JPMorgan, BofA, Wells Fargo and PNC held early talks to buy Fiserv's debit networks STAR and Accel, aiming to bypass Durbin Amendment fee caps. The deal faces political risk.
JPMorgan Chase, Bank of America, Wells Fargo and PNC have held preliminary talks about buying a debit card network from Fiserv, The Wall Street Journal reported Monday. The strategic logic is straightforward: owning the network could let large issuers bypass the Durbin Amendment's fee caps.
The Durbin Amendment, part of the 2010 Dodd-Frank law, limits the interchange fees banks with $10 billion or more in assets can collect when debit transactions run over outside networks. The Journal reported that banks could be exempt from those caps if they also own the network processing the transaction.
Fiserv owns STAR and Accel, two networks that handle debit card transactions. The company's shares have fallen sharply, the Journal noted, creating a potential opening for buyers. The talks are early and may not result in a deal. Several banks that examined the idea have already decided they are unlikely to move forward, people familiar with the matter told the Journal.
Capital One's $50.6 billion purchase of Discover last year showed what network ownership can do. By owning the rails, Capital One keeps more of the transaction economics and reduces reliance on outside processors. That deal sharpened interest across the industry, the Journal reported.
The risk is political as much as financial. Some bank executives worry a deal could provoke backlash from lawmakers, regulators and merchants, according to the Journal. Merchants have long argued that lower interchange fees help keep consumer prices down. Banks counter that fee caps reduced revenue that once supported free checking, debit rewards and other consumer services.
The talks, even at an early stage, are evidence of how aggressively banks are looking for an edge in payments, the Journal said. The industry faces rapid shifts tied to crypto and FinTechs under the Trump administration.
JPMorgan's Alpha Score is 66/100 (Moderate). Bank of America scores 65/100. Wells Fargo is at 61/100. All three sit in the Financials sector.
No decision has been made. Fiserv declined to comment. The banks either declined to comment or did not respond to requests, the Journal reported.
Prepared with AlphaScala research tooling and grounded in primary market data: live prices, fundamentals, SEC filings, hedge-fund holdings, and insider activity. Each story is checked against AlphaScala publishing rules before release. Educational coverage, not personalized advice.