NRF Calls for Swipe Fee Reform

The National Retail Federation has welcomed a letter from a coalition of consumer groups opposed to legislation that would delay swipe fee reform, scheduled to go into effect this summer. “Consumer groups want to see these skyrocketing fees brought under control,” NRF Senior VP and General Counsel, Mallory Duncan, said in a statement. “Contrary to banks’ claims, this is not a business to business issue, this is the big banks against everybody else. Swipe fees have been driving up prices for our customers for years. These groups are saying it’s time to do something about it, not time to derail reform through further study.”

Americans for Financial Reform, a coalition focused on financial services industry reform that includes the Consumer Federation of America, the U.S. Public Interest Research Group, and a number of other consumer organizations among its 250 national, state and local members, has asked Congress to reject proposals to delay swipe fee reform. “The current interchange system is uncompetitive, nontransparent and harmful to consumers,” AFR said in a statement. “AFR does not support congressional delay of implementation of the new law.” The letter comes as the banking industry is pushing for passage of legislation introduced in March that would delay swipe fee reform and require a study of the issue. One bill would delay implementation by a year, while another calls for a two year delay.

Federal Reserve Chairman, Ben Bernanke, has said the Fed will be able to finalize swipe fee reform regulations in time for the new rules to take effect on July 21, as scheduled. Regulations proposed by the Fed in December would lower debit card swipe fees, from their current level of one to two percent of each transaction, to a flat fee of no more than 12 cents per transaction, for large banks that adhere to fees set by the card companies. Banks that set their own rates would be free to charge any fee they believe the market would bear, provided they do so independently. The move would reduce the current $20 billion a year in debit swipe fees by about 70 percent, or $1.2 billion a month. Financial institutions with less than $10 billion in assets are exempt