Trends Affecting Payment Providers: Regulations & Compliance

In the latest episode of NMI Payment Playbook, host Greg Myers sits down with Kate Hampton, Chief Strategy Officer at NMI, to discuss the evolving landscape of payment regulations and their impact on the industry. This episode is the third in a three-part series focusing on trends affecting payment providers, with previous episodes covering embedded payments and AI in payments.

Kate begins by providing a broad overview of key regulations, categorizing them into two main areas: 

• Those that protect system participants, such as consumers and merchants 
• Those that protect the system itself, such as anti-money laundering (AML) and know-your-customer (KYC) regulations

Kate emphasizes the importance of these regulations in maintaining the security and integrity of the payment ecosystem.

The conversation then shifts to specific regulatory trends, including the stricter regulations in the European Union, like PSD2, which aims to increase competition by simplifying rules. Kate explains that while the U.S. often adopts similar initiatives, they are typically tailored to fit the unique aspects of the U.S. market.

Open banking is another topic of discussion, with Kate highlighting its core objective of empowering consumers to control their data and drive innovation. She suggests that while open banking will likely make its way to the U.S., it will take a form suited to the American financial environment.

The podcast also delves into the Credit Card Competition Act (CCCA), which seeks to lower card acceptance costs for merchants by increasing competition. Kate outlines the potential implications of this act, including the possibility of reduced rewards for cardholders and the introduction of new consumer fees.

Finally, the episode touches on the importance of transparency in the regulatory process and the evolving role of AI in payments. Kate stresses the need for ongoing industry engagement to ensure regulations are effective and beneficial for all stakeholders.

Listen to the full episode to learn more!