WASHINGTON--(BUSINESS WIRE)--The National Retail Federation today sent a letter to all members of the U.S. Senate asking them to vote against a so-called “compromise” amendment offered by Senator Jon Tester, D-Mont., that would delay a new federal law intended to save retailers and consumers more than $1 billion a month by lowering “swipe” fees banks charge to process debit card transactions.
“Even Wall Street bonuses and exotic junkets are likely to be considered costs under Senator Tester’s new language. Rather than bringing fees down, this amendment will force swipe fees even higher.”
“This bill is no compromise,” NRF Senior Vice President for Government Relations David French said. “It is a sham intended to kill swipe fee reform even more quickly than his original bill and should be seen for what it is.”
Tester today offered an amendment that would delay swipe fee reform by one year rather than the two years proposed under legislation he introduced earlier this spring. But the amendment goes further than the original bill by mandating that the Federal Reserve take into consideration a broad range of costs rather than those associated specifically with the cost of processing transactions.
A swipe fee reform provision included in last year’s Wall Street law is scheduled to take effect July 21. The provision would reduce the fees by an estimated 70 percent, saving about $14 billion a year that retailers plan to pass along to their customers through discounts or other benefits, but the banking industry is spending millions of dollars to delay reform.
Regulations proposed by the Federal Reserve to implement the provision would lower debit card swipe fees from their current level of 1 to 2 percent of each transaction to a flat fee of no more than 12 cents per transaction for large banks that adhere to fee schedules set by the card companies. Banks that set their own rates would be free to charge any fee they believe the market would bear provide that they do so independently. Financial institutions with less than $10 billion in assets are exempt.
As the world's largest retail trade association and the voice of retail worldwide, NRF's global membership includes retailers of all sizes, formats and channels of distribution as well as chain restaurants and industry partners from the United States and more than 45 countries abroad. In the United States, NRF represents the breadth and diversity of an industry with more than 1.6 million American companies that employ nearly 25 million workers and generated 2010 sales of $2.4 trillion. www.nrf.com
