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NewsBriefs

This article contains excerpts from news stories recently posted under by digital networks like Zelle and Venmo. According to
Breaking Industry News on our homepage. For links to these and other Sen. Warren’s report, Facilitating fraud: How consumers
full news stories, please visit www.greensheet.com/breakingnews.php. defrauded on Zelle are left high and dry by the banks that created
it, and reporting by the Wall Street Journal, the CFPB is
preparing fresh guidance under Reg E that would put
P2P networks and participating banks on the hook for all
kinds of fraud.

CFPB, payment leaders aligned
on open banking protections

Payments analysts have been generally supportive of a
new set of open banking guidelines, published Oct. 27,
2022, by the Consumer Financial Protection Bureau. The
CFPB proposal highlights potential risks to open banking,
particularly related to exposing personal financial data.
Chief among CFPB concerns is the notion that consumers
Tech giant Bluefin acquires global processor TECS deserve to access and control their financial data, including
the right "to walk away from companies offering bad
Bluefin, a payment technology and PCI-validated encryp- products and poor service and move towards companies
tion and tokenization services provider, joined a growing competing for their business with alternate or innovative
number of technology companies that have added pay- products and services."
ment processing to their product and service offerings.
Following in the footsteps of NCR Corp., which acquired CFPB Director Rohit Chopra encouraged payments
JetPay in October 2018, and Deluxe Corp., which added industry stakeholders to participate in discussions and
First American Payment System’s omnichannel payments rulemaking, which he indicated will drive best practices
platform in April 2021, Bluefin acquired TECS Payment and prevent open banking service providers from
Systems, a provider of omnichannel payment solutions. hoarding and harvesting data for their own use.

Bluefin representatives positioned the TECS acquisition as "The CFPB's personal financial data rights rulemaking has
a bid to drive secure commerce acceptance, whether trans- the potential to jumpstart competition, giving Americans
actions are done in-person, online, or via digital wallets or new options for financial products," he said in a statement.
mobile apps, to ensure data privacy and security.
Strong holiday spending growth predicted
Citing data from Insider Intelligence and Fortune Business
Insights, respectively, Bluefin projected the ecommerce The consumer spending outlook is bright for the year-end
channel alone will reach $6.169 trillion in 2023, practically holiday shopping season. The National Retail Federation
doubling 2019 volumes of $3.351 trillion. is forecasting holiday retail sales growth at between 6 and
8 percent during November and December, compared
Zelle under fire with the same two months of 2021.

Zelle, the banking industry’s answer to Venmo, is under Total spend in core retail environments will range between
attack from fraudsters—and from lawmakers. A recent $942.6 billion and $960.4 billion, NRF predicted in a Nov.
report released by Senator Elizabeth Warren, D-Mass., 3, 2022, call with analysts and reporters. The numbers
revealed that fraud on the person-to-person payment exclude restaurants, gasoline and auto sales.
network is rampant and that most defrauded customers
aren’t getting refunded by their banks. "This holiday season cycle is anything but typical," said
NRF Chief Economist Jack Kleinhenz. "NRF's holiday
That would seem to violate federal law and regulations, forecasts take a number of factors into consideration,
said Sen. Warren, who urged the Consumer Financial but the overall outlook is generally positive as consumer
Protection Bureau to beef-up its fraud rules. P2P payment fundamentals continue to support economic activity."
networks have been growing aggressively since the start
of the pandemic, as consumers shun ATMs and replace The NRF's predictions are in line with findings of a
cash and checks with digital transfers, like Zelle. In 2021, consumer survey by the International Council of Shopping
Zelle saw 1.8 billion transactions totaling $490 billion, Centers. When core retail and restaurant spending are
which was double pre-pandemic volume. combined, total anticipated spending for the holiday
season will reach $1.56 trillion, the ICSC reported.
The CFPB oversees compliance with Regulation E (the
federal rule set governing retail electronic funds transfers)

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