Transaction Trends

On, Tuesday, November 17, ETA’s Politics & Payments, brought together Isaac Boltansky of Compass Point Research & Trading, LLC and Jaret Seiberg of Cowen and Company, LLC, to discuss how the 2020 election will impact the payments and FinTech industries. ETA’s Senior Vice President for Government Affairs Scott Talbott moderated the discussion and helped drill down on the outlook for top policy issues that the payments industry can expect as well as how nominations and regulations that will impact our industry in 2021.

1. Governing

• The analysts anticipate that we will see a brief period of optimism and there will be a short window to move on bipartisan issues like broadband and infrastructure. But, with another debt ceiling deadline coming up, pending legislative deadlines will need to be watched.
• With the uncertainty in the Senate and a slim majority in the House, legislation might be hard to advance. It will come down to bipartisan compromises, where the moderates of both parties will need to come together to pass anything. You can anticipate that we will see a divided government for the next two years.
• With tax deadlines on the horizon, we will see a lurching between those deadlines and a lot of kicking the can down the road. Expect Republicans coming to the table since there are large number of tax provisions that are important to industry. This will give Democrats the leverage they need to get a tax package approved.
• Expect a “small” stimulus package approved with most of the funds going towards expanding/ increasing unemployment benefits and limited funds provided to the states.

2. Nominations

• The initial rounds of nominations for cabinet level positions will be more moderate. There will not be a perfect nominee for everyone which will make it hard and red state moderate Democrats will have a voice in getting any nominee through.

3. Regulatory

• CFPB – A new director will change the regulatory focus and anticipate a reorganization within the Bureau in areas that they have not been active in recent years. Both analysts anticipate movement on the small dollar rule or payday rule; and the continuation/changing of ongoing rule makings, including the open banking rule.
• Federal Reserve – The Fed is being asked to do more in the payments and banking space. You needed a blue wave to put postal banking or Fed banking as a priority since it would be a complex process without explicit legislation. With other countries moving and embracing a Digital Dollar, expect the Fed to move toward a Digital Dollar to remain competitive, with an initial focus on business use cases, then consumer use cases.