Short update on my industry discussions yesterday (in very brief form). 

Retailers

• Convinced US Banks would attempt to follow COF/Discover model and that Banks were not concerned about the politics. 
• Emphasize banks want control, with most seeing that BAC/WFC would make sense as owners of STAR
• Agreed that retailers would react to price increases, but only top 20 retailers have payment teams with enough depth to act on a plan (ex turn off Star).
• Believed acceptance rate and processor incentives would be a key hurdle, but that if pricing was around 125bps there was room to create superior processor incentives. 
• Loss of Tap to Pay and eCommerce (ie no PIN Debit) were consensus consumer impacts with no clear workaround. 
• Agree that retailers would strongly lobby OCC and CPFB that this was an obvious effort to end run Durbin. May seek to block acquisition. 
• Discover is an EMVCO member with most tools that would allow conversion of Pulse to dual message. No path for STAR (or EMVCo membership)
• Bank Consortium could use this as a path toward Zelle acceptance at POS (for 125 bps). This was probably the biggest “new” insight I gained