Internet search engine pioneer Yahoo! Inc. and First USA Bank will roll out the Yahoo! Platinum VISA Card' this month offering consumers an online rewards program. First USA is offering a special 9.9% fixed APR and no-annual-fee for charter 'Yahoo! VISA' cardholders. The new card rewards cardholders with one point for each purchase dollar charged, redeemable towards merchandise offered through participating online merchants of Yahoo!'s VISA website and Yahoo!'s Style website. The card comes in two designs: the 'Swirl Card' in vibrant purple and the 'Metallic Card' in classic metallic. The program also features online access to card account/reward account information and a consumer protection program against fraudulent online card transactions. Other terms of the program include a 19.99% punitive APR, 20-25 day grace, $28 late fee/over-limit fee and the two-cycle average daily balance interest calculation method.

The expected announcement of the Yahoo! VISA already drew fire from another competitor who recently launched an Internet card product. San Francisco-based Internet Access Financial Corporation says the new Yahoo!/First USA card is a "mass marketed product" that lacks a "100% Internet focus". IAFC says its NextCard VISA product is superior because it offers online approvals, customized pricing, balance transfer rates as low as 2.9% and full online customer service. The company's top executive said he believes Yahoo! made a strategic error by locking into an exclusive relationship with First USA and will eventually "regret that decision".

IAFC is billing its product as the "First True Internet VISA". The NextCard VISA offers instant credit approvals via the company's proprietary Internet, online application process called "Rapid Results". The card provides online access to account information and offers applicants the ability to design their own card features. The firm said this month it has received "thousands" of applications since going online in December. The card is being issued through Heritage Bank of Commerce of San Jose. For more information on NextCard VISA visit cardweb.com.

The nation's tenth largest issuer, Capital One, spent a record $65 million for credit card solicitations during the last three months of 1997. By comparison Cap One shelled out $52 million during the fourth quarter 1996. For all of last year Cap One invested $225 million in card marketing. The investment paid off as Cap One added 1.1 million new accounts and $758 million in new card loans. The issuer specializes in sub-prime, secured, and lower- balance VISA/MasterCard accounts. The issuer also entered the platinum card market during the fourth quarter. So far this year Cap One has launched an very aggressive fixed 9.9% interest rate card to low risk cardholders.

What drives Capital One's explosive growth? The secret is an "Information Based Strategy". The core of that strategy is comprised of an Oracle-based three-terabyte data warehouse and several data marts housed on a five terabyte disk farm. Cap One's data warehouse holds basic information on 120 million households, detailed data on 10 million customers and performance/profitability information on more than 4,000 product, pricing and feature combinations. The company uses the information to predict consumer behavior and then matches prospects to more than 300 credit cards with various terms and fees.

However Capital One is running out of hands. This month the bank announced it will expand its workforce by 2,000 people this year. The issuer is in the midst of breaking ground for a second operations facility in Tampa. The new Tampa call center will open in September with about 600 associates to complement the current Tampa call center of 650 associates.

Chase Manhattan relaunched the cobranded Bell Atlantic card this month by converting 70,000 Chase/NYNEX cardholders to the Bell Atlantic program. Bell Atlantic and NYNEX merged last year. Chase acquired the 500,000 cardholder, Bell Atlantic program August 21, 1997 from First Omni Bank. The relaunched card will be called: The Bell Atlantic Credit Card from Chase and will be issued as a no- annual-fee VISA or MasterCard. Chase indicated yesterday it will convert the existing Bell Atlantic VISA cardholders to the Bell Atlantic VISA Card from Chase in April.

The rewards program connected with the card offers a 1% rebate on purchases, a 2% rebate on Bell Atlantic residential phone services and a 3% rebate on certain Bell Atlantic calling card calls. Rebates are good towards Bell Atlantic residential phone bills. Card pricing includes a 9-month intro rate of 6.9%, a tiered go-to purchase rate of prime +9.4% for balances under $2,500 and prime +7.4% for balances above $2,500. Interest rates for cash advances are prime +11.55%.

MasterCard said this month its 'World MasterCard' product is exceeding projections. Since its launch, the new upscale, hybrid charge/credit card has exceeded the average transaction amount by 62% and the average number of transactions per account has nearly tripled from the original projections. MasterCard indicated it will introduce the product in other regions of the world over the next several months. In the U.S. the card is primarily issued by Bank of America and Household Credit Services. MasterCard will announce this month it has signed agreements with Avis Rent A Car and Summit Hotels & Resorts. Summit, a network of 150 luxury hotels, will offer WMC cardholders upgrades, a special arrival gift and discounted 'Summit Club' memberships. Avis will provide WMC cardholders discount rates, one-card group upgrades and free 'Avis Preferred Select' memberships. MasterCard says it will also offer WMC cardholders exclusive access to unique experiences in the areas of entertainment, travel and sports, including backstage passes, later this year.

A 7-Eleven store in Austin, Texas was the site recently for the introduction of 7-Eleven's 'Financial Service Center'. The new, self-serve technology cashes checks, sends money transfers and accepts cash or bank cards for purchases of items like money orders and phone cards, in addition to providing standard ATM services. 7- Eleven says it will install the new machines in all 37 Austin stores to test the concept before moving to a nationwide roll-out. As a promotion, 7-Eleven is waiving the check-cashing sign-up fee during the first month of operation and allowing customers to cash their first six payroll checks free.

7-Eleven is also getting into the local phone business. Phones for All Inc., a new prepaid local phone service company, is teaming up with 7-Eleven stores in Florida and Texas this month. The service is targeted at consumers who fail to qualify for local phone service due to poor credit or lack of U.S. citizenship. To activate the service consumers simply purchase a prepaid local phone card at a nearby 7-Eleven, call a special number for installation and continue to purchase a new card every thirty days to maintain service. Consumers can also purchase a long-distance prepaid phone card at 7-Eleven. Phones for All says 500,000 Texas households and 270,000 Florida households do not have local phone service. 7-Eleven has 288 stores in Texas and 425 in Florida.

American Express awarded $1 million to thirteen performing arts organizations this month. The American Express Performing Arts Fund was established last year to support organizations in markets which are important to American Express. Among this month's recipients: $200,000 to the New York Philharmonic, $100,000 to the Chicago Symphony and $100,000 to the San Francisco Ballet. A second round of funding will begin in April. Funding competition is by- invitation-only.

Revolving credit continues to grow slowly this year. According to January consumer credit figures released by the Federal Reserve this month, revolving credit inched up by 6.1% compared to a 14.7% growth rate last January. Revolving credit, mostly bank credit card, now stands at $533.5 billion compared to $505.3 billion for January 1997. Total consumer credit, exclusive of mortgages, now stands at $1.2 trillion.