Pre-paid card processor TxVia raises $15.5m

TxVia, a pioneer in prepaid card processing technology, today announced it has raised $15.5 million in Series C financing, led by new investor, Bain Capital Ventures.

Also participating were all current institutional investors, including Espírito Santo Ventures, High Peaks Venture Partners and Village Ventures. New York City Investment Fund joined as a new co-investor.

The funding follows important milestones for TxVia, including successful large-scale client deployments of the company's groundbreaking platform-as-a-service (PaaS) delivery model for prepaid card processing. Today, TxVia has more than five million reloadable and nonreloadable cards on file in both B2B and B2C prepaid applications.

"We conducted extensive diligence on the prepaid card industry and concluded that TxVia is the best-in-class processor," said Paul Zurlo, a partner with Bain Capital Ventures who was elected to the TxVia board of directors. "Issuers and program managers with complex requirements and sizeable portfolios have selected TxVia for complete deployment of their prepaid card portfolios, achieving new levels of reliability and configurability."

"TxVia strengthens New York City's position as the global center of financial services technology," said Maria Gotsch, president and CEO of New York City Investment Fund. "We are pleased to have the opportunity to invest in the company."

TxVia has pioneered technology to help its clients create those prepaid card products that are the best payment options for end-user organizations and individuals. With much of the financial services community moving back to basics, TxVia has been at the forefront of bringing fundamentals to payments processing-such as transparency, simplicity and accountability-and thereby expanding the bounds of stability and flexibility. By redefining the prepaid card value chain client by client, TxVia offers attainable economic benefits and superior opportunity to capitalize on the prepaid market potential.

"We're pleased to welcome Bain Capital Ventures and New York City Investment Fund as well respected investors and valued partners as we continue to enable the prepaid card industry and set new standards of excellence in processing," said Anil D. Aggarwal, chairman and CEO of TxVia.

via finextra.com and prepaid card blog

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Vision Prepaid Card - reloadable pre-paid card

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Other prepaid debit cards offers

Prepaid Card Industry Resists Proposed US Consumer Agency

WASHINGTON -(Dow Jones)- The prepaid card industry hopes to avoid being swept under the umbrella of the proposed new consumer watchdog agency, company representatives said this week.

While Congress and the Obama administration have yet to work out details on which sectors will fall under the proposed agency's supervision, leaders of the prepaid card industry said new regulations giving force to stricter state laws would make it more difficult and costly to operate the cards nationwide. Consumer groups countered that prepaid users, who often use the payment cards in lieu of traditional credit cards tied to bank accounts, shouldn't receive fewer protections than any other card holders.

At the top of the prepaid card industry's list of concerns is a section of the Treasury Department's latest proposal for the consumer agency specifying that state consumer protection laws would trump federal laws in situations where state laws are more stringent.

The problem for the industry is that prepaid cards are a motley bunch that includes gift cards for stores like Starbucks (SBUX), payroll cards issued by employers, and reloadable cards issued by credit card companies like American Express Co. (AXP), Visa (V) and Mastercard (MA).

Because some states don't distinguish between different varieties of prepaid cards, regulations imposed across the board can make it hard for certain cards to operate, said Judith Rinearson, a partner with Bryan Cave law firm representing the industry. If the new agency outlaws expiration dates, for instance, someone with a Visa-branded card might not be able to make a purchase.

"This would create a patchwork of regulations on the industry that could result in the withdrawal of prepaid products in certain states," Kirsten Trusko, president of the Network Branded Prepaid Card Association, said in a statement. Currently a 2007 appeals court ruling in the 1st U.S. Circuit Court of Appeals in Boston, involving gift cards distributed by Simon Malls, binds prepaid card issuers only to federal laws.

Consumer advocates said state-mandated protections would not put prepaid card companies out of business.

"The prepaid industry could take the high road and apply the strongest protection across the board," noted Michelle Jun, a Consumers Union staff attorney.

The industry is also bracing for the possibility that the new agency would outlaw or sharply curtail the fees that users pay right now to buy, reload and maintain the cards.

"The bottom line is that a lot of the profitability associated with prepaid cards is in fees paid by the end users," said Bruce Cundiff, director of payments research with Javelin Strategy, a financial services research firm. Unlike credit card companies, which may make money through interest or late fees, prepaid cards have fewer sources of revenue and rely on those charges for profits.

The larger question may be how much regulation is necessary to protect the consumer but still encourage financial innovation, said Carol Van Cleef, a partner at Patton Boggs specializing in financial services.

"The prepaid card product may serve as a very good case study as they're trying to work out the details," she said. "It is still a developing product and it's evolving very quickly."

-By Kristina Peterson, Dow Jones Newswires; 202-862-6619; kristina.peterson@ dowjones.com

Visa Prepaid Cards are the best money tool for all people. They are lower cost than most checking accounts, more practical than gift cards, and more responsible than credit cards. Visa Prepaid Card is optimized to receive funds from parents, employers, online social networks and other cardholders.

Cardholders can use Visa prepaid cards to securely pay for groceries, fuel, and even utility or household bills. Prepaid cards can also be used for making payments on the phone or line, and, in some cases, withdrawing cash at ATMs. Sign up here

About Prepaid Visa Card

The Perfect Prepaid Card for Every Occasion!

The Prepaid Visa Card is a quick purchase for you, and ideal for anyone on your gift list. It's welcomed worldwide at more than 19 million merchants that accept Visa debit cards, and can be used to make purchases online, by phone or in person. Prepaid Visa Cards come in a variety of designs that are perfect for any occasion. There's even an everyday card that's secure for travel and convenient for smart budgeting.

How does it work? A Prepaid Visa Card looks like a credit card. The front of the card displays the name of the purchaser or gift recipient, the Visa Brand logo, an individual account number and an expiration date. The back includes a magnetic strip. Unlike a credit card, however, the Prepaid Visa Card may only be used for the amount loaded on the card.

Purchasers or gift recipients can use the card as many times as they like for a full year, up to the amount stored on the card. As the card is used, the amount of each purchase is automatically deducted from the card's available balance. If the card is lost or stolen with a balance remaining, the user can cancel the card and order a replacement for a nominal fee.