October 03, 2022
Federal Reserve Board finalizes updates to the Board’s rule concerning debit card transactions
For release at 4:30 p.m. EDT
The Federal Reserve Board on Monday finalized updates to the Board’s rule concerning debit card transactions. Pursuant to statute, the updates specify that debit card issuers should enable at least two payment card networks to process all debit card transactions, including “card-not-present” transactions, such as online payments.1 The final rule is substantially similar to the proposal issued last year.
By law, the Board is required to make rules ensuring that debit card issuers give merchants the opportunity to choose between at least two unaffiliated networks when routing debit card transactions. When the Board initially issued the rule in July 2011, the market had not developed solutions to broadly support multiple networks for card-not-present debit card transactions. Since that time, technology has evolved to address these barriers. However, some debit card issuers have not yet enabled at least two unaffiliated networks for merchants to choose between when routing such transactions. This issue has become increasingly pronounced because of continued growth in online payments.
The final rule underscores that debit card issuers should enable at least two unaffiliated networks to process debit card transactions. Importantly, input received in connection with the proposal suggests that many debit card issuers, and