|Day's range||5.25 - 5.25|
Soft consumer sentiment index, prompted by curtailment in spending capacity, is sure to dampen the prospects of payment stocks going forward.
(Bloomberg) -- Visa Inc. is considering a reprieve for gas stations straining under an October deadline to upgrade their pumps, and, along with Mastercard Inc., delayed a set of fee changes that were to take effect next month.The moves are aimed at sending relief to merchants struggling to remain afloat as the coronavirus puts a virtual halt to global travel and governments order businesses to shut.“Now, more than ever, we’re putting all our power, capabilities, and technology to work to keep commerce flowing,” Seth Eisen, a spokesman for Mastercard, said in a statement. “To help our customers and partners manage through this unprecedented event, we are pausing updates to some systems while delivering the same level of security and service they receive every day.”Visa and Mastercard will delay until July the planned changes to interchange fees, which are paid by retailers each time a consumer swipes their card at checkout.“We are actively implementing and considering a number of ways we can proactively support our clients to ensure the stability, security, reliability and resiliency of the digital payments ecosystem,” said Will Stickney, a spokesman for Visa.The change was welcome news for retailers. The Merchant Advisory Group said the move would “provide needed relief to some of the hardest-hit businesses while ensuring electronic-payment processing continues to work in the seamless fashion as they do today.”Fuel PumpsVisa might also postpone a deadline for gas-station operators to upgrade their fuel pumps to accept chip cards, according to a person familiar with the matter.Fuel retailers currently have until Oct. 1 to upgrade their pumps. Those that don’t will have to start taking on responsibility for the costs related to fraud that happens at their facilities.Merchants have complained that the new machines are costly, and say it’s hard to find workers to install the pumps as more businesses shut because of the virus.“Nobody planned for the disruption of the pandemic delaying everything,” said Dan Rasmussen, a senior vice president at Hughes Network Systems, which helps retailers ready their systems to accept chip cards. Major oil companies including BP Plc, Chevron Corp. and Exxon Mobil Corp. have been “applying quite a bit of pressure on the retailers to move and get the orders in and start progressing.”The world’s largest payment networks have seen their stocks battered as the pandemic severely curtails spending on the firms’ networks, prompting Mastercard to abandon its full-year revenue guidance this week.Read more about restaurants pushing to lower card feesVisa Chief Executive Officer Al Kelly on Thursday pledged his company wouldn’t initiate any layoffs due to the global pandemic in 2020. The company has previously warned that the slowdown in cardholders’ overseas spending would likely crimp its outlook for revenue growth.“There is enough sadness in the world and already too many families impacted by job losses,” Kelly said in a LinkedIn post. “I have no interest in contributing to that.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Even a global health crisis can’t quell the fight between credit-card companies and retailers over fees.Visa Inc., Mastercard Inc. and banks that issue credit cards went on high alert Wednesday when the National Restaurant Association asked President Donald Trump and congressional leaders to cut the so-called swipe fees incurred every time a customer pays with plastic.The Electronic Payments Coalition, representing financial firms, held an emergency telephone meeting the same day to discuss strategies for heading off any such proposal, worried it might get tucked into the final version of the massive rescue legislation in the works on Capitol Hill. Congress enacted a similar measure for debit cards in the wake of the 2008 credit crunch. The coalition’s leader, Jeff Tassey, called the new push “unseemly.”“They are advocating in the midst of an economic and health crisis for what a lot of people now realize is a failed policy,” he said. “It never benefited consumers, while at the same time it harmed small banks and credit unions who are on the front line in many communities.”It’s unclear whether the measure will eventually make it into the rescue legislation. But there is no doubt restaurants are in for severe pain, and that many are fighting for survival.The food-service association, which says it advocates on behalf more than 500,000 restaurant businesses, predicted the industry’s sales will plunge by $225 billion over the next three months, leading to the loss of 5 million to 7 million jobs. The group’s letter seeks a wide range of aid, including tax relief and federal loan programs.“Providing short-term relief and longer-term recovery for restaurants and employees means looking at all options in the financial toolbox including grants, effective access to affordable credit, tax relief, easing lease, rent, mortgage and loan payments, reductions in credit card fees and more,” said Jeffrey Solsby, a spokesman for the association.Lobbying associations for other major retailers said they were caught unaware when the request was made.The National Retail Federation isn’t opposed to the idea of capping swipes fees, but the priority for merchants is obtaining more immediate assistance, said Stephanie Martz, the organization’s general counsel. Even if Congress passed interchange limits, the adjustments would probably need to go through a long regulatory process at the Federal Reserve.