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Amex Tops List of Issuers |
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From the Reuters Wire Service: American Express Co ranked highest in consumer satisfaction among U.S. credit card issuers for the second straight year, according to a J.D. Power and Associates poll released on Wednesday, which cited its benefit and reward programs.
American Express, the fourth-largest U.S. credit card issuer, was followed in the rankings by Discover Financial Services.
Both American Express and Discover improved their performance from last year's survey and were the only two companies whose scores topped the industry average in the poll.
JPMorgan Chase & Co, Citigroup Inc and Bank of America Corp appeared in the fourth, seventh and ninth positions in the rankings, respectively, according to J.D. Power, a unit of McGraw-Hill Cos.
The poll, conducted in April and May, received responses from 7,665 credit card users. |
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Element Unveils Hosted Payments |
Element Payment Services, Inc. has launched Hosted Payments; a payment solution that removes software vendors from the scope of Payment Application Data Security Standards (PA-DSS) (PABP), by shifting the responsibility of handling sensitive cardholder data to Element. With Hosted Payments, the software vendor’s application is responsible for collecting all of the non-sensitive data needed to perform a payment transaction, while Element collects, stores, processes and transmits all sensitive cardholder data. Software vendors not only avoid the hassle and cost of achieving PA-DSS (PABP) compliance, but because the Hosted Payments solution is integrated with Element’s PCI DSS compliant Express Processing Platform, software providers, merchants and consumers receive the highest level of protection from cardholder data compromises. Sean Kramer, CEO of Element says, “Our innovative Hosted Payments solution offers software vendors an alternative to PA-DSS (PABP) compliance that alleviates their cost burden, reduces their risk, and enables them to give their customers a completely secure, reliable payment application.”
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Harkin, Snowe, Cardin Ask GAO to Investigate Interchange Fees |
U.S. Senate Small Business and Entrepreneurship Committee Members Tom Harkin (D-Iowa), Olympia J. Snowe (R-Maine), and Benjamin L. Cardin (D-Maryland) today requested that the Government Accountability Office (GAO) investigate the structure of credit card interchange fees, which are used to reimburse credit card companies for processing transactions, according to a release from the committee.
The Senators said they asked GAO to take a balanced look at whether fees are properly disclosed, how the fees are set, and the level of competition in the marketplace.
“This multi-billion dollar fee is blamed for higher grocery prices and credited for subsidizing popular cash-back and rewards cards,” Senator Harkin said. “A GAO study will help us to gather unbiased information on these fees so that we can help the average consumers who are in the middle of this tug of war. I trust the GAO to honestly and comprehensively study this issue and advise us on a fair way forward.”
“While the credit card companies assert that they are helping consumers purchase goods and services, merchants, many of which are small businesses, say the interchange fees charged are too high, not set competitively, and eat into already slim profit margins,” said Senator Snowe, Ranking Member of the Senate Small Business and Entrepreneurship Committee. “To get to the bottom of this dispute, we’re asking GAO to look at the facts and assess whether credit card interchange fees are set in a transparent manner in accordance with market principles. I look forward to reviewing GAO’s recommendations to determine whether legislation is necessary to address this issue.”
“Interchange fees constitute significant surcharges which are passed on to Maryland businesses and consumers,” said Senator Cardin. “We need a balanced review to determine if merchants have appropriate bargaining power to negotiate fair and reasonable rates with companies like Visa and MasterCard, who control the majority of the market. Greater transparency, negotiation, and competition can only be of help to the credit and debit payment system.”
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Merchant Card Information Reporting Will Become Law |
The merchant card information reporting legislation that ETA has long opposed is about to become law as part of the American Housing Rescue and Foreclosure Prevention Act of 2008 (H.R.3221). The reporting requirement was included as a revenue offset in this high-profile legislation which includes assistance for financially-strapped homeowners and a potential bail-out for mortgage giants Fannie Mae and Freddie Mac. It was considered a must-pass bill by lawmakers from both political parties.
The bill cleared the U.S. House last week and the Senate passed it over the weekend. It is likely to be signed by the president very quickly and could become law as soon as August 1. The merchant reporting requirement takes effect December 31, 2010.
The major outlines of the requirement are clear: Acquirers must report to the IRS the aggregate dollar amounts of credit and debit card transactions for each merchant that has more than $20,000 in transactions and more than 200 transactions per year. Reporting will have to be done by taxpayer identification number (TIN). In certain cases, acquirers may also have to subject merchants to backup withholding. You can read a summary of the final legislation here.
[Update: President Bush signed the American Housing Rescue and Foreclosure Prevention Act late Tuesday afternoon, without a formal ceremony.]
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Check Volume Continues to Fall |
Check volume continues to fall, but checks aren't going away any time soon, thanks to the continued challenges in making and receiving electronic business-to-business (B2B) payments.
New research from TowerGroup finds that B2B payments remain the last bastion of checks - making up nearly 60 percent of US check dollar value. These persistent challenges in making and receiving B2B electronic payments are a main reason why average US check values are increasing faster than any other payment type, even as the numbers of checks themselves decline.
TowerGroup expects check volumes to decline to 17.9 billion transactions by the end of 2009 as consumers, businesses, and government entities increasingly make and accept electronic payments. However, TowerGroup believes that checks will remain an important and increasingly high-value part of the US payments landscape until all potential payees are willing and able to receive electronic payments - and until checks become too expensive for banks to process on a regular basis, as shrinking volumes drive up per-unit processing costs. TowerGroup's new research is based on its own the findings as well as those from the 2007 Federal Reserve Payments Study.
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ETA Glossary Online |
 | | | | | | | The ETA Encyclopedia of Terminology for the Acquiring Industry is now online! | | | | | | | | Need a good definition for P2P? Need to know what a Merchant Descriptor is? | | | | | | | | Our online glossary has the information and its been vetted by industry experts, so you can depend on it. | | | | | | | | | |
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