A US appeals court ruled against the Federal Reserve’s debit interchange cap, raising the prospect of lower fee income for large card-issuing banks. In Europe, Wero began replacing iDEAL at Dutch online checkouts, advancing a regional alternative to international card networks. Revolut launched UK personal loans as it seeks to become customers’ primary bank.

Stronger customer activity did not always translate into higher income: HSBC’s $41 billion in wealth inflows accompanied broadly flat wealth fees, while Visa’s client incentives outpaced revenue growth. Elsewhere, SoFi added record members, Sezzle sought a bank charter, and UnionPay and HDFC Bank expanded payment and lending options.

Read more on the week's key developments:

1. US appeals court vacates Federal Reserve's debit interchange cap

The US Court of Appeals for the Eighth Circuit ruled on 26 October that the Federal Reserve's Regulation II debit interchange cap does not comply with the Durbin Amendment, affirming an August 2025 district court decision vacating the current limit. The court held that the Fed must consider issuers' incremental transaction costs, excluding costs that fall outside that statutory category. Set in 2011, the cap of 21 cents plus 0.05% of transaction value, with a one-cent fraud-prevention adjustment, applies to issuers with $10 billion or more in assets.

A cap based on incremental transaction costs could fall below the 14.4 cent base cap the Fed proposed in October 2023, a proposal it has not finalised. This would reduce debit income that large US banks use to support current accounts and rewards. The ruling concerns interchange received by issuers, not network fees charged by Visa and Mastercard. Bank groups pointed to a pending Sixth Circuit case in which a lower court upheld the rule, raising the prospect of conflicting appellate decisions. Australia offers a recent comparison, having reduced domestic interchange caps from 1 October to lower merchant payment costs.

2. Wero begins replacing iDEAL at Dutch online checkouts

The European Payments Initiative began rolling out Wero for Dutch e-commerce payments on 26 October, enabling merchants to migrate from iDEAL. The service is available to customers of 11 institutions, including ABN AMRO, ING, Rabobank, bunq and ASN Bank. The first merchants are processing transactions, with migration due to finish by end-2027. Subscription payments and pay-on-delivery are planned for the second quarter of 2027, followed by purchase protection in January 2028.

The transition tests Europe's ability to consolidate domestic account-to-account schemes into a pan-European alternative to card networks. With iDEAL handling three-quarters of Dutch online purchases, banks can migrate existing customers rather than build adoption from scratch. A single merchant integration could extend acceptance across Germany, France and Belgium, reducing reliance on international card networks. However, delayed purchase protection may weaken Wero's appeal against cards and PayPal for cross-border purchases. Unlike Asia's bilateral QR payment links, Europe is consolidating domestic schemes under one wallet.

3. Revolut launches UK personal loans as it expands into mainstream banking

Revolut said on 26 October that it had begun offering unsecured personal loans in the UK of GBP 2,000 ($2,700) to GBP 25,000 ($33,500), at rates of 6.9% to 29.3% over terms generally of one to five years. Loans are initially available to selected customers before extending to its approximately 14 million UK users. UK chief executive Francesca Carlesi said credit cards would follow, with mortgages planned eventually. Revolut intends to securitise much of its lending exposure and keep its loan-to-deposit ratio near 6%, substantially below traditional banks.

Lending addresses Revolut’s lower revenue per customer than Lloyds, NatWest, Barclays, Santander and HSBC. Its planned originate-and-distribute model, similar to SoFi’s loan sales to third-party investors, could support growth while limiting the lending exposure retained on its balance sheet. However, Revolut has less customer credit history than incumbents and relies partly on external underwriting data. Rising UK inflation and a softer labour market could strain repayment. The longer-term test is whether lending persuades customers to deposit salaries and treat Revolut as their primary bank.

4. SoFi adds record 1.2 million members as lending and deposits expand

US digital bank SoFi Technologies reported on 27 October that third-quarter adjusted net revenue rose 44% to $1.4 billion, while net income reached $241 million. It added a record 1.2 million members, taking its total to 17.1 million, up 35%. Products rose 44% to 26.7 million, while loan originations reached $16.9 billion, including $12.6 billion in personal loans. Deposits increased $5.8 billion to $51.3 billion, and fee-based revenue accounted for 42% of total revenue.

Existing members opened 51% of new products, lifting products per member to 1.56 from 1.47 and indicating stronger cross-selling. Interchange revenue rose 77%, alongside $31 billion in annualised card spending, suggesting greater everyday account usage. Credit remains a watchpoint: the annualised personal loan net charge-off rate fell to 2.26%, including the effect of loan sales, but the assumed annual default rate increased to 5.10% from 4.77%. Like Revolut, SoFi is using lending to deepen customer relationships, although its growing deposit and card businesses provide additional sources of revenue.

5. Sezzle applies for US national bank charter to expand beyond BNPL

US buy now, pay later (BNPL) provider Sezzle announced on 22 October that it had applied to the Office of the Comptroller of the Currency for a national bank charter and the Federal Deposit Insurance Corporation for deposit insurance. The proposed Sezzle Bank would offer checking, savings and credit products to digitally native consumers. The application replaces plans for a Utah industrial loan company, partly prompted by new BNPL rules in New York, Illinois and Oregon. Sezzle chief executive and executive chairman Charlie Youakim said he expected the review process to take 12 to 18 months.

