Payments News Today: October 26, 2026

Payment processing news for October 26, 2026: the Eighth Circuit voids the Fed's debit fee cap. What it could save you, plus BLOOM and AI-agent checkout.

Adrian ReyesSenior Payments & Fintech Editor

October 27, 2026 · 7 min read

Two businessmen in dark suits shaking hands in front of an empty conference room with wooden chairs

Photo: Pixabay

On this page 5 sections

The Durbin Amendment Court Ruling: Regulation II Loses at the Eighth Circuit
Debit Interchange Cap Struck Down: What It Could Be Worth to You
BLOOM Stablecoin Cross-Border Payments Add Malaysia and Thailand
Agentic Commerce Council in Europe Takes on AI-Agent Checkout
Payment Processing News October 26, 2026: Dates and Decisions to Watch

Key takeaways

The Eighth Circuit struck down Regulation II's 21-cent debit cap on Oct. 26, but the old cap stays in force until the court issues its mandate.
The court lets the Fed use a cost proxy such as average variable cost. It just can't count fixed costs that Congress left out.
A lower cap reaches you automatically on interchange-plus pricing. On flat-rate or tiered plans, your processor decides whether to reprice, so ask in writing now.
BLOOM and Europe's new agentic commerce council won't change your checkout this quarter. They are setting the settlement and dispute rules you'll work under later.

A federal appeals court struck down the Federal Reserve's debit swipe-fee cap on Monday, Oct. 26, and that ruling leads the payment processing news for October 26, 2026. Your debit costs don't change yet. The current cap stays in force until the Eighth Circuit issues its formal mandate, and the Fed now has to write a replacement rule that could come in lower. Two other stories matter for sellers too. Malaysia and Thailand joined Singapore's BLOOM project for cross-border stablecoin settlement, and a group of European payment schemes formed a council to write rules for checkout by AI agents.

The Durbin Amendment Court Ruling: Regulation II Loses at the Eighth Circuit

The case is Corner Post Inc. v. Board of Governors of the Federal Reserve System. Corner Post is a North Dakota truck stop and convenience store that sued in 2021. It argued that the Fed set the debit interchange cap higher than Congress allowed. Interchange is the fee the card-issuing bank collects on each sale, and it is the largest part of what you pay to accept a card. In August 2025, U.S. District Judge Daniel Traynor agreed with Corner Post and vacated the rule, then put his order on hold pending appeal, according to The Shelby Report. A unanimous three-judge panel has now affirmed that decision. Judge David Stras wrote the opinion.

Here is the rule that lost. Regulation II is the Fed's 2011 rule implementing the Durbin Amendment to the Dodd-Frank Act. It lets issuers with more than $10 billion in assets collect up to 21 cents plus 0.05% of the sale on each debit transaction, plus one more cent if they meet fraud-prevention standards (CU Today). The statute tells the Fed to look at the incremental cost of authorizing, clearing and settling a particular transaction. The court found the Fed went further and counted fixed costs, such as software and equipment, that barely move as volume rises or falls (LawCommentary).

People are misreading one part of the opinion. The court did not order the Fed to price debit at exact marginal cost. As Payments Dive reports, the panel said the Fed may use a proxy, possibly average variable cost, as long as it bears a reasonable relationship to banks' marginal costs. What the Fed can't do, in the panel's words, is "pick a number and hope it is close enough for government work."

Merchant groups welcomed the ruling. FMI, the food industry association, had filed an amicus brief supporting Corner Post, and it urged the Fed to set a new rate (Chain Drug Review). Banking groups warned that lower interchange revenue could raise what consumers pay for checking accounts (ConsumerAffairs). They also pointed to a separate, competing case. If another circuit reads the statute differently, the conflict could end up at the Supreme Court. For the full history, see our explainer on the Regulation II proposal and the Corner Post ruling. This is general information, not legal advice; check specifics with counsel.

Debit Interchange Cap Struck Down: What It Could Be Worth to You

Nobody knows the new number yet. The closest reference point is the Fed's October 2023 proposal, which would have cut the base fee from 21 cents to 14.4 cents and changed the fraud components. That proposal was never finalized (CU Today). Because the court read "incremental cost" narrowly, a new rule could land at that figure, below it, or somewhere else.

Here is an illustrative example for a grocery store, where debit cards and small baskets dominate. Assumptions: 8,000 debit transactions a month on cards from regulated (large) issuers, a $35 average ticket, and every issuer qualifying for the 1-cent fraud adjustment. For simplicity, only the base fee changes, from 21 cents to 14.4 cents.

	Current cap	14.4-cent base (illustrative)
Base fee	$0.21	$0.144
0.05% of a $35 sale	$0.0175	$0.0175
Fraud-prevention adjustment	$0.01	$0.01
Interchange per transaction	$0.2375	$0.1715
Monthly interchange, 8,000 transactions	$1,900	$1,372

In this example the store saves $528 a month, or $6,336 a year, in interchange alone. Three limits apply. The cap covers only debit cards from issuers above $10 billion in assets, so cards from smaller banks and credit unions aren't regulated by it. Credit card interchange isn't touched at all. And your processor's markup sits on top of interchange either way.

