Banks Explore Debit Network Deal That Could Raise Fees

Debit cards have long been the no-frills alternative to credit cards. But a potential deal involving some of the country’s biggest banks could make debit a much bigger battleground.

Bank of America, JPMorgan Chase, Wells Fargo, and other major financial institutions have reportedly discussed a deal involving Fiserv’s STAR debit network, a move that could help banks capture more revenue from debit-card transactions.

That could eventually affect merchants, banks, and consumers — especially if it leads to higher fees, new debit rewards, or changes in how banks compete for everyday purchases.

Banks would have a clear financial incentive to seek more control over a debit network. Under the Durbin Amendment, banks with at least $10 billion in assets face a cap on the amount of interchange fees they can collect from merchants when a customer makes a purchase with a debit card. But there’s a catch.

If major banks owned or operated a network, the structure could potentially change how debit-fee limits apply. While interchange fees are just a small percentage of the total price of a purchase, they can amount to significant sums over the course of millions of transactions.

0M115M Number of debit card users served by Fiserv’s STAR network

Fiserv’s STAR network helps route debit card and ATM transactions between banks, cardholders, and merchants. More than 115 million debit card users are served by Fiserv’s STAR network, and that group uses cards from more than 2,800 financial institutions, according to Reuters.

The reported talks come at a difficult moment for Fiserv. The company has faced challenging times recently. On February 28, 2025, Fiserv’s stock price closed at more than $235 per share. However, as of the market’s close on July 6, 2026, Fiserv stock was trading at less than $52 per share.

In addition, Fiserv has had instability in its leadership recently. Dhivya Suryadevara resigned from her role as President of the company on July 7, which was less than a year after she took the position.

Mike Lyons stepped down as Fiserv’s CEO in June and is set to become Truist’s CEO on Sept. 1.

A deal between Fiserv and banks may not materialize anytime soon, if ever. The Wall Street Journal reported that talks regarding a deal are still in preliminary stages and suggested that many of the banks that had considered an agreement with Fiserv came to the conclusion that they likely won’t continue to pursue a deal with the company.

But the fact that talks have taken place indicates that there’s at least some interest in parties on both sides of the table to get something done. With that in mind, here’s a closer look at how a deal could impact financial institutions and merchants.

For banks, the financial implications of owning a network that can route debit transactions may be reason enough for them to pursue a deal. But banks may have another set of problems to contend with should a deal take place.

Namely, they could face political backlash. Even if such a structure were legally permissible, some critics could view it as a maneuver designed to sidestep the Durbin Amendment. And there’s always a chance that regulators could respond to any such move with new rules that banks must adhere to.

“We appreciate the notion of large banks wanting to own an independent debit network as it could allow them to circumvent Durbin debit-interchange regulations,” analysts from William Blair said, according to American Banker. “However, the regulatory risk is high, in our opinion, and backlash from large retailers would be swift and severe.”

In addition to those concerns, the William Blair analysts added that it’s unclear to them how a group of financial institutions would manage an owned network for debit card transactions.

As the analysts pointed out, merchants would likely not be in favor of any network deal between banks and Fiserv. Many sellers who accept payments from debit cards want to see interchange fees stay as low as possible so they can make more profit.

Consumers could either be winners or losers if a deal takes place between Fiserv and big banks. Which side of the equation they end up on largely depends on what type of card they use the most.

A deal could bring good news to people who prefer to transact with debit cards as they may be able to start earning rewards on debit purchases. If the revenue that banks earn on those purchases goes up, they may offer incentives to try to steer customers toward using their debit cards more often. 

Of course, consumers have no guarantee that financial institutions would take that step. They could decide to just pocket the extra revenue themselves. But banks aren’t reluctant to offer rewards on credit card purchases, so they could explore debit rewards, though there is no guarantee consumers would see that revenue passed back.

Consumers could also see more attractive bundle offers from banks should they compete for more debit transaction volume. Savvy shoppers may even benefit from using a debit card for one type of purchase, such as those under a certain dollar limit, and a credit card for another.

A deal could pave the way for debit card rewards to make a comeback.

On the downside, consumers may face higher prices from retailers if merchants begin to pay more in fees on debit card transactions. Debit rewards could offset some of the impact if merchants raise prices, but whether debit users will actually come out ahead remains to be seen.

People who prefer transacting with a credit card due to the rewards those products offer will want to keep a close eye on how any potential debit rewards stack up to perks from credit card programs.

There are a lot of moving parts to how a deal between Fiserv and big banks could shake up the payments industry. If a deal does take place, consumers may need to compare debit and credit card incentives more carefully to see which payment method actually leaves them better off.