Examine individual changes

'{{Refimprove|date=September 2008}} '''Merchant services''' is the name given in the United States to a broad category of [[financial services]] intended for use by businesses.<ref>{{cite book|title=Plunkett's Banking, Mortgages & Credit Industry Almanac 2008: Banking, Mortgages and Credit Industry Market Research, Statistics, Trends and Leading|first=Jack W. |last=Plunkett|publisher=Plunkett Research|year= 2007|isbn=1-59392-098-9}}</ref> In its most specific use, it usually refers to the service that enables a business to accept a transaction payment through some secure (encrypted) channel<ref>{{cite web|url=http://www.charge.com/payment-processing-on-the-web.aspx|title=Payment Processing On the Web|date={{date|2013-02-27}}}}</ref> by use of the customer's credit or debit card. More generally, the term includes the following in its use: * [[Credit card|Credit]] and [[debit card]]s payment processing * Check guarantee and check conversion services * [[Automated Clearing House]] check drafting and payment services * [[Gift card]] and [[loyalty program]]s * [[Payment gateway]] * [[Merchant cash advance]]s * [[Online transaction processing]] * [[Point of sale]] (POS) systems * [[Electronic Benefit Transfer|Electronic benefits transfer]] programs, such as [[ration stamps]] (called ''food stamps'' in the U.S.) == The Durbin Amendment == On October 1, 2011, new rules go into effect that lower the debit card interchange fees the Visa and MasterCard networks charge merchants. The changes — resulting from Durbin Amendment passed in year 2011 as part of the [[Dodd-Frank Wall Street Reform and Consumer Protection Act|Dodd–Frank Wall Street Reform and Consumer Protection Act]] — would appear to be a plus for merchants. But are they? At issue are the so-called “swipe” fees passed along to businesses as part of their credit card processing agreement with their merchant services provider. Interchange fees were originally imposed by the credit card networks to offset their costs of fraud prevention and processing the transaction. Swipe fees vary depending on the type of card used in a transaction (credit, debit, prepaid) and the merchant; typically, larger merchants have more negotiating power when it comes to fees than smaller merchants. Prior to the implementation of the Durbin Amendment, the swipe fee for a debit card transaction averaged 44 cents. Under Durbin, the Federal Reserve has set a cap of .05% + 21 cents per transaction (22 cents if the card has security features). (It is important to note that the new rules apply only to Visa and MasterCard debit cards — not credit cards — and only to card issuing banks with more than $10 billion in total assets.) Card processing costs are often a merchant’s second highest expense after labor, so lower swipe fees for debit cards should be a welcome development, particularly as the cards have grown in popularity with consumers, surpassing both checks and credit cards. Debit card transactions in the U.S. totaled 25 billion in 2006; by 2009, the number had reached 38 billion. Issuing banks like debit cards because they’re profitable, generating $16 billion in transaction fees in 2009 alone. To make up for the anticipated loss in revenue from the lower swipe fees, many banks have begun tacking on new checking account fees, raising minimum balance requirements and have threatened to cap the dollar amount for debit transactions and end debit card rewards programs. At the same time, banks are trying to renew customer interest in more profitable credit cards and prepaid debit cards with offers of low interest and rewards bonuses. ==References== {{Reflist}} {{DEFAULTSORT:Merchant Services}} [[Category:Merchant services]] [[Category:Retail financial services]]'