The U.S. Postal Service intends to conduct a gift card pilot at 2,000 initial branch locations. The pilot will first test the sale of open-loop, network-branded cards, which may be followed with a closed-loop gift card pilot, according to the USPS.
The pilot is scheduled to run from May 2011 to May 2013. The cobranded cards may feature stamp art and come in "fixed" denominations of $25 and $50, as well as "variable" amounts between $26 and $100, the USPS said.
Craig Shearman, Vice President for Government Affairs at the National Retail Federation, reported in the NRF publication Washington Retail Insight that retailers won a victory when the Internal Revenue Service said merchants can defer tax payments on gift card income for up to a year, even if the cards are sold through subsidiaries or franchises.
According to Shearman, retailers and the IRS have been at odds in recent years over when gift card income must be reported to the IRS. The disputes revolve around subsidiaries merchants set up to handle gift card programs, Shearman said.
Moneris Solutions, Canada's largest processor, reported in mid December 2010 that the market for gift cards in Canada continues to grow as small businesses recognize gift cards add profitability. Moneris calculated a 20 percent increase in 2010 in the number of gift card programs the processor operates for small businesses in Canada.
When Canadian consumers redeem gift cards in stores, they typically spend 53 percent more than is on the cards, Moneris said. Additionally, Moneris found that consumer demand for the cards seemingly grew as their availability rose.
ACE Cash Express Inc. donated $25,000 to Junior Achievement in support of its mission to educate and inspire young people to succeed in the global economy. The donation was made through the ACE Community Fund, ACE's corporate giving program that focuses on children, education and financial literacy.
The Center for Financial Services Innovation said it was pleased the U.S. Depatment of the Treasury launched a national pilot for tax refunds on general purpose reloadable prepaid cards. "The pilot is an excellent start to bringing low cost transaction and savings products to millions of tax filers," said Melissa Koide, the Policy Director at CFSI.
Green Dot Corp. was chosen by the Treasury Department as the program manager for a pilot program where federal tax refunds for unbanked individuals are loaded onto the Visa-branded MyAccountCard.
J.P. Morgan, the treasury arm of JPMorgan Chase & Co., said the U.S Department of Health and Human Services saved $1.4 million in administrative costs since launching its GO!card program in March 2010. The GO!card (a "green option" commuter card managed by J.P. Morgan) is a Visa Inc.-branded prepaid card given to HHS employees for the purchase of mass transit fares.
Hotgate Technology Inc. subsidiary REDtone Telecommunications (Shanghai) Ltd. entered an agreement with China Unicom (Hong Kong) Ltd. to build a reload network in Shanghai for China Mobile Ltd.'s long-distance prepaid calling cards. Hotgate said China Mobile has approximately 579 million users, representing approximately 70 percent of total mobile phone users in China.
Obopay Inc. promoted Deepak Chandnani from President to Chief Executive Officer. Former CEO Carol Realini will assume the new role of Executive Chairman. Chandnani will be based in Mumbai, India, while Realini will work out of the company's Redwood City, Calif., headquarters.
Global electronic money network provider Ukash tapped David Hunter as the company's new CEO. Ukash said Hunter has a track record of growing prepaid ventures and championing electronic money initiatives.
Las Vegas-based processor eCommLink Inc. added Jim Plunkett as Senior Vice President of Sales to focus on accounts in the retail, government and social networking verticals.
MoneyGram International appointed Phyllis Skene-Stimac as Senior Vice President and Chief Compliance Officer and also named Patricia Sullivan as Senior Vice President of Communications.
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