Federal Reserve Biennial Debit Card Report Findings

In December 2025, the Federal Reserve Board issued its biennial report on debit card transactions. The Dodd-Frank Act requires the Fed to establish rules regarding debit card interchange fees and routing, and it requires the Fed to disclose summary information concerning the costs incurred, and interchange fees charged or received on at least a biennial basis. The Fed has issued this report since 2011.

Key findings are as follows:

Card Usage

• In 2023, payment card networks in the United States processed 100.7 billion debit and general-use prepaid card transactions valued at $4.7 trillion. Total debit card transaction volume and value both grew at an average rate of 4.6% per year from 2021 to 2023.

• Dual-message networks, which traditionally process mainly signature-authenticated transactions, accounted for 71.4% and 72.9% of the total by volume and value, respectively, in 2023. Single-message networks, which traditionally process PIN-authenticated transactions, accounted for the rest.

• Card-not-present debit transactions grew 8.2% per year from 2021 to 2023, faster than the card-present debit transaction growth rate of 2.8%. Card-not-present debit transactions have grown faster than card-present debit transactions since 2009.

• In 2023, the average transaction value of card-not-present debit transactions was higher than that of card-present debit transactions, at $63.96 and $36.99, respectively.

Fees

• In 2023, interchange fees across all debit and general-use prepaid card transactions totaled $34.12 billion, an average increase of 3.9% per year since 2021.

• Network fees to all parties increased to $12.95 billion in 2023 from $11.49 billion in 2021.

• In 2023, acquirers and merchants paid 64.9% of network fees, up from 63.9% in 2021; issuers paid the rest. This continues a long-term trend, which has seen the proportion of network fees paid by acquirers and merchants increase since 2009.

For context on how these network fees affect merchant costs, see our analysis of processor fee structures.

Fraud

• In 2023, across all transactions for issuers covered by Regulation II interchange fee standards, fraud losses to all parties as a share of the transaction value were 17.6 basis points, or $17.63 per $10,000 in transaction value. This value reflects a steady increase in fraud losses from 7.8 basis points in 2011.

• In 2023, merchants absorbed 49.9% of losses from fraudulent transactions reported by covered issuers, up from 46.9% in 2021. The issuers absorbed 28.3% of losses in 2023, down from 33.4% in 2021. Cardholders' share of fraud losses rose from less than 1.8% in 2011 to 21.8% in 2023.

• In 2023, across all transaction categories, prepaid transactions experienced the highest level of fraud losses as a share of transaction value, as well as the highest incidence of fraudulent transactions as a percentage of total transactions.

The increasing share of fraud losses borne by merchants underscores the importance of robust fraud prevention measures.

Issuer Costs

• Across all issuers covered by Regulation II's fee standards, average per-transaction authorization, clearing, and settlement (ACS) costs, excluding issuer fraud losses, were $0.041 in 2023, approximately one-half of the 2009 value, and a slight increase from $0.039 in 2021.

• In 2023, the base interchange fee cap in Regulation II excluding the fraud-prevention adjustment—$0.21 plus 5 basis points multiplied by the value of a transaction—exceeded the average per-transaction ACS costs, including issuer fraud losses, for 80.1% of issuers covered by Regulation II fee standards and for 99.2% of transactions covered by the Regulation II interchange fee standards.

For more on how regulatory developments are shaping the debit card landscape, see our coverage of debit interchange regulatory developments.