Contents tagged with Credit Card News

  • California merchants beware of ZIP code ruling

    February 24, 2011
    In California a ZIP code is personal identification information

    In the case, Pineda v. Williams-Sonoma Stores, Inc., the California Supreme Court recently ruled that a ZIP code constitutes ‘personal identification information' as that phrase is used in California Civil Code section 1747.08 and that requesting and recording a cardholder's ZIP code is prohibited if it is requested as part of a credit card transaction.

    The California Civil Code Section 1747.08 does indicate exceptions which would allow the ZIP code to be requested, including:

    When the credit card is being used as a deposit to secure payment in the event of default, loss, damage, or other similar occurrence;

    Cash advance transactions;

    When the person, firm, partnership, association or corporation accepting the … more

  • Will debit card fee limits be delayed?

    February 18, 2011
    Stories like Congress May Slow ‘Swipe’ Cap Amid Regulator Concerns and Debit card fee limits hit a snag reported on yesterday's hearings where Congress and financial regulators discussed delaying or revising debit card price cap rules as suggested by The Federal Reserve to comply with the Durbin amendment before they are set to take effect in April.

    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

  • MasterCard and Visa Settle Antitrust Case

    October 04, 2010
    Visa and MasterCard have agreed to new changes that will allow merchants greater flexibility to steer their customer’s payment choice.

    The Dodd-Frank financial regulations signed into law in July allow merchants to set a $10 minimum card purchase. Now, announced in a Justice Department consent decree, Visa and MasterCard have agreed that merchants can:

    Offer consumers an immediate discount or rebate or a free or discounted product or service for using a particular credit card network, low-cost card within that network or other form of payment;

    Express a preference for the use of a particular credit card network, low-cost card within that network or other form of payment;

    Promote a particular credit card network, low-cost card within that network or other form of payment … more

  • Merchant Card Acceptance changes under the Dodd-Frank Act

    August 04, 2010
    The Dodd-Frank Wall Street Reform and Consumer Protection Act contains two provisions that impact card acceptance by US merchants:

    Using discounts to incentivize preferred payment types

    Setting thresholds for the acceptance of credit cards for payment.

    These items do not have explicit “in force” dates, so should be effective now that the bill was signed into law on July 21, 2010.

    Under the law, payment card networks are restricted from limiting merchants’ ability to offer discounts to incentivize customers to use payment types preferred by the merchants. Merchants would have legal protection under the law to offer customers discounts to pay with cash, check, or debit instead of a credit card. Merchants would not be able to offer a discount for payment with one … more

  • Merchant Alert: Debit Interchange Regulation continues move forward

    June 22, 2010
    Update:   It's Official.  The financial regulatory overhaul bill finally became law when President Obama signed the Dodd-Frank Wall Street Reform and Consumer Protection Act.

    Interchange regulation makes the cut as the House and Senate reconciled their differences on Senator Durbin’s amendment to the proposed Restoring American Financial Stability Act of 2010. The proposed Interchange amendment compromise must still survive a bipartisan conference committee.

    If the bill is passed, the Federal Reserve Board would gain the authority to establish rules and regulations related to the Interchange fees that issuers could earn with respect to debit card transactions. The Federal Reserve would have nine months to set Interchange fees and one would expect that they … more

  • Durbin's Interchange gets more complicated

    June 17, 2010
    Senator Durbin's original Interchange amendment, inserted into the financial reform bill working its way through Congress now, would limit the amount of debit-card Interchange fees that Visa Inc. and MasterCard Inc. charge banks to what's considered "reasonable and proportional" to the processing costs involved. These Interchange fees are then passed on to merchants when they accept card payments. But as Durbin learns more about the payment system intricacies, his Interchange plan is developing on the fly and becoming more complicated.

    Durbin now wants to keep Interchange 'as is' for debit cards used by the government by carving out an exemption to his own amendment. As reported in Digital Transactions, Durbin said he would write language to exempt transactions on "government cards so … more

  • Why Visa and MasterCard Should Voluntarily Lower Interchange

    June 16, 2010
    Lately I’ve read many articles about Contactless and Near Field Communication (NFC) payments, the prospects for merchant and consumer adoption, bridge technologies and market trials. Contactless payments, which feature speed, convenience, security and more functionality that leverages the mobile network, can outperform legacy mag-stripe payment technology. NFC promises smart phones as payment devices, which in turn promise to change consumer expectations about buying everything from mass transit, fast food and concert tickets, to the retail brands themselves.

    At the same time, U.S. cardholders increasingly find it difficult to use mag-stripe cards outside the U.S.  As we discussed here, the U.S. EMV strategy hinges on contactless / NFC adoption.  Some believe EMV 2.0 in … more

  • Senate Adopts Amendment to Regulate Interchange; What should merchants do now?

    May 14, 2010
    The Interchange amendment to the financial reform bill, sponsored by Senator Richard Durbin (D-IL), was adopted Thursday night.  The measure gives the Federal Reserve authority to regulate Interchange fees, using a "reasonable and proportional" standard.   The amendment also allows merchants to discount lower costs payment options and allows minimum card purchases.  Once the Senate passes the financial reform measure, it will have to be reconciled with a House version that does not include the Interchange provision.

    What does this mean for U.S. merchants?  First, take a look at your most recent April merchant statement.  If you are not on a direct Interchange pass through pricing plan already then you need to take action.   Open your browser and … more

  • Strategy to Advance Contactless

    February 23, 2010
    In an article on Digital Transactions “Could Visa’s New No-Signature Rule Hurt Contactless Payments?” it was argued that Visa’s expansion of its policy to no longer require signatures for transactions less than $25 for most U.S. merchants would undermine contactless payments.

    In our blog post Visa Changes Debit Debate, Backs Contactless, we suggested that extending Visa's No Signature Required (NSR) program (on transactions <$25) to most merchants (along with converging signature and PIN debit rates and expanding small ticket Interchange on transactions <$15) were policies that supported contactless payments.

    Changing ingrained behavior takes time and doing it in steps makes sense.  Step one, training merchants and … more

  • Visa Changes Debit Debate, Backs Contactless

    February 14, 2010
    Visa changes the signature vs. PIN debit debate with policies to support contactless payments. 

    In an interview in the June/July 2009 issue of Cards&Payments magazine, Ellen Richey, global head of enterprise risk for Visa, discussed the adoption of chip technology to make purchases more secure. Richey said “the U.S is not going to be adopting a chip-and-PIN credit card or debit card any time in the very near future” suggesting that in the U.S., the deployment of a contactless-chip card network may not include a PIN component.

    In October 2009, Best Buy announced that it would discontinue it’s acceptance of Visa contactless payment cards. Why?  Best Buy reportedly took issue that Visa contactless lacked the option of PIN acceptance, while payment industry … more