ARLINGTON, Va. – Despite the recent loss of the so-called Honor All Cards rule in a legal settlement with Wal-Mart and other retailers, Visa continues to project strong growth for its Visa check card product. In data presented recently to card executives, the San Francisco-based card association continued to project firm growth for its debit product, which validates transactions using a cardholder's signature, as it reported the strong growth that had already taken place. The association also continued to project increased use for the cards which should keep up issuer interchange income despite the cut in the rate of interchange for each transaction. According to the data, which Visa cautioned was meant only for discussion purposes, the card product was reported to have a penetration rate of 64% for third quarter of 2003 and a goal penetration rate of 65% for the year. Likewise, 58% of Visa check card holders activated their cards and the association has a goal of getting 60% of them to do so by the end of the year. In other signs of growth, the number of check cards has grown from 65 million in 1998 to over 122 million in 2003, with a goal of issuing over 125 million cards in 2003. In the crucial area of transactions, the association reported that cardholders used their check cards 22% more in 2003 than they had in 2002 and set a goal of transacting 15% more check card purchases overall in 2003 than in 2002, taking the total to over 6.6 million worth almost $250 billion. According to Visa, the top 10 types of businesses where consumers use their check cards are gas stations, restaurants, supermarkets, catalog merchants, department stores, telecommunication services, discount stores, specialty retailers, electronic stores and drug stores. In a comparison of third quarter sales volumes from 2001 to 2002, the only segment that showed a loss (-3.5%) was department stores. In the area of fraud, the association reported that fraud and charge-back levels for the debit card significantly lagged those for its credit card product. The association's data was less rosy for the Visa PLUS ATM Network. Year to date, Visa reported that transactions at its Visa PLUS ATMs were down over 18% from the same time last year and the association projected they would end the year off over 3%. It expects the number of its ATMs worldwide to drop from 823,000 in this year so far to finish at 820,000. The association also reported that less than half of its worldwide ATMs are in the U.S. – [email protected]