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Mastercard's Foote tackles short, long term crisis management
Attendees of NAFCU's Virtual Congressional Caucus heard from Mastercard Senior Vice President of Public Policy and Head of Government and Corporate Affairs in North America Tucker Foote yesterday as he tackled policy risks, both short term and long term, and themes credit unions can expect to come down the pike in terms of a potentially changing political landscape.
Foote briefly discussed on the valuable, real-time insights that Mastercard is able to access on where the economy is headed and consumer behavior. When looking at insights for short-term management, Foote highlighted four distinct phases to categorize how the public reacts and adjusts:
- containment, during which "travel is shut down, business as usual is changed drastically and shopping screeches to a halt;"
- stabilization, during which consumer spending sees a plateau and the general public begins to comply with new regulations (Foote added that Mastercard was “able to use technology to help through partnerships with the government at different levels" during this phase of the coronavirus pandemic);
- normalization, which is what the U.S. is currently in, is a "misnomer" according to Foote, as "things are very different from how they were pre-COVID-19;" and
- growth, which is achieved when consumer spending and economic growth are at pre-pandemic levels, that is when the growth phase has been achieved.
In addition to compiling and analyzing these insights, Foote said Mastercard will continue to look out for changes to the preferences of consumers, merchants, and issuers and continue the invaluable credit union partnerships.
“There are a lot of things we love about our partnerships with credit unions, shared values are at the top of that list,” Foote said.
On the political landscape, Foote explained that the payments sector will face challenges regardless of the outcome of the election because the “core problems are apolitical.”
Moving forward, he cautioned credit unions to be wary of the possible introduction of interchange language into future stimulus packages. Foote explains that pushing this ideas “as a way for merchants to recover” is how the Durbin Amendment of the Dodd-Frank Act – which places a price cap on interchange fees on debit card transactions – was created amid the housing crisis in 2008.
“We can continue to push back with the right data and the right political muscle,” Foote said.
NAFCU has repeatedly advocated against the Durbin Amendment and will continue to call for its repeal. Recently, President and CEO Dan Berger spoke out against attempts from some trade organizations to extend the Durbin Amendment to credit cards. Berger explained these attempts as “looking to pull the wool over consumers’ eyes while our nation is fighting a national pandemic.”