A research agenda, not completed reporting. These are the original topic questions and leads. Named companies, dates and outcomes require verification. Editorial operations and internal schemas remain private.

2. Card payment lifecycle

2.1 The four-party and three-party models

  • Cardholder, issuer, network, acquirer, merchant; plus processors, gateways, PayFacs, ISOs, and program managers
  • Closed-loop/three-party models (American Express, historically Discover — verify changes after Capital One's acquisition of Discover)
  • Domestic schemes and co-badging (e.g., RuPay in India, Cartes Bancaires, eftpos, Interac, Elo) and least-cost routing

2.2 Transaction stages (explain with diagrams and timing)

  • Authorization request/response (ISO 8583 fields at a conceptual level; authorization codes; stand-in processing)
  • Card-present vs. card-not-present; EMV chip, contactless, magstripe fallback; Tap to Pay on iPhone/Android (verify availability)
  • Tokenization: network tokens vs. device tokens (Apple Pay DPAN) vs. PCI vault tokens; effects on authorization rates and fraud (verify network-published claims and label as claimed)
  • 3-D Secure 2.x, Strong Customer Authentication exemptions (EU/UK), liability shift rules
  • Clearing and batch submission; settlement and funding timelines; reserves and rolling holds
  • Refunds vs. reversals vs. chargebacks
  • Incremental authorizations, pre-auths (hotels, fuel), partial approvals, MIT/CIT frameworks for recurring payments
  • Account updater services and card-on-file lifecycle

2.3 Authorization rates and declines

  • Decline reason codes and soft vs. hard declines
  • Retry rules and network excessive-retry fees (verify Visa and Mastercard programs)
  • Published or credible benchmarks on authorization rates by region and channel (Tier 4; note methodology)

3. Interchange, scheme fees, and merchant pricing

3.1 Components of the merchant discount rate

  • Interchange (to issuer), network/scheme/assessment fees (to network), acquirer/processor markup
  • Pricing models: flat-rate (blended), interchange-plus, tiered (qualified/mid-qualified/non-qualified), subscription/membership, surcharging and cash-discount programs
  • Hidden or often-missed fees: PCI non-compliance fees, statement fees, batch fees, AVS fees, chargeback fees, early termination and liquidated damages, equipment leases, monthly minimums, "junk fees" in merchant statements (verify FTC and state actions)

3.2 Interchange structure

  • Why interchange varies: card type (debit regulated/exempt, prepaid, credit consumer/rewards/premium, commercial), channel, MCC, transaction size, data level (Level 2/3 for B2B)
  • U.S. Durbin Amendment / Regulation II: cap for covered issuers (≥ $10B assets), fraud-prevention adjustment, routing requirements (two unaffiliated networks; October 2022 clarification for card-not-present — verify), Federal Reserve's proposal to lower the cap (proposed October 2023 — verify final status and any litigation)
  • Exempt issuers and why small banks' debit interchange underpins neobank models (link to Part 04)
  • EU Interchange Fee Regulation: 0.2% debit / 0.3% credit consumer caps; cross-border inter-regional card-not-present commitments (verify); UK post-Brexit cross-border EEA interchange increases and PSR market reviews (verify findings and remedies; note PSR consolidation into FCA — verify)
  • Australia: RBA review of merchant card payment costs and surcharging (verify proposals and decisions 2024–2026)
  • Other markets: India MDR on RuPay debit and UPI (zero MDR policy — verify), Brazil, Canada (verify federal commitments on small-merchant fees)

3.3 U.S. antitrust and policy

  • Merchant class-action settlement history; the 2024 proposed injunctive-relief settlement rejected by the court (verify); subsequent revised settlement(s) in 2025–2026 (verify terms, approval status)
  • United States v. Visa debit monopolization suit (filed September 2024 — verify status)
  • Credit Card Competition Act proposals (verify reintroductions and status)
  • Capital One–Discover merger: approvals, closing date, plans to move debit and/or credit volume onto Discover network (verify)
  • State laws on interchange on sales tax (e.g., Illinois Interchange Fee Prohibition Act — verify litigation and effective date status)
  • Surcharging rules: network rules, state laws, FTC junk-fee rule scope (verify), New York and other state disclosure laws

3.4 Worked cost examples (illustrative, labeled)

Build examples for:

  • A $50 in-person debit sale at a coffee shop on flat-rate vs. interchange-plus
  • A $120 online rewards-credit sale
  • A $2,500 B2B commercial card sale with and without Level 3 data
  • Monthly statements for merchants at $10K, $100K, and $1M monthly volume
  • The effect of a 1% chargeback rate on total costs

4. Acquiring, PSPs, and PayFacs

  • Merchant of record, sub-merchants, and PayFac model (registration with networks, sponsor bank, underwriting obligations)
  • PayFac-as-a-service providers (verify: Stripe Connect, Adyen for Platforms, Finix, Payrix/Worldpay, Infinicept, Tilled, Rainforest)
  • Vertical SaaS payments monetization (link to Part 08)
  • Merchant underwriting, high-risk MCCs, MATCH/TMF list
  • Reserves, holds, and account terminations: complaints, contract terms, and evidence
  • Acquirer landscape (verify ownership changes): Fiserv/Clover, FIS→Worldpay→Global Payments transactions (verify deal terms and closing), Chase, Elavon, Adyen, Stripe, Checkout.com, Nuvei (taken private — verify), Shift4, Paysafe, Worldline (verify restructuring), Nexi

