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Table of Contents

Lead Story

Oct. 1, 2011: D-Day for debit cards?


Industry Update

New Visa, MasterCard rates take effect

Heartland offers Durbin impact insights

Operation Swiper succeeds, cyber theft continues

World payments growing in recession

Trade Association News


An interview with Douglas Bergeron

Ken Musante
Eureka Payments LLC

Underbanked in America

Patti Murphy
ProScribes Inc.

Research Rundown

Helping to expand services while minimizing costs

Square versus the payments world

Tim McWeeney

Payroll and gen Y

Excelling at social media marketing

Selling Prepaid

Prepaid in brief

First Data powers prepaid for Google Wallet

Prepaid spot-on for incentives


Merchants lack focus, fraud eats profits

Patti Murphy
ProScribes Inc.


Street SmartsSM:
Vertical market tradeshows hold many helpful surprises

Bill Pirtle
MPCT Publishing Co.

Fraud's twists and turns in 2011

Nicholas Cucci
Network Merchants Inc.

Customer longevity in the new commerce chain

Dale S. Laszig
Castles Technology Co. Ltd.

Steps toward efficient IRS 1099-K reporting

Troy Thibodeau
Convey Compliance Systems Inc.

Company Profile

Lead Source Call Center

New Products

A complete online payment center

Transaction Express
TransFirst LLC

Cloud-based POS comes in three flavors

Moneris Solutions Inc.


It really is about you



Resource Guide


A Bigger Thing

The Green Sheet Online Edition

October 24, 2011  •  Issue 11:10:02

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Heartland offers Durbin impact insights

Life under the Durbin Amendment to the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act has begun, and some merchant segments are seeing substantial benefits. But not all card-accepting businesses are faring well; those with large volumes of small-ticket items are paying more to accept debit cards than they were before Oct. 1, 2011.

QSRs lose, others gain

For example, Heartland Payment Systems Inc. reported that quick service restaurants (QSRs) it services are paying an effective interchange rate of 2.15 percent now compared to 2.08 percent in September.

That's because Visa Inc. and MasterCard Worldwide eliminated the small-ticket interchange rates QSRs had enjoyed before the new pricing regimen imposed by the Durbin Amendment, Heartland noted in a statement detailing "actual Durbin impact statistics."

More upscale restaurants (and QSRs with average tickets exceeding $11) are among the biggest winners among Heartland's clients. The company reported that from Oct. 1 through 3, it passed along $671,652 in debit interchange price reductions to restaurants and, altogether, passed along nearly $1.78 million in debit interchange price cuts to customers during that three-day period.

"These savings are just the tip of the iceberg," said Bob Baldwin, Heartland's President. The company estimates the average merchant in its portfolio will save more than $1,000 in debit interchange between now and this time next year.

The Durbin Amendment directed the Federal Reserve Board to study and come up with a cap for the interchange assessments card acquirers collect from merchants on behalf of card-issuing banks.

The Fed set an initial cap of 21-cents plus 0.05 percent of the transaction plus an additional penny provided certain security requirements are met. That amounted to about a 40 percent discount on the going rate for debit interchange in 2010, but it only officially applies to banks with $10 billion and more in assets.

The Durbin Amendment also requires debit card issuers to accept transactions routed through at least two competing electronic funds transfer networks.

Post-Durbin pricing

Heartland has been vocal about its intent to pass along merchant savings on debit interchange in the wake of debit interchange caps imposed under the Durbin Amendment, even as other acquirers and ISOs have hinted they plan otherwise. Several industry experts suggested that Heartland's position on interchange is driven largely by the fact that it uses an interchange-plus pricing scheme.

"Durbin Dollars should stay where they belong - in merchant's bank accounts - and Heartland is helping business owners keep more of their hard-earned cash," Baldwin said. "Merchants shouldn't take this for granted."

Here are some other post-Durbin Amendment statistics concerning Heartland's portfolio. Between Oct. 1 and 3, across Heartland's portfolio of 250,000 merchant locations:

For additional news stories, please visit and click on "Read the Entire Story" in the center column below the latest news story excerpt. This will take you to the full text of that story, followed by all other news stories posted online.

Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.

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North American Bancard | Simpay | USAePay | Impact Paysystems | Board Studios