In theory, merchants should be thrilled that the Federal Reserve under the Durbin Amendment has proposed lowering debit card interchange fees and has proposed a 12-cent cap. But will they really pass these savings along to consumers, as is the amendment’s intent? Or like the card networks, do merchants believe the Fed’s debit proposal will yield consequences that Congress did not originally foresee?
As the deadline for public comments on the Fed’s debit plan arrives, we take a look at some of the raw, unedited official responses from merchants that have been submitted thus far:
“On behalf of over 2800 retail storefronts in Washington State, please support the Federal Reserve in quickly implementing provisions of the Durbin Amendment approved by Congress last year… Such relief is crucial as retailers continue to struggle for recovery from the worst recession in our lifetimes.
In 2008 alone, American merchants and consumers paid over $48 billion in swipe fees. In recent months, the banking and credit card lobbies have been demanding a two-year delay to this reform that would reap them another $100 billion in profits.” – Jan Teague, President/CEO, Washington Retail Association
“I own a small business in a very small community in Michigan. I try everyday to help make it easier for my customers to spend their hard earned money with me. However I need help also. The money that I spend in Third Party fees could go toward my heat bill or my electric bill.” – Lisa Schwach
“As a small business owner I am opposed to the proposed rule of limiting the debit card interchange. The fees that are imposed to me are small compare to the benefits that I receive. About half my sales are from debit cards which has reduced my costs and risks of handling cash and to process checks. Since I started taking debit cards I have saved a lot of time and money. I am guaranteed the funds with debit cards and do not have to worry about fraud risk as that falls onto the banks.
I also do not have to deal with bad checks which has saved me lots of time and money. If the fee is reduced to banks in particular if the fee trickles down to small community banks they may stop issuing debits cards my costs to operate my business will go up.” – Justin Hauff
“Please subject the company, Paypal, to a cap on debit-card transaction fees. Paypal’s charges, in
my opinion, are even more excessive, and therefore, more important in controlling, and Paypal acts like a payment – card network, and advertises, stating they are the best payment network.” R. Tucker, Front Porch Feed & Mercantile
“Card swipe fees are a huge burden on me, my business, and my customers. With the poor economy we count our wins in pennies and can’t afford to loose dollars.” – Shawn Rehberg
As a small retail store owner, I find it absurdly difficult to arrive at a reasonable price for merchandise when the TWO credit cards I accept result in 25 different fees when my statement appears… The card companies, who make much more than I, should be paying me for my time. That being said, I appreciate that thieves now have to rob banks to get cash.” – Ruth Hanessian, President, Animal Exchange
“On behalf of ICE [Insurance Collection Executives], whose members and associate insurance companies account for 60% of the insurance premiums collected in the U.S., we are writing to express our support for the efforts of the Federal Reserve Board of Governors and Federal Reserve Board Payments staff pertaining to the proposed regulations on debit card interchange fees and routing.
Over the years, we have seen the cost of accepting debit cards increase in spite of technology advances. As insurance companies we have paid, the interchange fees yet have had no forum to negotiate a better rate for our industry and our customers. Now, with debit cards rapidly replacing paper checks, the card companies have more opportunities to take advantage of their position. Please ensure that that the broken payments card market is repaired.” – Ken Godfrey on behalf of Insurance Collection Executives
“It is my belief that small businesses are the heart and soul of our great country. We do not need more government control especiall in small community banks. Please allow the small bank to survive by not taking away yet another source of revenue by not passing the Durbin provision of the Dodd-Frank bill. Enough with all this govermental control.” – Kay D. Darnell
I am writing on behalf of Weis Markets, a Mid-Atlantic supermarket company operating 164 stores in six states. In 2010, our debit swipe fees totaled $14 million — costs which were paid by our customers.
It is for these reasons we are strongly opposed to the repeal or delay of the implementation of the Durbin Amendment which allows the Federal Reserve to set debit swipe fees.
Potentially, the Durbin Amendment will give millions of dollars of relief to our customers at a time of high unemployment and low consumer confidence. Ultimately, we see it as a choice between big banks and Wall Street v the interests of our business and most importantly our customers.” – Dennis Curtin, Weis Markets