Fed To Appeal Swipe Fee Ruling
The U.S. Federal Reserve announced that it will appeal U.S. District Judge Richard Leon’s decision that its rules for debit card transaction fees were illegal during a court hearing on Wednesday, Bloomberg reported on August 21.
Merchants aligned with the Fed to ask for the court to stay the judgment pending appeal, explaining to the court that they would prefer to continue to pay pre-Durbin interchange fees until a final decision is reached, The Wall Street Journal reported.
Merchants said that this cost could rise from 21 cents to upwards of 50 cents per transaction if this request was not granted.
“The Fed worked hard to make sense of legislation that was slipped into Dodd-Frank without much debate or analysis of the consequences of the legislation on consumers. The Fed ought to get some deference and credit for trying to sort this out. Filing an appeal was the right and probably only move they could make,” economist and Market Platform Dynamics Founder David Evans told PYMNTS.com.
Visa’s stock climbed 3 percent, while MasterCard’s dropped 0.5 percent following the announcement.
For more on the initial ruling and what it could mean for the payments industry, read our full report here.