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Transaction Trends Online |
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In the December 2009 Issue of Transaction Trends: 
- Sales Incentives That Work
- PCI’s Evolutionary Process
- Brave New World for Payments
- Special Series: Startup Stories, Part 2
- And much more...
Visit the Transaction Trends Web Site
Advertise in Transaction Trends Need to reach the most powerful audience in the acquiring industry? Download our media kit and get started right away! |
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ETA Glossary Online |
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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 ion it. Give it a try! |
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Featured Articles
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Merchants Like Banks But Want Funding Backup |
The results of a recent survey of small business owners reveals a desire for banks to offer other options when a loan application is denied. The Spring/Summer 2008 edition of the Capital Access Network (CAN) Small Business Barometer uncovered that 87 percent of rejected small business loan applicants were not offered any alternative by their bank after they were denied a traditional lending product. However, 69 percent said they would consider an alternative offered by their bank, highlighting an opportunity for banks to satisfy customer need by providing other funding options and ideas.
An overwhelming 87 percent of small businesses surveyed indicated that it is important to have access to a readily available and predictable source of capital, a reflection of today’s credit conditions. These results indicate that banks may have a compelling marketing opportunity to provide additional value, secure customer loyalty and responsibly meet demands for working capital even as credit conditions tighten. The survey was conducted online; respondents consisted of 276 small business operators who accept credit cards as a form of payment in their business.
Read the full survey here.
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Read more...
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VISA Rescinds Debit Card Rule in the Face of Antitrust Inquiry |
Visa Inc. has rescinded a rule that required merchants to treat Visa-branded debit cards differently when used as a PIN-debit card (and processed via non-Visa networks) from the same cards when used as signature debit cards and processed on the Visa network. The change came apparently in responsoe to an antitrust probe.
The U.S. Justice Department said it had been investigating whether the rule adversely affected competition in the debit card industry by restricting certain PIN debit transactions, particularly small-value and Internet transactions, and by potentially interfering with the introduction of new types of PIN debit services.
The Department’s Antitrust Division will close its investigation now that Visa has rescinded its operating regulation and adopted new regulations that should eliminate any potential for competitive harm. The Department had opened its investigation to examine whether Visa’s operating regulation had the potential to reduce competition between Visa and the PIN debit networks. The Department had not completed its investigation when Visa proposed eliminating the rules under investigation. The Department coordinated its investigation with the attorneys general of the District of Columbia, New York and Ohio, who conducted parallel investigations.
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Read more...
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Mastercard Settles Amex Suit |
MasterCard Inc.has agreed to pay as much as $1.8 billion to settle a complaint that it blocked banks from issuing American Express cards.
The agreement will cost MasterCard about $1 billion over three years after taxes, the Purchase, New York-based company said today in a statement. American Express said the payments will act as a cushion against borrower defaults, which are likely to be more than expected.
American Express sued larger competitors MasterCard and Visa Inc. in November 2004 after the U.S. Supreme Court ruled they violated antitrust laws by preventing member banks from offering rival cards.
Last year, Visa settled its case with AmEx for $2.25 billion, and both Visa and Mastercard still face a 2004 suit by Discover, which reportedly seeks a combined $6 billion from the card companies.
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ETA Weighs In On Merchant Reporting |
The Electronic Transactions Association (ETA) submitted written testimony as part of today’s House Small Business Committee hearing on the House version of the IRS merchant reporting proposal, opposing the scheme to have payment industry companies report merchant credit and debit card sales data as a way to uncover unreported cash transactions by merchants.
The hearing featured in-person testimony from representatives of First Data, Fifth Third Processing Solutions, National Small Business Association and the National Association for the Self-Employed.
In ETA’s written testimony, the association said the proposal before the committee is deeply flawed and Congress should “consider the likely inaccuracies that would be created by every offered version of the Merchant Card Information Reporting Proposal; the burden the Proposal makes on every business involved in the electronic transaction industry; and the resulting risk of trickle-down cost increases to be borne by the American consumer.”
ETA and others opposing the merchant reporting proposal have so far succeeded in efforts to prevent the estimated revenue from closing the so-called tax gap from being used to offset spending in the recent farm bill and unemployment insurance extension legislation. However it is now being touted as an offset to the cost of eliminating the alternative minimum tax for middle income taxpayers.
Read Testimony (.pdf)
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Sen. Durbin Introduced Interchange Bill |
U.S. Senator Dick Durbin (D-IL) today introduced legislation to allow merchants to negotiate directly with credit card companies to reduce the interchange fees.
Higher interchange fees for businesses mean higher costs for retailers and consumers,” said Durbin. "American businesses and consumers are getting nickled and dimed by the big banks, who end up making billions from these hidden fees. Interchange fees need to be fairly and transparently negotiated between the merchants and the credit card companies who represent the banks’ interests so working Americans don’t get shortchanged.”
Durbin said in a press release that there is no meaningful competition or negotiation involved in the setting of interchange fees and that retailers are forced to abide by these fees, because credit and debit cards are used for over 40% of all transactions in the United States and most retailers cannot stay in business if they do not accept these cards.
Durbin's bill comes on the heels of interchange legislation introduced in the U.S. House of Representatives by Rep. John Conyers (D-MI) which would give limited anti-trust protection to acceptance-cost agreements between the bank card networks and merchants. If the parties couldn’t reach agreement, a three-judge panel appointed by the U.S. Department of Justice and the Federal Trade Commission would be empowered to impose one of the sides’ final offers as binding for three years. Card networks, however, say the bill establishes federal price controls on interchange.
Read the full release
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ACH Payments Top $18 billion in 07 |
U.S. financial institutions and the federal government made more than 18 billion ACH payments combined in 2007, a 12.5% increase from 16 billion in 2006, according to NACHA, the ACH trade group.
ACH payments include direct deposit of payroll, Social Security benefits, tax refunds, direct payment of consumer bills, bill payments by Internet and telephone, check conversion, business-to-business payments, and federal tax withholdings.
NACHA said direct deposit, up 6.4%, to 5 billion payments from 4.7 billion, remains the most widely used type of ACH payment. |
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