by Ty Hardison

Resilient checks fail to become extinct

The UK has reversed its Vote to Abolish Check Clearing. In a testament to the power of the payment properties of checks, the UK Payments Council has decided to keep checks and cancel its 2018 target end date. Instead the UK Payments Council has decided to focus on payment innovations, reassuring customers that the check is staying.

The biggest innovation coming soon to the paper check is the digital check. Keeping all the benefits of its paper form except the piece of paper, we expect the digital check will usher in big changes in the payments industry. more

Merchant rates for debit acceptance to fall in October

Debit Savings The countdown to lower debit Interchange is on with only 11 short weeks remaining. The most important thing merchants can do now is switch to an Interchange plus pricing plan. Take a look at your current merchant statement. If you have a “qualified” rate or “non-qualified” transaction fees its time to act. No matter the size of your business or the industry you are in, it's easy to start processing on an Interchange pass through pricing plan by visiting

October Debit Interchange Savings

Here we take a look at the current Visa and MasterCard charges for the processing of debit cards for retail, restaurant and ecommerce merchant categories to project possible savings for a range of transaction sizes from $10 to $75.

For example a merchant … more

Fed announces final debit Interchange rules

Breaking Interchange NewsAt the Federal Reserve meeting today the final debit card rules where announced and the debit Interchange cap has been raised to 21 cents plus 5 basis points per transaction (not to exceed a sum of these two components). The initial proposal in December called for capping debit Interchange fees to 12 cents per transaction. After taking eleven thousand public comments, the Fed has adjusted this cap to include a “fraud prevention adjustment” in order to compensate for the costs that banks and financial institutions incur to maintain security against fraud.

The rule was slated to take effect on July 21, yet with less than one month to put in place all the mandated provisions, more time is required to implement these changes. For example, it will take … more

Joining Forces: and Vantage Partner to offer Integrated Level 3 Merchant Services

Today businesses are finding that accepting card payments is a growing necessity and often a preferred method for collecting accounts receivables. So when, who helps small and mid-sized businesses efficiently manage their day-to-day bill payment and invoicing processes, looked to integrate credit and debit card acceptance they conducted extensive research.

"What we found was that in addition to popular consumer oriented products like debit cards and rewards cards, today’s buyers are using several types of commercial card products including business, corporate, fleet, purchasing and GSA purchasing cards”, says Henrique Ceribelli, product manager at "We built our integrated merchant services solution so our clients could accept both consumer and commercial … more

Tester Amendment fails to get 60 votes to study Interchange regulations

Sens. Jon Tester (D-Mont.) and Bob Corker (R-Tenn.) offered an amendment to the Economic Development Reauthorization bill to delay by 15 months the implementation of the Federal Reserve’s rule regulating debit interchange fees and the vote this afternoon was a close one. They needed 60 votes to avoid a Senate filibuster but only garnered 54 votes.

In a mega lobbying effort pitting mega retailers against mega banks, the mega retailers won the day and the amendment was defeated. The amendment had called for a six-month study by regulators to consider the fixed and incremental costs to the financial institutions of the new rules, whether the rules will adversely affect consumers, and whether the small issuer exemption is feasible.

So what happens now? The Fed issued a draft rule in … more

How does Square compare?

At Vantage we market the VeriFone PAYware Mobile iPhone reader for mobile merchants who have the sales volume to support having their own direct merchant account. (How is that for a disclaimer?) However, as a merchant advocate, I'm always trying to recommend the best, lowest cost solution for my clients, and when their situation and environment dictates, I have recommended Square’s mobile payment solution. Of course along with this I've also followed up to get a first hand account of what real merchants thought of the Square experience.

Some cool features of Square:

It's simple to get started.

After entering a dollar amount for the transaction, you can add a picture from your phone or take a picture of the product you are selling.

You can enter and report on cash transactions … more

Visa backs Square with Investment

Last year Visa completed its acquisition of CyberSource ( for approximately $2 billion in cash to expand its online payment, fraud and security capabilities. Since then Visa launched online shopping tool, Rightcliq; acquired PlaySpan Inc. (a payments platform to handle transactions for digital goods in online games, digital media and social networks); and signed strategic agreements to deliver P2P payments with CashEdge and Fiserv enabling U.S. Visa account holders to pay each other for the first time.

Now Visa is making a strategic investment in Square, a mobile payments start. Square's card readers plug into the iPhone jack for swiping cards and have been criticized for lacking encryption security. Perhaps with Visa's involvement they will address this issue given on the … more

MasterCard announces Processing Integrity Fee

In October 2009, Visa announced a Misuse of Authorization System Fee of $0.045 per occurrence. Now MasterCard with the introduction of a Processing Integrity Fee will begin to monitor compliance to the authorization guidelines with billing scheduled to begin on August 15, 2011. And like Visa, MasterCard has set its Processing Integrity Fee at $0.045 per occurrence.

While the purpose (encourage proper compliance with transaction authorization standards) of the two programs is similar, there are some differences in how they will monitor compliance. While both Visa and MasterCard will assess fees when authorized (approved) transactions cannot be matched to a clearing settlement record or an authorization reversal, Visa allows 10 days (20 days for T&E merchants) while MasterCard provides … more

Will debit only Interchange regulation back fire?

More evidence that the ill-conceived debit only Interchange regulation may back fire for small merchants this week comes from the MasterCard blog.

In a post, The Durbin Chickens Start Coming Home to Roost we find this quote “What banks’ shying away from debit rewards is likely to do is shift volume away from debit cards to credit cards for those who pay with plastic.” Of course as merchants well know, credit and reward credit Interchange is substantially higher than debit Interchange today.

In December 2010 when the Fed issued a proposal to set a price cap on debit card Interchange fees under new powers from the Dodd-Frank Act, we warned that “without a compelling financial incentive to develop debit that issuing resources will move away from this product line. … more

Banks change business models in response to regulations

New reports about ways banks will react to the Fed's proposal to cap signature and PIN debit rates continue to emerge.

According to the Wall Street Journal, U.S. banks are debating letting debit card transactions bounce like checks. And banks may charge more to merchants in order to guarantee debit card payments. While consumers could face bounce fees like they do for checks. Both developments could steer use away from debit cards to other forms of payment not regulated by Dodd-Frank.

In addition it was recently reported that banks are considering a $50 cap on debit card purchases.

Merchants that have relied on ATMs in store to avoid taking credit and debit card payments may soon find this strategy of steering customers to cash more difficult to implement as banks begin to increase ATM … more