More than 900 members of the retail community including NATSO members urged Congress to refrain from taking up legislation that would repeal debit card swipe fee reform, commonly known as the “Durbin Amendment.”
In a letter addressed to House Speaker Paul Ryan (R-Wisc.) and Minority Leader Nancy Pelosi (D-Calif.), the businesses, which represent a broad cross section of the retail community, said that debit card reforms have been a major step forward and any removal of those reforms would be a monumental step in the wrong direction for U.S. businesses and consumers.
Repealing the 2010 law would dismantle the substantial progress debit reforms have made in correcting in part an otherwise non-functioning and non-transparent card acceptance marketplace in the United States, they said.
”As cornerstones in the business community, we are staunch supporters of free enterprise, and generally do not support any market intervention unless markets are not functioning efficiently,” the companies wrote. “Credit and debit card acceptance is a prime example of a non- functioning marketplace void of true open competition.”
Signatories included fuel retailers as well as members of the convenience and restaurant industries, among many others.
The letter was sent amid ongoing discussions on Capitol Hill about financial reform. With Republican majorities in both the House and the Senate, the banking industry is aggressively pursuing policy changes that would loosen the debit card fee and rule reforms prescribed in Section 1075 of the Wall Street Reform and Consumer Protection Act. Those reforms have provided significant relief to Main Street businesses from anti-free market practices employed by global credit and debit card brands.
Rep. Jeb Hensarling (R-Texas), Chairman of the House Financial Services Committee, is expected this year to reintroduce the Financial Choice Act, which seeks to repeal the Durbin Amendment. However, the fight over this issue is expected to take place in the Senate.
Repeal of the Durbin Amendment would allow the big banks to impose outrageous fees on merchants and increase prices for consumers. Companies like Visa and MasterCard will dominate the market to the extent that they can fix fees, squeezing retailers and raising costs for consumers. It is currently estimated that swipe fees cost merchants and consumers $40 billion every year.
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