Understanding the Credit Card Competition Act a/k/a Durbin 2.0

Consumer Finance Monitor

Our special guest is Zarik Khan, Founder and Managing Director of Finsolute Advisors. Congress is now considering whether to enact the CCCA, a bill that would require credit card issuers with assets over $100 billion to include at least two possible network processors on each card. We first look at the roles of the various parties involved in a typical transaction in which a consumer makes a purchase from a merchant using a credit card. We then discuss how the CCCA requirement for at least two networks would operate, its potential implications for smaller banks and credit unions, and its implications for each of the parties involved in a typical credit card transaction. After discussing the bill’s political prospects, we assess the principal arguments made in support of or opposition to the bill, including the arguments made by the bill’s opponents that the CCCA will reduce access to consumer benefits such as rewards programs and zero fraud liability protection.

Alan Kaplinsky, Senior Counsel in Ballard Spahr’s Consumer Financial Services Group, hosts the conversation.