Uncertainty of Swipe Fee Cap Looms for Retailers
BROOKFIELD, Wis. -- Despite a move by the Federal Reserve Board to cap debit card transaction fees at 21 cents, merchants still remain unsure how the decision will affect their business practices.
According to a survey of 169 retail executives at the Direct Response Forum, 56 percent said they don't know what impact the new rules will have on their business. Not surprisingly then, 41 percent doubted they will be passing on debit card fee savings to their customers. Interchange fees, alternative payments, and PCI/Fraud top the list of concerns of the payment professionals, according to the survey.
The prospects for mobile payments has changed significantly in the last six months with 11 percent of merchants reporting they have a solution and a full 43 percent will be implementing a solution in the next 12 months, according to the survey. In a follow up question, only 40 percent of respondents reported they are comfortable that mobile payment options offer a secure credit card environment.
"In the last six months mobile payments and other alternative payment schemes are becoming important areas of opportunity for payment professionals. Alternative payments have replaced chargebacks as one of the top three issues on the minds of payment professionals," said Chantal Gaspie, DRF executive chair.
A popular question at this year's DRF was, "What does tokenization really accomplish for a merchant"? The merchant survey revealed that 31 percent of retailers currently support a tokenization system, while 38 percent will not be implementing in the near future. There are still many unknowns regarding the ability of tokenization to reduce PCI scope for merchants.
As with last year's results, payment professionals still indicated that lack of developmental bandwidth, insufficient budget and staffing are standing in the way of contributing to improved profitability for their company, the release stated.