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Thursday, July 24, 2014

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Update Newsletter: Fall 2004

From the Director

Welcome to this edition of Update, a publication of the Payment Cards Center that highlights recent Center activities. Also available on our website, Update complements the more complete set of content at www.philadelphiafed.org/pcc.

The Payment Cards Center was established at the Federal Reserve Bank of Philadelphia to develop insights and to communicate about issues relevant to the rapidly expanding arena of consumer payments. Its goal is to inform debate on current issues facing the industry and policymakers.

One way in which the Center pursues this goal is through its forums and conferences. A key to the success of these events has been the particular attention paid to bringing together the right group of experts to focus on current issues. Featured in this issue are two such conferences held earlier this year.

The first, a forum titled "Identity Theft: Where Do We Go from Here?," PDF focused on the dramatic growth in this new type of payment fraud. The discussion benefited from the perspectives offered by experts from the credit card industry, technology firms, credit reporting agencies, and the law enforcement, legal, and regulatory communities. As described more fully in this newsletter, discussion of the question where do we go from here revealed the need for cooperation among all affected parties.

The second conference dealt with another development in payment cards: prepaid cards. As discussed in the sessions of "Prepaid Cards: How Do They Function? How Are They Regulated?" PDF the market for prepaid cards is growing rapidly and expanding well beyond the original gift-card application. At the same time – and as with most financial-product innovations – there are growing uncertainties about applying existing laws and regulations to the governance of these new product categories. The quality of the dialogue on these and other critical issues was enhanced by contributions not only from lawyers and regulators but also from retailers, bankers, processors, and others who deal with specific prepaid business applications.

In addition to sponsoring conferences and forums, the Payment Cards Center actively supports original research and analysis. A list of recent papers written by the Center's staff, colleagues from the Bank's Research Department, and academic visitors is included in this newsletter. We have highlighted one particular effort, a Discussion Paper on "The Debate Over the National Bank Act and the Preemption of State Efforts to Regulate Credit Cards." PDF This timely analysis provides details about the act itself and outlines the evolution of related judicial opinions over the subsequent 140 years. The paper makes a particular contribution in its analysis of how the law and subsequent interpretations have shaped the credit card industry.

In support of the Center's own research agenda, staff analysts have been developing data sets and categorizing information relevant to the study of consumer credit and payments. Earlier this year, we upgraded two of these research tools – the Data Dictionary and a searchable Consumer Payments Online Bibliography – and made them available on the Center's website. We've provided a brief description of both in this issue of Update.

I hope you will enjoy reading this issue, and I thank you for your interest and support. As always, I welcome your thoughts as to how the Center can better serve the needs of market participants and other parties interested in this important and dynamic sector of the financial services industry.