NRF: Consumers want swipe fee status quo
The people have spoken – and they like limits on debit card swipe fees the way they are.
According to new data from the National Retail Federation (NRF), 89% of consumers want to maintain Federal Reserve limits on the fees banks charge retailers and their customers when they use a debit card to pay for purchase. In addition, 84% say swipe fees should be set on a competitive basis rather than letting credit card companies set their own fees that virtually all the banks that issue their credit and debit cards charge.
The NRF has been actively opposing a proposal from the head of the House Financial Services Committee to repeal a cap on debit card swipe fees. According to the NRF, the fees have saved consumers billions of dollars over the past five years.
Since October 2011, swipe fees for debit cards issued by the nation’s largest banks have been capped at 22 cents per transaction plus 0.05% of the purchase price, or just under a quarter in most cases. Before the Fed acted, NRF data indicates the swipe fee on an average debit purchase was typically about 45 cents, but it could add $10 to $20 to the price of a large purchase like an airline ticket or big-screen TV. The NRF says the cap is still far higher than the average 4 cents the Fed estimates it costs banks to process a debit transaction.
“The truth is that the debit card swipe fee cap has been a win for consumers, retailers and the nation’s economy by sharply reducing a hidden tax collected by the banks,” Mallory Duncan, senior VP and general counsel for the NRF, said in a press release. “Repealing it would be a win for no one but the banks.”