Decoding the Interchange Enigma: What ISVs and Merchants Need to Know
Interchange fees represent a substantial operational cost for businesses accepting card payments. While these fees are a necessary part of the payment ecosystem, a deep understanding of their structure and influencing factors empowers payment processors to optimize payment strategies and minimize expenses.
The payment processor’s acquiring bank pays interchange fees to the card-issuing bank for each transaction. This fee covers the costs associated with issuing and maintaining cards, providing rewards, managing fraud and bad debt, and the inherent risk assumed by issuing banks. However, the complexity of interchange fee schedules can make it challenging for processors to understand precisely what they are paying and why.
Visa has transitioned from quarterly to monthly reviews for exception reporting
Ultimately, the new Visa Acceptance Risk Standards underscore the industry’s commitment to innovation, security, and trust. By refining its approach to exception reporting, Visa fosters a healthier payments ecosystem—one where businesses can operate confidently, customers feel protected, and technology-driven insights shape a resilient and future-ready marketplace.
Update on Visa’s new Standards for Third Party Compliance
Visa’s retirement of the Global Acquiring Risk Standards (GARS) and introduction of the new Visa Acceptance Risk Standards (VARS) signals a significant shift in how acquiring banks, payment facilitators, and other stakeholders manage risk and ensure compliance. The overarching goal remains to protect the payments ecosystem from fraud and reputational harm, but VARS introduces a more dynamic framework that places a stronger emphasis on third-party oversight.
Navigating the Labyrinth: Deciphering the Merchant of Record Model for Payment Facilitators
In the dynamic world of payment processing, Third Party Agents (TPAs) face a constant barrage of decisions, each carrying significant weight. One of the most impactful, yet often obfuscated, is the choice of a MID model for their payments program.
What is the new VARS Assessment of Merchant Credit Worthiness?
What is the new VARS Assessment of Merchant Credit Worthiness?
GARS retirement presents VARS: Archetypes and Risk Domains
By combining Archetypes and Risk Domains, Visa Acceptance Risk Standards offer a more granular and proactive approach to safeguarding payment ecosystems. This new framework not only empowers acquirers to tackle emerging threats with precision, but also fosters greater trust and transparency among consumers, merchants, and the broader financial community. The result is a streamlined, future-ready standard that underpins resilience in a rapidly evolving payments landscape.
Navigating the Evolving Payments Ecosystem: A Strategic Imperative for Acquirers and TPAs
The payments landscape is undergoing a period of rapid transformation, characterized by the emergence of agile, technology-driven players and the increasing sophistication of consumer and merchant demands. This dynamic necessitates a strategic re-evaluation for both acquirers and Third-Party Agents (TPAs) to maintain competitiveness and drive sustainable growth.
From GARS to VARS: An Overview of the New Standards
The payment industry’s rapid growth has ushered in new complexities, especially around risk management. In response to evolving threats, in October 2024, Visa retired its Global Acquirer Risk Standard (known as GARS) and replaced it with the Visa Acceptance Risk Standards (now known as VARS). While both sets of guidelines aim to maintain trust and security, the changes reflect how Visa is adapting to new market conditions, regulatory demands, and expanding digital transactions. This article explores why Visa implemented this transition, what the new standards entail, and how they will affect acquirers, merchants, and the broader payment ecosystem.
Understanding Fourth-Party Risk in the Payments Industry
In the rapidly evolving payments industry, fourth-party risk management is not just a regulatory obligation but a strategic imperative. Companies must proactively identify and mitigate risks emanating from their extended network of vendors to protect their operations, customers, and reputation. By implementing robust risk management strategies, businesses can navigate the complexities of the supply chain and maintain a competitive edge in the market.
The Future of Payment Experiences: How Context-Aware Solutions Are Reshaping the Way We Pay
Over the past decade, the payments industry has come a long way—shifting from swiping plastic cards to tapping mobile devices and, more recently, automating transactions entirely. But while these innovations are transformative, they only scratch the surface of the frictionless future we’re racing toward. Context-aware payment experiences, powered by artificial intelligence and intuitive data analytics, are set to reshape how we transact daily. At RPY Innovations, we’ve been at the forefront of this shift, and I’d like to share my perspective on where we’re headed and why it’s so exciting.