Senator Dick Durbin (D-Ill.) and Rep. Peter Welch (D-Vt.) have asked the Federal Reserve Board to revisit the fee levels set in the debit fee rules standard established after passage of the Dodd-Frank Wall Street Reform legislation. The request comes in the wake of a newly released proposal by the European Commission (EC) to limit excessive credit and debit card interchange swipe fees.
The Federal Reserve in 2011 changed the per-transaction cap on debit card transaction fees to 21 cents. The Reserve also banned banks from routing debit card transactions through any one payments network and required at least one unaffiliated network on all debit cards.
Sen. Durbin and Rep. Welch are urging the Federal Reserve Board to review the European model of a 0.2 percent ceiling in relation to the U.S. standards. If adopted in the United States, such a proposal could lead to a significant reduction in regulated debit transactions costs.
The EC proposal also addresses certain anti-competitive network business rules, increases fee transparency, and requires legal separation between the card schemes and entities that process transactions.
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