Image via WikipediaOverwhelming Majority of Americans Reject Anti-Consumer Debit Amendment Hidden in Wall Street Reform Bill
Eighty-three Percent of Americans Oppose a Provision of Financial Reform Legislation that Passes Costs of Card Acceptance onto the backs of Consumers
SAN FRANCISCO--(BUSINESS WIRE)--A new survey finds that an overwhelming majority of Americans oppose giving the federal government the ability to set the rates retailers pay for accepting debit products at the consumer’s expense. The study released today by Visa Inc. (NYSE: V) reveals widespread skepticism toward this and other provisions put forth in a controversial amendment to the financial regulatory reform bill currently being negotiated in Congress.
“There is a strong historical precedent that shows how government intervention benefits large retailers and leaves consumers worse off”
According to the survey:
- Eighty-three percent of respondents specifically oppose the amendment’s requirement that the government establish the prices retailers pay for accepting debit cards, if it would likely result in debit cardholders paying fees for owning and using their debit cards.
- Seventy-five percent of consumers would oppose – and 59 percent would strongly oppose – Wall Street reform legislation overall if it results in consumers having to pay more to use a debit card and mandates minimum payments on credit cards.
- Sixty percent of consumers believe retailers – not cardholders – should bear the fair cost of accepting credit and debit cards.
“Consumers are sending a very clear message to Congress: this amendment is wrong and amounts to nothing more than a government bailout of big retailers at the expense of hardworking Americans,” said Bill Sheedy, Group Executive for The Americas, Visa Inc. “These same retailers have lobbied for more than a decade to force consumers to pay their reasonable cost of doing business and the American public clearly sees through this latest cynical effort.”
Big box retailers and their well-funded trade associations are asking Congress to shift their business costs onto the backs of customers by allowing the government the power to set price controls on debit cards, while merchants continue to receive the value of electronic payments, including guaranteed payment, faster check out, increased sales and increased security.
Under the amendment written by Senator Durbin, Americans who benefit from the security and convenience of electronic payments could find themselves forced to spend a minimum amount when they choose to pay for goods and services with a credit card. Sixty-eight percent of consumers surveyed oppose – and 55 percent strongly oppose – the bill’s minimum payment provision.
The U.S. Government Accountability Office (GAO), at the direction of Congress, has examined the potential impact of proposed interchange legislation and confirmed that there is little evidence to suggest that merchants would pass any potential savings from lower interchange on to consumers. In addition, after examining the issue twice the GAO has found no need for Congress to intervene and regulate interchange.
“There is a strong historical precedent that shows how government intervention benefits large retailers and leaves consumers worse off,” continued Sheedy. “In Australia, the longest-running example of interchange regulation, the central bank has found that consumers have not seen lower retail prices, but have seen the cost of electronic payments go up and rewards go down.”
The House version of Wall Street legislation did not include the debit provision and a House-Senate Conference is expected to begin this week to iron out differences in the two bills. In its recently amended form, the survey found there is currently more opposition than support for the financial reform bill with 41 percent of consumers opposing it, and 36 percent favoring it.
“The Senate amendment has nothing to do with the original intent of the financial reform bill. We urge Congress to listen to Americans – their constituents – by stripping this provision from the financial regulatory reform bill before it goes to President Obama’s desk,” added Sheedy.
About the Survey
This survey was conducted from June 2 to 6, 2010 by Fabrizio, McLaughlin & Associates and was sponsored by Visa Inc. This telephone poll is based on a nationally-representative probability sample of 1,000 general population adults age 18 or older contacted on both conventional and cellular telephones. The full results of the survey have sampling error of ±3.1 percent at the 95 percent confidence level.
About Visa Inc.
Visa is a global payments technology company that connects consumers, businesses, financial institutions and governments in more than 200 countries and territories to fast, secure and reliable digital currency. Underpinning digital currency is one of the world’s most advanced processing networks—VisaNet—that is capable of handling more than 10,000 transactions a second, with fraud protection for consumers and guaranteed payment for merchants. Visa is not a bank, and does not issue cards, extend credit or set rates and fees for consumers. Visa’s innovations, however, enable its financial institution customers to offer consumers more choices: Pay now with debit, ahead of time with prepaid or later with credit products. For more information, visitwww.corporate.visa.com.
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