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Thursday, September 2, 2010

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Payment Cards Center

The Payment Cards Center provides meaningful insights into developments in consumer credit and payments that are of interest not only to the Federal Reserve but also to the industry, other businesses, academia, policymakers, and the public at large. The center carries out its work through an agenda of research and analysis as well as forums and conferences that encourage dialogue incorporating industry, academic, and public-sector perspectives.

What's new

August 2010

Contactless Consumer Payments: A Look at Rules, Laws, and Regulations That Apply to Over-the-Air Communication of Consumers’ Payment Information (303 KB, 8 pages)

In this newly published PCC Note, Industry Specialist Philip Keitel summarizes a variety of rules that govern over-the-air communication of consumers’ payment information, an essential ingredient to the functionality of contactless consumer payment instruments. These rules affect how those devices will be designed, how banks will deploy them, and which merchants are likely to accept them.

June 2010

Consumer Testing Informs Policy: Overdraft Regulation as a Case Study
(322 KB, 16 pages)

In November 2009, the Board of Governors of the Federal Reserve System issued regulations that protect consumers from being charged certain fees when, under a discretionary overdraft service, financial institutions pay transactions from a deposit account that contains insufficient funds. Under the regulations, consumers must receive notices that explain any discretionary overdraft services offered to them by their bank. In addition, consumers may not be charged overdraft fees for ATM or one-time debit transactions unless they have opted in to this service. During the rulemaking process, the Board extensively interviewed consumers and tested model notices to understand how consumers think about and use overdraft services. This paper describes banks’ overdraft programs, examines lessons learned from consumer testing, and explains how information obtained during consumer testing influenced the rulemaking. In addition, this paper presents some insights about more effective ways of conveying key information about overdraft services to consumers.

Spring 2010 Update Newsletter (797 KB, 12 pages)

This edition of Update features summaries of two conferences sponsored by the Payment Cards Center during the first quarter of 2010. Also in this issue, we feature the Consumer Statistics web pages, which have been gaining in popularity since we first created them earlier this year.

We also highlight two recently released discussion papers. The first is Julia Cheney’s paper, “Heartland Payment Systems: Lessons Learned from a Data Breach,” which was released in January. We also introduce Susan Herbst-Murphy’s paper, “Trends and Preferences in Consumer Payments: Lessons from the Visa Payment Panel Study,” released shortly before we went to press with Update.

Trends and Preferences in Consumer Payments: Lessons from the Visa Payment Panel Study Discussion Paper Released (257 KB, 13 pages)

For two decades, Visa Inc. has contracted with a market research firm to gather detailed information from U.S. consumers about the forms of payment they use when carrying out transactions at many types of merchants. This omnibus project, the Visa Payment Panel Study, has recorded the migration away from paper forms of payment to electronic and plastic payment methods, identified variation in preferred payment methods based on consumer demographics, and calculated a share of use for each payment type at the merchant category level. The Payment Cards Center invited Michael Marx, senior business leader, Visa Inc. Research Services, to conduct a workshop on findings from the Visa Payment Panel Study. This paper summarizes the information presented at that workshop, including indications from panel data about changes in payment behavior during the recent recession.