9 In addition, the law states that the standards do not apply to debit cards used in government-administered payment programs and certain reloadable, general-use prepaid cards. 10 As stated above, the statute requires the Board to consider “the incremental cost incurred by an issuer for the role of the issuer in the authorization, clearance, or settlement” of a particular transaction.
We considered limiting the allowable costs to only those costs associated with authorizing a debit card transaction. This approach would reflect a key distinction between debit card and check transactions: the fact that debit card transactions are authorized by the issuer, whereas check transactions are not (although merchants may purchase a third-party check guarantee service).