The Campus Debit Card Trap: Are Bank Partnerships Fair to Students?

Examines partnerships between colleges and financial firms on campus ID, prepaid, debit, and financial aid disbursement cards and questions about fees, aggressive marketing strategies, and consumer protection. Lists best practices and recommendations

Recommendations for mitigating information disclosure from point of sale devices in South Africa

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A Study of the Interrelated Bilateral Transactions in Credit Card Networks

Over the last decade, consumers have tripled their use of credit cards as more merchants have increased their acceptance of them. This increase suggests that incentives in today's marketplace favor greater credit card use by consumers and acceptance by merchants. In this paper, we study the set of interrelated bilateral transactions in credit card networks. First, we survey the recent theoretical papers using this approach and find that there is a lack of consensus regarding the optimal set of pricing policies. Second, we explore each of these interrelated transactions emphasizing common market practices and the underlying regulatory and legal framework. Third, we analyze the impact of certain credit card market practices on competing payment instruments such as debit cards.credit cards, rents, antitrust, networks

Closing the Book on Jusen: An Account of the Bad Loan Crisis and a New Chapter for Securitization in Japan

University business incubators (UBIs) are organizations that provide new startup companies with a support environment. However, there are split opinions on the UBIs’ contributions to the startups and the regional economy and, consequently, there are also split opinions on  how to assess UBI performance. According to the resource-based view (RBV), a company’s competitive advantage results from the various resources the company has access to. The biotechnology industry is characterized by high research intensity, weak entrepreneurial and managerial skills of the entrepreneur, huge capital requirements, and long product  evelopment approval processes. Previous research has showed that these characteristics imply certain challenges for new biotech ventures. In this study, these industry specific characteristic and challenges were believed to affect what constitutes successful bioincubation and how bio-incubators’ performance should be assessed. The purpose of this report is, thus, to examine how bio-incubator performance can, and should be, assessed. An existing framework for assessing UBI performance is used as a basis for performing  emistructured interviews with 18 incubator managers in order to examine what performance indicators are perceived as robust for assessing bio-incubator performance. The findings show that the value contributions of bio-incubators mainly include space and network provision, support services, and coaching. The perceived value contributions, in combination with the perceived challenges, imply that it is particularly appropriate to assess bio-incubators performance in terms of Job Creation, Economy Enhancement, Access to Funds, and the Incubator Offer and Internal Environment. However, Job Creation and Economy Enhancement are closely related and are therefore suggested to be merged into a single performance indicator. Hardware and Services, on the other hand, seems to be less relevant for assessing bio-incubator performance as it depends on the incubator’s strategy. The study concludes that there are additional ways of assessing bio-incubator performance, such as shortened time to graduation, links with universities, and the flexibility of the incubator. Further research may include the entrepreneurs’ point of view or use the approach of this study to examine incubator performance in other high-technology industries

Better Than Cash? Global Proliferation of Debit and Prepaid Cards and Consumer Protection Policy

A global deluge of debit cards and prepaid cards – payment cards that do not require consumers to qualify for credit – is rapidly making electronic payment systems accessible to much of the world’s population that previously paid in cash for goods and services. The global proliferation of payment cards is fraught with both risk and promise for consumers. The billions of people of low to moderate incomes who are being hurled from a cash economy into the era of electronic payments in emerging economies by the proliferation of debit and prepaid cards are particularly vulnerable to abuses by banks and merchants. Unregulated private lawmaking by payment card associations and card issuers will not ensure that consumers are treated fairly, due to their countervailing incentives to attract merchants into their payment networks. Technological solutions promote efficiency and limit abuse, but cannot ensure fair resolution of consumer-merchant disputes. Payment card associations such as Visa and MasterCard operate chargeback systems for resolving disputes, but chargeback systems cannot function in cash economies without merchants’ consent, because cash transactions are usually anonymous, evidenced at most by a receipt, and do not involve an intermediary. However, while the lack of anonymity inherent in the use of payment cards entails risk for consumer privacy, it also makes possible greater transparency in payment systems. As billions of vulnerable consumers become connected to electronic payment systems, chargeback systems become a possible means of protecting them from merchant misconduct. Moreover, this lack of anonymity makes possible new ways of protecting consumers, such as disclosure to consumers of outcomes of the Visa and MasterCard chargeback systems through merchant ratings such as those posted on eBay. There is a risk that nations with emerging economies will uncritically emulate regimes of consumer protection adopted in the United States and Europe. These regimes in many respects lack a consistent conceptual foundation and fail to address problems, such as bank fees, access to banking services and payment system insolvency, that are poorly addressed in developed countries if they are addressed at all. For example, debit and prepaid card transactions are both a convenient means of obtaining cash and a substitute for cash, but this does not justify denying chargeback rights to consumers who use debit and prepaid cards, as if they had paid in cash. Prior scholarship on payment cards has suffered from the assumption that American use of credit cards is normative. This article demonstrates that it is a global anomaly; most consumers worldwide use payment cards for convenience rather than a source of long-term credit, and that is why debit cards have become popular so quickly. Moreover, fees and charges imposed on consumers for payment card services are one of the most prolific sources of consumer complaints. Fee regulation should be regarded as a legitimate part of payments law in scholarship on the subject, and should not be ignored in establishing a regulatory system to govern debit and prepaid cards

“Buy Now, Pay Later: No Fees. No Credit Check.”

Afterpay and Affirm, are financial technology (“fintech”) platforms that allow consumers to split their low-cost purchases into four installment payments–with seemingly no interest, fees, or hard credit inquiries. Similar to retailer fees on credit card transactions, these companies generate most of their profits as the intermediary between consumers and merchants. By flaunting celebrities like A$AP Rocky and Keke Palmer, the loan products are heavily advertised as the “cool” alternative to traditional credit cards and are particularly well-received among Millennials and Generation Z (“Gen Z”) consumers. Consequently, consumer advocates are duly concerned that lenders irresponsibly extend credit to a young generation, who remain particularly vulnerable to the “present bias,” which undervalues future losses and overvalues present satisfaction. Currently, U.S. regulators have not confined lenders to proper regulatory parameters and remain silent on the regulatory gaps caused by the third-party lenders’ intentional “skirt[ing] of the definition of a [covered] loan under some U.S. laws.

Information security, data breaches, and protecting cardholder information: facing up to the challenges

On September 13 and 14, 2006, the Payment Cards Center of the Federal Reserve Bank of Philadelphia and the Electronic Funds Transfer Association (EFTA) hosted a conference entitled “Information Security, Data Breaches, and Protecting Cardholder Information: Facing Up to the Challenges.” The two-day event was designed to bring together a diverse set of stakeholders from the U.S. payments industry to discuss a framework to guide industry practices and inform public policy. This paper summarizes key highlights from this event. Conference participants emphasized that the industry must address two fundamental issues: (1) increasingly dangerous threats to sensitive consumer information and (2) public perception and understanding of the risks from data breaches. These challenges are related but need different solutions. A consensus emerged that while the situation is not yet dire, it is serious, and warrants attention from all payments stakeholders.Data protection ; Payment systems ; Computer security