Washington, D.C. The National Retail Federation is continuing its rallying cry to make sure an amendment requiring the Federal Reserve to determine “reasonable” swipe fees for debit card purchases remains in the final version of financial services reform legislation currently being negotiated in Congress.
With a deadline for action approaching next week, NRF CEO Matt Shay has asked retailers to become vocal with Congress.
“Congress needs to hear from every one of you,” Shay said Monday. “Unless we all speak up now, a golden opportunity may be lost. The banks and credit card companies will stop at nothing to strip these merchant- and customer-friendly provisions out of the proposed law,” Shay said.
Shay’s comments came in a letter to CEOs of all NRF member companies asking them to encourage store managers, employees and customers to contact Congress and urge lawmakers to keep the swipe fee amendment in the bill. The request also went to heads of state retail associations and other national merchant associations.
A House-Senate conference committee negotiating a final version of the Restoring American Financial Stability Act of 2010 held its initial meeting last week, but began the real work of debating and voting on details of the bill on Tuesday and expects to continue meeting Wednesday and Thursday. The panel is trying to come up with a final bill by June 24. That would allow the House to take up the compromise measure on June 29 and the Senate to vote in time to have the bill on President Obama’s desk by Independence Day.
The key concern for retailers is an amendment sponsored by Majority Whip Richard Durbin, D-Ill., that would require the Federal Reserve to establish rules that would result in the setting of “reasonable and proportional” rates for the interchange or “swipe” fees that Visa and MasterCard banks charge merchants to process debit-card transactions. The Fed would be required to take into consideration both the actual cost of processing the transactions and the fact that paper checks drawn on the same bank accounts are paid at face value.
The Senate approved the amendment by a nearly veto-proof margin of 64-33 in May, but the provision was not included in the House bill passed last November.
Enactment of the amendment would be a huge victory for retailers’ attempts to bring soaring swipe fees under control and would also prohibit card companies from interfering with merchants’ ability to offer a discount or other benefit to customers who pay by cash, check or debit rather than credit card.