Fiserv in talks with major US banks to sell debt card network

(Sharecast News) - Fiserv is reportedly in discussions with America's leading banks to take over its debit card payments infrastructure arm in an effort to bypass federal card caps. According to a report by The Wall Street Journal, lenders including JPMorgan, Bank of America, Wells Fargo and PNC Financial Services Group have all held talks with Fiserv over recent months regarding its STAR Network.

The network is responsible for routing debit, ATM, e-commerce, and transactions between consumers, merchants and banks.

Currently, the Durbin amendment to the 2010 Dodd-Frank Act caps transaction fees paid to banks by merchants when they use an external network. If the bank itself owns that network, however, then it would be exempt from the limit.

So-called interchange fees have been a contentious issue for many years between banks and lawmakers, with banks arguing that the income generated previously enabled them to offer free current accounts and debit-card rewards programmes.

Fiserv futures were up 7.2% at $55.51 in pre-market trading on Tuesday, following a 70% drop over the past 12 months.