2 PAYMENT METHOD PROFILES: CARD
Token Portability A few regulators around the world have intervened to protect competition on network tokenized transactions. These include: United States: In December 2022, the Federal Trade Commission (FTC) announced a consent decree with Mastercard to change its CNP network tokenization business practices. 194 Prior to the consent decree, Mastercard’s policies did not allow for detokenizing CNP debit transactions blocking merchant routing rights Today, both Mastercard and Visa permit card-on-file, CNP, tokens to be routed to non-affiliated networks. However, they will detokenize the transaction, but access to security measures like crytpogram validation and token domain control restriction enforcement may not be as easily received. Australia: In May 2024, the Reserve Bank of Australia set expectations for the tokenization of payment cards and storage of primary account numbers. The expectations include protections related to token portability of debit, credit, and charge card tokens as well as synchronization for dual-network debit cards. By June 2025, schemes, gateways, and acquirers, were expected to support domestic and international networks for tokenized dual-network debit cards. 195 Secure Checkout Regulation In some markets, regulators have introduced mandates requiring merchants to multi-authenticate customers. This includes markets like EU’s Strong Customer Authentication, 196 Australia’s CNP Fraud Mitigation Strategy framework released by AusPayNet, 197 India’s guidelines on additional factor of authentication, 198 and Japan’s 3D Secure mandate. 199 Financial Product Regulation Around the world, regulations seek to protect customers from predatory lending and promote transparency in lending practices. While these vary country to country, they often share common goals, including: Clear and Accurate Disclosures: Requiring lenders to inform customers of the annual percentage rates, terms of the loan, cost of the loan, and the borrowers rights. Fair Lending Practices: Prohibiting discriminatory practices and ensuring equal access to credit Consumer protection: Protecting customers from predatory lending practices, such as excessive fees, high-interest rates, and deceptive marketing. Here are some examples of regulations around the world governing financial products: United States Laws such as the Truth in Lending Act, Fair Credit Reporting Act, the Unsolicited Credit Card Reporting Act, Credit Card Accountability, Responsibility, and Disclosure Act govern the accuracy and transparency of credit term disclosures to customers, while laws like the Fair Credit Billing Act and Equal Credit Opportunity Act regulate fair lending practices, ensuring equal access to credit facilities.
84
Powered by FlippingBook