Walmart is the first major merchant to add Fiserv’s Accel signature debit service following the debit network’s recent expansion of routing options, in a move to cut costs for card acceptance.
Accel's changes allow merchants to route signature debit transactions on cards that carry the Accel debit network logo on that network, instead of only Visa or Mastercard, said Carol Specogna, Fiserv’s vice president of card services. Previously merchants could process Accel cards only as PIN-based transactions.
The move followed implementation of regulations under the Durbin Amendment to the Dodd-Frank Act of 2010, dictating that merchants must have a choice of at least two unaffiliated networks for routing debit transactions, but it took time for Accel and merchants to make back-end changes to enable these choices, Specogna explained.
“It took about two and a half years for all the development work necessary to be complete at our end, and with merchants, after regulatory changes enabled us to expand debit-routing choices,” she said.
Customers will see no difference at the checkout, according to a recent press release.
“For Walmart, the cost savings from this additional routing option will quickly add up, allowing us to further invest in price and the customer experience,” said Mike Cook, Walmart’s senior vice president and assistant treasurer, in the release.
Other big-box merchants may soon follow Walmart in routing signature debit transactions via its network, and restaurants are likely to be next, Specogna said.
“Many restaurants’ payment terminals never had PIN pads, but now they may use existing terminals to route transactions that previously required a PIN over Accel—via the signature debit option—giving them more options to control expenses,” she said.
Debit cards sporting the Accel logo account for a relatively smaller portion of all cards in circulation. Accel declined to provide the estimated market share or the specific cost of its fees versus transactions flowing over the Visa and Mastercard signature debit rails.
“As an independent debit network, Accel traditionally has had fewer fees versus Visa and Mastercard, which means merchants might find a better net revenue position using our network for certain transactions,” Specogna said.