National Automatic Merchandising Association: Durbin to Have “Adverse Impact on the Vending Industry”

By  |  October 3, 2011
 | 

Date: October 1, 2011
To: All NAMA Members
From: COO Dan Mathews, Chairman Brad Ellis & the NAMA Board of Directors
Subject: DEBIT CARD “SWIPE FEE” CHANGES

    Get the Full Story

    Complete the form to unlock this article and enjoy unlimited free access to all PYMNTS content — no additional logins required.

    yesSubscribe to our daily newsletter, PYMNTS Today.

    By completing this form, you agree to receive marketing communications from PYMNTS and to the sharing of your information with our sponsor, if applicable, in accordance with our Privacy Policy and Terms and Conditions.

    The “Dodd-Frank Financial Reform Legislation” was enacted to bring fundamental changes to the U.S. financial system after the last financial crisis affecting the banking industry. The added “Durbin Amendment” required a limit on “swipe fees” that VISA, MasterCard and others can charge for debit card transactions.

    Effective today, October 1, 2011 major changes will cut average debit card swipe fees by approximately 45%. Although this will be beneficial for large ticket transactions there is an adverse impact on the vending industry due to our typical “small ticket transactions”. This new cap could as much as triple the net “swipe fee” for small transactions (gateway provider contracts vary from operator to operator therefore the impact on rates will vary).

    Card Companies/Banks now have the option to charge up to $.21 per transaction plus an additional .05% of the transaction to mitigate fraud losses and $.01 for fraud protection. The situation is changing every day so contact your provider directly to ask how the new rate caps will impact your business.

    What you can do:

    – Immediately contact your Congressional Representative and Senator to educate them on the adverse reaction this will have on your business, your customers and jobs. There are over 10,000 vending companies in the USA serving millions of consumers everyday. Cost increases will have to be passed onto consumers or debit card acceptance will be suspended

    Advertisement: Scroll to Continue

    – Ask your provider to negotiate directly with VISA/MC on your behalf

    •   

        Thank you.

      •  

      What NAMA is doing:

      – Actively engaged in exploring options for lessening/eliminating the adverse impact of the new debit card “swipe fee” cap

      – Lobbying members of the Small Business Committee in the US House of representatives

      – Mobilizing a grassroots effort to educate politicians on the adverse and clearly unintended consequences of this new law

      – Using NAMA “Action Alerts” to communicate to our membership and provide appropriate talking points

      – Directly and indirectly negotiating with VISA/MasterCard

      – Adding a new link on the NAMA website to provide up-to-date information


    See More In: