Specifically citing the new debit interchange rules as the cause, Mike Grossman announced this week that his Tempo Payments business will be closing its doors on July 15th.
“Grossman confirmed that, saying the company laid off 15 of its 25 employees when the Fed’s regulations came out and that the rest, including himself, would be laid off once operations wind down over the next few months. “When you impose price controls, a lot of things happen,” says Grossman.”
Tempo’s business model was based on a revenue distribution strategy dependent on interchange and may represent the first example of how regulated debit interchange will impact emerging debit payment forms that are dependent on some level, on interchange. With no other income basis, these schemes either collapse or have to evolve to include account-based fees.
