Several of the largest U.S. banks have spent recent months exploring the possibility of acquiring one of Fiserv’s payment networks. Discussions have remained at a preliminary stage, and some of the potential participants have already decided not to pursue the deal further.
According to The Wall Street Journal, citing people familiar with the matter, the banks are interested in the potential acquisition because they want to recapture some of the revenue they currently forgo on debit card transactions due to federal regulations.
U.S. law limits the fees that large banks can collect on debit card transactions when payments are processed through a third-party network. Owning a payment network of their own would exempt banks from those limits, allowing them to retain a larger share of the fee revenue.
According to the WSJ, JPMorgan Chase, Bank of America, Wells Fargo, and PNC Financial Services Group have all explored the possibility of such a deal. Sources told the publication that some banks have already decided not to pursue the deal further because they are concerned about potential backlash from regulators, lawmakers, and the retail industry.