What Government Agency Monitors Credit Card Processors

While most institutions that monitor card payment processing are privately owned, several federal and state government bodies also intervene with inspections. They implement various guidelines to ensure consumer safety. Entities like the PCI DSS, CAN, and NACHA generally abide by government-mandated policies.

The Federal Trade Commission (FTC) oversees the majority of the credit card industry. They set guidelines geared toward consumer fairness, such as limiting card fees, securing sensitive information, and combating fraudulent transactions. However, the local state government can also enforce specific laws on processing payments.

How the Government Regulates the Credit Card Industry

Federal and state government bodies like the FTC have extensive control over the credit card industry. They primarily focus on the following variables:

• Credit Card Rates: Many government bodies work with card networks to set reasonable limits on credit card penalties.
• Fraudulent Cases: The government has strict guidelines to help minimize the prevalence of credit card fraud and identity theft.
• Card Fees: Reports indicate that Massachusetts, Colorado, Kansas, Maine, and Connecticut prohibit surcharging.
• Account Application: The government might prohibit SMBs in risky industries from getting a POS system.

Don’t worry if you cannot wholly grasp the mandated payment processing guidelines yet. Most merchants never even deal with government institutions directly. Merchant service providers are typically responsible for abiding by the different policies and regulations on behalf of their clients. 

To avoid violating the guidelines by accident, work with certified processors. Prospective providers must have the necessary authorization documents. It would be in your best interest to partner with a reliable, secure processor since cybersecurity attacks occur every 39 seconds. Never compromise your customer’s PII.

Do you need a merchant account for your high-risk business? Processing Card can help! Read our piece on which payment processors work with clients at risk of fraud, chargebacks, and data breaches.