“We are always in favor of lower overhead, and that’s a big part of our members’ overhead,” she said. “But we’re focused on the crisis right now.”Other RequestsSome merchant groups may ask card companies in the near future to delay planned increases to certain fees and to push back a deadline for gas stations to upgrade fuel pumps to accept chip cards, according to people with knowledge of the matter.The issue of interchange fees has repeatedly flared up in Washington, pitting two constituencies important to lawmakers against each other -- banks versus merchants that range from giants like Target Corp. to the local liquor store. Few on Capitol Hill want to choose sides. The restaurants’ proposal wasn’t included in a draft bill that Republicans released late Thursday.Visa and Mastercard argue the fees are appropriate, noting that the technology that runs the system isn’t free and that consumer confidence in the system is essential. Retailers contend the fees force them to raise prices.For a credit-card transaction, merchants typically pay about 2% of a total purchase and the fee is divvied up by the bank that issued the credit card, the merchant’s payments processor and the card networks. Though the payment may amount to pennies per transaction, the money adds up, providing a major source of revenue to financial firms. Merchants spend more than $100 billion to accept electronic payments a year, according to the Nilson Report, an industry publication.The last time Congress took major action on card fees was in 2010 when the Dodd-Frank Act capped how much big lenders can charge for debit transactions. The law didn’t touch credit cards, which the restaurant association now argues should face similar limits.“The restaurant industry is one of low margins, tight cash flow and a workforce that depends on us for their livelihood,” Sean Kennedy, the group’s executive vice president of public affairs, wrote in the letter. “Without aggressive and immediate action from the federal government, many restaurants that are a staple of local communities will simply never resume service.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Alarm.com, Six Flags Entertainment, Visa, Mastercard and American Express highlighted as Zacks Bull and Bear of the Day
Communities have been hit hard with 9,500 free-to-use cash machines removed from across the UK in last two years, according to Which?
(Bloomberg) -- Ken Lin co-founded Credit Karma Inc. in 2007 after struggling to find out his own credit score. That’s something he probably won’t need in the future.Intuit Inc. -- the software giant behind TurboTax -- said Monday it’s buying Credit Karma for about $7.1 billion in cash and stock. The firm, which offers free credit scores and help applying for cards and loans, has more than 100 million members and reported unaudited revenue of nearly $1 billion in 2019, according to a company statement.Lin, 44, who owns at least 15% of the San Francisco-based company, is poised for a ten-figure windfall, according to calculations by the Bloomberg Billionaires Index, the latest fintech founder to strike gold in recent months as more established firms snap up upstarts.It caps a remarkable rise for Lin, who as a child immigrated to the U.S. from China with his parents and was the first of his family to graduate from college. The founder is far from the stereotypical staid financial planner. Described as an adrenaline junkie, he once took his company’s board on dune buggy rides in Las Vegas and is known for hitting the dance floor at his firm’s holiday parties.Credit Karma declined to comment on Lin’s net worth.Others geting windfalls include co-founders Nichole Mustard, 47, and Ryan Graciano, 38, as well as firms such as Silver Lake, Ribbit Capital and QED Investors, a Virginia-based outfit that led the first investment round.The startup’s hefty price tag contrasts with its early days.It initially struggled to raise funding from venture capitalists and its first office was an apartment located by a San Francisco overpass and above Kate O’Brien’s Irish Bar & Grill. The company has since moved to fancier digs near Union Square whose amenities include a nail salon.While Silicon Valley has witnessed plenty of lackluster public offerings recently, there’s still demand for financial tech companies from larger rivals.George Ruan and Ryan Hudson, the co-founders of Honey Science Corp. pulled in $1.5 billion after completing the $4 billion sale of their firm to PayPal Holdings Inc. Plaid Inc. co-founders Zach Perret and William Hockey will collect hundreds of millions of dollars each after selling their company to payments giant Visa Inc. for $5.3 billion in January.Intuit’s share price rose 2.5% to $293.60 at 10:13 a.m. in New York on Tuesday.(Updates with details of Intuit share price in final paragraph.)To contact the reporters on this story: Tom Metcalf in London at email@example.com;Julie Verhage in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: Pierre Paulden at email@example.com, Steven CrabillFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
CNA Financial, The Mosaic Company, United Airlines, Chase Credit Card Services and Visa highlighted as Zacks Bull and Bear of the Day
Digital banking app Revolut has raised $500 million in a fresh funding round, confirming the British-based business as one of the world's most valuable financial technology firms with a valuation of $5.5 billion. The Series D funding round was led by U.S. investment firm TCV - which has previously backed Netflix, Spotify and Airbnb - and takes the total amount raised by Revolut to $836 million. Revolut has attracted more than 10 million customers since its launch in 2015 by offering slick money management tools and undercutting traditional banks on pricing for foreign exchange, stock trading and money transfers.