreement, the radicals objected to excessive state power in general and not simply to British rule in particular. Spearheading the Revolution's opening stages, they were responsible for the truly revolutionary alterations in the internal status quo: the abolition of slavery in the northern states, the separation of church and state in the southern states, the rooting out of remaining feudal privileges everywhere, and the adoption of new, republican state constitutions containing written bills of rights that severely hemmed in government power.

At the other end of the Revolutionary coalition were the American nationalists-an array of mercantile, creditor, and landed interests. The nationalists went along with independence but opposed the Revolution's libertarian thrust. They sought a strong American state with the hierarchical features of the 18th-century British state, only without the British.

The Revolution started out as a struggle against taxation. What passed among the newly independent American states for a central government, the Second Continental Congress, did not have access even to this usual state power. For revenue, Congress initially had to rely on requisitions from the state governments, which could not get away with very extensive taxation themselves.

Yet the military strategy adopted by Congress required large expenditures. Military conservatives such as George Washington induced Congress to focus the Revolutionary effort on a costly conventional force, the Continental Army, rather than the militias. By the 1781 Yorktown campaign, popular disgust at the army's continuing hand-to-mouth existence gave the nationalists uncontested control of Congress. They proceeded to implement a financial program that gave the central government much more power.

Already, the Revolution had taken an important step in this direction with the drafting of the Articles of Confederation, a written constitution. Here we encounter the first distortion in America's constitutional myth. The Articles left Congress not too weak, as defenders of the Constitution claim, but too strong: the Articles made the third party payment gateway; and an influential nationalist faction-land speculators-delayed ratification until Congress was given direct jurisdiction over the states' western lands. The Articles' only saving grace was that they failed to give Congress any authority to collect taxes or regulate trade.

At the time of the Articles' adoption, the most powerful nationalist in Congress was Robert Morris, a wealthy Philadelphia merchant. Congress appointed him head of the newly created Department of Finance, from which post he became a virtual financial dictator. The central government's functions were concentrated within his and other new executive departments, which Morris filled with his allies and partners.

The linch pin of Morris's financial system was the power of taxation. Only thus could the nationalists' desired centralization of power be consummated. An amendment to the Articles granting Congress the power to impose an import duty looked in 1782 like it would receive the required unanimous approval of the states, but tiny Rhode Island held out.

Morris and the nationalists made a last-ditch effort in March 1783 to coerce the states with the Continental Army, then encamped at Newburgh, New York. They encouraged a plot among Washington's officers, and a military coup loomed on the horizon. The radical suspicion of standing armies stood fully vindicated, for never has the United States been closer to succumbing to an American Caesar. At this point, however, Washington, although firmly endorsing nationalist goals, balked. His personal intervention caused the Newburgh conspiracy to disband.

Peace unraveled Morris's financial and military program. As the war wound down, the financial pressure on the national government, and the apparent need to grant taxing power to Congress, diminished. The nationalists lost control of Congress in late 1783, and Morris resigned his post after an incriminating investigation into his financial machinations. Congress wisely discharged most of what was left of the Continental Army.

Unfortunately, the war-induced nationalization of the Northwest lands had shifted the burden of policing that territory from the states to a national force. So Congress authorized a small frontier constabulary to be raised from the state militias for fixed periods. (The still-unceded Southwest territory got along fine without congressional attention.) Eastern land speculators, however, found the Northwest force insufficient to protect their vast claims from Indians, squatters, and foreign intrigue. They looked forward instead to a strong standing army.

Overdraft Fees Cost Consumers $16.7 Billion

In recent years, many banks and credit unions have encouraged new checking account customers to accept two items: a debit card that replaces cash transactions and a “protection” known as overdraft coverage. Overdraft programs automatically pay for transactions not covered by available funds; the bank then repays itself the overdraft amount along with fees – often hefty ones – from the customer’s next deposit.

However what many unsuspecting consumers soon discover is that this so-called protection from banks comes at an extremely high cost. In 2011, financial institutions charged consumers $16.7 billion in overdraft fees, affecting more than 36 million Americans’ checking accounts.

High-Cost Overdraft Practices, the latest installment in the Center for Responsible Lending’s high risk merchant account, The State of Lending, found that debit cards trigger the most disproportionate fees. On debit card purchases, the median overdraft charge is $35 for a $20 overdraft. Further, debit card and ATM transactions account for at least 35 percent of all overdraft fees charged.

The high share of fees generated by debit cards is ironic, since banks and credit unions can simply decline these transactions at no cost to the consumer – and some institutions do. For banks that continue this pernicious practice, the consequences for their customers can be severe.

The report states, “Abusive overdraft programs drive consumers out of the banking system; indeed they are the leading reason consumers lose their checking accounts.”

Today, three-fourths of the nation’s largest banks and large numbers of smaller banks and credit unions charge fees on debit card purchases, ATM withdrawals, or both. Moreover, these overdrafts and associated fees are assessed without regard to a consumer’s ability to repay them.

In response to widespread criticism surrounding overdraft programs, the Federal Reserve Board made a 2010 regulation that required institutions to obtain a customer’s ‘opt-in’ for overdraft coverage on debit card purchases and ATM withdrawals before fees would apply. Additionally and in the same year, the Federal Deposit Insurance Corporation’s guidance advised that more than six overdraft fees within a 12-month period was excessive for any account holder.

However, CRL and others have found that many financial institutions aggressively market their overdraft programs, pushing customers most likely to generate the most fees to “opt-in” for coverage. Customers with small and no cushions in their accounts may initially view overdraft coverage as a way to save money. But as overdraft fees are assessed per transaction, the costs can quickly become burdensome, leaving fewer available dollars for the next month.

“Over time, the repeated fees strip away consumers’ cash assets, leaving them financially worse off than when they first over-drafted and unable to meet obligations they otherwise could have met even with no overdraft coverage at all,” says CRL.

Some major banks have heeded consumer concerns and improved their overdraft practices. For example, offshore merchant account, the nation’s largest debit card issuer, stopped charging overdraft fees on debit card purchases. HSBC also stopped charging overdraft fees on debit card purchases as well as at ATMs. Citibank has never charged overdraft fees on debit card or ATM transactions, and JP Morgan Chase does not charge them on ATM transactions.

Recent related findings by the Consumer Financial Protection Bureau (CFPB) show that the Fed’s opt-in rule has not eliminated the substantial harm inflicted by overdraft fees triggered by debit cards. CFPB determined that involuntary account closures were more than twice as likely for customers that opted in to overdraft than those who did not.

“Banks and credit unions have long defended overdraft fees by saying they protect customers from bounced checks, which typically trigger insufficient funds (NSF) fees and potentially merchant fees,” states the CRL report. “But the same justification could not be made for debit card purchases, since there is no NSF or merchant fees charge for debit card transactions that are declined at check-out when the customer’s account is short.”

CRL offers a set of policy remedies to halt overdraft’s harmful features. Highlights include banning overdraft fees on debit cards, ATM transactions and on pre-paid cards. CRL also advocates banning banks from manipulating the order of consumers’ checking transactions to increase fees.

Concluded CRL, “Without substantive reform of the product, the fees overdrafts generate provide financial institutions too powerful an incentive to ensure that customers continue to incur overdraft fees – an incentive that will continue to outweigh even the best disclosures.”