New Limits on Debit Card Interchange Fees

NEW LIMITS ON DEBIT CARD INTERCHANGE FEES: THE FACTS The Federal Reserve has limited the amount issuers can charge retailers for accepting their debit cards to 0.05% of the purchase amount + $0.22 per transaction. However, the new fee structure will affect the two main types of debit transactions in a very different way. Let's take a look. SIGNATURE-BASED PIN-BASED DEBIT TRANSACTION DEBIT TRANSACTION Average per-transaction interchange fee DECREASES from $0.56 to $0.24. Average per-transaction interchange fee INCREASES from $0.23 to $0.24. Interchange fees, as a proportion of the total transaction value, DECREASE from 1.53% to 0.65%. Interchange fees, as a proportion of the total transaction value, INCREASE from 0.58% to 0.60%. 1.53% .65% .58% .60% TOTAL DEBIT PURCHASE TRANSACTIONS AND INTERCHANGE FEES, 2009 36.5 BILLION TRANSACTIONS totaling $1,391,000,000,000 with an average transaction value SIGNATURE DEBIT $836 BILLION SIGNATURE DEBIT $37.15 PIN DEBIT 38% 62% $555 BILLION PIN DEBIT 14 BILLION PIN DEBIT $40.03 SIGNATURE DEBIT 22.5 BILLION PIN-BASED INTERCHANGE FEES PAID BY RETAILERS SIGNATURE-BASED INTERCHANGE FEES PAID BY RETAILERS $12.5 BILLION $5.37 BILLION $3.2 BILLION $3.3 BILLION OLD STRUCTURE NEW STRUCTURE OLD STRUCTURE NEW STRUCTURE So, what does this mean for business? The new debit interchange fee structure greatly reduces the cost of accepting signature debit, while slightly increasing the cost of accepting PIN debit. UniBul SOURCES: http://www.federalreserve.gov/debitfees_costs.pdf. http://blog.unibulmerchantservices.com/pin-based-debit-interchange-fees-to-rise-under-new-fed-rules MERCHANT SERVICES www.unibulmerchantservices.com www.facebook.com/UniBul www.twitter.com/UniBul NEW LIMITS ON DEBIT CARD INTERCHANGE FEES: THE FACTS The Federal Reserve has limited the amount issuers can charge retailers for accepting their debit cards to 0.05% of the purchase amount + $0.22 per transaction. However, the new fee structure will affect the two main types of debit transactions in a very different way. Let's take a look. SIGNATURE-BASED PIN-BASED DEBIT TRANSACTION DEBIT TRANSACTION Average per-transaction interchange fee DECREASES from $0.56 to $0.24. Average per-transaction interchange fee INCREASES from $0.23 to $0.24. Interchange fees, as a proportion of the total transaction value, DECREASE from 1.53% to 0.65%. Interchange fees, as a proportion of the total transaction value, INCREASE from 0.58% to 0.60%. 1.53% .65% .58% .60% TOTAL DEBIT PURCHASE TRANSACTIONS AND INTERCHANGE FEES, 2009 36.5 BILLION TRANSACTIONS totaling $1,391,000,000,000 with an average transaction value SIGNATURE DEBIT $836 BILLION SIGNATURE DEBIT $37.15 PIN DEBIT 38% 62% $555 BILLION PIN DEBIT 14 BILLION PIN DEBIT $40.03 SIGNATURE DEBIT 22.5 BILLION PIN-BASED INTERCHANGE FEES PAID BY RETAILERS SIGNATURE-BASED INTERCHANGE FEES PAID BY RETAILERS $12.5 BILLION $5.37 BILLION $3.2 BILLION $3.3 BILLION OLD STRUCTURE NEW STRUCTURE OLD STRUCTURE NEW STRUCTURE So, what does this mean for business? The new debit interchange fee structure greatly reduces the cost of accepting signature debit, while slightly increasing the cost of accepting PIN debit. UniBul SOURCES: http://www.federalreserve.gov/debitfees_costs.pdf. http://blog.unibulmerchantservices.com/pin-based-debit-interchange-fees-to-rise-under-new-fed-rules MERCHANT SERVICES www.unibulmerchantservices.com www.facebook.com/UniBul