Short Blog – Key developments this week

I hope to finish part 2 – Power of Bank Networks tomorrow (12-15 pages). In the meantime I have to recap a few key developments this week. 

  • A SCATHING report from Senator Warren titled “How Consumers Defrauded on Zelle are Left High and Dry by the Banks that Created It” There goes the Zelle Brand. Glad to see banks acting on my February recommendations to protect consumers and their brands. This is just a small taste of what happens in real-time payments. This is a political hit job on banks. This “fraud” is not bank fraud at all.. It is acting on consumer requests. See my blog for more. 
  • Visa and Mastercard stocks are getting hit as Senator Durbin attempts to add Durbin II to the Defense bill. Read this ABA article. Lobbyists see a 5% chance that this will stick. Banks need to move quickly to create consumer awareness with a very simple message “this will kill card rewards”. What Senator wants to take part in such a scheme during an election year? My blog on topic is Durbin 2 – Short Update 
  • Enforcing Durbin 1 in eCommerce. FED just issued final rule that requires dual routing in eCom debit. I see minimal impact to V GDV (<1%) for 4 reasons 1) limited eCom debit 2) only the largest merchants use dual routing 3) Visa DPS footprint AND Interlink 4) Top merchants have been doing this for 3+ yrs (ex WMT). For an overview see my 2011 blog, for how it will work in eCom see this article
  • CFPB Releases Report on Buy Now, Pay Later. See blog from Federal Reserve of Atlanta. The report shows that this is a real credit product that is behaving itself. If I were to add anything it would be the impact of incremental conversions. Interesting to note the repayment methods. 

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