A national charter could provide greater regulatory consistency across states and reduce Sezzle’s reliance on partner banks through deposit funding. Unlike Affirm and PayPal, which sought state industrial loan company charters whose parents are generally exempt from Federal Reserve holding-company supervision, Sezzle would apply to become a bank holding company overseen by the Fed. For customers, approval would bring FDIC-insured accounts alongside instalment credit. Running a deposit-taking bank for younger, thin-file borrowers would also place heavy operational and compliance demands on Sezzle.

6. HSBC draws $41 billion in wealth inflows, led by Asia

HSBC reported on 27 October that third-quarter wealth net new money reached $41 billion, including $38 billion booked through its Asia-Pacific entity. Deposits contributed $24 billion and net new invested assets $17 billion, taking wealth balances to $1.6 trillion. Nine-month inflows reached $105 billion, including $95 billion booked in Asia. Hong Kong customer accounts rose $20.6 billion quarter on quarter on a constant-currency basis, mainly in term deposits. Group wealth fee and other income remained broadly flat at $2.7 billion.

Flat wealth fees reflected a $124 million drag from strategic transactions and, separately, the non-recurrence of one-off insurance gains in 3Q25, masking stronger underlying activity. Investment Distribution and Private Bank income increased, while Hong Kong wealth fees rose 7%. However, competition for term deposits could compress margins, limiting the profitability of inflows. Planned retail exits in Australia, Indonesia and Egypt reflect HSBC's concentration of resources in Hong Kong, the UK and international wealth hubs, where deposits and investment services can support deeper customer relationships.

7. Venmo growth offsets PayPal's slow checkout expansion

PayPal reported on 27 October that third-quarter revenue rose 2% to $8.6 billion, while payment volume increased 6% to $487.1 billion. Active accounts reached 440 million. Venmo payment volume grew 14%, while monthly active debit card accounts increased more than 55% to 6.7 million, according to chief executive Enrique Lores. PayPal-branded checkout growth remained at 1% to 2% for a fourth consecutive quarter. The company raised its full-year adjusted earnings-per-share guidance to approximately $5.60 from $5.38.

Growth is coming from engagement rather than new users: active accounts rose only 0.6%, while transactions per account increased 6%. Venmo’s debit card extends it from peer-to-peer transfers into everyday spending, supporting interchange income, while branded checkout faces Apple Pay, Stripe’s Link and bank-owned Paze. The transaction and credit loss rate improved to 0.08% from 0.11%, though PayPal sells much of its pay-later receivables, keeping part of the credit risk off its balance sheet. However, international revenue declined 4% on a currency-neutral basis, providing a counterpoint to stronger Venmo growth.

8. Visa reports 15% annual revenue growth as issuer incentives rise

Visa reported on 27 October that fiscal fourth-quarter net revenue rose 13% to $12.1 billion, bringing full-year revenue to $45.9 billion, up 15%. Quarterly payment volume increased 9%, while cross-border volume excluding intra-Europe transactions grew 14%. Processed transactions rose 10% to 74.2 billion. Other revenue increased 40% to $1.6 billion, while client incentives grew 21% to $5.1 billion. Visa also recorded a $469 million provision for US interchange litigation.

Client incentives growing faster than revenue reflect intensifying competition for issuing relationships. Quarterly cross-border growth of 14% exceeded the full-year rate of 12%, indicating sustained international spending. The US debit interchange ruling affects issuer income rather than Visa’s network fees. Meanwhile, Visa’s pending $2.4 billion BioCatch acquisition extends its fraud-prevention business, supporting fee income beyond transaction processing as competition and regulatory pressure affect traditional card economics.

9. UnionPay expands China payment access through Malaysian and Ghanaian banks

Hong Leong Bank (HLB) announced on 27 October a partnership with UnionPay International allowing customers to pay at more than 120 million UnionPay and Weixin Pay QR-enabled merchant touchpoints in China through its HLB Connect app, following the service’s launch on 22 October. Payments draw on offshore yuan (CNH) held in HLB’s multi-currency account, falling back to ringgit if the balance is insufficient. Separately, Ghana’s GCB Bank agreed on 26 October to issue UnionPay debit and prepaid cards that make payments in renminbi, UnionPay’s first cards to clear and settle directly in RMB, according to the institutions.

The arrangements differ: HLB embeds China QR acceptance in its own app, using UnionPay’s network and Weixin Pay integration, while GCB issues cards for point-of-sale, ATM and online use. Both keep customers’ China spending within the bank relationship, rather than in separately topped-up wallets or cash, while generating currency conversion income. HLB charges no transaction fees on CNH-funded payments. The model mirrors DBS’s PayLah! links to regional QR networks, though uptake will depend on fees, exchange rates and merchant coverage.

10. HDFC Bank introduces flexible financing for electric car purchases

India's HDFC Bank launched its Flexi Electric Car Loan on 25 October, allowing customers to finance an electric vehicle's body and battery separately with different repayment terms. Borrowers can extend battery repayments over a longer period and customise monthly instalments. Available through more than 9,700 branches, the product covers vehicles from leading manufacturers. HDFC Bank said the structure addresses high upfront battery costs, with battery instalments designed to be comparable to the running costs of petrol vehicles.

The structure adapts battery-subscription economics to bank lending without requiring a separate carmaker scheme. Longer battery terms can lower monthly payments but increase total interest costs. For HDFC Bank, battery depreciation and uncertain resale values could complicate collateral recovery following default. The test is whether greater affordability supports EV lending growth without weakening credit quality, as industry projections cited by the bank suggest electric cars could reach 15–20% of India's passenger vehicle market by 2030.