A few weeks back, we posted an initial Denver field test report of Chase's blink card from our friend Linda Elliott.

Today, she's back with an update. This is more great stuff from Linda, just in time for the weekend. Enjoy!

The Federal Reserve Bank of Chicago has published a special edition Fed Letter titled "Innovations, Incentives, And Regulation: Forces Shaping The Payments Environment" (PDF) as a follow-up to its fifth annual payments conference held last May and summarizes the conference participants’ responses to the following questions:

• What emerging innovations have the greatest potential to improve the payment system?
• Why have certain payment innovations been more successful than others?
• How does the current legal and regulatory framework affect the adoption of efficient payment mechanisms?

Some quotes from today's testimony by Ian Macfarlane, Governor, Reserve Bank of Australia, responding to questions at a hearing of the Australian House of Representatives Standing Committee on Economics, Finance and Public Administration (PDF) regarding payment system reforms in Australia:

I think merchants as a whole have underestimated the power that they really have at their disposal. They are in this mindset because for 30 years they had all sorts of restrictions on them that prevented them from doing things that a normal business should be able to do; in other words, if you choose an expensive way of doing something, they should charge you more than if you choose a cheap way.

For 30 years they had legal restrictions that prevented them from doing that. So some of them have actually developed a very defeatist attitude, as you just described. What we are trying to do is put the power back in their hands to actually stand up to the providers of credit cards and charge cards.

Essentially, the merchants somehow or other have to get together and use some bargaining power. In a negotiation between, say, Amex and a merchant, everyone in Amex has spent every day of their lives becoming an expert and a specialist in payment systems. They negotiate with the merchant. The merchant knows how to buy and sell things and inventory control. He knows almost nothing about payments. It is an incredibly unequal bargain.

E. Scott Reckard reports for the Los Angeles Times on an agreement Thursday by Wells Fargo to pay as much as $34 million to settle a lawsuit alleging that it had imposed improper credit card processing charges on about 96,000 California businesses.

The disputed charges included extra fees charged by the bank when merchants had to punch in a credit card number by hand, said Howard M. Jaffe, a Los Angeles lawyer representing the businesses.

"If a merchant failed to swipe the card, couldn't get the machine to read it and just manually input the numbers, they'd get dinged — usually by a modest amount, but it added up to millions and millions of dollars," he said.

99Bill and NetEase.com have announced an agreement to jointly establish an online NetEase prepaid card payment platform. Under the agreement, 99Bill launched the new online payment service to let the NetEase's prepaid online game card users to pay for the third party online products and services, and enable the Internet and wireless service providers to accept the prepaid card payment online.

The Federal Reserve Bank of New York has announced a conference to be held on September 15 and 16 in New York City examining antitrust activity in card-based payment systems.

In recent years, credit and debit card systems have been the focus of significant antitrust inquiries and actions. Card-based payment businesses in Asia, Australia, Europe, and North America have been investigated for their methods of determining interchange fees, exclusivity arrangements, no-surcharge rules, honor-all-cards rules, membership requirements, and governance policies.

Antitrust activity worldwide has many similarities, such as a focus on interchange fees, and many differences, such as exclusivity rules in one country and no-surcharge rules in another. In addition, antitrust efforts directed at debit card and credit card systems show similarities and differences.

This conference's focus is two-pronged: to present research on the cause and on the effects of antitrust actions. The organizers of the conference hope to address the need for better information on the efficacy of the different remedies mandated by the courts worldwide.

• Open Solutions Launches POS IP Gateway Expanding POS Offering
• Australia: RBA hails merchants who charge extra for credit card use
• WSJ: In a Challenging China Market, EBay Confronts a Big New Rival