Looking to vent on the Forum

I am a new subscriber to The Green Sheet. I have had some very unpleasant experiences with a vendor. Where do I make comments?

- S. L. Young

S.L:

Our forums, whether GS Online's MLS Forum or this printed Forum, are not for complaining about bad ISOs or vendors. Rather, they are intended to provide constructive dialog (for more information about Forum etiquette, see "Playing nicely in the sandbox: MLS Forum etiquette" in this issue of The Green Sheet). If you have legal issues, we suggest that you seek the advice of an attorney.

Editor

GS Advisory Board interchange question redux

Editor's note: The feature story, "Interchange: Will regulation or competition drive down pricing?" (The Green Sheet, March 27, 2006, issue 060302), included questions posed to GS Advisory Board members and their responses. David H. Press' comments were submitted after we went to press. His responses follow.

Do you think competition alone can drive down interchange pricing?

Yes ... especially after Visa and MasterCard go public. As public entities they will be less influenced by the member banks to maintain high interchange rates. However, in response to the various lawsuits and Congressional pressure, interchange pricing also is likely to be driven down, again due to Visa and MasterCard having less interest in maintaining high interchange rates.

Is Debitman (or any other nonbank debit card) the type of market response that's preferable to court-imposed or Congressionally mandated pricing models? Do you expect these programs to have a demonstrable effect on interchange pricing?

I doubt if Debitman will have a significant impact due to lack of consumer demand. Despite all the Sears/Morgan Stanley money invested in marketing Discover over the years, Discover still only has a small market share. Debitman will have to develop a program that will make consumers want to use the card.

You're an MLS, pummeled with complaints from merchants over the latest round of bankcard interchange increases. What do you say or do in hopes of keeping these merchants from shopping for better deals?

You tell merchants that eventually the other processors will follow RBS Lynk's lead and process Debitman for merchants, but in the meantime, you have to continue to take Visa and MasterCard because that is the card your customers have and use.

David H. Press
President, Integrity Bankcard Consultants Inc.