www.twitter.com/UniBul NEW LIMITS ON DEBIT CARD INTERCHANGE FEES: THE FACTS The Federal Reserve has limited the amount issuers can charge retailers for accepting their debit cards to 0.05% of the purchase amount + $0.22 per transaction. However, the new fee structure will affect the two main types of debit transactions in a very different way. Let's take a look. SIGNATURE-BASED PIN-BASED DEBIT TRANSACTION DEBIT TRANSACTION Average per-transaction interchange fee DECREASES from $0.56 to $0.24. Average per-transaction interchange fee INCREASES from $0.23 to $0.24. Interchange fees, as a proportion of the total transaction value, DECREASE from 1.53% to 0.65%. Interchange fees, as a proportion of the total transaction value, INCREASE from 0.58% to 0.60%. 1.53% .65% .58% .60% TOTAL DEBIT PURCHASE TRANSACTIONS AND INTERCHANGE FEES, 2009 36.5 BILLION TRANSACTIONS totaling $1,391,000,000,000 with an average transaction value SIGNATURE DEBIT $836 BILLION SIGNATURE DEBIT $37.15 PIN DEBIT 38% 62% $555 BILLION PIN DEBIT 14 BILLION PIN DEBIT $40.03 SIGNATURE DEBIT 22.5 BILLION PIN-BASED INTERCHANGE FEES PAID BY RETAILERS SIGNATURE-BASED INTERCHANGE FEES PAID BY RETAILERS $12.5 BILLION $5.37 BILLION $3.2 BILLION $3.3 BILLION OLD STRUCTURE NEW STRUCTURE OLD STRUCTURE NEW STRUCTURE So, what does this mean for business? The new debit interchange fee structure greatly reduces the cost of accepting signature debit, while slightly increasing the cost of accepting PIN debit. UniBul SOURCES: http://www.federalreserve.gov/debitfees_costs.pdf. http://blog.unibulmerchantservices.com/pin-based-debit-interchange-fees-to-rise-under-new-fed-rules MERCHANT SERVICES www.unibulmerchantservices.com www.facebook.com/UniBul www.twitter.com/UniBul NEW LIMITS ON DEBIT CARD INTERCHANGE FEES: THE FACTS The Federal Reserve has limited the amount issuers can charge retailers for accepting their debit cards to 0.05% of the purchase amount + $0.22 per transaction. However, the new fee structure will affect the two main types of debit transactions in a very different way. Let's take a look. SIGNATURE-BASED PIN-BASED DEBIT TRANSACTION DEBIT TRANSACTION Average per-transaction interchange fee DECREASES from $0.56 to $0.24. Average per-transaction interchange fee INCREASES from $0.23 to $0.24. Interchange fees, as a proportion of the total transaction value, DECREASE from 1.53% to 0.65%. Interchange fees, as a proportion of the total transaction value, INCREASE from 0.58% to 0.60%. 1.53% .65% .58% .60% TOTAL DEBIT PURCHASE TRANSACTIONS AND INTERCHANGE FEES, 2009 36.5 BILLION TRANSACTIONS totaling $1,391,000,000,000 with an average transaction value SIGNATURE DEBIT $836 BILLION SIGNATURE DEBIT $37.15 PIN DEBIT 38% 62% $555 BILLION PIN DEBIT 14 BILLION PIN DEBIT $40.03 SIGNATURE DEBIT 22.5 BILLION PIN-BASED INTERCHANGE FEES PAID BY RETAILERS SIGNATURE-BASED INTERCHANGE FEES PAID BY RETAILERS $12.5 BILLION $5.37 BILLION $3.2 BILLION $3.3 BILLION OLD STRUCTURE NEW STRUCTURE OLD STRUCTURE NEW STRUCTURE So, what does this mean for business? The new debit interchange fee structure greatly reduces the cost of accepting signature debit, while slightly increasing the cost of accepting PIN debit. UniBul SOURCES: http://www.federalreserve.gov/debitfees_costs.pdf. http://blog.unibulmerchantservices.com/pin-based-debit-interchange-fees-to-rise-under-new-fed-rules MERCHANT SERVICES www.unibulmerchantservices.com www.facebook.com/UniBul