First some background. As a merchant services provider, Vantage collects only a very small fraction of the fees merchants pay to perform services ranging from marketing, sales, underwriting, risk management, customer service, terminal services, 24x7 help desk, transaction authorization and settlement, funding, statement reporting, PCI … more
According to a BankInfoSecurity.com post, the number of banks on the Federal Deposit Insurance Corp.'s "Problem List" totaled 884. If these institutions are already hurting, will any survive the Feds plan to cap debit Interchange fees?
The Independent Community Bankers of America speculates that the exemption for small banks (<$10 billion) to the Fed Interchange price cap will fail to protect these institutions for the following reasons:
As the largest debit issuers, mega banks will influence networks to limit support of dual pricing schemes that make their cards less attractive to merchants.
Merchants will discriminate against any high-cost cards customers present.
Debit card … more
Facebook also charges a 30% fee for using Facebook Credits (with 500+ million users). So in this alternative payment space it appears that 30% is the top end regardless of number of users. Of course to buy Facebook Credits people would use PayPal. Wouldn’t it be better to simply use PayPal and skip Facebook Credits? Users would skip a currency … more
As I see it, this is really a showdown between mega-banks and mega-retailers. Small community banks and credit unions, small merchants in communities serviced by these community banks and credit unions and consumers should be most concerned about the hastily added Durbin amendment to the massive financial regulatory bill. We’ve raised concerns about the impact of the unintended consequences for both our merchant clients and … more
The Fed has proposed capping debit-card merchant fees, known as interchange. I’ve been concerned about the unintended consequences for small businesses and community banks. The proposed caps on debit Interchange fees will increase the cost of debit cards for consumers and potentially curtail debit card use (resulting in either lower sales volume or use of higher cost card types). On the drawing board are annual debit card fees of $25 or $30 and limits on the number of debit-card transactions that a customer can make each month or limiting the size of a purchase that a … more
Interchange fees are paid to the banks that issue debit cards when they are accepted for payment. The fees that Visa and MasterCard charge are excluded from this regulation. Yet in question is their business model. Are the card brands value-added service providers or has their success turned them into just another type of utility company that should be regulated by the government?
Visa and MasterCard made headlines on the news with both experiencing major stock price declines. Merrill Lynch speculated that banks will seek financial concessions from Visa and MasterCard to make up for lost debit … more
Breaking Payment Industry News – Fed announces Debit Card Rates and Rules for Comment
In a history making live webcast, the Federal Reserve Board announced proposed debit card Interchange rates and rules under the controversial Durbin amendment of the Dodd-Frank financial reform act. Noting the short time frame provided by the bill to undertake such an important and complex issue, the Fed voted unanimously to submit proposed debit rule recommendations for public comment.
In the debate over fees, the Fed is looking for input on the provision requiring debit Interchange to be “reasonable and proportional” to the cost that card issuers incur. The Fed is proposing to two alternatives: a $0.07 safe harbor price along with a $0.12 cap or a $0.12 cap for all transactions. … more
I envision a better ACH. One that lets me pay anyone from any personal or business checking account I choose without having to give up my sensitive account information or authorization to withdraw funds. It would be very secure and I would control both the access and the timing of when I choose to make a payment. And it would be convenient. It would work with my existing bank so I wouldn't have to deal with the hassle of moving funds in and out of a 3rd party "holding account" like PayPal.
My mobile device would become my digital checkbook and registry. At my business I would write digitally originated checks straight from my accounting, CRM or ERP system. For proof of payment and for my own record keeping I would get the cancelled check image returned with my bank statement.
Anyone who … more
As reported in the WSJ, mega banks are “exploring prepaid cards as a way to make up revenue that will likely be lost from federal restrictions on debt cards.” In our blog post under the section “Exemptions for government administered cards & reloadable prepaid cards” we envisioned the compromise exempting reloadable prepaid debit cards from Interchange regulation under the Dodd-Frank financial-overhaul bill would result in “banks moving more and more consumers to exempt prepaid card … more
Small Business Saturday Initiatives include:
A major social media campaign to spread the word about Small Business Saturday and encourage people to give shout-outs for their favorite local shops and restaurants via Facebook and Twitter.
The 1st ten … more