Legal and Regulatory Developments

SPOTLIGHT: Judge in CFPB Case ‘Leaning’ Toward Injunction
Banking Dive – March 12, 2025

The federal judge in the National Treasury Employees Union’s case against Trump-era management of the Consumer Financial Protection Bureau said Tuesday she’s “leaning” toward issuing a preliminary injunction to keep at bay a plan to put the agency in “wind down mode.”

“I want to preserve an agency that could be revived, if necessary,” Judge Amy Berman Jackson of the U.S. District Court for the District of Columbia said Tuesday, according to American Banker. “I don’t think we can have nothing.”

The comment capped two days of testimony, including from the CFPB chief operating officer credited with calling the Trump administration’s design for the agency “wind-down mode.”. . .

The EPC Takes Aim at the CCCA and Illinois’s Interchange Law
Digital Transactions News – March 13, 2025

The Electronic Payments Coalition has launched the latest salvo in its offensive against legislation seeking to regulate credit card interchange. This time the thrust takes aim at federal and state legislative efforts.

At the federal level, EPC executive chairman Richard Hunt said during a press conference late Wednesday morning the EPC is ready to once again “engage in the fight” against the Credit Card Competition Act when it is reintroduced.

Hunt’s comments were made against the backdrop of a meeting between the National Association of Convenience Stores and members of Congress this week. Hunt added that past announcements about the CCCA have coincided with NACS meets with members of Congress. . . .

UK Payments Regulator to Be Abolished and Absorbed by Financial Watchdog
Reuters – March 12, 2025

Britain’s payments regulator will be abolished and its remit absorbed by another financial regulator, the government said on Tuesday, as it aims to cut red tape in favour of growth.

The Payment Systems Regulator (PSR), which oversees systems including MasterCard and bank transfers, tackles problems such as fraud, excessive fees and lack of competition among banks and payment providers.

The government said its decision to axe the PSR followed businesses complaining that the UK’s financial regulatory system was overly complex due to the country’s three financial regulators – the Financial Conduct Authority (FCA), the Bank of England’s Prudential Regulatory Authority and the PSR. . . .

Revolut and Visa File Legal Challenges Against UK Payments Regulator
Financial Times – March 7, 2025 (subscription may be required)

Revolut and Visa have filed legal challenges against the UK’s Payment Systems Regulator, with the companies arguing that the watchdog has overstepped its powers with a proposed cap on international digital transaction fees.

The move adds to pressure on the PSR as the government reviews the country’s regulatory landscape in a bid to cut red tape and boost growth. The regulator attracted ire from industry and politicians over controversial fraud reimbursement measures last year, fueling speculation that its powers could be reined in.

The PSR proposed a plan in 2023 to cap interchange fees — which are levied by Visa and Mastercard on behalf of banks — on cross-border online payments after it found that they had risen more than fivefold since Brexit. . . .

Sen. Blumenthal Asks Visa for Records of Its Payments Deal With Elon Musk’s X
CNBC – March 7, 2025

Sen. Richard Blumenthal this week pressed Visa for detailed plans and documents related to its deal to provide payments services to Elon Musk’s social media site, X, as it prepares to launch a digital wallet.

Blumenthal, a Democrat from Connecticut and the ranking member of the Senate’s Permanent Subcommittee on Investigations, pointed to Musk’s role in hobbling the Consumer Financial Protection Bureau — the consumer watchdog that would be a key regulator of the X Money service — as among the reasons for the information request, according to a March 6 letter obtained by CNBC.

“Given the unique position of X Chairman and Chief Technology Officer Elon Musk as leader of the Department of Government Efficiency and his recent role in gutting the Consumer Financial Protection Bureau … Visa stands to take advantage of the deep conflicts of interest and unscrupulous conduct of its new business partner,” Blumenthal wrote. . . .

Payments 3.0: Get Set for the Mini CFPBs
Digital Transactions Magazine – March 1, 2025

Will the states step into a regulatory gap left by the new Trump administration?

In February, acting Consumer Financial Protection Bureau director Russell Vought, director of the United States Office of Management and Budget, ordered the Bureau to close for a week and two senior officials resigned. The Department of Government Efficiency has also set its sights on closing the Bureau.

Perhaps recognizing what was coming, about a week before the inauguration, the CFPB (under its previous director) encouraged states to prepare to take the lead on consumer financial protection. . . .

Industry Developments

SPOTLIGHT: Billions of Tokens
Digital Transactions Magazine – March 1, 2025

In the 10 years since its debut, network tokenization has changed the payments industry, improving the security and versatility of digital payments. Apple Pay, the mobile payment service from Apple Inc. that debuted in 2014, could have been a no-go if not for the development of network tokenization.

The mobile phone-based payment service needed a way to secure sensitive payment card data that would work with any U.S. card issuer. The solution was network tokenization. Publicly, work began on a standard in 2013 and the technology was ready for the October 2014 launch of Apple Pay on iPhones.

Today, network tokens extend well beyond the iPhone user base, threading their way into e-commerce transactions and card-present transactions in some use cases. . . .

Retailers Are Pushing Payment Modernization as Customers Ask for More
Retail Dive – March 6, 2025

Over half of retailers completed a major payments modernization program within the past year, a KPMG modernizing payments report found. For most retailers, the work is not over: 4 in 5 will once again update their payments infrastructure or plan to do so.

Almost 3 in 5 retailers in North America report changing customer expectations as the top factor triggering payment modernizations. The findings are based on a survey by KPMG International of 810 financial institutions and 690 retailers.

A seamless payment experience is critical to customer satisfaction, according to a statement from Duleep Rodrigo, national sector leader of consumer and retail at KPMG U.S. The right delivery can improve operational efficiency and help provide insights into customer behavior, Rodrigo said. . . .

What Are FinTechs Doing With Crypto? Mostly Stablecoins, Financial Services
PYMNTS – March 6, 2025

The relationship between traditional finance and cryptocurrency has, for years, been uneasy at best.

But when it comes to FinTech companies, it’s been an entirely different story. Many of the leading platforms have embraced blockchain products, positioning them at the center of their offerings. The crypto products they are embracing and integrating? Stablecoins and financial services tend to top the list.

Take for example Stripe’s latest shareholder letter, which includes an entire section on stablecoins as “room temperature superconductors for financial services.”. . .

Read Payments News Update – March 14, 2025 at constantinecannon.com