Federal Reserve Numbers Shows Banks' Claims Are Wrong

WASHINGTON, May 1, 2012 /PRNewswire-USNewswire/ -- The Federal Reserve Board released statistics Tuesday that show small and medium-sized banks and credit unions are prospering under reform of the swipe fees that banks charge merchants to process debit-card transactions.

"Just as reform advocates argued and Congress intended, today's data confirms that small institutions are unaffected by swipe fee reform," said Douglas Kantor, counsel to the Merchants Payments Coalition. "The gloom-and-doom predictions of reform opponents have proved false."

Americans pay the highest swipe-fees in the industrialized world.

Congress passed the Durbin Amendment as part of the Dodd-Frank financial-reform law in 2010, which required Visa and MasterCard to end the practice of setting fees together in secret. It took effect in October.

Small banks and credit unions argued they would be harmed even though the amendment exempted financial institutions under $10 billion in assets.

The Fed report shows the average swipe fee on a purchase for these small institutions was 43 cents in the fourth quarter – the same as it was in 2009.

For large banks, though, the average dropped to 24 cents. That is benefitting consumers when they buy things every day.

"While problems remains, swipe fee reform has significantly improved the debit market, resulting in countless benefits for small businesses and consumers," said Mr. Kantor. "The intense competition that exists among merchants means consumers are winning with swipe-fee savings."

The Merchants Payments Coalition (MPC) - UnfairCreditCardFees.com - is a group of retailers, supermarkets, drug stores, convenience stores, fuel stations, on-line merchants and other businesses who are fighting against unfair credit card fees and fighting for a more competitive and transparent card system that works better for consumers and merchants alike. The coalition's member associations collectively represent about 2.7 million stores with approximately 50 million employees.

SOURCE Merchants Payments Coalition

WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM?

440k+
Newsrooms &
Influencers

9k+
Digital Media
Outlets

270k+
Journalists
Opted In

GET STARTED