The table also shows why this ruling matters more to some businesses than others. The cap is mostly a flat per-transaction fee, so it is heaviest on small tickets. On a $35 grocery basket, the current cap works out to about 0.68% of the sale. On a $6 coffee, it is about 3.7%. Quick-service restaurants, convenience stores and grocers carry more of this cost than a furniture store does. Online sellers pay the same regulated debit rate as stores do, so e-commerce shops with heavy debit volume have a stake as well. Our breakdown of debit vs. credit card processing fees covers how the two categories differ.

Whether a Lower Cap Reaches You Depends on Your Pricing Plan

A lower cap set by the Fed is federal law, but your processor decides how much of that change you see. On interchange-plus pricing, interchange passes through at cost, so a lower regulated rate shows up on your statement automatically. Flat-rate and tiered plans bundle interchange into one price. On those plans the processor keeps any drop in its costs unless it chooses to reprice.

Do this now, while the old cap is still in effect. Pull your last three statements and find your regulated debit volume. Then ask your provider in writing how a new Regulation II rate would flow through to you. Our playbook on what to do after the appeals court ruling has a statement checklist. To compare offers when the new rate lands, use your effective rate, not the headline rate.

BLOOM Stablecoin Cross-Border Payments Add Malaysia and Thailand

The Monetary Authority of Singapore (MAS) announced on Oct. 23 that Bank Negara Malaysia and the Bank of Thailand have joined BLOOM as policymaker members (Disruption Banking). Before this, MAS ran the program alone. BLOOM stands for Borderless, Liquid, Open, Online, Multi-currency. It sets common approaches for cross-border payments in regulated stablecoins and tokenized bank deposits, and its participants include Airwallex, Mastercard, Maybank, Ripple, Visa and the World Bank Group (CryptoRank).

MAS launched BLOOM in October 2025. The stated aim is to lower costs and speed up new services by cutting down on separate agreements with every counterparty and market. Its scope reaches past payments into corporate treasury, trade finance and payments made by AI agents within preset limits (Bloomingbit). No token or launch date has been named.

None of this changes your checkout this quarter. The likely first effect is lower foreign exchange and settlement costs for the banks and payment companies that serve you. If you sell to buyers or pay suppliers in Southeast Asia, the decision you can make now concerns how you accept cross-border cards today and which currency you settle in. Our international payment processing team reviews multi-currency acceptance and USD or local-currency settlement. For context on crypto at the U.S. point of sale, see Visa and Mesh crypto spending.

Agentic Commerce Council in Europe Takes on AI-Agent Checkout

UK-based PPRO launched the Local Payments Council for Agentic Commerce on Oct. 21. The founding members are BLIK, the European Payments Initiative (the group behind the Wero wallet), Bancontact Company and DIAS, and other schemes have committed to join (PPRO). Agentic commerce means an AI agent shops and pays on a buyer's behalf. The council plans common technical standards for how local payment methods such as BLIK, Wero and Bancontact plug into agent protocols.

Its agenda, as reported by Fintech Futures, has four main items. A human has to keep control of authorization, so an agent can't approve its own transaction. Agents need a way to prove to banks that a payment is authorized. Users need a defined way to give an agent that authority.

And the rules have to say who is responsible when a sale is reversed through a dispute, a refund or a liability claim. PaymentsJournal adds that the council will also address how agents identify merchants. It notes parallel efforts too: a bank group including Bank of America, Capital One, NatWest and ING working on safeguards, and Visa, Mastercard and Ant International working on "Know Your Agent" standards.

For later coverage of AI-agent identity checks, see our payments news for October 28, 2026.

U.S. stores will mostly see agent purchases on card rails. Still, the questions Europe is answering are the ones that will decide your chargeback exposure: who authorized the purchase, and who pays when the agent buys the wrong thing. If you sell online, give agents clean data to work from now. That means accurate product details, a clear refund policy, and a billing descriptor customers recognize. Step-up checks such as 3D Secure authentication are the tool to reach for when an order looks off.

Payment Processing News October 26, 2026: Dates and Decisions to Watch

On the debit cap, watch four things. First, whether the Fed seeks rehearing or Supreme Court review, or opens a new rulemaking. Second, when the Eighth Circuit issues its mandate, since that is the date the ruling takes effect. Third, what applies between the mandate and a final new rule. Fourth, how the competing case develops. On standards, track whether BLOOM names a launch timeline and whether Europe's council publishes draft specs that card networks adopt or answer. Fraud is the other near-term issue as holiday volume builds. Our piece on loyalty programs as a weak spot is a starting point for reviewing stored-card and loyalty account security before Black Friday.

Your most useful step this week is to find your regulated debit volume and ask your provider how a new rate would reach you. If you'd like a second opinion on your pricing plan before the Fed acts, request a free processing quote and a MannyPay specialist will respond within one business day.

Sources

About the author

Adrian Reyes

Adrian Reyes is Senior Payments & Fintech Editor for Beyond the Swipe, covering credit card processing, merchant accounts, payment technology and processing fees.

This article is for general educational purposes and is not legal, tax or financial advice. Card network rules and state laws change; confirm current requirements for your business.