CEO DATELINE - Retailers, banks prepare once again to clash on swipe fees
CEO DATELINE - Retailers, banks prepare once again to clash on swipe fees
- February 9, 2017 |
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Walt Williams
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One of Washington, D.C.'s most high-profile lobbying battles is once again heating up as the Trump administration prepares to revisit Dodd-Frank Act regulations enacted after the 2008 financial crisis.
Payments industry lobbyists have been meeting with key lawmakers in recent months to argue that limits on credit and debit card swipe fees amount to "un-American" price controls that hurt consumers, news agency Reuters reported. At the same time, more than 60 representatives from various retail groups have descended on the nation's capital this week to argue in favor of keeping existing limits for debit card purchases.
Swipe fees are charges imposed on retailers and service industry businesses by financial instructions for credit and debit card transactions by customers. The Dodd-Frank Act, passed in 2010, required the Federal Reserve to set an upper limit for how much financial institutions could charge in fees for debit card transactions. The cap was eventually set at 24 cents per transaction. (There is no federal cap for credit card transactions.)
President Donald Trump recently signed an executive order requiring the U.S. Treasury secretary to conduct a review of Dodd-Frank. The order has left open the possibility the swipe fee cap could be revised or eliminated.
"We go up there (to Capitol Hill) every day and meet with members of Congress and their staff and walk them through why this has been such a failure," Molly Wilkinson, executive director of the Electronic Payments Coalition, told Reuters.
Retailers and service industry businesses argue otherwise. The National Retail Federation, National Restaurant Association and Retail Industry Leaders Association are among the groups hitting Capital Hill this week to advocate in favor of keeping the cap intact.
"If Wall Street get its way and the current debit swipe fee protections are removed, it would mean an $8 billion tax on small businesses that goes directly into the biggest banks in the country," Leslie Shedd, vice president of communications at NRA, said in a statement. http://reut.rs/2kw8NeC
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