Analysis
Archived posts from this Category
A Case For Regulating Debit Card Fees
Posted by anandkgoel on 17 May 2010 | Tagged as: Analysis, Education, General
An amendment sponsored by Senator Dick Durbin to tackle “swipe fees” passed last Thursday in a 64-33 vote. This amendment focuses on how much Interchange fees issuing banks can charge merchants for accepting debit cards. Although this amendment still has to go through several hurdles Continue Reading»
2010 Spring Interchange Updates (Increases) are Here
Posted by srini on 13 Mar 2010 | Tagged as: Analysis, Education, General
Visa, MasterCard, and the PIN debit networks are starting to release their annual Spring interchange and dues updates. For the most part, the updates reflect interchange increases that will be passed on to merchants, and will drive up the overall effective cost of electronic payments.
Visa has taken a major step by pricing a Visa signature debit card (check card) transaction the same as a Visa Interlink PIN debit transaction, both at 0.95% + $0.20 plus assessment or switch fee, respectively. Other PIN debit networks are also increasing their interchange rates or eliminating the cap on interchange fees, and thus, are slowly eroding the cost differential between signature and PIN debit transactions. Star was the last major debit network to remove its cap on interchange fees. Â Continue Reading»
GAO Releases Interchange Report
Posted by anandkgoel on 24 Nov 2009 | Tagged as: Analysis, Education, General
Last week, the Government Accountability Office (GAO) released its report on interchange as required by the CARD Act that was enacted earlier this year. Read the full report here. Continue Reading»
Card Fees Pit Retailers Against Banks
Posted by mike on 17 Jul 2009 | Tagged as: Analysis, General
Here’s a good article from the New York Times titled, “Card Fees Pit Retailers Against Banks“. The article was published two days ago and it summarizes the latest efforts by retailers to lobby for interchange reform.
It is true that legislation could regulate and thus, reduce Interchange costs. However, regulatory action is very untenable and could take years. The banks will be very aggressive in fighting any sort of regulation, having just lost their battle with consumers in the way of Credit Card Accountability Responsibility & Disclosure Act. Moreover, lawmakers will be a bit more reticent in implementing additional bank regulations that further stresses bank profitability, especially after sector weakness and increased regulations from the mortgage meltdown and the CCARD Act.
While there is potential for regulatory relief for merchants, there are a number of things that merchants can do on their own to reduce payment costs. Our Company’s entire business model is centered around helping merchants reduce their payment costs in the current environment.
Impact of Financial Regulations Proposal on Payments
Posted by anandkgoel on 17 Jun 2009 | Tagged as: Analysis, Education, General
President Obama’s sent a draft proposal of new financial regulations to Congress today. This 85-page document outlines sweeping reorganization of financial-markets are supervised since the Great Depression. It will touch almost every facet of banking from “how mortgages are underwritten to the way exotic financial instruments are traded” according to Damian Paletta at the Wall Street Journal. Continue Reading»
Impact of Credit Card Act on Businesses
Posted by anandkgoel on 06 Jun 2009 | Tagged as: Analysis, Education, General, Published Articles
President Barak Obama signed into law on May 22, 2009, the Credit Card Accountability Responsibility & Disclosure Act. This sweeping legislation has significant implications for consumers, banks, and many businesses who issue gift cards.
Understanding and Managing Your Payments Effective Cost
Posted by anandkgoel on 04 May 2009 | Tagged as: Analysis, Education, General, Published Articles
Pricing in the credit card processing industry is very complex and most merchant statements do not make it any easier to understand. There are so many technical and industry laden terms (Interchange, qualification tiers, downgrades, batch fee, ACH fee, authorization fee, settlement fee, AVS fee, PCI compliance fee, etc.) that even a sophisticated financial manager can get cross-eyed. So how do you really understand your true cost of credit/debit card processing, and then use that knowledge to ensure that your company is getting the best value for merchant services? This article will help you understand and manage the effective cost of different payment cards. Continue Reading»
Comparing Merchant Services Across Wholesale Clubs
Posted by anandkgoel on 17 Nov 2008 | Tagged as: Analysis, Education, General, Published Articles
Wholesale clubs like BJ’s, Costco and Sam’s provide fantastic value when you want to buy in bulk, but how competitive are they when you are looking to buy merchant services for your business? Continue Reading»
How Accepting ATM Cards Can Improve Your Profitability
Posted by anandkgoel on 01 Aug 2008 | Tagged as: Analysis, Education, General, Published Articles
The use of ATM or PIN-based debit cards in the U.S. has been rising faster than signature debit cards and credit cards over the past decade. Merchant sales volume for PIN transactions has been growing 21% annually since 2000, slightly ahead of signature debit and significantly ahead of credit cards. And, according to a recent study by Star electronic funds transfer (EFT) network, consumers preferred PIN debit over signature debit, with 54% opting for PIN and 38% for signature. This trend is great for both consumers and merchants. Continue Reading»
