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Payments News Update – March 4, 2022

Posted  March 4, 2022

Legal and Regulatory Developments

SPOTLIGHT: Merchants Payments Coalition Launches Campaign to Fight Swipe-Fee Increase Slated for April
ConvenienceStore News – March 2, 2022

The Merchants Payments Coalition (MPC) has unveiled an advertising campaign to educate Congress and other policymakers on increasing the swipe fees credit card networks and big banks charge merchants to process transactions.

According to MPC, the campaign comes as Visa Inc. and Mastercard Inc., which comprise nearly 80 percent of the U.S. credit card market, are prepared to implement a $1.2 billion increase in swipe fees in April. The increase was delayed from a year ago after members of Congress said it would “undermine efforts to help the economy recover.” . . .

Payments Sanctions on Russia Have Been Coming Quick, but Their Impact May Be Limited
Digital Transactions News – March 3, 2022

The actions taken by the SWIFT payments-messaging network and by Visa Inc. and Mastercard Inc. to punish Russia for its invasion of Ukraine will have an impact, but a muted one, observers say.

The 49-year-old SWIFT system, which on Saturday said it is banning Russian banks, has not barred all Russian banks, leaving open channels for payments on Russian oil and gas, says Eric Grover, a payments consultant and close observer of the payments business in Europe. Meanwhile, “the Visa and Mastercard bans will be more effective, but [Russia] can weather that,” he adds. . . .

Law.com Litigation Trendspotter: ‘Buy Now, Pay Later’ Services Are Emerging as Plaintiffs Bar Targets
Law.com – March 2, 2022

Law.com Radar editors have noticed an uptick in consumer lawsuits challenging “buy now, pay later” features on e-commerce websites and targeting companies like Klarna, Affirm and PayPal.

Earlier this week, Carlton Fields released its annual class action report, in which it predicted that consumer fraud claims would “soar” in the coming year. While the report specifically called out companies’ use of social media, denial of medical claims, and debt collection practices as drivers of that trend, another strain of consumer protection litigation appears to be emerging. . . .

Affirm, Klarna Meet CFPB Deadline, Others Mum
Payments Dive – March 1, 2022

Buy now-pay later providers Affirm and Klarna said they met a March 1 deadline to respond to Consumer Financial Protection Bureau (CFPB) questions about their business practices, making them the only two out of five companies to publicly acknowledge they expected to fulfill their obligations.

The federal agency made the request for detailed information from five big buy now-pay later (BNPL) providers in December because of concern over consumers taking on too much debt as the installment payment tool grows in popularity. The digital payment option, which is mainly used online, is particularly popular with young consumers. . . .

Apple Says It Has Complied With Dutch Watchdog – Letter
Reuters – February 28, 2022

Apple (AAPL.O) argued in a letter to the Dutch consumer watchdog obtained by Reuters on Monday that it has complied with an order to open its App Store to alternative payment providers for dating apps in the Netherlands.

The Authority for Consumers and Markets (ACM) has levied five separate weekly $5.7 million fines against Apple for failure to comply with the order, saying that Apple’s proposed solutions put an unfair burden on developers. The letter from Apple to the ACM dated Feb. 28 said the solution it has offered would require only a “minor technical change” with no additional costs. . . .

European Parliament Postpones Vote on Crypto Regulations Indefinitely
CoinDesk – February 25, 2022

The European parliament has postponed its vote on the proposed regulatory package for crypto assets after a leaked draft drew criticism for including a provision that sought to ban the use of cryptocurrencies like bitcoin and ether in the European Union (EU) over energy concerns.

The parliament member in charge, who is known as the rapporteur, Stefan Berger, has asked for more time to clarify the provisions, according to a Twitter post he made on Friday. The parliament was supposed to vote on the draft for the Markets in Crypto Assets (MiCA) framework on Feb. 28. . . .

Industry Developments

SPOTLIGHT: Report: The Impact of Merchant Surcharges on Cardholder Satisfaction
PYMNTS – March 1, 2022

The stresses of the pandemic have stretched merchants and consumers to their limits. In addition, as inflation has spread throughout the economy, credit card processing fees are adding to merchants’ financial burdens.

Some have decided to recoup the added costs with card surcharges, but how do consumers react when faced with surcharges? PYMNTS’ research finds that the U.S. cardholders who have never had to pay a surcharge typically raised objections when asked to consider the prospect of paying one. The cardholders who have paid them were often more accepting of the extra fee. . . .

Worldpay Is Diving Deep Into Crypto Payments
Protocol – March 4, 2022

The FIS unit is already a big player in helping consumers buy crypto with debit and credit cards. Worldpay’s next move could help replace plastic cards with crypto wallets. Worldpay is already processing billions of dollars of crypto purchases. Now the card-payments giant is diving deeper into crypto.

The unit of FIS has a network of more than 1 million merchants that it could use to mainstream crypto payments — a sector that’s been dominated to date by a handful of crypto-native companies. And it works with four large U.S. crypto exchanges: Binance, Coinbase, Crypto.com, OKEx. . . .

It Took off During the Pandemic, and Now E-Commerce Shows No Signs of Slowing
Digital Transactions News – March 3, 2022