www.twitter.com/UniBul NEW LIMITS ON DEBIT CARD INTERCHANGE FEES: THE FACTS The Federal Reserve has limited the amount issuers can charge retailers for accepting their debit cards to 0.05% of the purchase amount + $0.22 per transaction. However, the new fee structure will affect the two main types of debit transactions in a very different way. Let's take a look. SIGNATURE-BASED PIN-BASED DEBIT TRANSACTION DEBIT TRANSACTION Average per-transaction interchange fee DECREASES from $0.56 to $0.24. Average per-transaction interchange fee INCREASES from $0.23 to $0.24. Interchange fees, as a proportion of the total transaction value, DECREASE from 1.53% to 0.65%. Interchange fees, as a proportion of the total transaction value, INCREASE from 0.58% to 0.60%. 1.53% .65% .58% .60% TOTAL DEBIT PURCHASE TRANSACTIONS AND INTERCHANGE FEES, 2009 36.5 BILLION TRANSACTIONS totaling $1,391,000,000,000 with an average transaction value SIGNATURE DEBIT $836 BILLION SIGNATURE DEBIT $37.15 PIN DEBIT 38% 62% $555 BILLION PIN DEBIT 14 BILLION PIN DEBIT $40.03 SIGNATURE DEBIT 22.5 BILLION PIN-BASED INTERCHANGE FEES PAID BY RETAILERS SIGNATURE-BASED INTERCHANGE FEES PAID BY RETAILERS $12.5 BILLION $5.37 BILLION $3.2 BILLION $3.3 BILLION OLD STRUCTURE NEW STRUCTURE OLD STRUCTURE NEW STRUCTURE So, what does this mean for business? The new debit interchange fee structure greatly reduces the cost of accepting signature debit, while slightly increasing the cost of accepting PIN debit. UniBul SOURCES: http://www.federalreserve.gov/debitfees_costs.pdf. http://blog.unibulmerchantservices.com/pin-based-debit-interchange-fees-to-rise-under-new-fed-rules MERCHANT SERVICES www.unibulmerchantservices.com www.facebook.com/UniBul www.twitter.com/UniBul NEW LIMITS ON DEBIT CARD INTERCHANGE FEES: THE FACTS The Federal Reserve has limited the amount issuers can charge retailers for accepting their debit cards to 0.05% of the purchase amount + $0.22 per transaction. However, the new fee structure will affect the two main types of debit transactions in a very different way. Let's take a look. SIGNATURE-BASED PIN-BASED DEBIT TRANSACTION DEBIT TRANSACTION Average per-transaction interchange fee DECREASES from $0.56 to $0.24. Average per-transaction interchange fee INCREASES from $0.23 to $0.24. Interchange fees, as a proportion of the total transaction value, DECREASE from 1.53% to 0.65%. Interchange fees, as a proportion of the total transaction value, INCREASE from 0.58% to 0.60%. 1.53% .65% .58% .60% TOTAL DEBIT PURCHASE TRANSACTIONS AND INTERCHANGE FEES, 2009 36.5 BILLION TRANSACTIONS totaling $1,391,000,000,000 with an average transaction value SIGNATURE DEBIT $836 BILLION SIGNATURE DEBIT $37.15 PIN DEBIT 38% 62% $555 BILLION PIN DEBIT 14 BILLION PIN DEBIT $40.03 SIGNATURE DEBIT 22.5 BILLION PIN-BASED INTERCHANGE FEES PAID BY RETAILERS SIGNATURE-BASED INTERCHANGE FEES PAID BY RETAILERS $12.5 BILLION $5.37 BILLION $3.2 BILLION $3.3 BILLION OLD STRUCTURE NEW STRUCTURE OLD STRUCTURE NEW STRUCTURE So, what does this mean for business? The new debit interchange fee structure greatly reduces the cost of accepting signature debit, while slightly increasing the cost of accepting PIN debit. UniBul SOURCES: http://www.federalreserve.gov/debitfees_costs.pdf. http://blog.unibulmerchantservices.com/pin-based-debit-interchange-fees-to-rise-under-new-fed-rules MERCHANT SERVICES www.unibulmerchantservices.com www.facebook.com/UniBul www.twitter.com/UniBul