5. Card issuing and program management

  • Issuer processors (Marqeta, Galileo/SoFi, i2c, Lithic, Highnote, Episode Six, TSYS, Fiserv) — verify current clients and changes
  • Program managers vs. sponsor banks
  • Prepaid rules (Reg E prepaid rule), debit rewards economics after Durbin, credit card issuing via partners (Apple Card/Goldman Sachs transition — verify new issuer and timing)
  • Virtual cards and commercial card interchange

6. Disputes, chargebacks, and liability

  • Consumer rights: Reg Z billing-error rights for credit; Reg E error resolution for debit/EFTs; network zero-liability policies (policy, not law)
  • EU/UK: PSD2 unauthorized-transaction refund rights; Section 75 Consumer Credit Act (UK) for credit card purchases £100–£30,000 (verify thresholds)
  • Chargeback reason code families; evidence and representment; compelling evidence programs (e.g., Visa Compelling Evidence 3.0 — verify)
  • Friendly fraud/first-party misuse; dispute-rate monitoring programs (Visa VAMP changes 2025 — verify thresholds and dates)
  • Chargeback-management vendors (verify)
  • Liability allocation by rail: cards vs. ACH vs. wires vs. checks (table)

7. ACH

  • ACH operators: Federal Reserve FedACH and The Clearing House EPN; Nacha as rule-maker
  • Credits vs. debits; SEC codes (PPD, CCD, WEB, TEL, CTX); ODFI/RDFI roles
  • Settlement windows; Same Day ACH phases and current per-payment limit ($1M — verify); proposals for later windows or weekend settlement (verify)
  • Returns and timeframes (R01, R10, unauthorized 60-day consumer window), NOC codes
  • Nacha 2024–2026 rule changes: fraud-monitoring requirements for originators/ODFIs/RDFIs with phased effective dates in 2026 (verify dates and thresholds), "false pretenses" return reason, account validation for WEB debits (verify)
  • ACH fraud patterns: business email compromise, payroll diversion, unauthorized debits
  • Pay-by-bank on ACH (link to Part 03) and account verification services (Plaid, micro-deposits)
  • Volume statistics from Nacha (annual) and the Federal Reserve Payments Study (verify latest)

8. Wires, checks, and high-value systems

  • Fedwire Funds Service: operating hours, proposals to expand hours (verify), ISO 20022 implementation (March 2025 — verify)
  • CHIPS; correspondent banking for domestic and international wires (link to Part 03 for SWIFT)
  • UCC Article 4A: finality and commercially reasonable security procedures; relevant case law on wire fraud losses (verify cases)
  • Wire fees to consumers and businesses (fee records from major banks and neobanks)
  • Checks: Check 21 image exchange, remote deposit capture, mail-theft and check-washing fraud surge (FinCEN alert February 2023 — verify), U.S. Treasury phase-out of paper checks for federal payments (Executive Order 2025 — verify effective date and implementation), check volume decline data

9. Comparative analysis

Produce comparison tables:

  • Cards vs. ACH vs. wires vs. checks vs. instant payments (speed, cost, finality, fraud liability, dispute rights, data richness, availability)
  • Consumer protections by rail (U.S., UK, EU)
  • Merchant cost by rail at three ticket sizes
  • Who bears fraud losses (issuer, acquirer/merchant, consumer, bank) by scenario

10. Workflows

Use the master workflow format (goal, audience, required items, steps, fees/limits to check, security/privacy checks, common mistakes, how to verify, estimated cost, estimated time) for:

  • Reading a merchant processing statement line by line
  • Calculating an effective rate and comparing two processor quotes
  • Negotiating or switching processors (contract exit, equipment, PCI, customer card-on-file migration)
  • Disputing a credit card charge (U.S. Reg Z) vs. a debit card charge (Reg E)
  • Responding to a chargeback as a small merchant
  • Reducing false declines on an online store (tokenization, 3DS, retries — within network rules)
  • Setting up ACH debits for subscriptions compliantly (authorization language, account validation)
  • Sending a wire safely (callback verification, BEC red flags)
  • Stopping and reporting an unauthorized ACH debit

12. Timeline 2020–2026

  • Interchange settlements, court rulings, DOJ actions
  • Regulation II proposal and outcomes
  • Nacha rule changes and Same Day ACH milestones
  • Fedwire and CHIPS ISO 20022 migration
  • Card network policy changes (dispute programs, tokenization mandates, click-to-pay, passkey-based authentication — verify)
  • Major acquirer M&A (Global Payments/Worldpay, Capital One/Discover, others — verify)
  • Check-fraud surge and federal paper-check phase-out
  • Surcharging and junk-fee rule changes